Time limits most commonly missed in relation to building actions.
What's on this page?
Building actions limitations
| Action | Time limit | Legislation | Extension availability |
|---|---|---|---|
|
Action
‘A building action in respect of the building works’ |
Time limit
No more than 10 years after the date of issue of the occupancy permit or if no occupancy permit is issued, the date of issue of the certificate of final inspection of building works |
Legislation
s.134 Building Act 1993 (Vic) |
Extension availability
No extension available |
|
Action
An action for damages for loss or damage arising out of defective building work |
Time limit
See Brirek Industries Pty Ltd v McKenzie Group Consulting (Vic) Pty Ltd [2014] VSCA 165 – the Court of Appeal found that s.134 Building Act 1993 (Vic) replaces the usual 6 year limitation of actions period for all building actions, whether arising in contract or negligence.This means that it operates as an end date to bar actions in negligence after 10 years, regardless of when the defect becomes known. |
Legislation
|
Extension availability
|
|
Action
Security of Payments Act claims |
Time limit
The process is technical and has a host of time limits but the time limit of most immediate importance is: a principal has 10 business days to issue a payment schedule in response to a contractor’s payment claim (unless a shorter period is required by the construction contract); care needs to be taken in correctly calculating the due date; failure to respond within time means that the amount claimed in the payment claim is automatically deemed to be due and payable |
Legislation
s.15 Building and Construction Industry Security of Payment Act 2002 (Vic) |
Extension availability
No extension available unless contract stipulates otherwise |
Claim example
A firm took instructions from a client in February 2010 about a possible claim concerning defective building works. The certificate of occupancy for the house had been issued in November 2000 and the house was showing signs of severe corrosion to the structural steelwork.
The firm obtained an expert report in April 2010 which confirmed there were defects and what remedial work was required. Counsel was then briefed in October, after giving preliminary advice on liability, to draw points of claim for a VCAT proceeding. Counsel was busy with another large matter and did not finalise the points of claim until early in 2011 when proceedings were finally issued. Unfortunately the proceeding was statute barred. Neither the firm nor counsel had any expertise in building and construction law and so neither realised that section 134 of the Building Act 1993 (Vic) provided a final ten year limitation period for any building works claims even when latent defects are found more than four years after the certificate of occupancy.
The firm had an opportunity to issue proceedings within the ten year limitation period and missed it. The claim against the firm and counsel was settled with a significant amount paid to the client.
Lessons
- Always double-check the relevant legislation to ascertain the applicable time limit. This is especially important when acting in matters outside your expertise.
- If taking advice from counsel ensure they have expertise in the relevant area.
- Don’t get delayed waiting for counsel or experts.
