NSW Fair Trading and SCA (NSW) update: window locks, cladding, legislative reviews

SCA (NSW) regularly meets with representatives from NSW Fair Trading and they also attend our Strata Managers Chapter Committee meetings (previously the Professional Standards and Education Committees) to discuss various aspects of the strata industry, share knowledge and information and provide input into the policy making process.

Last week, SCA (NSW) and NSW Fair Trading held the first of our meetings for 2018.

A number of items of importance were discussed at the meeting and advice sought from NSW Fair Trading on issues currently impacting our members. Please read through our report below and click on the links for additional information.

Child Safety Window Locks

SCA (NSW) has expressed concern about the deadline for compliance, which is 13 March 2018. The concerns are that there are strata schemes that will not be able to fully comply, for the following reasons:

  • inability to gain access to all lots in each scheme
  • window lock installers have a backlog of work
  • partially complete installation works
  • difficulty complying due to heritage issues

SCA (NSW) sought advice regarding the requirement for ongoing audits and when to re-certify for compliance. NSW Fair Trading’s response was that there is no ongoing compliance legislation and no guidelines around certification – noting they are likely to produce a guide in the future that provides clarity regarding expectations for ongoing testing. However, owners corporations have an ongoing duty of care meaning that it may be wise to undertake ongoing testing.

Members are also advised there may be ongoing insurance declaration obligations for non-compliance, which adds to the need for ongoing testing. Real Estate Agents may be required to check if devices are installed and working during tenancy inspections. Currently, there are no plans to insert a check of compliance of devices within the Conveyancing Act upon the sale of a lot.

We approached the Minister last year, and again most recently last week. He reconfirmed that there are no extensions to this deadline. The position is that the requirement has been known for three years, which is plenty of time to comply and that child safety is important.

NSW Fair Trading has committed to provide further information to the public about what to do if you are unable to comply by 13 March 2018.

Information about the requirement can be found on the NSW Fair Trading website here.

Cladding update

Under the draft Environmental Planning and Assessment Amendment (Identification of Buildings with Combustible Cladding) Regulation 2017 owners of buildings with combustible cladding will be required to identify whether cladding is present on schemes, and, if present, undertake an independent fire safety assessment and make a statement to Government which will be included on a public register. This amendment is currently on public exhibition until 16 February 2018. Upon enactment the Regulation requires schemes to make the above declaration within three months. SCA (NSW) attended a high level stakeholder meeting last week to ensure that our feedback in relation to the proposed regulation was conveyed to the policy makers.

The new regulation is being fast tracked and SCA (NSW) understands that owners will be responsible for ensuring they make the appropriate mandatory declarations. Penalties for non-compliance will apply and the owners corporation may have issues with disclosure for insurance purposes if it doesn’t register.

We have advocated that at a minimum, external wall cladding should be classified as a major defect under the Home Building Act and we have had a partial win in respect to Building Products (Safety) Act 2017 with a recent amendment to the Home Building Act 1989. This amendment now includes unsafe products as an item potentially attracting a six-year statutory warranty.

While unfortunately this is not retrospective, SCA (NSW) is committed to continue lobbying for existing schemes to be afforded the extended six-year statutory warranty protection for these products in the interest of consumer protection.

SCA (NSW) is making a submission and we encourage you to review the draft regulation and submit your feedback to planning.nsw.gov.au/proposals by Friday 16 February 2018.

NSW Fair Trading has posted information about wall cladding here.

For more information click here to attend the SCA (NSW) Strata Industry Briefing – Cladding Forum.

Community Title Reform

Community Title reform is on the government’s agenda for 2018 with a draft Bill to be released this calendar year. SCA (NSW) was advised that the consultation process will be quick and simple as most clauses are in line with the intent of the Strata Schemes Management Act 2015. The Community Title legislation will continue to be a separate Act and Regulations as it is now.

Section 55

SCA (NSW) has undertaken to make a recommendation to NSW Fair Trading on what should be recorded to owners, such as, things outside of our scope listed in Schedule A. The intention is for transparency so that owners know what they are paying for.

SCA (NSW) has established a working group to put a list of what should be in there, the bare minimum for the area of delegation and this will be provided to NSW Fair Trading which in turn will issue guidance to the consumer. Most software programs are not designed to record everything unless you have a bolt on to record so this will certainly be of interest to strata members and services with business in this area.

Amendments to the Strata Management Act 2015

A suite of amendments to the Act will be introduced into parliament in early 2018. NSW Fair Trading has requested feedback from SCA (NSW) for any issues identified in the new Regulations, which it will then consider before submitting to the Minister for sign off.

New Licensing

There are no significant changes to the licence categories, however qualifications will change. The Corporation licence will not be removed for now but will in the future. SCA (NSW) is waiting on the draft Regulations to do more work.

At our next meeting with NSW Fair Trading, SCA (NSW) is expecting a response to issues raised about child safety window locks, Conveyancing Act compliance and some practical steps to assist with Part 11 bonds.

We will update members on these and other issues as we progress through the year.