NSW building reforms: what the duty of care and declarations mean for developers and owners

In December 2018, residents of Opal Tower at Sydney Olympic Park were evacuated after cracking appeared in the building. Months later, Mascot Towers was evacuated too. Those two events changed NSW building law more than anything in a generation. The reforms that followed shifted responsibility for defects towards the people who design, build and develop, made them answer for longer, and gave the regulator real powers to stop a defective apartment building from being occupied.

If you are a small developer, a builder, or a strata committee, the reforms affect you directly. This article explains what is in force now, what has changed in 2026, what it means in practice, and how we work under it.

What is in force now

The statutory duty of care (Design and Building Practitioners Act 2020, Part 4)

Section 37 of the Design and Building Practitioners Act 2020 (the DBP Act) creates a duty for anyone who carries out construction work to exercise reasonable care to avoid economic loss caused by defects. Three things make it significant:

• It is broad. The duty applies to construction work on all classes of building, not only apartments, and it is owed by the builders, developers, designers and engineers who carry out that work.
• It reaches later owners. The duty is owed to the owner of the land and to subsequent owners. Owners corporations use it: the High Court's leading decision on it, Pafburn Pty Ltd v The Owners – Strata Plan No 84674 [2024] HCA 49, was a claim brought by an owners corporation.
• It cannot be passed on. Section 39 makes the duty non-delegable, and section 40 stops a contract from excluding or limiting it. In Pafburn, the High Court held that a builder and developer could not use proportionate liability to shift their share of the loss onto the subcontractors and consultants who did the defective work. The party at the top answers for the whole job.

The duty also has a retrospective reach. It applies to economic loss that first became apparent within the ten years before section 37 commenced in June 2020, as well as loss that becomes apparent afterwards. Claims are subject to the long-stop limitation in section 6.20 of the Environmental Planning and Assessment Act 1979, which generally runs ten years from completion of the work.

Regulated designs and compliance declarations

For regulated buildings, the DBP Act also controls how designs are prepared and how compliance is declared. According to the NSW Government's guidance, the scheme has applied to Class 2 buildings (apartments), and buildings with a Class 2 part, since 1 July 2021. It was extended to new Class 3 and Class 9c buildings from 3 July 2023, and to alterations of existing Class 3 and 9c buildings from 1 July 2024.

On those buildings:

• Regulated designs, such as structure, waterproofing, fire safety and building enclosure, must be prepared by a registered design practitioner, who provides a design compliance declaration that the design complies with the Building Code of Australia.
• Building work must be done by a registered building practitioner. If a variation affects a building element or performance solution, a design practitioner must prepare a new regulated design.
• Near completion, the building practitioner must lodge a building compliance declaration and the as-built regulated designs on the NSW Planning Portal before the occupation certificate is applied for. This task cannot be delegated. Any further variations must be lodged within 90 days of the occupation certificate.
• Lodged documents can be audited by Building Commission NSW.

Enforcement powers for apartment buildings

The Residential Apartment Buildings (Compliance and Enforcement Powers) Act 2020 (the RAB Act) commenced on 1 September 2020 and applies to residential apartment buildings. Its key mechanisms are:

• Expected completion notice. A developer must notify the regulator between six and twelve months before applying for an occupation certificate.
• Prohibition orders. The regulator can prohibit the issue of an occupation certificate if the notice was not given, was given too late, or if it is satisfied that a serious defect exists.
• Building work rectification orders. The regulator can order a developer to fix serious defects.

The regulator is Building Commission NSW, which describes itself as the regulator of the building industry in NSW and now also handles building and trade licensing.

What changed in 2026: the new Building Act

On 4 August 2026, NSW Parliament passed the Building (Approvals and Practitioners) Bill 2026. It received assent on 14 August 2026 as Act No 26 of 2026. It is important to be precise about where it stands:

• Most of it has not commenced. Apart from two provisions dealing with Crown prefabricated building work, it starts on dates to be proclaimed, and the supporting regulations have not yet been released. Commentators expect commencement in around mid-2028.
• It will consolidate the system. According to MinterEllison's summary, it will repeal the DBP Act and the Building and Development Certifiers Act 2018 and bring registration of certifiers, designers, engineers and builders into one scheme. Construction certificates will become "building approvals" and occupation certificates "completion approvals".
• The duty of care carries over. The duty is reproduced in substantially its current form, and its scope expands to manufacturers and suppliers, which matters for prefabricated and modular work. Until commencement, and for work completed before it, the DBP Act duty continues to apply.

For now, the practical position is simple: the DBP Act and the RAB Act are the law you are building under today. Plan for the new Act, but do not act as if it has commenced.

What it means for small developers and builders

• Your liability now outlasts your contracts. A non-delegable duty, owed to future owners for up to ten years from completion, means defects can come back to you long after the subcontractors have moved on. You cannot rely on a contract clause or on the trade who did the work to absorb it.
• Documentation is your defence. If a claim arrives in year eight, the questions will be what was designed, what was built, who checked it, and when. A project without inspection records, product data and photos of concealed work is very hard to defend, even if the work was sound.
• Design changes are not informal. On regulated buildings, a change to a building element or performance solution needs a new regulated design and declaration. "We sorted it on site" is not compliant, and it also leaves no record of what was actually built.
• The programme has a regulatory step at the end. On apartment buildings, missing the expected completion notice window can stop an occupation certificate. Build the notice and declaration lodgements into the programme from the start.
• Non-compliance costs more than compliance. Rectification orders, delayed settlements, holding costs and defect litigation all cost far more than doing the work properly and recording it the first time.

What it gives owners corporations

• A direct claim against those responsible, including developers, builders and designers, for economic loss caused by defects, without needing a contract with them.
• Protection that survives a sale. Subsequent owners are covered, so the duty does not end when the original buyers sell.
• A regulator with teeth. Building Commission NSW can audit lodged declarations, refuse occupation, and order rectification of serious defects.
• A paper trail to work from. On regulated buildings, the declarations and as-built designs lodged on the Planning Portal are a starting point for any defect investigation.

These sit alongside, not instead of, the statutory warranties and defects bond processes. If your building has a defects report, see our post on strata defects reports and next steps, and get legal advice early, because time limits apply.

How we work under the reforms

The reforms reward exactly what we already treat as non-negotiable:

• We build to the code, and record that we did. Concealed work is inspected and photographed at hold points before it is covered, as described in hold points and the handover record.
• We treat design changes as design changes. If something on site needs to change, it goes back to the designer or engineer, not to a judgement call.
• We plan the paperwork into the programme. Declarations, certificates and notices are scheduled tasks, not end-of-job scrambles.
• We hand over the evidence. Certificates, product data, inspection records and warranties go to the owner or owners corporation, so compliance can be shown years later.

For the broader picture of why building to the code is the foundation of all of this, see why the NCC matters. If you are planning a development or managing a building and want to talk through how the reforms affect it, get in touch.

Sources

• Design and Building Practitioners Act 2020, NSW Legislation
• Residential Apartment Buildings (Compliance and Enforcement Powers) Act 2020, NSW Legislation
• Building classes and roles of professionals under the Design and Building Practitioners scheme, NSW Government
• Building practitioner obligations when working on regulated buildings, NSW Government
• Building Commission NSW, NSW Government
• Building (Approvals and Practitioners) Bill 2026, Parliament of NSW
• NSW Parliament has passed the Building (Approvals and Practitioners) Bill 2026, MinterEllison
• Case note: the High Court decides Pafburn, Landers & Rogers

This article is general information, not legal advice. The reforms are complex, the new Building Act has not yet commenced, and how the law applies depends on your building, its class, its dates and your contracts. Get advice from a construction or strata lawyer before acting. Full website disclaimer