Strata defects reports: how to read one and what to do next

If you sit on a strata committee in NSW, sooner or later a defects report will land in your inbox. It may come from an inspection under the state's building bond scheme, from a building consultant the owners corporation engaged, or from a routine inspection of common property. The report is usually long, technical and full of photographs, and it can be hard to know what matters.

This guide is general information for committees. It is not legal advice, and for anything involving a claim you should speak to a strata lawyer.

Where reports come from

• The Strata Building Bond and Inspections Scheme. For new strata buildings that fall within the scheme, the developer lodges a bond, and an independent inspector reports on defects in the common property at set points after the building work is finished. The owners corporation approves the inspector and decides what to do about the findings. Details and current timeframes are on the NSW Government scheme page, and the bond amount has been changing, so check the current settings.
• A report the owners corporation commissions. Committees often engage a building consultant when they suspect a problem, or before a warranty period runs out.
• Routine inspections. Regular building management inspections will often flag early signs such as staining, cracking, failed sealant or blocked drains before they become claims.

How to read a defects report

1. Separate the categories. Good reports group findings by element: roof, facade, waterproofing, fire safety, structure, services, common areas. Look first at the elements that the law treats as most serious.
2. Check severity and urgency. Is each item a safety risk, a risk of further damage, or cosmetic? A wet-area or balcony leak, or a fire-safety item, is a different priority from a paint blemish.
3. Look for cause, not just symptom. A stain on a ceiling is the symptom. The report should say what failed: a flashing, a membrane, a drain. Without a cause, you cannot price or brief a fix.
4. Look at the evidence. Photos, locations marked on plans, measurements and references to the standard or code the work is said to breach. A finding you cannot locate is a finding you cannot fix or claim on.
5. Check the author. Who prepared the report, what are their qualifications, and were they independent of the builder?
6. Ask what is not covered. Concealed areas, inaccessible roofs and areas that were not opened up are often excluded. That is not a clean bill of health.

What to do next

• Note the dates now. Under the Home Building Act, the statutory warranty period is six years for major defects and two years for other defects, and it starts on completion of the work (section 18E). Other rights may also apply, including the statutory duty of care in the Design and Building Practitioners Act 2020. Get legal advice on which dates apply to your building, and act early. Time limits are strict.
• Prioritise. Make safe anything that poses a risk to people, and stop further damage first. Temporary protection is usually cheaper than repairing water damage later.
• Get the committee's decision on record. Table the report at a meeting, minute how the owners corporation will respond, and keep every version of the report.
• Give the builder or developer written notice. If defects are within the warranty or a bond scheme, your lawyer can advise on how and when to notify them and what to record.
• Obtain a scope and quotes for rectification. A repair scope should address the cause, not only the symptom, and set out the sequence, the products and how the work will be inspected.
• Manage the rectification. Repair work on common property should be inspected and recorded like any other building work, particularly waterproofing and envelope repairs, which are covered up when finished.

Where regular inspections help

A defects report is a snapshot. Between reports, regular building inspections and a clear record of call-outs, repairs and photographs give a committee the evidence it needs and help catch problems early. That is part of what our Strata Inspections & Repairs service is for: scheduled building inspections and repairs, with written reports that your strata manager can pass to the owners corporation.

If you have a defects report and want help making sense of it, or want to plan the rectification works, get in touch.

Sources

• Strata Building Bond and Inspections Scheme, NSW Government
• Home Building Act 1989, section 18E (Proceedings for breach of warranty), NSW Legislation via AustLII
• Design and Building Practitioners Act 2020, section 37 (Extension of duty of care), NSW Legislation via AustLII

This article is general information, not legal or technical advice. Time limits and rights depend on your building, its dates and the work involved, so get advice from a strata lawyer and a qualified building consultant before acting. Full website disclaimer