Change text size:   Increase font size   Reduce font size  |   Print page:   Print this page
  |   Contact us   
 
nosection
English

For owners corporations and lot owners 

Strata building bond and inspections scheme 

A strata developer must appoint a strata building inspector to conduct interim and final inspections and produce reports. If the developer fails to appoint an inspector, the Building Bond Secretary will appoint one.

The developer can propose a building inspector once they receive notification that the building bond has been approved by the Building Bond Secretary.

The developer can only appoint the inspector after the owners corporation has approved the appointment of the inspector by a resolution at a general meeting. The general meeting resolution must be determined by a simple majority. A developer or lessor of a leasehold strata scheme cannot vote, or exercise a proxy vote, on a matter concerning building defects.

Online portal for strata building bond inspections 

The developer must provide the owners corporation details, including an email address, when they lodge the building bond in the Strata building bond and inspection scheme online portal (SBBIS Online Portal). The online portal will send the owners corporations all notifications to the email address provided by the developer, so the owners corporation should make sure the email address is correct. This is especially important when the initial period of a strata scheme owners corporation is constituted, and when it ends.

The owners corporation must create an account in the online portal.

The Building Bond Secretary will give the owners corporation 14 days’ notice of any proposed payment from the building bond. The owners corporation must ensure their details registered at the NSW Land Registry Services are updated and correct.

Top of page

Appointing a strata building inspector 

The online portal will notify the owners corporation about the proposed building inspector and any related disclosures.

The owners corporation must call a general meeting of the owners to consider the proposed inspector and any disclosures, and pass a resolution to approve or refuse their appointment. The owners corporation must record their decision through the online portal.

The developer and the Building Bond Secretary be notified of the owners corporation’s decision through the online portal.

If the owners corporation rejects the proposed building inspector, the developer can repeat the process until either the 12 months expires, or the owners corporation approves an inspector.

Once the owners corporation approves the appointment of the building inspector in the online portal, the developer, owners corporation, building inspector and the Building Bond Secretary will be notified through the online portal.

An individual owner of a strata scheme lot can object, for any reason, to the owners corporation’s approval of a building inspector. The individual owner must lodge their objection with the Building Bond Secretary within 14 days after the owners corporation approves the appointment.

The Building Bond Secretary will decide whether or not to appoint another building inspector, and they will notify the person who made the objection, the developer, the owners corporation and the originally appointed building inspector of their decision as soon as possible.

If a developer fails to appoint a building inspector within 12 months, they must notify the Building Bond Secretary through the online portal within 21 days after the end of the 12 month period.

The Building Bond Secretary will then appoint an inspector through the online portal which will notify the developer, owners corporation and the building inspector.

The developer must pay all inspector costs, even when the inspector is not appointed by the developer.

Top of page

Strata scheme interim inspection and report 

The building inspector must attend the site to do the interim inspection.

The inspector must do the inspection and upload a report to the online portal between 15 and 18 months after the occupation certificate is issued.

The building inspector must give at least 14 days’ written notice to the owners corporation, the owner, and any occupant of any affected lot of their intention to enter any part of the strata scheme.

The owners corporation, any person who has exclusive use of common property, a strata managing agent, building manager or manager of the common property, and any owner or occupier of a lot must provide any reasonable assistance to enable an inspection.

A person must not unreasonably refuse a building inspector access to any part of the strata scheme, or obstruct or hinder the inspection.

Once uploaded by the inspector, the owners corporation will be notified that the report is available on the online portal.

Within 14 days of being notified, the owners corporation must notify the lot owners of the strata scheme that the interim inspection report has been received, and how they can obtain an electronic copy.

If there is no defective building work identified in the interim report, the developer can apply to the Building Bond Secretary for a determination that a final inspection/report is not required. In this case, the interim report becomes the final report.

Top of page

Review of a decision to not require a final report 

An owners corporation can apply to the Building Bond Secretary to review the decision that a final inspection/report is not required.

An application for review must be made within 14 days after notice has been given. The application must be in writing, signed by the applicant, and specify the relevant decision and reasons for seeking a review. The application should provide any additional information, the reason why that information was not previously provided, and an email address the Building Bond Secretary can send notification of their decision to.

Top of page

Rectify defective building work 

After the interim report is lodged, any defective building work must be rectified by the builder before the final inspection starts.

The builder must give at least 14 days’ written notice to the owners corporation, the developer, the owner, and any occupant of any affected lot of their intention to enter any part of the strata lot for an inspection, or to rectify the defective building work.

After providing proper notice, the builder may enter the lot at a reasonable time, or at a time agreed with the owner or occupant of the lot.

A person must not unreasonably refuse a builder access to any part of the strata scheme if the builder has given proper notice.

Top of page

Final inspection 

The building inspector must attend the site to do the final inspection.

The building inspector must do the final inspection and upload the final inspection report to the online portal between 21 and 24 months after the occupation certificate is issued.

The building inspector must give at least 14 days’ written notice to the owners corporation, the owner, and any occupant of any affected lot of their intention to enter any part of the strata scheme.

The owners corporation, any person who has exclusive use of common property, a strata managing agent, building manager or manager of the common property, and any owner or occupier of a lot must provide any reasonable assistance to enable an inspection to be carried out.

A person must not unreasonably refuse a building inspector access to any part of the strata scheme or obstruct or hinder the inspection.

Once uploaded by the building inspector, the owners corporation will be notified that the final inspection report is available on the online portal.

Within 14 days of being notified, the owners corporation must notify the lot owners of the strata scheme the interim inspection report has been received and must provide whether the report is an interim (or final) report and how they can obtain an electronic copy.

Top of page

Review of a decision to appoint an inspector for a final strata inspection 

A developer, owners corporation, owner of a lot, or the builder who carried out building work in a strata scheme, can apply to the Building Bond Secretary to review their decision to appoint or not appoint a building inspector to carry out a final inspection and provide a final report on the building work.

An application for review must be made within 14 days after notice to appoint/not appoint and inspector. The application must be in writing, signed by the applicant, and specify the relevant decision and reasons the review is sought. The application should provide any additional information, the reason why that information was not previously provided, and an email address the Building Bond Secretary can send notification of their decision to.

Top of page

Paying the building bond 

All or part of the building bond may be claimed or realised by the Building Bond Secretary to pay to the owners corporation:

  • to meet the costs to rectify any defective building work identified in the final report
  • where both the owners corporation and the developer agree to apply to the Building Bond Secretary to pay the bond.

The cost to rectify identified building work should be agreed by the developer and the owners corporation.

The owners corporation and the developer may apply to the Building Bond Secretary with their agreed amount to rectify identified building work no later than 14 days before the last day that the building bond must be claimed or realised. The final date to claim or realise the strata building bond is:

  • 2 years after the date the building work covered by the bond is completed, or
  • within 60 days after the final report on the building work is submitted to the Building Bond Secretary by the building inspector through the online portal (where the Building Bond Secretary appoints the building inspector)

If the owners corporation and the developer do not agree on the amount to be paid, the Building Bond Secretary will nominate a quantity surveyor to decide the amount. The cost of the quantity surveyor must be paid equally by the owners corporation and the developer.

The developer must take any necessary steps to enable the Building Bond Secretary to claim or realise an amount of building bond given by the developer and required to be paid under the Strata building bond and inspections scheme.

The Building Bond Secretary may refuse to claim or realise an amount, or reduce the amount otherwise payable, if they are satisfied that the developer or the builder responsible for defective building work was unreasonably refused access to the strata scheme to rectify the work.

The Secretary will notify the owners corporation and the developer of any proposed payment in the online portal.

Top of page

Review of a decision on a building bond claim 

An owners corporation can apply to the Building Bond Secretary to review the decision that all or part of a building bond can be claimed or realised for payment to an owners corporation, developer or other person.

Despite the above, a decision by the Building Bond Secretary to claim or realise a building bond for payment cannot be reviewed if the amount has already been paid in accordance with the decision.

An application for review must be made within 14 days after notice is given of the proposed payment. The application must be made through the online portal and specify the decision to be reviewed and the reasons for seeking a review. The application should provide any additional information and the reason why that information was not previously provided, and an email address the Building Bond Secretary can send notification of their decision to.

Top of page

Tribunal orders - contract price and access to a strata scheme 

Contract price

The contract price for building work covered by a strata building bond is the total price for all applicable building contracts at the date of issue of the occupation certificate.

Where there is no written contract for the building work, or the parties to the building contract are connected persons, the contract price will be the price set out in a cost report prepared by a quantity surveyor. The quantity surveyor will be appointed by the Building Bond Secretary and not connected to the developer or the builder.

An owners corporation can apply to the NSW Civil and Administrative Tribunal (the Tribunal) for an order specifying the amount of the contract price of building work for the purpose only of determining the amount of a building bond.

If there are other incidental proceeding being dealt with by a Court, then the application to make an order specifying the amount of the contract price of building work is to be made to and determined by the Supreme Court of NSW.

Access to the lot or any other part of the strata scheme

An owners corporation can apply to the Tribunal for an order requiring the occupier of a strata scheme lot or any other person (such as a building manager) to allow the building inspector and/or builder access to the lot or any other part of the scheme for an inspection (interim or final) or to rectify defective building work.

Top of page