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Fire-risk cladding a legal minefield, apartment owners warned

The peak industry body for strata and community title management in Australia has called on body corporates or owners’ ­organisations across Australia to immediately carry out building inspections to identify the type of cladding that has been used on the exterior of their buildings.

It has also urged owners to ­obtain legal advice on insurance issues as building warranties and common law rights for complexes more than three storeys high had been extinguished in some parts of the country.

It follows a report last week by the Metropolitan Fire Brigade in Melbourne that found imported, cheap aluminium cladding that did not meet Australian fire safety standards had helped spread a fire through the 13-storey Lacrosse building in the high-density Docklands precinct.

While a cigarette on the eighth floor was the cause of the November fire, the MFB report found the cladding was combustible and once alight had caused the fire to rapidly spread up the side of the building, reaching the 21st floor within 11 minutes.

The Weekend Australian reported that Pan Urban, the property development company owned by developer Morry Schwartz — who co-developed the Lacrosse tower — faces being sued over the non-compliant and flammable cladding.

Industry insiders claim that the use of the cheaper cladding, which because of its plastic core does not meet Australian fire and combustibility standards, is widespread in the apartment building sector across the country.

The supplier of cladding to a north Sydney project — Chief Media Pty Ltd’s managing director Mary Lee — yesterday confirmed to The Australian that the Westbourne Constructions development in Milsons Point was using Haida, which also contained a plastic core.

That plastic core is similar to the Alucobest cladding used at the Lacrosse building in Melbourne.

Workers at the Westbourne Constructions project could be seen yesterday fixing the material to the facade.

The development’s project manager, McNally Management, did not return calls fromThe ­Australian.

Kim Henshaw, the chief executive of Strata Community Australia, said the issue was potentially a legal minefield, with the cost of replacing the cladding for individual apartment owners “exorbitant” and the work potentially not covered by insurance.

“This beggars belief; there are tens of thousands of lots across Australia that could potentially be affected by this,” he said. “The only way to find out whether a building is at risk is via a building inspection so strata managers should also be recommending this action to their clients.”

Leading Sydney strata lawyer Colin Grace said all body corporate, strata managers or owner-­organisations should urgently engage fire experts or experts in the Building Code of Australia to undertake inspections.

“If they find the cladding they have on their building is a fire risk, then body corporates, or whatever the management organisation is called in various states, need to move very quickly ­because there are legal, insurance and warranty issues,” he said.

Industry experts have told The Australian that the use of substandard cladding imported from China was widespread, particularly in Sydney and Melbourne.

Law firm Slater & Gordon is considering a class action on ­behalf of 100 owners of apartments in the fire-damaged Docklands building and warns litigation could spread nationwide. “If reports of widespread usage of illegal building materials are correct, we would anticipate widespread litigation, including class actions, to result throughout Australia,” Ben Hardwick, ­nat­ional practice group leader of commercial and project litigation for Slater & Gordon, said.


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