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What is a Building Defect? Melbourne Property Owner’s Guide

Building defects can have significant financial and operational consequences if not addressed early.

Obtaining timely legal advice can help protect both individuals and Owners Corporations, while informing the most appropriate path to rectification or recovery.

Bugden Allen advises on building defect inspections in Melbourne, offering support across all aspects of building defect matters.

Whether the issue involves water ingress, structural cracking, defective cladding or non-compliant building work, our aim is to help resolve defects as early as possible.

We offer specialist legal advice across the property lifecycle, including all levels of building defect matters.

In this article, we discuss the definition of a building defect, along with some of the specific issues you may come across and what they mean for you.

What is a Building Defect? Understanding the Basics

A building defect is a fault, deficiency or non-compliance in building work that affects the quality, safety, functionality or value of a building.

Defects can be structural or non-structural, and may arise from defective design, workmanship, materials or non-compliance with applicable building legislation, the National Construction Code, Australian Standards or the terms of the building contract.

Building defects can range from relatively minor cosmetic issues through to serious structural failures or safety concerns.

They may become apparent shortly after construction is completed or develop over time as the building ages or is exposed to environmental conditions.

In Victoria, homeowners, Owners Corporations and other eligible parties may have legal rights to pursue builders and other responsible parties where defective building work has occurred.

In many cases, legal action for defective building work can be commenced within 10 years of the date the occupancy permit is issued, the certificate of final inspection is issued, or the building work is completed.

This will depend on the circumstances of the claim and the applicable legislative framework.

Building defect disputes can involve breaches of statutory warranties, contractual obligations, the Building Act 1993 (Vic), or non-compliance with the National Construction Code.

Determining the cause of a defect, identifying the responsible parties and understanding the available legal remedies often requires both technical and legal expertise.

There are numerous variables to consider legally when addressing any type of building defect.

These can determine who is responsible for rectification, who can bring a claim, and which parties may be liable.

Bugden Allen works alongside building consultants and other technical experts to understand the nature of a defect and its legal significance.

Building Defect Categories & Common Building Defects in Australia

Building defect matters can arise from a wide range of structural or non-structural issues affecting residential, commercial and mix-use developments. While every matter is unique, some of the more common building defects we encounter include:

Structural defects: faults affecting load-bearing elements such as foundations, slabs, columns, beams, retaining walls and roof framing.
Waterproofing defects: failures in waterproofing systems, membranes, flashings or seals that result in water ingress, moisture damage, timber decay, corrosion or mould growth.
Building service defects: defects involving electrical, plumbing, gas, fire safety or mechanical systems that affect the safe operation of the building
Building envelope defects: issues affecting roofs, windows, cladding, balconies, façades and external walls that allow water penetration or compromise the building’s performance.

In many cases, multiple defects are interconnected.

For example, a waterproofing failure may lead to structural deterioration, corrosion or mould growth, while inadequate structural design can result in movement that causes cracking and water ingress.

Identifying the underlying cause of a defect often requires an investigation by independent building consultants or engineers before legal liability can be properly assessed.

Building Defect Liability Period

In Victoria, building work must comply with the Building Act 1993 (Vic), the Building Regulations 2018 (Vic), the National Construction Code (NCC) and the relevant Australian Standards.

Where building work fails to meet these requirements, it may constitute defective or non-compliant building work and give rise to a range of legal remedies.

The timeframe for pursuing a building defect claim depends on the nature of the defect, the legal basis of the claim and the legislative framework that applies.

In many cases, domestic building claims can be brought within 10 years of the date of the occupancy permit, certificate of final inspection or completion of the building work, although different statutory regimes and limitation periods may apply depending on the circumstances.

Where defective work involves a failure to comply with the NCC or other applicable building standards, property owners may have access to regulatory remedies through the Building and Plumbing Commission (BPC).

This includes inspections and rectification orders where appropriate.

The introduction of Victoria’s Home Warranty Insurance Scheme on 1 July 2026 has also changed the insurance framework for eligible domestic building claims where a builder has passed away, disappeared or become insolvent.

Bugden Allen can help identify which regime applies to your specific matter, and who you should be engaging with regarding your building defects.

Every case is different, so it’s important to gather all the necessary information before taking legal action.

Reach out to us today.

Building Code Violations & Compliancy Issues

Building code violations and non-compliance issues occur when work falls below implied warranty standards or breaches the Building Act 1993 (Vic) or the National Construction Code (NCC).

These typically require distinct legal resolution pathways, depending on the complexity of the matter.

Common code violations include:
Waterproofing failures
Fire safety non-compliance
Structural inadequacy
Ventilation and energy inefficiency

In Victoria, the legal pathways for non-compliance issues and code violations can involve any of the following:

Building and Plumbing Commission (BPC): the primary regulatory body responsible for issuing formal rectification orders.
Relevant Building Surveyor (RBS): responsible for inspecting mandatory construction stages.
Victorian Civil and Administrative Tribunal (VCAT): where builders refuse to rectify issues, property owners can escalate matters to VCAT.

Difference Between Defects & Non-Compliance

Aspect	Non-Compliant Building Work	Standard Building Defect
Definition	Building work that does not comply with the requirements of the Building Act 1993 (Vic), the National Construction Code (NCC), relevant Australian Standards, approved plans or permit conditions.	A fault, deficiency or failure in the building works that affects the quality, safety, functionality or intended performance of a building.
Legal basis	Assessed against prescribed legislative and regulatory requirements.	Assessed against the contractual obligations, accepted building practices, statutory obligations and the standard expected of a competent building practitioner.
Cause	Failure to comply with the applicable building legislation, code, permits or approved documentation. Deviation from code requirements, unapproved variations, or work completed without required permits/approvals	Defective design, poor workmanship, unsuitable materials, construction errors or inadequate supervision.
Overlap	Non-compliant building work is often defective, but this is not always the case.	A building defect may exist even where the work complies with the NCC or other regulatory requirements.
Example	Combustible cladding installed contrary to NCC fire performance requirements or work completed without the required building approval.	A waterproofing failure resulting in water ingress despite the original design complying with the applicable building standards.
How it’s identified	Building surveyor inspections, compliance audits, expert reports or comparison against approved plans, permits and the NCC.	Building inspections, engineering assessments, destructive testing or defects becoming apparent over time through cracking, movement or water ingress.
Typical remedy	Rectification to achieve compliance, regulatory action or rectification orders issued by the Building and Plumbing Commission.	Rectification, damages or other remedies available under contract, statute or common law
Relevant claim	Claims or regulatory action under the Building Act 1993 (Vic) and related legislation.	Claims arising under contract, statutory warranties, negligence or other applicable causes of action.

The key distinctions between non-compliance and building defects are important to be made aware of, as the two concepts are related but not identical.

Non-compliance focuses on whether building work meets the requirements of the Building Act 1993 (Vic), the National Construction Code and other legislative standards.

A building defect is a broader concept, referring to work that is faulty, unsafe or not fit for its intended purpose.

In practice, many building defect disputes involve both defective and non-compliant work.

However, it is possible for building work to be non-compliant without causing an obvious defect, or for a defect to arise even where the work technically complies with the applicable codes and standards.

Understanding the distinction is essential when determining liability, identifying the responsible parties and selecting the appropriate legal pathway for resolving a building dispute.

Seeking legal advice on a building defect claim can help you identify the best path forward.

Identifying Building Defects in Melbourne Properties

Building defects are not always immediately apparent.

While some issues become obvious shortly after construction is completed, others may take months or even years to emerge as the building settles or is exposed to weather and everyday use.

Some common signs of a potential building defect include:

Cracking in walls, ceilings or foundations
Doors and windows that stick or no longer close properly
Uneven floors
Roof leaks or water ingress
Water stains, dampness or mould

At Bugden Allen, we recommend engaging a licensed professional to carry out a comprehensive investigation.

We can assist you throughout this process and guide you through the next steps if a defect is identified.

Building Defect Inspection Process

Step	Action
1. Document & Assess	Gather all relevant documents, including the building contract, approved plans, specifications, occupancy permit or certificate of final inspection, warranties and any correspondence. Engage a registered building practitioner, engineer or independent building consultant to inspect the property and prepare a report identifying the defects and any non-compliance with the Building Act 1993 (Vic), the National Construction Code (NCC) or applicable Australian Standards.
2. Notify the Builder	Notify the builder of the alleged defects in writing. Include the expert report, supporting photographs and a reasonable opportunity for the builder to inspect the property and rectify the defects. Maintaining clear records of all correspondence is essential should the dispute escalate.
3. Lodge a Complaint / Seek Dispute Resolution	If the builder refuses to rectify the defects or the dispute cannot be resolved, the matter may be referred to the Building and Plumbing Commission (BPC). Depending on the circumstances, the BPC may facilitate dispute resolution, investigate the complaint or exercise its statutory powers, including issuing rectification orders where appropriate.
4. Escalate to VCAT	Where the dispute remains unresolved, a claim may be commenced in the Victorian Civil and Administrative Tribunal (VCAT) or another court of competent jurisdiction, depending on the nature of the dispute. VCAT may make legally binding orders requiring rectification works, payment of damages or other appropriate relief.

Who is Responsible for Fixing Building Defects in Melbourne?

Typically, the licensed builder who signed the original building contract is responsible for fixing building defects.

This applies to both standalone houses and multi-unit complexes.

However, who is responsible for coordinating repairs can depend on the type of property and whether the defect affects common or private property:

Houses and townhouses: The original builder is responsible for defects in the property.
Common property in apartment buildings: The Owners Corporation is responsible for coordinating repairs, and can pursue the original builder where the defect falls within the statutory liability period.
Private lots within apartment buildings: Individual lot owners are generally responsible for defects within their own lot, though they may still have a claim against the original builder.

Reach out to us at Bugden Allen if you’re unsure which category your property falls under, or if disputes arise within the Owners Corporation.

We have extensive experience working alongside Owners Corporations on building defect matters, and can guide you towards an equitable resolution.

What Should You Do When Defective Building Works are Identified?

When defective building work is identified, an Owners Corporation and/or lot owners should act promptly to understand the nature and extent of the problem and protect its legal position.

The first step is to document the defect carefully. This may include photographs, a detailed description of the issue, relevant plans and reports, and records of previous repairs or correspondence.

Depending on the nature of the defect, it may also be appropriate to obtain advice from a building consultant, engineer or other technical expert before rectification work is undertaken.

For Owners Corporations, there may be additional considerations.

It is important to determine whether the defect affects common property, a private lot or shared building infrastructure, as this can influence responsibility for rectification, the Owners Corporation’s obligations and who may be entitled to pursue a claim.

The builder or other relevant party should generally be notified of the alleged defects in writing and given an appropriate opportunity to respond.

Legal advice at this stage can assist with preserving evidence, coordinating experts, identifying potentially responsible parties and ensuring that any applicable limitation periods or procedural requirements are considered.

Where a dispute cannot be resolved directly, it may be necessary to engage with the Building and Plumbing Commission (BPC) or another applicable dispute resolution process before proceedings are commenced.

If the dispute remains unresolved, the matter may ultimately proceed to VCAT or another appropriate forum.

Obtaining legal advice early can help an Owners Corporation or lot owner understand the available options and develop an appropriate strategy for investigation, rectification and, where necessary, recovery.

When to Hire a Building Defect Lawyer?

Building defects may become apparent during or shortly after construction. In some cases, however, issues may not emerge until years later.

Persistent water ingress, recurring cracking, waterproofing failures or problems affecting common building services are often the first signs that further investigation is warranted.

When defects are identified, it is important to understand not only what has gone wrong, but who is responsible and what steps should be taken next.

An Owners Corporation may need to investigate and preserve evidence of defective work while also meeting its obligations to repair and maintain common property.

Obtaining legal advice early can help to:

Determine whether the defect affects common property, a private lot or shared building infrastructure
Understand responsibility for repair and rectification
Identify the scope and location of defects
Coordinate building consultants, engineers and other experts
Preserve evidence while necessary repairs are undertaken
Identify potentially responsible parties and available claims
Assess applicable limitation periods
Engage with builders, developers, consultants and insurers from an informed position.

Early legal advice doesn’t mean litigation is inevitable.

In many cases, it enables you to make informed decisions during the defect recovery process while continuing to meet your obligations to lot owners.

Contact Bugden Allen for personalised support and advice on your building defect matter.

Body Corporate Body Corporate disputes common property common property improvements disposal of common property Queensland strata strata approvals Sun Lagoon

When is ‘just laying some pavers’ actually a disposal of common property?

A Queensland body corporate Adjudicator draws the line between an “improvement” and a “disposal” of common property: Sun Lagoon [2026] QBCCMCmr 253

Every body corporate has, at some point, faced a version of this problem: one owner wants to do something to the common property that benefits their own lot. A deck. A garden bed. In this case, pavers. The other owners are quick to ask the obvious question — is body corporate approval needed, and if so, at what level? Approval can vary from a simple committee resolution on the one hand, all the way to a resolution without dissent at a general meeting. This recent decision from the Adjudicator Ananda helps lot owners and committee members find the line between improving and disposing of common property.

What was the dispute about?

Sun Lagoon is a 30-lot scheme at Noosa Heads. The owner of Lot 9 wanted to remove a roughly 3 by 3 square metre section of grass and garden on common property next to the back (sliding) door of their lot, and lay pavers in its place, matching paving that the owners of the neighbouring Lots 8 and 10 had been allowed to install back in 2011. The owner of Lot 9 (a related entity to the management rights operator) put forth a motion at the body corporate’s Annual General Meeting on 18 September 2025 (Motion 18A) asking the body corporate to approve the works as an “improvement to common property”, requiring only an ordinary resolution; that is, the motion passes with a simple majority.

The body corporate’s committee did not agree, and put forward a competing motion (Motion 18B) asking the lot owners to reject Lot 9’s proposal. The committee’s concerns were that the pavers would affect the visual amenity of the complex, would occupy a meaningful area of common property, and, in substance, would end up being used exclusively by Lot 9, even though no formal exclusive use right was being sought.

Another lot owner, Grant Hailes (the owner of Lot 29 and Chairperson), went further. He argued that removing grass, topsoil and a garden bed and replacing them with pavers was not merely an “improvement” at all, it was a disposal of common property; that being a de facto grant of exclusive use, or the grant of a licence for exclusive and indefinite use of the affected patch of turf and garden. Under the legislation, either of those things would require the highest level of owner approval available: a resolution without dissent, meaning that the approval motion would fail if even only one lot owner voted against it.

At the AGM, Motion 18A received 17 votes in favour and 12 against, which would easily carry as an ordinary resolution. The Chairperson however, ruled Motion 18A out of order, taking the view that the motion should have been put forward as a resolution without dissent. That ruling is what ended up before the Adjudicator, by virtue of Mr Hailes’ application to have Motion 18A declared invalid outright.

Why does the level of approval matter?

Queensland’s body corporate legislation scales the level of owner approval according to how seriously a proposal, and resultant decision on that proposal, affects everyone’s shared interest in the common property. Routine improvements that benefit one lot but leave everyone else’s rights untouched can generally proceed as either a committee resolution (depending on the value of the improvement) or as an ordinary resolution.

Anything that amounts to selling, disposing of, or granting a long-term lease or licence over common property sits in a different category, because it affects what every owner co-owns. Selling or otherwise disposing of common property, or granting a long-term lease or licence over common property, requires a resolution without dissent; all votes cast must be in favour, and just one (or more) votes against will cause the motion to fail.

So, the entire dispute turned on a single question of substance rather than form: irrespective of how the motion was worded, did laying pavers over that area of grass and garden amount to a disposal of common property, whether by a de facto grant of exclusive use, or the grant of an exclusive and indefinite licence? If yes, the ordinary resolution the owners of Lot 9 had put forward, and had actually won, was not good enough.

The competing arguments

Mr Hailes, the Chairperson who had ruled Motion 18A out of order, pointed to a line of earlier decisions to support his case. In Katsikalis v Body Corporate for “The Centre” [2009] QCA 77, the Queensland Court of Appeal found that the extension of an advertising hoarding into (previously unoccupied) common property air space amounted to a disposition of that space, because it excluded all other lot owners from using it, apparently for good. In Dansur v Body Corporate for Cairns Aquarius CTS 1439 & Anor [2022] QCATA 15, removing a section of common property masonry to enlarge a window was found to be a disposal. In Ainsworth & Ors v Albrecht & Anor [2016] HCA 40, the High Court dealt with a lot owner absorbing a small pocket of common property airspace into their own balconies (turning two small balconies into one large balcony). Again, this was treated as something that required a resolution without dissent. On Mr Hailes’ argument, digging up the grass, topsoil and garden bed, disposing of those things, and then replacing them with pavers, for the benefit of Lot 9, was no different.

The owners of Lot 9 (represented by Bugden Allen) argued the opposite. Nothing about the proposal excluded any owner, occupier or visitor. There would be no fence, no barrier, and no legal right for Lot 9 to stop another owner, occupier or visitor from walking across the paved area, sitting on it, or otherwise using it, just as they could when it was grass. In ancient common law parlance, none of their fellow lot owners were being ‘ousted’ from the affected area of common property. Further, and in any event, the works were, they said, materially the same as what the committee had already allowed the neighbouring Lots 8 and 10 to do, back in 2011. At an installed value under $3,000, the works arguably even qualified as a “minor improvement” under the regulation; a category that, if it applied, meant that only committee approval was required.

What the Adjudicator decided

Adjudicator Ananda dismissed Mr Hailes’ application, and found that Motion 18A only ever needed the ordinary resolution it was put forward as. Three points of reasoning from Adjudicator Ananda stand out.

A “disposal” is narrower than simply changing or removing part of common property. The Adjudicator held that “disposal” in the legislation carries its everyday meaning of parting with property with some finality — closer to a sale, gift or transfer — rather than any physical alteration to common property. If digging up grass and topsoil counted as a disposal every time, a body corporate would technically need unanimous approval to mow the lawn, which cannot have been the legislature’s intention.
There was no exclusion of other owners, in law or in fact. The critical difference from Katsikalis and Ainsworth was that those cases involved a physical or legal barrier; a rooftop hoarding and an enclosed balcony, that genuinely shut other owners out. Here, nothing stopped anyone else from walking onto, or using, the paved area once it was laid. Without that exclusion, there was no “disposal” and no licence for exclusive and indefinite use.
There was no demonstrable loss to the other owners for Lot 9’s exclusive benefit. Citing Dansur, where enlarging a window changed the building’s façade to the exclusive benefit of one lot, the Adjudicator found no equivalent loss here. The pavers did not obstruct anyone’s view or access, and the area remained open to all.

On the basis of the Adjudicator’s analysis above, laying the pavers was simply an “improvement to common property for the benefit of the owner’s lot” under section 177 of the Accommodation Module. That is, the type of change that should be approved by committee resolution where it can be, and ordinary resolution if it must. Motion 18A had already cleared the higher of those two bars, with 17 votes in favour to 12 against, and the Chairperson (Mr Hailes) should not have ruled it out of order.

Why this decision matters

Ever since Dansur (actually spelled Danseur – the writer acted for that successful company in those proceedings) ‘nay sayers’ and NIMBY’s have used the Danseur decision to argue that almost any improvement to common property needs a resolution without dissent to authorise. In Sun Lagoon the learned Adjudicator went to some pains to identify, outline and analyse relevant common law, property law and body corporate legislation to reconcile, and ultimately make sense of, what appear to be competing authorities. For Adjudicator Ananda (and in our view, correctly) the decision in Danseur is authority for the proposition that:

‘…a disposal or disposition of common property was found to have occurred because (in a nutshell) there was a demonstrable loss to the members of the body corporate save the benefiting member (which it said must be greater than the loss of a negligible tangible thing such as bricks and mortar) in respect of the interest in common property, which was to the exclusive benefit of one member.’ at [100]

That is the take home message from Sun Lagoon and it is a message that will probably be repeated by Adjudicators for many years to come – since Danseur was handed down in 2022, it has been cited at least 21 times in Adjudications, often by applicants seeking a ‘silver bullet’ to stop another lot owner’s improvement to common property.

Bodies Corporate and committees can now easily explain, and apply, Danseur, which in turn should lead to better decisions on lot owner improvements, and less unnecessary disputation.

This article was first published on 13 August 2026. It was written by Michael Kleinschmidt, Legal Practitioner Director & Jade Marley, Lawyer from our Sunshine Coast office.

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