On 16 May 2023 the fire at the Loafers Lodge in Newtown, Wellington, broke out killing 5 and injuring 20 people. This tragic event has resulted in a review of how building warrants of fitness (BWOF) is issued under the Building Act 2004 (Act), resulting in proposed changes to both the Act and regulations that will hopefully make not only boarding houses but all buildings subject to the BWOF regime under the Act, safer.

Background

By way of background, a BWOF is required for buildings that contain certain systems such as automatic sprinkler systems, fire alarms and lifts. These systems require specialist maintenance and inspection every year to ensure they continue to perform effectively.

A BWOF is issued by the owner of buildings subject to the BWOF regime under the Act. Building owners engage an independent qualified person to undertake an inspection, maintenance and reporting procedures listed on the compliance schedule issued by the relevant territorial authority for the building. The independent qualified person then issues a certificate of compliance known as Form 12A which is attached to the BWOF provided by the building owner to the relevant territorial authority.

There is no centralised national system for how independent qualified persons act and there is disparity across the country as to how Form 12A is completed. For example, there are instances of Form 12A being issued where it should not be which, as indicated in the MBIE Paper submitted to Cabinet on 18 September 2023, [1] is due to negligence rather than knowledge of the failure. This can result, where say a sprinkler system is not operating as it should be, making a building unsafe.

Independent Qualified Persons

So how does the system currently work?

Territorial Authorities hold independent qualified person registers. The registers vary in nature including as to the competency requirements for registration and how territorial authorities set up their disciplinary and complaints process. There is no national register and registration is limited to the geographic area in which the independent qualified person is registered. Neither is there a legislative framework for the regulation of independent qualified persons.

To resolve this issue, the Hon Dr Megan Woods has commissioned MBIE to work with territorial authorities to agree a nationally consistent approach to assist both territorial authorities and independent qualified persons.

The Hon Dr Megan Woods has also proposed the Act be amended to include an express requirement to the effect that “independent qualified persons have an obligation to only issue a 12A Form where the procedures in the building’s compliance schedule relating to the specified systems have been fully complied with during the previous 12 month period.”[2] This proposal has now been accepted by Cabinet.

Introduction of offences and fines

To support the change discussed above regarding the issue of the 12A Form, it was proposed the Act is also amended to include, where a 12A Form is negligently issued, will be an offence under the Act subject to a maximum penalty of $50,000 for an individuals and $150,000 for a body corporates. This proposal has also been accepted by Cabinet.

In 2021 the fines in the Act for failing to provide and display BWOFs was increased to up to $50,000 for individuals and up to $150,000 for a body corporate, and there is no intention to change these amounts. However, the fee in the Regulations for failing to provide or display a BWOF will, under the Regulations, increase from $250 to $1000.

With the imposition of an offence where Form 12A is issued negligently and the increase in fines under the regulations, going forward, it is hoped that both building owners and independent certifiers will pay more attention to inspections of the systems required and completion of Form 12A and the display of BWOFs. It is also hoped that creating a more unified approach for territorial authorities, together with the increase in fines, will also assist in making sure buildings are safer for occupants and our communities.

[1] Office of the Minister for Building and Construction – Update on the Loafers Lodge Fire and new and enhanced offences in the Building Warrant of Fitness Regime, 18 September

[2] Office of the Minister for Building and Construction – Update on the Loafers Lodge Fire and new and enhanced offences in the Building Warrant of Fitness Regime, 18 September 2023.