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A recent Supreme Court decision has cast doubt on Local Governments’ power to order rectification of building works carried out prior to 2012.

In Chan v City of Subiaco [2017] WASC 134, the Court reviewed the application of section 178(2) of the Building Act 2011 (WA) (Building Act) and found that Local Governments have no power to order rectification of building works licensed under the previous legislation.

The Court’s interpretation of the Building Act may sometimes leave Local Governments powerless to order rectification or removal of potentially illegal and dangerous structures.

The Background

The dispute centred around a ‘building licence’ (Licence) issued to former tenants of a property in Subiaco under the Local Government (Miscellaneous Provisions) Act 1960 (WA) (LGMP Act).

The Licence allowed the tenants and their builder to carry out building works. The works included converting the property into a restaurant and amendments to the parking facilities.  The License also required the tenants to make allocation for a disabled parking bay which was not done.

Time passed and the tenants of the property changed without the City of Subiaco (City) noticing the absence of disabled parking bays.  New tenants took over the lease; the City had still not issued any notices of non-conformance.

Eight years passed and the City finally issued a notice. However, the previous tenants no longer had any right to access the property. Therefore the notice was issued to the new owners of the property ordering them to rectify the works, in accordance with the terms of the original Licence.

The owners refused to rectify the works, because they had not been named in the original Licence.  By this time, the relevant provisions of the LGMP Act had been repealed and replaced with provisions for the issue of building permits under the Building Act.

Under these new provisions of the Building Act, the City issued a notice to the new owners to install an additional disabled parking bay within 30 days. The new owners refused and sought review by the State Administrative Tribunal (SAT). SAT ordered the new owners to make certain modifications to the site.

The Appeal

The owners then appealed to the Supreme Court which overturned SAT’s order.

The Court held that a ‘building licence’ issued under the LGMP Act could not be treated as if it were a ‘building permit’ under the Building Act, unless, immediately prior to 2 April 2012, works under that building licence were still being carried out. This is because:

(a)  The relevant building licence had to have been “operational” as at the date of transition from the LGMP Act to the Building Act;

(b)  That transitional date was 2 April 2012; and

(c)  According to the Court, for a building licence to have been “operational” in a relevant sense, works had to have been carried out under that licence.

In this case, the relevant works had been completed by 2 April 2012 such that the building licence was not “operational” immediately prior to that date. The Court held that the City could not therefore issue a ‘building order’ or require rectification of the original Licence pursuant to the Building Act, because the Licence had expired before that Act commenced.

Is there now a Loophole?

This decision means that Local Governments may not be able to order rectification of building works that were supposed to have been completed under licences issued under the old LGMP Act.

It is not unusual for issues with building works not to come to the attention of Local Government for some time. Conceivably, then, a considerable number of works licensed under the LGMP Act may require rectification in the future.

This matter is currently on appeal to the Full Bench of the Supreme Court. It will be interesting to see if the Court’s interpretation at first instance is upheld, particularly given the impact on Local Governments’ ability to administer their planning and development obligations.

If the appeal fails it may fall to the legislature to ensure Local Governments can rectify, amend or demolish illegal or non-conforming building works.

*This is general information only, and does not constitute specific legal advice. Please consult one of our experienced Legal Team for specific advice relevant to your situation.