Guidelines on 'Adequate Means' for Private Building Consent Authorities

Summary

Private organisations seeking registration under the Building Act 2004 (the Act) as building consent authorities must satisfy the Department of Building and Housing (the Department) that they have 'adequate means' to cover any civil liabilities that may arise in the performance of the organisation's functions as a building consent authority. This might be achieved, for example, through insurance, a bond or a guarantor.

The Department would assess whether the organisation's arrangements for meeting civil liabilities are adequate in the event of a claim for damages. This would include arrangements for any claims that may arise within 10 years after an organisation ceases to provide building consent authority services.

Following public consultation in 2007, the Department has recommended to Ministers that regulations be made under the Act prescribing minimum terms and conditions, and acceptable conditions and exclusions for building consent authority civil liability insurance. Subject to usual government approval and drafting processes, we expect that regulations will be made and come into force during 2008.

 

These guidelines, while developed in anticipation of the proposed regulations, should in no way be interpreted as pre-empting the outcomes of government policy or regulation development processes. Rather the Department wishes to provide general information in a timely manner to assist potential applicants. In particular, so they can consider whether they might, in future, seek accreditation and registration as a building consent authority; and what information might be necessary for the Department's assessment of adequate means.

Introduction

The Government is implementing a series of reforms to improve consumer protection and increase public confidence in the building control sector. The accreditation and registration of building consent authorities to ensure further professionalism, competencies and upgrading of quality assurance measures in the building consenting and inspection processes are key aspects of the improvement process.

Collectively these initiatives help to ensure:

• improvements in the competencies and performance of all who participate in the building sector, including designers, constructors and regulators
• better-quality buildings and outcomes for all consumers.

These guidelines provide information to assist private organisations¹ who may, in future, consider applying to be registered as a building consent authority under the Act. In particular, the guidelines explain requirements relating to the assessment the Department would undertake of an organisation's means of covering civil liabilities.

¹ A private organisation includes an organisation that is not a territorial or regional authority and that is empowered under the Building Act 2004 to undertake the functions of a building consent authority (eg, issuing building consents, undertaking building inspections and issuing related certificates and approvals).