What is the evidentiary threshold for combustible cladding?

In our previous article published this October titled, “Governments react to combustible cladding following the Grenfell fire?”, we discussed NSW and UK government reactions to combustible cladding post-Grenfell.

Here, we ask what evidence is required to determine whether the builder or developer is liable to replace retrospectively-banned cladding.

Biowood Case

In Taylor Construction Group Pty Ltd v Strata Plan 92888 t/as The Owners Strata Plan 92888 [2021] NSWSC 1315 (Biowood), the Supreme Court upheld the decision of the NSW Civil and Administrative Tribunal (NCAT) that the Builder and Developer were responsible for removing the ‘Biowood’ (which consisted of 70% reconstituted timber and 23% PVC) cladding installed on the building. The following points from the Supreme Court judgment noted:

1. It was common ground that the 2014 version of the Building Code of Australia (BCA) applied at the time of the relevant building work.
2. However, the NCAT’s Appeal Panel’s finding that the material’s compliance with Specification C1.10 of BCA, such as the AS1530.3 test and a low Spread of Flame Index, was not determinative of whether use of that material otherwise constitutes an unwarranted or excessive risk of fire spread.
3. The importance of the AS1530.3 test was deemphasised in favour of a multifactorial consideration focused on determining whether there was “undue risk of fire spread” based on considering the following factors in conjunction: the extent of the use of materials, their location in relation to other parts of the building such as windows and balconies, their combustibility, ignitability and rate of flame spread.

Significantly, focus on this “undue risk of fire spread” placed the onus on the Builder and Developer to prove that the cladding was “fit for purpose” under the Home Building Act 1989 (NSW) (HBA).

JKN Case

Subsequently, in Strata Plan 92450 v JKN Para 1 Pty Ltd & Anor [2022] NSWSC 958 (JKN), the Supreme Court held that the Owners had failed to prove that the cladding installed on their building had breached statutory warranties under section 18B of the HBA.

Justice Black found the following:

1. The parties agreed that the BCA at the time of construction applies.
2. The Applicant bore the onus of proving the cladding was defective.
3. The Owners bore the onus of showing, with strong evidence, that the works as carried out did not comply with the “Deemed to Satisfy Provisions”, nor could they have constituted an Alternative Solution which met the performance criteria: see JKN Para at [37] citing cl A0.4 and A0.5 of the BCA.
4. ‘Combustibility’ had a definition specific to the BCA:
   • when applied to a material, “combustibility” was to be determined by AS 1530.1; and,
   • when applied to construction or part of a building – “combustibility” depended on whether construction was wholly, or in part of, combustible materials.
5. Examples of evidence which could be relied on when determining compliance with a Performance Requirement or a DtS provision could include documentation such as CodeMark conformity certificates.
6. Furthermore, the silicon between the Vitrabond FR cores’ joints could not be assumed to be combustible without any evidence of silicon’s combustibility.
7. Ultimately and importantly, the Owners failed to prove that they had explored an Alternative Solution via which the ACP cladding could otherwise comply with the BCA. Moreover, the Court refused to infer combustibility by reference to the Owners’ secondary sources, especially where their applicability and relevance were in question.

Takeaways

The JKN case is reportedly being appealed.

Pending this appeal, these cases provide a guide on retrospectively-banned cladding cases. The takeaways are as follows:

1. The BCA applicable at the time of the building work matters. An expert report based on current NCC requirements will not assist a party seeking to establish defective cladding amounting to a breach of the statutory warranties under the HBA.
2. The courts will place the onus on the claimant to demonstrate that cladding does not satisfy the BCA’s performance criteria.
3. “Combustibility” is defined by AS 1530.1. Certificates in relation to AS 1530.1 test are useful to prove combustibility. This can be contrasted from the position in Biowood, where the Supreme Court merely affirmed the Tribunal’s decision. In the JKN case, the Court, exercising its independent judgment, placed the burden of proof on the Applicant to establish a statutory liability and emphasised the significance of AS 1530.1 in this process.

If you would like to discuss this article, please contact Brett Vincent or Angie Kim.