Does the construction of a Class 3 'care type' facility such as a residential accomodation building operated by NDIS providers for people with a disability require Domestic Building Warranty Insurance?
The Domestic Building Insurance Ministerial Order specifies the insurance that a builder is required to be covered by in order to carry out or manage or arrange the carrying out of 'domestic building work' under a domestic building contract.
Section 6 of the Domestic Building Contracts Act 1995 ('Act') specifies building work to which the Act does not apply. Sub-section 6(1)(c) states the Act does not apply to for any work in relation to a building intended to be used only for 'business purposes'.
Further, 'home' under Act means any residential premises and includes any part of a commercial or industrial premises that is used as a residential premises but does not include—
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(b) any residence that is not intended for permanent habitation; or
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(f) any residence that the regulations state is not a home for the purposes of this definition - The Domestic Building Contracts Regulations 2017 (Vic) does not provide for any ‘residence’ that is not a home.
In APM Group (Aust) Pty Ltd v Centurion Australia Investments Pty Ltd [2022] VSC 637, Stynes J when considering whether the Act applied to building work performed in relation to student accommodation, at paragraph [50] found:
"It is common ground, and I accept, that when applying the non-permanent habitation exclusion to the facts of this case, the following principles derived from the decisions of Maclaw and H Buildings apply:
(a) ‘permanent habitation’ is a reference to future use rather than current use;
(b) the question of whether a premises is ’intended for permanent habitation’ is to be approached with regard to the design purpose of the premises as determined by the application of objective criteria, including the physical characteristics of the building (ascertained by reference to the design and specification of the relevant works), at the time the contract is entered into; and
(c) whether a structure falls within the definition of a ‘home’ in ss 3 and 5 of the DBCA, also taking into account the exclusions in s 6, requires the determination, inter alia, of whether that structure is, at the time of entry into the contract, intended to be used as residential premises."
He honour went onto find at paragraph [69]:
"Having regard to the design purpose of the Premises, it is plain that it was suitable for permanent habitation and that it was intended to be a permanently inhabited residential premises. To put it another way, there is no evidence to suggest that it was intended to be used as a residential premises for only a temporary period and then used, say, as a business premises thereafter."
Her honours findings with respect to the permanent habitation exclusion were upheld on appeal by Ferguson CJ, Niall and Kennedy JJA - [2023] VSCA 324
