It has been 5-years since the Design and Building Practitioners Act 2020 (NSW) (DBP Act) came into force. What began as a statutory response to the Opal Tower and Mascot Tower crises has since disturbed the construction industry and redefined risk across every layer of the contracting chain.
With the High Court’s landmark decision in Pafburn Pty Ltd v The Owners – Strata Plan No 84674, the judicial system continues to grapple with several intricate legal and practical issues arising under the legislation.
At the heart of the DBP Act is section 37(1) – the statutory duty of care. It is owed to each owner and subsequent owner of the land and requires anyone who carries out construction work to exercise reasonable care to avoid economic loss caused by defects: (i) in or related to a building; and (ii) arising from the construction work.
The DBP Act overturned the long-standing common law principle in Brookfield Multiplex Ltd v Owners – Strata Plan No 61288 where the HCA held that a builder did not owe a duty of care to subsequent owners to avoid pure economic loss arising from building defects; and reversed this trend by establishing that a statutory duty of care applies to anyone who carries out construction work. A Quick Recap: What defines construction work within the meaning of the DBP Act?
Construction work is broadly defined to include:
building work;
the preparation of regulated designs and other designs for building work;
the manufacture or supply of a building product used for building work; and
supervising, coordinating, project managing or otherwise having substantive control over the carrying out of any work referred to above.
The scope of this definition is quite expansive. It captures nearly every participant in a construction project from builders and consultants to project managers and superintendents.
One of the more pressing questions still to be resolved is whether those who certify (ie. principal certifying authority) a construction falls within this web of liability. Given their pivotal role in authorising works and occupation certificates, the issue of whether PCAs “exercise substantive control” under the DBP Act is now squarely in the spotlight. The Emerging Question: Do PCAs owe a Statutory Duty of Care?
While the DBP Act clearly captures builders, designers, engineers and even project managers, a live issue remains – does the duty extend to PCAs?
PCAs occupy a unique position within the construction ecosystem. They are not directly involved in the delivery of works, yet no project can lawfully commence or be occupied without their certification. In that sense, their role in regulating and enabling the construction is both administrative and influential – they hold the keys to progress and completion, but do they have substantive control over the carrying out of building work / construction work?
Supporters of an expansive interpretation point to the fourth limb of the definition of “construction work” in s36(1)(d) of the DBP Act - a person who “supervises, coordinates, project manages or otherwise has substantive control” over building work.
PCAs arguably exercise substantive control within this definition because a project cannot commence without a construction certificate issued by a PCA; or a building cannot be occupied without an occupation certificate issued by a PCA confirming compliance with development consent conditions.
On this view, PCAs hold a gatekeeping function that directly affects whether works proceed or conclude. That influence has been held onto by current and subsequent owners of constructions to assert that the “substantive control” requirement is met and therefore attracts the DBP Act’s statutory duty of care.
The counterargument is that PCAs operate primarily in a regulatory capacity and not as participants in the construction process. Their role is to assess compliance and not manage or control the performance of construction works.
Based on this reasoning, PCAs do not “carry out” or “supervise” construction work in the conventional sense. Their obligations arise from the Environmental Planning and Assessment Act 1979 (NSW) and imposing the statutory duty of care under the DBP Act likely operates to conflate their regulatory oversight. This can possibly deter PCAs from performing their functions with independence.
Judicial Insights
The question of whether PCAs are captured under the DBP Act has begun to surface in a few proceedings.
In University of Sydney v Multiplex Constructions Pty Ltd, the plaintiff sought to extend the DBP Act duty to a certifier who had performed inspection and reporting functions. Although the Court declined to permit the submissions, it left open the possibility that a certifier could fall within the definition in appropriate circumstances.
In The Owners – Strata Plan No 90832 v Dyldam Developments Pty Ltd, the Owners Corporation pressed the issue directly, arguing that the certifier exercised “substantive control” and therefore owed a statutory duty. Hammerschlag CJ described the question as one of “manifest importance to the building and construction industry,” signalling that appellate clarification is required.
In December 2024, the construction industry had hoped that the appellate clarification would be delivered by the High Court in its landmark decision of Pafburn Pty Ltd v The Owners – Strata Plan No 84674. The HCA stated that:
“It is not self-evident that a certifier or the local council, in performing their duties, is “a person who carries out construction work” within the meaning of s 36(1)(d) of the DBP Act… the matter should be remitted to determine the question whether the list response pleading can be maintained against all of the alleged wrongdoers, which turns on whether they can truly be characterised as persons who carry out construction work under the DBP Act.”
The recent decisions of the Supreme Court of NSW and the High Court of Australia suggest a degree of judicial restraint, reflecting an apparent reluctance to make determinations that could unsettle established practices within the construction industry.
Key Takeaways
The DBP Act continues to expand the boundaries of professional responsibility across the construction industry.
The High Court’s reasoning in Pafburn confirms that this duty is non-delegable – liability cannot be reduced or shifted on subcontractors or consultants. This reinforces the importance of robust supervision, detailed record-keeping and documented quality assurance at every stage of the construction process.
The DBP Act provides owners and subsequent purchasers with a powerful statutory avenue to pursue economic loss for building defects regardless of whether they had a direct contractual relationship with the at-fault builder.
The question of whether PCAs fall within the DBP Act’s duty of care framework remains unsettled. Judicial commentary highlights the industry’s anticipation of appellate clarification. Until the courts provide clear guidance, PCAs should adopt a cautious and transparent approach to their statutory functions by ensuring documentation and decision-making processes demonstrate due diligence.
What This Means Going Forward
As the DBP Act enters its 5th year, the legal landscape continues to evolve. Courts are defining the reach of the statutory duty of care balancing consumer protection with practical limits on industry liability.
For PCAs, the unresolved question of whether certifiers “exercise substantive control” under the DBP Act is poised to shape the next chapter of construction liability in New South Wales. A finding that PCAs fall within the statutory duty would mark a profound shift in how regulatory oversight and construction accountability intersect.
As appellate courts take up these questions in the coming years, one thing is certain: the DBP Act has transformed construction law in NSW embedding a culture of care, accountability and diligence that will continue to shape industry practice well beyond its first decade.
Connect with GopherWood Lawyers
For further information about the DBP Act, construction disputes, or advice concerning the statutory duty of care and potential liability of principal certifying authorities, please contact the author of this article.
If you’d like to discuss how these reforms affect you or understand how GopherWood Lawyers can support your organisation, please get in touch with Christopher Fahmy.