NSW court rules on former building code concession relating to combustible cladding installation

This case is significant to the building industry because it offers further clarity regarding the historical approval and use of ACP after a decade of heightened scrutiny and regulatory intervention regarding the use of ACP cladding materials to the external facades of buildings throughout Australia, particularly following the Lacrosse tower fire in Melbourne.

The court’s decision in the Star Casino case reinforces that the former clause 2.4 of specification C1.1 of the BCA, known within the industry as the attachment concession, could have applied to permit the use of ACPs if installed as an attachment to an external wall, and if all other criteria in the concession were satisfied.

A Casino refurbishment

The case concerned the specification, approval and installation of ACPs to the external façade of the Star Casino in Sydney as part of refurbishment works which comprised three projects.  

ACPs were specified, approved and installed to the external façade of two buildings in the casino complex. The ACP product was ‘Alpolic FR’, a ‘fire-rated’ (FR) ACP with a lower percentage composition of polyethylene than comparable non-FR products.

The works occurred between 2014 and 2016, around and following the Lacrosse tower fire in Melbourne. In 2017, over a year after completion, and following the Grenfell Tower fire in London, the NSW Government ordered Star Casino to remove all ACPs from the buildings.

After complying with the order, Star Casino launched a claim against its builder, alleging that the builder had breached its contract with Star Casino because the ACP cladding contravened the then-applicable requirements of the BCA.

The second project was a refurbishment of the Darling VIP Gaming rooms in the Darling Hotel. The court found that, on the evidence, the installation of the ACPs on the external façade complied with the BCA at the time of installation through application of the attachment concession. Star Casino’s claim against the builder therefore failed. 

The former ‘attachment concession’

In New South Wales, a construction certificate approving construction of a building cannot be issued by a certifying authority unless the proposed building would be compliant with the BCA at the time of issuing the certificate.

The Darling Hotel was a mixed-use building, classified as a hotel and an assembly building. The BCA requires that buildings of these classes with a height of greater than three storeys be of “Type A Construction”, being the most fire-resistant type of construction.

Accordingly, clause 3.1(b) of specification C1.1 of the BCA required the external walls of the Darling Hotel to be non-combustible. At the relevant time, clause 2.4 of the same specification permitted some use of combustible materials as “attachments” to building elements if certain conditions were met.

Clause 2.4 of Specification C1.1 provided as follows:

2.4 Attachments not to impair fire-resistance

(a) A combustible material may be used as a finish or lining to a wall or roof, or in a sign, sunscreen or blind, awning, or other attachment to a building element which has the required FRL [fire-resistance level] if –

(i) the material is exempted under C1.10 or complies with the fire hazard properties prescribed in Specification C1.10; and

(ii) it is not located near or directly above a required exit so as to make the exit unusable in a fire; and

(iii) it does not otherwise constitute an undue risk of fire spread via the façade of the building.

(b) The attachment of a facing or finish, or the installation of ducting or any other service, to a part of a building required to have an FRL must not impair the required FRL of that part.

This “concession” was removed in BCA 2016 Amendment 1 in 2018.

Star Casino and the builder disagreed on the application and scope of this attachment concession.

Competing positions regarding clause 2.4

Star Casino’s position, relying on the expert opinion of a fire safety engineer, was that clause 3.1(b) took precedence over clause 2.4 and, therefore, anything attached to an external wall had to be non-combustible. It argued that clause 2.4 could not have applied to the ACP in question because the ACP cladding was part of the external wall and not an ‘attachment’ like a ‘sign, sunscreen or blind (or) awning’.

The builder’s position, relying on a competing expert opinion of a fire safety engineer, was that the ACP cladding was an attachment because it was not fulfilling a characteristic function of the external wall. A lining and, in some cases, a concrete structure was beneath the ACP, while insulation was not installed beneath the ACP. The builder’s expert stated that clause 2.4 was satisfied as the Alpolic FR used complied with the relevant fire hazard properties, there were no exits made unusable during a fire because of its use, there was no undue risk of fire spread via the façade because of its use, and there was no impairment of a required fire resistance level.

The court’s ruling 

In its decision, the court followed established principles of interpreting the BCA as a technical document for use by industry and found clauses 3.1(b) and 2.4 operated harmoniously. If the external wall was constructed of non-combustible material, and there was then an attachment to that external wall which met the criteria in clause 2.4, then applicable sections of the BCA were satisfied, according to the court.

The court stated that an ‘attachment’ in clause 2.4 is not limited to the likes of ‘signs, sunscreens, blinds or awnings’, concluding: “As a matter of principle, there was nothing to prevent an ACP being attached to an external wall of a building required to be of Type A construction so long as it satisfied the criteria in clause 2.4. Whether that was so will depend upon the particular features of each project.”

The court accepted the evidence from the builder’s fire safety engineer and found that although the Alpolic FR cladding used on the second stage of the Star Casino project was not non-combustible, it met the conditions of clause 2.4 in specification C1.1 of the BCA. 
The court accepted that the cladding met the criteria of clause 2.4, including that the product met the fire hazard properties as it had been certified as a “Group 1 material” under a CodeMark certificate; that none of the building’s exits sat directly beneath or unprotected from the ACP; that fire testing showed the material did not spread fire sideways across the façade and did not create an undue risk of fire spread; and that the panels were not installed on any part of the building that required a fire resistance rating.

On that basis, the court concluded that the ACP installation complied with the BCA and with the legislation in force at the time. As a result, the builder was found not to have breached any of its contractual warranties to Star Casino in carrying out the works. 

Takeaways

This decision reinforces to building industry participants faced with a claim for defective work arising out of the historical proposed use, approval and installation of ACPs cladding that each case must be carefully considered on a case-by-case basis.  Properly based expert evidence remains critical in the resolution of such claims.