Lacrosse residential tower decision

The much publicised fire on 24 November 2014 resulted in estimated losses exceeding $12 million as a result of the rectification of the aluminium composite panels with a 100% polyethylene core on the southern wall of the tower. 

Whilst the original Builder agreed to replace the panels, the subsequent Court proceeding analysed the selection, approval and installation process of the panels which enabled the fire to spread so as to apportion blame.

Whilst the Builder was found primarily liable to the Owners due to its breach of warranties in relation to suitability of materials and fitness for purpose, the Court found that the Builder did not fail to exercise reasonable care.  In fact, the Court found that there was no evidence that the Builder had failed to take reasonable care and no evidence that the Builder acted other than entirely reasonably and in accordance with what would be expected of a reasonably confident Builder, viz:-

          … for a large and complex project, [the Builder] sought to cover acknowledged shortcomings in its own expertise, by engaging highly skilled professionals to direct and supervise its           construction work.

Instead, the Court found the following parties responsible:-

• Fire Engineer – 39%;

• Building Surveyor – 33%;

• Architect – 25%; and

• Tenant (who failed to put out his cigarette) – 3%.

The basis of those findings was as follows:-

• Building Surveyor – failed to exercise due care and skill in issuing the building permit which approved the Architect’s specification of the panels described as ‘indicative to Alucobond’ and failed to notice and query the incomplete description of the cladding systems in the fire engineering report;

• Architect - failed to exercise due care and skill by failing to:-

            (i)    remedy defects in its design … the specification and drawings provided for extensive use of the panels on the facades; and

            (ii)   ensure, as the head design consultant, that the panel sample provided by the Builder was compliant with the Architect’s own design intent articulated in the specification;

• Fire Engineer – failed to:-

            (i)    conduct a formal engineering assessment of the Lacrosse Tower and include the results of that assessment in its fire engineering report;

            (ii)   recognise that the panels proposed for use in the construction did not comply with the Building Code of Australia; and

            (iii)   warn the Builder of that fact.