10 Aug 2018

Have Home Owners Warranty Insurers Won A Battle, But Lost The War?

Frank Hicks SC

The Court of Appeal’s decision in Owners Strata Plan 66375 v King is critically important for all members of the residential building industry, including those who are on risk for Home Owners Warranty insurance policies. The decision effectively means that a builder engaged under a “construct only” contract is potentially liable for design defects. This will greatly expand the exposure of the insurers who have written policies to cover breaches of the implied warranties under s.18B of the Home Building Act 1989 (NSW).

On 3 August 2018, the NSW Court of Appeal handed down judgment with respect to the obligations of developers and builders under s18B and s18C of the Home Building Act 1989 (NSW) (the HB Act) in The Owners Strata Plan No 66375 v King [2018] NSWCA 170 (SP66375 v King).

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