Recent Order made under the Design and Building Practitioners Act: Are easements now required for ground anchors under a neighbouring property in NSW?

On 1 July 2021, the Particulars for Regulated Design Order 2021 came into effect in NSW.  This requires regulated designs for ground anchors to include evidence of a registered easement for the ground anchors.  Previously, developers and contractors have frequently relied on simple contractual licences rather than registered easements for such rights.  They need to prepare for this new requirement to avoid delays for residential development projects.

The new Order specifies additional conditions for a ‘regulated design’ under section 5(3) of the Design and Building Practitioners Act 2020 (D&BP Act), in particular a requirement to provide evidence of a registered easement where installing ground anchors under neighbouring properties.  This ‘minimum requirement’ for a registered easement is also specified in the D&BP Act’s Regulated Design Guidance Material and Design Practitioners’ Handbook.

Effect of the Order under the D&BP Act

In effect, if a ground anchor is required to extend onto a neighbouring property in the construction of a class 2 building or mixed-use building with class 2 elements, a registered design practitioner will not be able to give a design compliance declaration without there being a registered easement over the neighbouring property for the ground anchor.  Building work, including the installation of a ground anchor, cannot commence without that declaration.

By operation of the transitional provisions in the NSW Design and Building Practitioners Regulation 2021 (Regulation), this requirement for a registered easement applies to building work that commences after 1 July 2021 even if the design was prepared before 1 July 2021.

The requirement does not apply to ground anchors under a neighbouring public road where a consent under the NSW Roads Act 1993 has been granted by the local council as roads authority.

The responsible Minister for the Order has not provided any reasons for the requirement of a registered easement for every instance of a ground anchor onto a neighbouring property in residential construction.

An easement offers extra benefits to a developer, namely an interest in the neighbouring property.  However both developers and burdened landowners typically prefer to negotiate a ground anchor licence for access to the neighbouring property because the reliance upon the ground anchor is usually short term.  Once the development rises the anchors are de-stressed.  A licence is usually a relatively simple contract and can be agreed without the need for additional formalities such as registration, financier consents or, in some cases, special resolutions of the burdened landowner.  All of the additional requirements result in extra time and cost for the developer.

Be prepared

For building work commencing from 1 July 2021, developers and builders in NSW must prepare for this new requirement.  It is essential to:

• assess the need for ground anchors early on and commence the easement process
• factor in an allowance of time for this process into the construction programme
• if negotiations to obtain an easement are proving unsuccessful, you may need to make an application to the Supreme Court for an easement under section 88K of the Conveyancing Act 1919
• take care in preparing and executing the easement to limit requisitions and processing delays
• consider whether a need for a variation to an existing design arises from this Order. This may require re-engaging designers to prepare new regulated designs or engaging a new registered design practitioner

If you have any further inquiries about how the Order, D&BP Act and Regulation may affect your project or business, please do not hesitate to contact Adam or Divya or another member of our NSW Construction and Infrastructure team.

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