Canberra developer Michael Koundouris has lost his case over a leaky apartment building in Turner, with the ACT Civil and Administrative Tribunal finding on Wednesday that the building's defects should be fixed.
The result was welcomed by residents, including Mark Farrell, who said he hoped Mr Koundouris would now "get on with fixing up the building".
But Mr Koundouris hit back at the decision on Wednesday night, saying it was wrong and he would lodge an appeal.
"The Manhattan project was completed almost 15 years ago and there is no legal basis for the rectification order," he said. "More importantly, this decision will impact on the ACT economy by encouraging builders and developers, such as ourselves, to invest elsewhere."
The ACT government issued a rectification order against Mr Koundouris in late 2013, requiring him to fix defects in the 32-apartment Manhattan building, including water entering the car-park roof ceilings and walls of units, and from the balconies into units, cracking in the facade, corrosion of steel framework on balconies, failure of waterproofing in bathrooms, defective parapet capping and defects in roofing.
In the long-running case, Mr Koundouris argued that the rectification order was issued too late, outside the 10-year limit after work had finished. Any rectification order should be issued within 10 years of each piece of allegedly defective work, not within 10 years of the whole building being signed off.
But the tribunal rejected the claim, finding instead that the 10 years should be calculated from the notice of intention to make a rectification order – July 2013.
Most of the work was done from October 2002 to July 2003, with the certificate of occupation issued at the end of November 2003. The residents' complaint was lodged at the end of November 2012 and the final rectification order was issued in November 2013.
The case has implications for another concerning Mr Koundouris in Manuka, where he also argues the 10-year limit has expired.
In a third case, residents of the Lagani apartments in Braddon took the developer to the Supreme Court, alleging waterproofing and other defects. In July, the court reserved its decision.
In the Manhattan case, Mr Koundouris argued the problems were a result of faulty maintenance, rather than faulty construction, and that it was reasonable for him to rely on the expertise of subcontractors.
But the tribunal found a series of defects, which it said should be included in a new rectification order.
It pointed to significant cracks more than 1 millimetre wide found in the facade.
Water was entering the basement, causing corrosion in the steel beams holding up the conceded slab above basement car parking, it found. While the original plans had required a waterproof membrane and ceramic tiles to stop water entering the basement, the membrane had been omitted in parts of the basement roof, with Xypex added to the cement instead, and concrete pavers on sand used instead of ceramic tiles. Cracking in the slab had caused water to drip on to cars parked below. The tribunal said the basement roof outside the units should be covered with a suitable membrane and ceramic tiles, with rust removed from all structural steel, and, if necessary, the lintel beam should be replaced.
It said rust should be removed from steel in the balconies. It found water had penetrated through the slab from level three into the units below, and said the level-three balconies should be rectified.
It made no findings about water in ceilings and walls of apartments, saying it didn't have sufficient evidence on which to make a decision, and similarly made no finding about the bathrooms, saying the government had decided not to pursue waterproofing issues there and owners had mostly dealt with the issues themselves.
Mr Koundouris insisted the case showed that building issues "often emanate from nothing more than minor maintenance issues that have been left unattended or on which insufficient money has been spent" and he hoped body corporates would become more aware of the need to keep up routine maintenance. Manhattan not only received a government certificate of occupancy but it won industry awards, he said.
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