SACSC – Construction Disasters – what happens next?

On Tuesday 24 May thirty of Kwazulu-Natal’s leading property developers, construction companies and industry professionals gathered at Umhlanga’s Oyster Box Hotel to listen to leading South African attorney Richard Hoal speak on construction disasters at a Special Industry Groups (SIGS) breakfast organised by the Kwazulu-Natal Chapter of the South African Council of Shopping Centres.

Mr Hoal, who is an expert on construction disasters, also heads the Construction, Engineering and Infrastructure Law team at Durban-based Cox Yeats Attorneys. He has been involved in two Commissions of Inquiry in the past three years, including the November 2013 Tongaat Mall collapse which killed two people and injured 29 others, and more recently the October 2015 Grayston Bridge collapse in Sandton which also resulted in two fatalities, and which Commission of Inquiry commences on 7 July 2016.

Mr Hoal provided some insights into the Tongaat Mall collapse – the size of one and a half rugby fields – where he said the developer, Rectangle Property Investments, commenced construction without approval from the local authority, and further ignored a High Court interdict to stop all building works.

A day after Hoal’s presentation at the SACSC SIGS in Durban, it was reported by local media that Labour Minister Mildred Oliphant had announced in Cape Town that the Department of Labour had completed its report and would be recommending prosecution for those found responsible for the part collapse of the R208 million Tongaat Mall, and that the matter was being referred to the National Prosecuting Authority (NPA) for further consideration. In its as yet unreleased report the Department of Labour has purportedly said that the developer contravened the National Building Regulations & Building standards Act by beginning construction before getting approval from the local authority, as well as the Occupational Health & Safety Act by failing to act, and in doing so caused and injury and death.

Hoal advised the group that although no one in South Africa had previously received a jail sentence for any past construction disasters, that it was likely that Department of Labour and the NPA would take a much tougher stance going forward. He said that in addition to building contractors, company owners, CEO’s and MD’s of Employers and even the professionals involved in any such disaster, were all individually at risk to be found both criminally and civilly liable in future cases, and could potentially face jail time over and above paying admission-of- guilt fines.

In conclusion Hoal spoke of the severe reputation and financial disaster that follows any company or professional facing a construction disaster, and where consequential damages can be infinitesimal. He said that the only way to mitigate such possible damages and avoid possible criminal prosecution, would be to ensure compliance with National Building Regulations; to give 100% real focus and priority to Occupational Health & Safety – and not just pay lip-service in this regard; that one had a full professional team in place and that all parties had written, signed contracts defining each parties’ scope of works, and the full extent of their roles and responsibilities; and lastly for all stakeholders to ensure that adequate insurances and public indemnities were in place.