Experts say the legal mess left by the botched townhouses is a prime example of the Victorian Building Authority failing to do its job despite a decade of complaints.

The authority came under fire in 2015 from the Auditor-General for failing to act when construction projects went wrong. The findings led the Andrews government to change the state's building act.

But the case of Tony Veleski, a retired Australia Post worker who bought his Footscray site 17 years ago, shows an industry still rife with problems.

In 2015, construction on Mr Veleski's long-planned twin townhouses started.

His project was signed off at multiple stages by building surveyor Adam Petryshyn of Petracon Building Surveying Group.

Mr Veleski's builder - constructing the townhouses for just $480,000, less than half what experts said was an appropriate price - went bankrupt.

After a range of flaws were identified with the work signed off by the building surveyor, the Victorian Building Authority agreed to remove Mr Petryshyn from the job.

But before he could be officially replaced by another building surveyor, Mr Petryshyn visited the townhouses - which he had approved six months before - and deemed them unsafe.

He ordered their immediate demolition.

The Victorian Building Authority, instead of investigating the surveyor's conduct, reinstated him.

The project has left Mr Veleski a financial and emotional wreck, and in substantial debt. "It's caused me anxiety, anger, stress - I've lost a lot of sleep over it."

The two half-completed townhouses were built almost a metre too high, on a faulty slab, an independent building report found.

The unlawful extra height at the base means the townhouses also break ResCode and Maribyrnong Council height limits by 1.5 metres.

Mr Veleski's building overhangs one neighbouring property, and excavation works may have undermined the other neighbour.

A separate building report shows Mr Veleski will have to pay almost $1 million to get the building torn down and the building frame reinstated.

Mr Veleski's surveyor, Mr Petryshyn, in June 2016 found the properties were progressing well and had only minor problems.

Mr Petryshyn told The Age he did not want to discuss the case. The Age later put a range of questions to him via email over his role in signing off stages of the project but then later declaring demolition necessary.

In response he said via email: "I deny allegations of improper behaviour. No further comment."

Craig Little, a Victorian Building Authority spokesman, said Mr Petryshyn had been asked to provide information by this week detailing his mandatory inspections of the slab and frame at the Footscray site.

Mr Little said that, as Mr Petryshyn had failed to provide the information, he would now be investigated.

The authority could give a property owner consent to terminate the building surveyor, Mr Little said.

"But the termination will only take effect once a new surveyor is appointed. The owner of the Footscray property failed to appoint a new registered building surveyor."

Mr Veleski said he had arranged for a new surveyor to take over the Footscray job, but before he could start, a demolition order had been made by Mr Petryshyn.

Sahil Bhasin is general manager of Roscon, a company specialising in identifying building defects. "Everyone is on a mission to cover their own backside" when things went wrong in building disputes, he said.

Due to the privatisation of building surveying from the 1990s, the work done by council surveyors was opened to the private sector. Mr Bhasin said this had been disastrous for consumers.

Mr Bhasin, a former local government employee, said building surveyor powers and responsibilities should be handed back to public authorities such as councils. He said that, since privatisation, building surveyors were regularly not paid enough.

This meant inspections were sometimes not done thoroughly, with surveyors attempting to turn over as many projects as possible to make a profit. Some had up to 10 small residential projects running at once, he said.

And he said many developers and builders enjoyed a close relationship with their building surveyors. They often gave developers special "dispensations".

Phil Dwyer is a commercial builder, and national president of the Builders Collective of Australia, a body representing small firms around the country.

Having read key documents in the case, he said Mr Veleski should have known the price the builder had quoted him was way too low and "always going to fail". He said the surveyor had also ignored crucial issues and still signed off on stages of the project.

But he said the conduct of the Victorian Building Authority made clear it was determined to ignore or divert even the most serious complaints.

Mr Dwyer said it would be better if the authority ceased to exist. "Their inability to undertake their basic role is doing untold damage to the building industry by allowing questionable operators to flourish in an unregulated environment."

In 2015, Planning Minister Richard Wynne and then consumer affairs minister Jane Garrett said new laws they were passing would "simplify" the process of disciplining building practitioners, via the Victorian Building Authority.

They also changed the law so builders no longer appointed their own surveyor.

An earlier 2011 Auditor-General's report found 96 per cent of building permits in Victoria were non-compliant.