Current liability of contractor after completion has had its day

The Cabinet has plans to increase contractors' liability for defects after the completion of a work. The position of principals would possibly be strengthened by amending the Civil Code.

The Civil Code provides that the contractor is released from liability for defects that the client should reasonably have discovered at the time of delivery, known as hidden defects. This means that the main rule is that after delivery, the contractor is no longer liable for defects in the work. The exception to this main rule is that the contractor is still liable for defects that the client should not reasonably have discovered at the time of delivery of the work.

Expertise

The answer to the question of which defects the client should have discovered upon completion depends not only on his own expertise, but also on the expertise of persons assisting him during completion. A consumer who does not allow himself to be assisted by a construction expert during the delivery of his home is less likely to be blamed for not having recognized construction defects at the time of delivery than a professional client who has had himself assisted by an expert executive during the delivery. This example alone shows that the answer to the question of whether the contractor is liable for a defect after delivery depends on the circumstances of the case. The more expertise at and on the side of the principal, the sooner a principal should have discovered a defect upon completion.

This regulation has been criticized in the past. The question can be raised whether it is reasonable that a contractor, while demonstrably having made a mistake, should escape liability because the defense is that the client's consultant should have reasonably recognized a defect at completion and failed to do so. After all, the primary culprit is the contractor and he successfully evades liability in that case. The unconditional involvement of an expert consultant at the time of delivery can therefore cost a client dearly. Especially if the consultant has contracted the client under the applicability of for example the DNR (The New Rules) 2011 and his liability is limited to his fee. In that case a client might miss the boat.

Construction and design defects

Big news recently in the Cobouw and others was that the cabinet wants to increase contractors' liability after completion as it currently stands. According to the PvdA, for example, the position of end users should be strengthened; now, recovering damages after collapses or other construction and design errors would be too complicated. The Institute for Construction Law has also questioned its current regulation of contractor liability after completion.

What any change in the contractor's liability will look like after delivery is not yet known. It is possible that a system will be chosen in which all defects not mentioned in the report of completion will be considered hidden defects and that the criterion "should reasonably have discovered" will disappear from the law. Another possibility could be that the change is more drastic and the contractor becomes unclausibly liable for defects after delivery of the work.

In the coming months, more clarity will emerge on what the contractor's liability after completion may look like under the Civil Code in a few years. A hefty debate about contractor liability has already flared up following the announcement of an imminent amendment to the Civil Code. In the event that the Civil Code is amended, it may also lead to a modification of the UAV (Uniform Administrative Terms and Conditions) 2012, which is widely used in construction. In any case, as it looks now, the contractor's liability after delivery as currently included in the law has had its day.