As Parliament aims to drive up new standards of building in England, the Code of Practice and a new Act will significantly improve the rights of homeowners and those affected by poor quality building work.
Homeowners have for a long time faced difficulties in getting compensation if their home turns out to suffer from building defects, especially if they did not buy the property from the builder.
In most cases, no claim could be brought more than 6 years from when the property was built, and even then, a claim depended on the wording of the contract. The problem was even worse for those who were second or subsequent owners as they did not have a contract with the builder.
In the past, some protection was supposed to be given via the NHBC Warranty Scheme, or similar warranties, but the process was fraught with difficulty and rarely gave homeowners any satisfaction.
As a result of these difficulties, England saw a plague of poor-quality house building and many thousands of people living in defective homes where they faced having to pay to put matters right themselves.
In 2015 the position improved slightly with the introduction of the Consumer Rights Act 2015, although this only gave rights to those who brought their property from the builder.
The horror of the Grenfell disaster coupled with the increasing realisation of the scale of the house building problem triggered two significant changes, one of which has already come into effect and the second of which will come into effect before the middle of 2022.
The New Homes Quality Code of Practice
The New Homes Quality Board has responsibility for overseeing the build quality and the customer service provided by developers of new homes and strengthening the complaints handling process of developers and has published a Code of Practice. While registration with the board will be voluntary, it is expected that the great majority of developers will sign up to the scheme as membership will be a positive marketing feature. A lack of registration would likely make it difficult for developers to sell their houses.
The code will be backed up by the New Homes Ombudsman Service, where complaints will be dealt with online. The Ombudsman has statutory power to make builders carry out remedial work and pay compensation.
The operation and enforcement of the Code of Practice should speed up the time taken to deal with defects in new homes and avoid the time and expense of going to court.
The Building Safety Bill
The Building Safety Bill is currently going through Parliament and is likely to come into law mid-2022. As the name suggests, the emphasis is on safety, and the changes will be achieved by amending and extending existing laws (the Defective Premises Act 1972 and The Building Act 1984).
The important point to note is this legislation will cover claims by owners who did not purchase their property from the builder and for those who did, creates a much longer period in which a claim can be made.
Claims are now possible up to 30 years after the work was carried out
Under the new Act, it will be possible to claim any time up to 30 years from when the work was carried out, if it was carried out before the Act comes into effect.
Further and unusually, the Act will be backdated i.e. it will immediately apply to work carried out up to 30 years ago.
In addition, for any work carried out after the date on which the Act comes into force, it will be possible to make a claim up to 15 years after the time when the work was carried out.
In another important change, the scope of the Defective Premises Act is being extended. Originally it only covered work carried out in connection with the “Provision” of a home (i.e., the original design and building of the property). When the Act comes into force, it will also cover the refurbishment of homes and extensions. However, these particular changes will only apply to work carried out after the new Act comes into force.
Claims under the Building Safety Act will still have to be made through the courts
In the past, builders had tried to avoid liability by arguing that they carried out the work to the standard current when the work was carried out. This will not be a defence to new claims as the test is not one of fault but only as to whether the property is fit to be lived in and existing decisions of the courts show that a realistic approach is taken when answering that question.
It is also important to note claims are not restricted to those who own or lease the property; a claim can be brought by anyone who suffers injury or damage to their property if that injury or damage was caused by the failure to comply with the Building Regulations.