The Importance of The Right Build Agreement

25th April 2019

In today’s house building industry, many build defect problems arise from a poorly constructed build agreement between developers and contractors. Usually in years 1-2 of the 10-year structural warranty, every developer has an obligation under the terms of the warranty that they need to provide after care. This period is usually referred to as the ‘Builder’s Rectification’ period.

 

So, when a new homeowner reports a legitimate build defect during this period, the developer is obligated to remedy the problem at no expense to the homeowner and within a reasonable time frame. A well written agreement will contain a section covering ‘After Care’ and it will set out what is expected of the contractor when problems arise.

 

The JCT agreement and After Care

 

The JCT (Joint Contracts Tribunal) agreement details the process of delivering a building project, setting out the responsibilities of the parties and their obligations to each other and, in the case of disputes, how they should be resolved.

 

When it comes to the after care, the terms of defect management for the property need to be addressed within the contract. The points raised need to cover the following:

 

  • The definition of a build snag
  • The process for addressing snags
  • The definition of a build defect
  • The categorisation of a build defect (Emergency, Urgent, Routine etc.)
  • The process the developer shall apply when a legitimate build defect is reported
  • The response required of the contractor
  • The consequences to the contractor when they fail to respond
  • The term during which these conditions shall apply
  • The start-point for the term

 

If the agreement is not sufficiently detailed and specific problems will arise later on.

 

How can this problem occur?

 

In an ideal world, the contractor’s obligations should mirror those of the developer. However, this is often not the case leaving the developer exposed when defects need attention.

 

How can After Build help?

 

At After Build, we work with new home developers and their contractors (where there is a genuine willingness on the part of the contractor to provide excellent customer support) to improve the terms of after care. This is called a ‘Memorandum of Understanding’, which is a non-binding document of intent and supplementary to the original agreement that most likely was signed some time earlier.

 

The MoU establishes a process with clearer definitions and the expectations of contractors when defects are reported. This provides the developer with a point of reference when things go wrong, so they can work with the specific after care teams to get the problems resolved long-term.

 

However, this does not always apply to situations where the contractor’s only focus is to get away from the site as quickly as possible and never to return. The contractor must show a genuine concern for after care and working with the site manager to provide the best after care for new builds.

 

If you would like some more information regarding the outsourced after care service for new homes we provide, visit the After Build website for more information. On the other hand, if you are looking to have a conversation with our specialists, you are more than welcome to telephone us on 01444 460129. Our team would be more than happy to assist you on your journey to providing the best after care for new homes.

 

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