Introduced in the wake of the Grenfell Tower disaster, the Building Safety Act (BSA) 2022 aims to improve the safety of all new buildings (not just high-rise properties).
One of its most significant changes is tucked away in Section 135, which inserts new wording into the Limitations Act (LA) 1980, extending the limitation period for claims under Section 1 of yet another piece of legislation, the Defective Premises Act (DPA) 1972. This could have a significant impact on anyone building, extending or renovating their home.
Prior to the BSA, claims related to defective premises could generally only be brought within six years of completing the construction work – which just happens to line up with the effective period of a professional consultant’s certificate (PCC). The updated Limitation Act extends this time limit as follows:
The BSA also introduces a new prospective right of action against any person who “takes on work in relation to any part” of a dwelling. This means claims may now also be brought in respect of any refurbishment or remedial works completed on an existing building after 28 June 2022, subject to the 15-year limitation period.
Under the DPA, anyone involved in the construction of a residential property has “a duty of care to any person who acquires an interest in a dwelling” to carry out their work in a workmanlike or professional manner, such that the property is “fit for habitation” upon completion.
This is good news if you plan to live in your home until the end of time; less so if you plan to sell before then. That’s because the DPA goes on to say that a person who “arranges for another to take on work for or in connection with the provision of a dwelling shall be… included among the persons who have taken on the work.”
A key step is to keep full records: contracts, product logs, photos of works in progress, dates professionals were on the site and everything in between. This is the minimum you would probably need to defend or launch a legal case, whether you put additional protection in place or not.
A professional consultant’s certificate (PCC) is sometimes viewed as an effective route to protecting yourself against a future claim. However, a PCC relies on that professional’s indemnity insurance, which only covers negligence. So, if a future owner pursues you for a defective property, you’ll need to prove professional negligence (assuming it’s within the first six years of certification). This could be a futile, costly and time prohibitive process. Don’t forget, the claimant has as much as 15 or 30 years to pursue you.
The Building Safety Act covers the design, construction and ongoing maintenance of new dwellings. Photo: iStock.com/Wichayada Suwanachun
In addition, with a PCC, you may be excluded from making a claim at all in the first 12 months – not helpful, given most defects arise in the first two years. PCCs are cheap for a reason, and their function as a risk management tool is very limited. We’re starting to find that some lenders are now reconsidering whether to accept them.
A self build structural warranty gives far better cover over a much longer duration of time. Crucially, that cover starts from day one. These products are suitable for extensions, renovations, remodels etc, too. You should always obtain your warranty from a recognised provider and ensure it doesn’t have a two-year defects period. A good policy is transferrable to the future buyer of a property and, unlike a PCC, there is no requirement to prove negligence in the event of a claim. So, it’s a more comprehensive and robust solution.
Ideally, look for a warranty that includes cover for failure to comply with Building Regulations. The Limitations Act provides a right to claim for damage suffered as a result of a breach of Building Regs. This part of the LA has never been enacted but, given the BSA amends the same section, it’s likely this will come into force in the near future.
In essence, the BSA aims to provide greater protection for homeowners, providing new options to seek redress for defective building works. So, prepare and manage your exposure (or recourse opportunity) by taking action now. Structural warranties are available retrospectively, even after you have completed the project, to give you the cover you need.
Simon Middleton is managing director of Protek Group. Since starting his career as a site engineer, he has been underwriting site insurance and structural warranty in the self build and construction sector for over 25 years. For more information speak to the team by calling 0333 456 8030 or go to Protek’s website. |