New Build Disputes

The number of new build properties across the United Kingdom is increasing and with it so are disputes. Common new build disputes include:

1. A failure to comply with the contractual timeline upon purchase of an off plan property. 

2. Foundation related problems.

3. Poor quality workmanship and finishing.

4. Structural defects.

5. Developers going bust.

Whilst defects could be minor (known as “snags”), there may be larger more problematic issues resulting in possible contractual or tortious claims being brought.

Before investing in a new build property, it is worth checking the financial stability of the developer and in particular whether the developer has much by way of assets. Where a developer becomes insolvent, there is a possibility that the company’s liquidator may attempt to sell the contracts to an alternative developer to enable the new build project to complete. This process could result in delays and result in the purchaser bringing an end to the contract and claiming the deposit. The risk, however, is that the deposit has been used to fund the development and therefore, is no longer available for the purposes of a refund.

A purchaser will need to carefully review the terms of the contract and understand whether there has in fact been a breach of the contract. If there has been a breach, there may be a possible claim against the developer for breach of contract. Our lawyers can assist you with assessing the merits of this claim.

If you have entered a new build contract as a consumer, you may have rights under the Consumer Code for Home Builders. The code requires the developer seller to provide reliable and realistic information about when the construction of the property may be finished, the date of completion and the date of handover of the property. If the developer is a participating developer under the code there is a low cost dispute resolution mechanism which can be used.

New Build warranties are put in place to provide homeowners with full peace of mind and to ensure any defects in new homes are covered and will be put right. NHBC is the UK’s primary provider of insurance for new builds. The warranty means that the builder is responsible for correcting any problems or repairing damage if they have not built the property in line with NHBC standards. Generally, after the third year of the warranty, it usually only covers major defects.

The solicitors at WYN Legal have significant experience in acting for purchasers and sellers on a variety of contractual and tortious disputes when it comes to new build projects. In particular, we can assist with the following:

1. Carryout due diligence and financial report on a developer prior to you purchasing an off plan or new build property. 

2. Reviewing and negotiating new build contracts.

3. Assessing the merits of a potential breach of contract claim.

4. Claiming or defending a potential claim.

5. Representing you throughout the mediation, adjudication or court process should this be necessary.

Consumer Code For Home Builders