Liabilities for defective construction

Liabilities for defective construction

The contractor's main obligations are included in the construction contract. For example, agreements regarding the completion of the construction work are stipulated in the construction contract. The law specifies which party is liable in a particular situation. If the contractor fails to fulfill their obligation, the contractor must compensate the client for the damage suffered as a result of this failure. This concerns an attributable fault on the part of the contractor. The contractor is not liable for errors made by other parties involved in the construction work. Consider, for example, an architect who submits an incorrect design. In many cases, the contractor remains liable for the defect for up to two years after completion. In principle, this period begins to run from the moment of completion. However, the statute of limitations for a contractor's liability for hidden and serious defects is longer. If there is a defect in a construction work, it is advisable to seek legal advice immediately.

Do you have questions regarding liability for defective construction? Please contact us.

Liability before and after delivery: the tipping point

Legally, the handover is the pivotal moment in cases of defective construction. Until the moment of handover, the contractor bears the risk for the work. From the moment of handover, liability shifts. Prior to handover, the contractor is subject to a duty to warn: if he detects an error in the design or in data provided by the client, he must issue a timely written warning (Article 7:754 of the Dutch Civil Code). If he fails to do so, he cannot later hide behind the defect in the design. At the time of handover, the client inspects the work; if he accepts the work, it is deemed handed over (Article 7:758 of the Dutch Civil Code). Whether you are an international construction group or an entrepreneur having their business premises renovated: have an independent inspection carried out and record defects in the handover report. What is stated there often determines the outcome of a subsequent dispute.

Visible defects versus hidden defects

The difference between visible and hidden defects determines whether you can still hold the contractor liable. Under the old regime (agreements concluded before January 1, 2024), the contractor was released from liability after completion for defects that the client should reasonably have discovered upon completion (Article 7:758, paragraph 3 of the Dutch Civil Code). However, the contractor remained liable for hidden defects, provided the defect is attributable to him. A hidden defect is a defect that was not visible during a normal, careful inspection and only comes to light later, such as a leaking foundation or a structural defect behind the finish. It is therefore important to carry out a thorough inspection upon completion and to have a defect investigated promptly after discovery.

The Construction Quality Assurance Act (Wkb): liability since 2024

For construction contracts concluded on or after January 1, 2024, a stricter regime applies due to the Quality Assurance in Construction Act (Wkb). Pursuant to the new Article 7:758, paragraph 4 of the Dutch Civil Code, the contractor is liable for all defects that were not discovered upon completion, unless those defects are not attributable to him. Consequently, the distinction between visible and hidden defects loses its sharpness: the contractor can no longer rely on the mere fact that the client could have seen a defect upon completion. In practice, the burden of proof shifts: it is up to the contractor to demonstrate that the defect is not attributable to him. For agreements concluded prior to that date, the old system continues to apply. Which regime applies to your situation therefore depends on the date on which the agreement was concluded.

Private client versus business client

Whether you can deviate from the statutory liability rules depends on who the client is. In the case of a private client (a natural person who is not acting in the exercise of a profession or business), the liability regulations of the Wkb are mandatory: it cannot be deviated from to the detriment of the private individual. In the case of a business or professional client, it is permitted to deviate from the regulations contractually, but this must be explicitly included in the agreement itself and not hidden away in general terms and conditions. For MKB Juristen, this is a key point: whether you are the baker on the corner having your shop renovated, or a corporate entity with an extensive construction program, we assess the scope you have to contractually shift or, conversely, cover risks.

Statute of limitations and duty to complain: act on time

In the case of defective construction, you lose your rights if you wait too long. In fact, there are two time limits you must keep an eye on. First, the duty to complain: if you discover a defect, you must protest to the contractor within a reasonable time (Article 6:89 of the Dutch Civil Code). If you do so too late, you can no longer rely on the defect. Second, the statute of limitations: a legal claim due to a defect after completion generally lapses after two years have elapsed since the client protested in this regard (Article 7:761 of the Dutch Civil Code), with a maximum period of twenty years after completion for hidden defects. Moreover, the contractor cannot exclude or limit his liability for concealed defects that he was aware of (Article 7:762 of the Dutch Civil Code). Are you unsure whether a time limit is still running? Do not wait, as inaction can cost you your right of recourse.

Who is liable? Contractor, architect, subcontractor, or consultant

In the event of defective construction, the contractor is by no means always the liable party. A construction process involves many links: the architect who designs, the structural engineer who performs calculations, the subcontractor who executes, and the supplier who provides materials. In principle, the main contractor is not liable for errors made by other parties involved in the construction, such as an incorrect design by the architect. At the same time, a client can sometimes hold multiple parties liable simultaneously. Determining the correct liable party, and holding that party liable in a timely manner, requires a careful legal analysis of the contractual chain and the actual cause of the defect. Our lawyers and in-house counsel map out this chain for you and determine which party you have the greatest chance of success in holding liable.

Resolving a construction dispute: from liability claim to legal proceedings

A defective construction project rarely leads immediately to legal proceedings. The approach almost always begins with a substantiated notice of liability, in which you put the contractor in default and grant a reasonable period for rectification. If you are unable to reach an agreement together, there are various routes: a second opinion from an independent expert, mediation, or proceedings before the ordinary courts or the Council of Arbitration for Construction Disputes (often applicable if the UAV 2012 has been agreed upon). Which route is the most sensible depends on the stakes, the evidentiary position, and the applicable regime. We guide both small business owners and international corporations through this process, always keeping the balance between costs, speed, and the chance of success in mind.

Real estate and construction: more than just liability

Liability for defective construction does not stand alone. A defect can affect the purchase of a property, tenancy relationships, or other construction law issues. This page is part of our broad Real Estate, within which we also assist you with construction law matters and the dissolution of the purchase agreement. By viewing these subjects in conjunction, you prevent a construction dispute from escalating into an unmanageable conflict.

Are you encountering a defect in your construction work, or are you at risk of being held liable yourself? Our mixed teams of lawyers and in-house counsel, ranging from international corporations to the baker around the corner, are happy to assist you. Please contact us without obligation.