Construction warranties are often called collateral warranties and create a contractual relationship between those involved in a building project and those who have an interest in the building. These are usually done by deed to avoid the need for money to exchange hands and increases the limitation period for claim from 6 to 12 years, to allow time for defect to come to light.
The provider of the construction warranty is not only warranting to carry out their contractual obligations, but that they will complete the scope of their work to a certain standard. This removes certain defences they would have under usual contract law, and the construction warranty can still be relied upon even if the contract has been terminated.
In the event of a construction warranty dispute, people often choose to act through the courts. However, beneficiaries may be able to refer the dispute to construction adjudication, which is a quick way of having the dispute dealt with as a decision is made within 28 days.
Our corporate solicitors can ensure any construction warranty is beneficial to you, ensuring there are no gaps in the scope of works warranted and advising if the provisions are adequate.
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If you would like to enquire for any matters regarding development agreements please complete our online contact form here or send an email to us at [email protected] and one of our solicitors shall call you back.
Alternatively, please call our corporate solicitors in Manchester on 0161 820 8888 for a no obligation discussion.
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Warranties usually allow two assignments without the beneficiary’s consent with further assignments only with their consent. Consent is often not to be unreasonably withheld, which allows the provider to charge a reasonable fee for further assignments.
The beneficiary needs warranties from all parties who have contracts into which the beneficiary might want to step, or contracts with providers that the beneficiary might want to sue.
These usually include the following.
- The contractor.
- The employer’s agent (sometimes called contract administrator or project manager).
- The architect.
- The structural engineer.
- The mechanical and electrical consultant.
- Sub-contractors with design responsibility, for example steelwork and piling sub-contractors.
The beneficiary needs the original of the warranty and a certified copy of the contract. Warranties are commonly handed over without this certified copy and these are likely to be useless. The beneficiary also needs an expert’s report before commencing a claim.
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