Posts

Conflicts with a building contractor

Hiring an inaccurate building contractor can cause a lot of issues. This blog will inform you on what to do when conflicts with a building contractor arise. In general, the contractor has a duty to heed any orders and directions issued by or on behalf of his client. He has to carry out the work properly and thoroughly in accordance with the provisions of the agreement in question. Additionally, the contractor is liable for any damage he inflicts on a client’s other works and property. He is liable for all damage caused by the execution of work and attributable to negligence. However, carelessness or improper conduct on the part of the contractor also falls under this liability. Including the damage caused by the contractor’s staff, subcontractors or suppliers.

Whether the contractor fails to fulfill his contractual obligations, strongly depends on the specific circumstances of the case. First, it needs to be clear on what work(s) the parties have agreed. The offer, final agreement and further correspondence provide a frame work to give more clarity on this subject. Secondly, there will need to be proof of the defect itself. Again, this strongly depends on the agreements regarding the quality, time frame, and quantity of the works.

Notice of default and conversion statement

In most cases, the contractor has the right to correct his errors. This is because an agreement cannot be terminated easily under Dutch law. Therefore, the client needs to call the contractor to account as soon as possible and give him a deadline in writing to perform properly or to correct the defect. This is called a notice of default. If the contractor does not comply within the set (reasonable) time, he runs a great risk.

Depending on the seriousness and scope of the breach, the client has multiple options, such as (partial) termination, suspending his obligation to pay, or opting for a conversion statement (in Dutch: ‘omzettingsverklaring’). With such a declaration, the client can convert the obligation to perform into an obligation to pay compensation. The contractor can then no longer perform the contract, and is obligated to compensate the client for the damages; in most cases the costs of hiring a third party to finish the works. Once a conversion notice has been sent, the client cannot rescind the contract.

Risks


Please note that short delays or minor defects do not justify termination or making a conversion statement. If the client acts unduly expeditiously, he could actually be the one failing his contractual obligations by not paying the agreed sum or refusing the contractor to finish the works. This makes the contractor the party who may terminate the contract.

Summarizing, it is very important for the client to take all necessary steps in a well-considered way, since you cannot easily undo your (legal) actions. Therefore, we advise you to let an independent building contractor or building engineer review the works, since their reports can be crucial for rightfully taking the necessary legal steps. After this, a lawyer can assist you in taking the next steps, depending on the nature and seriousness of the defects.

 

If you have any questions regarding conflicts with a building contractor, please do contact us.