Last edited 20 Jul 2017

Defective Premises Act

It is easy to forget that other duties may govern the work of contractors and consultants apart from those set out in their written contracts.

Where a contractor is involved in the construction of a residential dwelling there is an implied term, implied by law, that the contractor will carry out the work in a good and workmanlike manner, that they will supply good and proper materials and that the dwelling will be reasonably fit for human habitation. This common law obligation has now been supplemented by a statutory code set out in the Defective Premises Act 1972 (“DPA”) which came into force on 1 January 1974.

The Act provides that a person taking on work for, or in connection with, the provision of a dwelling owes a duty to the person acquiring the dwelling and subsequent purchasers to see that the work which they take on is done in a workmanlike or professional manner, with proper materials so that it will be fit for habitation when completed.

Section 1(1) of the Act provides:

'A person taking on work for or in connection with the provision of a dwelling (whether the dwelling is provided by the erection or by the conversion or enlargement of the building) owes a duty,

A) if the dwelling is provided to the order of any person, to that person; and
B) without prejudice to paragraph A above to every person who acquires an interest (whether legal or equitable) in the dwelling; to see that the work which he takes on is done in a workmanlike or, as the case may be, professional manner with proper materials and so that as regards that work the dwelling will be fit for habitation when completed’

The DPA applies to the provision of new dwellings, extensions or conversions and the defects must be significant to render the dwelling unfit for habitation. This could clearly affect contractors and consultants when constructing/designing residential properties. Whilst contractors and consultants may in their written contracts seek to limit or exclude liability for losses, they cannot exclude or limit liability under the DPA to the current or subsequent owners.

The DPA is restricted to the provision of dwellings and does not apply to commercial developments. There is also a statutory exception: Section 2(1) provides that where the construction of the dwellings is subject to 'an approved scheme' the Act does not apply. The National House Building Council operates a warranty scheme for dwellings that is approved under the Act.

The Act prohibits any attempt to exclude its operation by section 6(3), which makes void any term in a contract that purports to exclude or restrict the operation of the Act.

For defendants to be caught by the DPA it must be proven that they developed the dwelling in the course of a business. In the 2013 case of Zennstrom & Anor v Fagot & Ors, circumstances proved the defendants were not property developers; they were just building their dream home. Compelling evidence that supported this were the bespoke features installed, such as an entertainment system and art work, together with evidence from friends, neighbours and their architect that the house was to be their dream home. Also, significantly, the property did not benefit from an NHBC certificate which it might have, had it been developed by a property developer.