Q&As

Does an employer incur liability in respect of a complaint (from a homeowner) that its contractor has completed defective, faulty works (which do not meet the contractor's obligations under the contract but cannot be remedied by the contractor) and that contractor is now (i) insolvent; and (ii) released from any and all liabilities in respect of the works under an earlier settlement agreement between the employer and the contractor? If neither the employer nor the contractor incur liability, where would a complaint in respect of the faulty works be directed?

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Published on LexisPSL on 25/04/2019

The following Construction Q&A provides comprehensive and up to date legal information covering:

  • Does an employer incur liability in respect of a complaint (from a homeowner) that its contractor has completed defective, faulty works (which do not meet the contractor's obligations under the contract but cannot be remedied by the contractor) and that contractor is now (i) insolvent; and (ii) released from any and all liabilities in respect of the works under an earlier settlement agreement between the employer and the contractor? If neither the employer nor the contractor incur liability, where would a complaint in respect of the faulty works be directed?

Does an employer incur liability in respect of a complaint (from a homeowner) that its contractor has completed defective, faulty works (which do not meet the contractor's obligations under the contract but cannot be remedied by the contractor) and that contractor is now (i) insolvent; and (ii) released from any and all liabilities in respect of the works under an earlier settlement agreement between the employer and the contractor? If neither the employer nor the contractor incur liability, where would a complaint in respect of the faulty works be directed?

If the homeowner is, as in this scenario, without any means of seeking recourse directly from the contractor involved in constructing its property, the other party to whom it may look to impose liability, and recover losses that it has suffered, will be the employer. The extent to which it is able to do so will depend, however, on the terms of the contract entered into between the homeowner and the employer and the nature/extent of the defects in the property. The homeowner should consider very

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