What Are Your Defect Duties?

Any client needs to ensure that the works meet the contractual quality standards for goods, design and workmanship. Defects can be spotted and made good in three separate phases:

During Construction

The contract administrator must identify visible defects and exercise her powers before completion and ensures that issues relating to quality and defects do not wait until the defects period.

The contract administrator/client may:

  • ask the contractor to remove work, plant, goods or materials that fail tests or inspection [eg JCT DB 16 cl 3.13.1, NEC3 cl 42.2, MF/1 cl 23.5]
  • exclude the value of defective work from interim certificates [JCT DB 16 cl 4.13.1.1, NEC3 cl 50.2]
  • terminate the contractor’s employment for failure to rectify defects [JCT DB 16 cl 8.4.3, NEC3 cl 91.2, MF/1 cl 35.8(c) and 49.1(d)(iii)]
  • have to confirm that she is satisfied with the works [MF/1 cl 13.2]
  • confirm the performance of the works through testing before and after completion [JCT DB 16 cl 3.1.2, NEC3 cl 40, MF/1 cl 23, 28 & 35].

Obvious or ‘patent’ defects should prevent the issue of the certificate of completion [read more].

Accordingly, the date of completion, all work should conform to the requirements of the contract.

During defects period

The contractor is required to either:

  • make good defects at its cost (a defects liability or rectification period), or
  • keep the works in a specific state of repair and is paid for all maintenance that does not arise from a defect (a maintenance period).

There is a subtle but critical difference [read more] between these two: the second is more time-consuming but results in additional fees for the contractor.  A maintenance period should always make exceptions for fair wear and tear as the works are not meant to stay pristine for a year or more.

In Pearce & High v Baxter, the court said (with some reservations) that the JCT Minor Works wording

can be regarded as giving the contractor a right to make good defects at his own expense, and a licence to enter the property for that purpose

To ‘encourage’ the contractor to return to the project and make defects good, most construction contracts allow the client to withhold some of the money due to the contractor until the end of the defects period, either by a final stage payment or retention.

After defects period

Once the defects/maintenance period has come to an end, the client can bring a claim for breach of contract for any defects which become patent during the limitation period. The client’s claim is for damages to put it in the position it would have been in if the contractor had carried out the contract properly.

Case: Pearce v Baxter [1999] CLC 749 at 751.

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