Contractor's Liability for Defects in Construction Contracts

CONTRACTOR'S LIABILITY FOR DEFECT IN CONSTRUCTION CONTRACTS

The Construction Contract in Return for Floors, to which the work contract provisions of the Turkish Code of Obligations apply, is a bilateral contract where the owner of the real estate (land) subject to the contract transfers a certain share of the land to the contractor, and the contractor, in return, delivers to the land owner a certain number of independent sections built on the land in question. When it comes to the form requirement of the contract, while the work contract is not subject to any form requirement, the official form requirement applies to construction contracts. In other words, a construction contract that is not notarized will not be considered valid by law.

In construction contracts, the contractor is obliged to create a structure that is suitable for the intended use agreed in the contract and to deliver this structure to the owner in return for the owner's obligation to pay the price. The contractor is obliged to deliver the structure without defects. The owner, on the other hand, is obliged to inspect the work as soon as possible according to the ordinary course of life after the delivery of the work to him and, if there is a defect, to notify the contractor within an appropriate period of time.

Types of Shame

  1. Open Shame According to Article 474/1 of the TCO, these are defects that are visible upon inspection.
  2. Open acceptance of the construction by the owner with its defects, acceptance without inspection or notification of defects shall relieve the contractor from liability for defects.
  3. Hidden Shame  Defects that cannot be seen visually and are difficult to detect with the inspection of the construction.
  4. Material Shame  Defects where the physical characteristics of the work do not have the agreed or expected qualities in accordance with the principle of trust.
  5. Legal Shame  It refers to defects that arise in the work due to the rules stipulated by the legal order.
  6. Economic Shame  The lack of economic quality in the work.

Conditions of Liability for Defects

  1. Delivery of the Construction:

In order for the owner to apply for liability for defects, the work must be completed and delivered. Receipt of the work is an indication that the construction has been completed as a rule; however, it has not yet been determined whether the construction is defective or not. The fact that the construction is defective does not prevent the performance of the delivery obligation. Upon delivery, the landowner will have the opportunity to determine the defects in the work by inspection.

  • Defects in the Work:

Defect in the work contract; the existing qualities of the work are different from the qualities that should be present or the qualities of the work that should be present

does not bear any defects. The work to be created by the contractor must be in accordance with the contract in a way to meet the performance interest of the owner, in other words, it must be a work without any defects. If the construction does not meet these qualifications, the responsibility of the contractor will come to the fore.

In some cases, the contractor guarantees that the construction will have these promised qualities by specifying some issues specifically. In this case, if the work does not have the qualities promised by the contractor, there is a defect.

  1. Defect Detection and Notification Obligation:

The owner is obliged to notify the contractor of any defects discovered after the inspection. Pursuant to Article 474 of the TCO, “- After the delivery of the work, the owner is obliged to inspect the work as soon as he has the opportunity in the ordinary course of business, and if there are defects, to notify the contractor within a reasonable time.” If the owner fails to fulfill his obligation of inspection and notification, he will not be able to assert the contractor's liability for defects. The said inspection must be carried out in a diligent manner. Because failure to notify the defects that can be detected by a diligent inspection within an appropriate period of time means that the owner accepts the work with these defects. The obligations of inspection and notification are a condition required by the law for the emergence and exercise of the rights of the owner of the work due to liability for defects, which are listed in Article 475 of the TCO.  

TBK M.475: In cases where the contractor is liable for defects in the work, the owner may exercise one of the following optional rights:

1. If the work is defective to the extent that the owner cannot use it or cannot be forced to accept it in equity, or if it is contrary to the provisions of the contract to the same extent, rescission of the contract.

2. Retaining the work and asking for a discount in proportion to the defect.

3. Request that the work be repaired free of charge at the contractor's sole expense, unless this would entail an excessive expense.

In the case of a defect that occurs later, pursuant to Article 477/3 of the TCO, ”If the defect in the work is discovered later, the owner is obliged to notify the contractor without delay; if he fails to do so, he is deemed to have accepted the work.”

Stj. Av. Ecenur UĞURLU