Multiple breaches of the Code covering pre-sale, exchange, occupation and after-sales

The buyer’s claim

The buyer claimed the builder supplied the home in a sub-standard and unusable state and failed to deal with the issues in a reasonable time.

In addition, the buyer claimed numerous breaches of the Code including changes made to the design of the home without prior consultation, misleading sales and advertising material, not receiving realistic timeline details for construction and completion, not receiving  health and safety information for occupying the home whilst other building work was in progress and inadequate customer service with poorly trained staff.

The buyer requested compensation of £15,000 for the costs, inconvenience and distress.

The builder’s defence

The builder did not respond to the buyer’s claim.

The adjudicator’s findings

As the buyer had accepted two cash settlements from the home warranty body, under the rules of the Consumer Code Scheme, the adjudicator excluded the elements of the dispute which related to the prior settlement.

As the builder provided no defence or response to the buyer’s claim, the adjudicator considered the buyer’s claim on its own merits, assuming the account of the buyer to be true unless there was a lack of evidence or consistency in their account.

The adjudicator found multiple breaches of the Code:

• The buyer was not provided with a copy of the Code and Scheme with the reservation agreement, so they were unaware of the Code until they discussed the issues with the home warranty body
• The builder did not have suitable systems and procedures to ensure it could reliably and accurately meet the commitments on service and procedures. Customer service was insufficient and the buyer was left to seek out information themselves
• Staff had not been trained in advising buyers on the health and safety precautions required when living on a development where building work was still underway
• The home had been marketed as a high end, luxury property built to the highest standards whereas it was supplied at variance with multiple standards and of inferior quality and finish
• Major changes were made to the materials and layout of the home which were not drawn to the attention of the buyer, nor discussed with them
• The buyer was not given reliable or realistic information about completion of construction or the date of legal completion and handover. The buyer was given occupation of the home without a functioning kitchen or washing facilities
• There was no adequate after sales service and nobody in place to provide this service. Further, the buyer’s access to the website provided for raising issues was revoked and their previously logged issues were deleted.
• The complaints were not dealt with in a reasonable timeframe leaving the buyer eventually to take measures to remedy some issues themselves
• The builder did not cooperate with the inspector from the home warranty body.

Learning points

For buyers:

• Knowing the requirements set out in the Code will help you identify when things aren’t right and source help when you need it.
• Some types of complaints sit outside the Code Scheme but may be covered by the home warranty scheme. If you’re unsure, contact your home warranty provider or our contact centre for guidance on how to proceed.
• The Code’s Independent Dispute Resolution Scheme (IDRS) can only review cases that haven’t already been assessed or settled via a different scheme. However, bringing a dispute to the IDRS does not prevent you taking matters further, such as taking legal action should you wish to. The courts may take into account the outcome of an IDRS dispute in their decision-making.

For builders:

• Failing to comply with the Code can have costly consequences, not only in recompense but also in reputation.
• Initial errors can easily escalate if they are not dealt with promptly and fully. Failing to respond adequately to complaints is one of the most common causes of disputes handled by our Independent Dispute Resolution Scheme (IDRS). The code provides lots of useful guidance on how to handle complaints effectively including our Right First Time factsheet on handling customer complaints. Section 5.2 of the Fifth Edition of the Consumer Code Scheme with Builder Guidance also sets out the expected responses and timescales for handling complaints.
• Don’t ignore the IDRS. Independent adjudicators can only reach decisions based on the evidence submitted. If you fail to respond to a request for information, the adjudicator is likely to take the buyer’s evidence at face value without considering your view. Ignoring a request for evidence will not make the dispute go away.