BRegs Blog

A blog to debate the Building Control (Amendment) Regulations (BCAR): The BRegs Blog presents an opportunity for free expression of opinion on BCAR and their implementation. The blog is not representative of any professional body or organisation. Each post represents the personal opinion of that contributor and does not purport to represent the views of all contributors.

Tag: Insurance

Thoughts on a way forward #bregs #JoanO’Connor

by bregs blog admin team

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The Obligations of the State

The involvement of the State in the protection of the interests of its citizens is a legitimate expectation and is an obligation of Government in a civil society. The State cannot abdicate its responsibilities to purchasers and users of property and there are means by which Government could control design and construction quality analogous to the operations of the Revenue Commissioners and their use of licensed auditors as a means of discharging the State’s functions in the control and oversight of business.

What is needed is a State-sponsored, self-funding independent inspection system which is credible and authoritative.

Consumer Needs

The consumer – particularly the house owner – must have easy access to a speedy means of resolving significant defects emerging in recently-completed property [particularly the home] at minimum, collateral costs. The current, Courts-based solution is slow, expensive and adversarial, even if a “mark” is found in the end.

The consumer – e.g. house purchaser – should have access to a guarantee, backed by insurance, to which he has immediate access to deal with legitimate complaints regarding defects. This guarantee – sometimes called latent defects insurance – can be provided, at minimal additional cost which would be carried by the Developer.

Such a guarantee would be mandatory and form part of the chain of conveyance and mortgage funding. LDI brings with it the following advantages in the campaign for better building:

  • Better builders will get insurance cheaper, based on track record, and thus will be able to sell more competitively.
  • Bad builders may be unable to get such insurance, ruling them out of the market.
  • The insurers carry out their own design reviews and site inspections, appropriate to the type of project and the risk profile of the building : another, experienced set of eyes looking at the project.

Increased Complexity of Building in Ireland

A multiplicity of approvals and certificates now required to build and there are numerous appointments to made for all building endeavours – whereas the obligations of the main parties to a building contract with regard to building standards are simple – to design and to build in compliance with the Building Regulations – and this encompasses everything – fire, thermal performance, disability access, structural stability, etc.

Appointments include architect, engineers, QS – PSDS, PSCS, Design Certifier, Assigned Certifier [and statutory notifications of such appointments where required]. Approvals, plans, certificates and consents will now include –

Planning Permission [separate regime].

  • Fire Safety Certificate : €2.90 per sq.m., €12,500 max.
  • Commencement Notice
  • 7-Day Notice : €5.80 per sq.m., €25,000 max.
  • Regularisation FSC : €11.60 per sq.m., €50,000 max.
  • Disability Access Certificate [excluding houses] – €800 plus fees, no time limit for issue.
  • Notice of Assigned Certifier [by Building Owner]
  • Undertaking by Assigned Certifier
  • Notice of Assignment of Builder [by Building Owner]
  • Undertaking by Builder
  • Design Certificate – submission of details, full drawings and specifications to BCA
  • Health and Safety Plan
  • Safety File
  • Preliminary Inspection Plan
  • Inspection Plan
  • Completion Certificate by Assigned Certifier and Builder [and acceptance thereof by the Building Control Authority – “BCA”].

Registration of Builders

Notices issued by Building Employer states that the Owner is satisfied that the person or firm appointed is/are competent to undertake the works …. How is a consumer building a house, or indeed a small shop-owner carrying out some alterations – supposed to know whether a builder is competent or not? The response might be that a check of the Builder’s Register should be adequate but such a register is not in place and will not be in place until 2015 at the earliest.

A voluntary register of builders is a nonsense. Registration with teeth needs statutory backing and would take at least two years to develop. It necessitates the establishment of a registration board, standards and codes of practice, grievance procedures, codes of conduct and the like so that there is fair procedure in the event of a challenge to a builder’s registration.

Registration as a system of recognition or public endorsement is more suited to the individual trader or practitioner – or a single, small firm whose entire activities can readily be encompassed and/or understood. It is less suitable for large, multi-faceted contracting firms with multiple employees of wide-ranging skill levels.

Licensing of contractors could be more appropriate, with builders ranked by competence for projects of varying sizes and complexities. A licence would last for –say – three years and might also be used to exempt firms from pre-qualification procedures or to, de facto, pre-qualify them. There would, obviously, have to be control and complaints procedures of some kind.

The Underlying Purpose of Building Regulations

The primary purpose of Building Regulations is to provide for the health, safety and welfare of people in and around buildings.

Some Impacts of S.I.80

S.I.80 is primarily intended to remedy problems in the speculative residential sector but applies to all buildings and material alterations or extensions to existing buildings, including office and factory fit-outs.

Delays to projects planned to start in early 2014, increased costs – already acknowledged by Government, and protracted procedures at completion and handover, often a critical time for new business or business processes.

Building and construction investment forecast to increase by 5% this year and 7.2% in 2014, subject to conditions – an end to a 6-year decline. But regulatory bottlenecks are cited as a risk – and this is the biggest, avoidable hurdle.

Risks to the Government’s capital programme, including schools recently announced.

Reliance on Professionals’ Insurance

P.I. insurance needs to be in place when damage occurs and/or a claim is made. It is no use if the Assigned Certifier has retired [or been let go] , if his PI has lapsed for reasons of cost or whatever.

The PI insurer will cast his eye around the multiple players in the building works and will sue them all on the basis of joint and several liability whereby one, insured actor with even a minimal liability for the damage can be made to carry all of the costs, even for culpable parties who are no longer in business – “the last man standing”. As architects carry PI insurance, they are often that last man [or woman].

A Way Forward?

Dare we look aim for a radical overhaul of the system to simplify the administrative aspects of building control to focus on essentials such as education, inspection and insurance?

Joan O’Connor, President of the Royal Institute of the Architects of Ireland 1994-1995

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The Consumer and the Contradiction at the Heart of S.I.80

by bregs blog admin team

As industry stakeholders debate with the government on the final wording of the new regulations, we ask has the consumer been forgotten?

In the original wording the Government strategy was to protect the consumer through facilitating people with unsatisfactory buildings to identify a clear legal target – the Assigned Certifier – who is backed by professional indemnity insurance and who may readily be pursued legally.

“The Regulations … give home-owners clarity, traceability and accountability at all stages …. They will provide consumers with the protection they need and deserve. … The mandatory certificates will be clear, unambiguous statements on statutory forms stating that each of the key parties to a project certifies that the works comply with the building regulations and that they accept legal responsibility for their work … this new statutory certification is a key consumer protection measure … If anyone signs a statutory certificate for a building which subsequently proves to be non-compliant, they can be held legally liable for the consequences.”  Minister Phil Hogan 04/04/2013

Putting aside the question of whether making one person responsible for the work of all the others leads to better building, this strategy was found to be unworkable as the role of the Certifier was found to be uninsurable by the insurance industry.

The answer proposed by the industry stakeholders is to allow the Certifier to rely on other peoples’ confirmations and test reports, so that each player is responsible for their own role and the Certifier can obtain insurance. However the more the legal target is diffused, the harder it is for the Consumer with the defective building to obtain redress – and the less consumer protection.

This circle cannot be squared. “Solutions” merely blur the issue, to the detriment of consumer and certifier alike.

From the quarry in Kerry to the glass manufacturer in Spain, the consumer will have to pursue redress through the courts with no guarantee of success. Critically, the component of independent local-authority building control inspections is missing from S.I.80, and a building contractor with an in-house certifier can design, build and self-certify as a single entity.

Self-certification is No Certification and Self-Regulation is No Regulation.

What is PI Insurance?

by bregs blog admin team

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PI (Professional Indemnity) Insurance is taken out by those providing a professional service to provide cover against claims for error or negligence. Generally, PI covers the legal fees involved in defending a claim and the cost of ‘righting the wrong’ if the professional was found to have been at fault.

PI is to protect the professional against a claim, if he makes a mistake. It is, sometimes mistakenly, considered as future warranty for the building owner available to fix anything that goes wrong with the building. This is not the case, as there is no certainty that the professional was at fault or that a claim will be upheld in court.

There are two important points about PI:

Firstly it is on a ‘claims made’ basis.  The claim must be made during the policy, so a 2013 policy covers claims made in 2013, regardless of when the problem happened in the past. This is not like motor insurance- if you crash today and cancel the policy, a future claim will be valid once insurance was in place on the date of the accident.  This poses a problem for professionals and consumers alike; because in order to provide redress, PI insurance would have to be kept in place until the statute of limitations applies.

Secondly, in Ireland there is ‘joint and several’ liability. This means that even if a professional is 1% liable, the entire claim can be made against him as the ‘last man standing’.