Construction Defects and Warranties

Construction Defects and Warranties in Switzerland

Real estate construction in Switzerland is subject to a strict legal framework that protects owners against construction defects. Swiss law provides different types of warranties and remedies allowing owners to assert their rights against contractors, architects or engineers. These legal mechanisms are governed primarily by the Code of Obligations, but involve various standards specific to the construction sector. Given the complexity of issues related to construction defects, a thorough knowledge of deadlines, procedures and liabilities is essential to protect one's real estate investment and obtain necessary repairs in the event of defects.

Legal Framework for Construction Defects in Switzerland

In Switzerland, construction defects are primarily governed by articles 367 to 371 of the Code of Obligations (CO) dealing with construction contracts. This legal framework defines the obligations of contractors and the rights of owners in the event of defects found in the work.

A construction defect is legally defined as an imperfection that diminishes the value of the work or impedes its intended use. Swiss law distinguishes several categories of defects:

• Apparent defects: visible during ordinary inspection
• Latent defects: not detectable during usual inspection
• Serious defects: seriously compromising use of the work
• Moderate defects: affecting the work without compromising use
• Minor defects: not significantly affecting use or value

In addition to the Code of Obligations, other legal sources complement this framework, notably the SIA 118 standard (Swiss Society of Engineers and Architects), frequently incorporated into construction contracts. This technical standard specifies the procedures for inspecting works, notifying defects and applicable warranties.

SIA Standard 118 and Its Impact

SIA standard 118 plays a key role in the construction sector in Switzerland. Although not having force of law, it is often incorporated by reference into contracts, making it binding on the parties. This standard provides a more detailed framework than the Code of Obligations and provides notably:

• A warranty period of 2 years (compared to 1 year under the CO)
• A detailed procedure for acceptance of the work
• Precise modalities for notifying defects
• The distinction between provisional and final acceptance

It is fundamental for any owner to verify whether SIA standard 118 applies to their contract, as this substantially modifies their rights and the procedures to follow in the event of defects.

Types of Warranties and Their Deadlines

Warranty for Defects

Under article 371 CO, the limitation period for defects in an immovable work is 5 years from acceptance of the work. This period applies to both the general contractor and the various trades involved in construction.

However, it is crucial to distinguish this limitation period from the defect notification deadline:

• Under the CO regime (art. 370), apparent defects must be reported immediately upon discovery
• Under the SIA 118 regime, apparent defects must be notified within 2 years of acceptance, and latent defects immediately upon discovery

Warranty of Perfect Completion

This warranty, although not explicitly named as such in Swiss legislation, corresponds to the contractor's obligation to repair defects notified during acceptance or during the warranty period. It is particularly regulated by SIA standard 118 which provides:

• A joint inspection of the work at the end of construction
• Drawing up of minutes listing the defects found
• A period granted to the contractor to remedy defects
• A final inspection after repair works

Ten-Year Warranty

Article 371 para. 2 CO provides a limitation period of 10 years for defects intentionally concealed by the contractor. This warranty is particularly protective for the owner, as it allows action even long after acceptance of the work, provided intentional concealment is proved.

Liabilities of the Different Parties Involved

The Contractor and Their Subcontractors

The main contractor is primarily responsible for the quality of the work they deliver. Their liability is engaged for:

• Defects in the execution of works
• Non-compliance with rules of good practice
• Use of defective materials
• Works carried out by their subcontractors

Notably, the contractor is responsible for the acts of their subcontractors as for their own acts (art. 101 CO). The owner may therefore proceed directly against the main contractor, even if the defect originates with a subcontractor.

The Architect and Engineer

These professionals bear specific responsibility regarding the design of the building and supervision of works:

• Design or calculation errors
• Defects in plans or technical specifications
• Failures in directing and supervising works
• Failure to advise the owner

Their liability is generally engaged on the basis of the mandate contract (art. 394 et seq. CO), with a reinforced duty of care given their professional expertise.

Complaints Procedures and Remedies

Inspection and Defect Notification

The first decisive step is to inspect the work and formally notify defects:

• The inspection must be thorough and take place as soon as the work is accepted
• The defect notification must be precise, documented and sent in writing (ideally by registered letter)
• Each defect must be described precisely, if possible with supporting photographs
• Legal or contractual deadlines must be strictly observed

The Owner's Rights

Once defects have been validly notified, the owner has several options under article 368 CO:

• Require free repair of defects (right to rectification)
• Reduce the price in proportion to the diminution in value (price reduction claim)
• Rescind the contract if defects are serious (rescission claim)
• Claim damages in the event of contractor fault

Limitation Periods for Construction Defects

Frequently Asked Questions on Construction Defects