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A defect that is not always a defect and when the assessment can vary from one case to another

1. Introduction

1.1 The heading chosen indicates something that may be intrinsically typical for law: there is seldom anything that is black or white. When we were students we joked heartily about “on the one hand this, yet on the other hand that”.

1.2 The judgment of the Supreme Court of 11 May 2016 (case no. T 6237-14) is, it would seem, one example of how a question that upon first glance might appear to be obvious but is not, and also a very good example of how a well-worded a judgment can be structured so that one really understands what is meant.

2. Single-stage sealing of façades

2.1 The Supreme Court considered ’single-stage sealed façades” in the reported cases NJA[1] 2015 p. 110 and NJA 2015 p. 1040. To simplify, it was considered that the contract works were not professionally executed. The implication of this was that all clients that had engaged building contractors to erect houses where the method with single-stage sealed façades had been used began to wonder about the prospects of being able to demand damages from the contractors. The single-stage method for sealing façades was considered not to be professional.

3. The Land Code

3.1 It is hardly stretching the point, one might assume, to consider that the conclusions drawn in NJA 2015 p. 110 and NJA 2015 p. 1040 should also encompass the subsequent buyers and sellers, that is to say when the rules of the Land Code concerning defects to property are to be applied. However, this is not the case according to the judgment of the Supreme Court of 11 May 2016 (case no. T 6237-14). That situation involves completely different sets of rules and different norms for adjudication.

4. Applicable building standards – main rule

4.1 As regards building defects at the time of the erection of the building in the case of a sale of property, the Supreme Court attached weight to the applicable building standards or corresponding guidelines and what may be deemed to be ‘professional’. The building regulations, which were issued by public authorities pursuant to statute and are in the public domain, may according to the Supreme Court be deemed to constitute an objective benchmark regarding what it may be justified to expect on the part of a purchaser of a property.

4.2 The main rule since the ruling NJA 2010 p. 286 is that “if the building standards applicable to the construction have according to their generally accepted interpretation been complied with, then it is considered according to this main rule that the property does not deviate from what the purchaser has justified cause to expect.” The consequence of this is that a purchaser thereby cannot claim a right to a price reduction.

5. Applicable building standards – exceptions from the main rule

5.1 In accordance with that stated initially, law often offers opportunities for exceptions. The ruling of the Supreme Court reported in NJA 1997 p. 290 constitutes one example of such an exception from the main rule set forth above.

5.2 In the earlier ruling the matter involved completely newly constructed houses where damp and mould damage arose rather soon after the purchase and despite measures having been taken to remedy the problems, measures which as such were considered to be satisfactory and professional. The Supreme Court considered that the purchaser of a newly constructed small (self-contained) house was justified in expecting that the house would be generally fit for purpose and not encumbered with any special deficiencies whereby the house was less suitable for purpose, that is to say as a home, or that entailed a risk of causing significant nuisance for the occupants.

6. Summary

6.1 A defect in the context of construction law is not necessarily also a defect in the sense referred to in Chapter 4 of the Land Code.

6.2 The main rule according to Swedish legal practice is that building regulations, issued by a public authority pursuant to statute that are in the public domain, are deemed to constitute an objective benchmark for what it may be justified to expect.

6.3 If the usual interpretation would be that the building standards applicable to the construction have been complied with, there is no construction defect in the sense referred to in Chapter 4 of the Land Code.

6.4 Exceptions from the main rule may be justified where the matter involves a newly constructed house and the defect problems arose rather soon after the purchase. Other circumstances taken into account are whether measures that have been taken, which are considered professional as such, have not yielded the desired result, and also if the property owing to the defect is either not serviceable for purpose or entails significant nuisance for the occupants.

Claude D Zacharias

[1] Nytt Juridiskt Arkiv - a renowned Swedish law report series.

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