How do you deal with this? - a mini comparative research

An interesting new thought expressed in legal doctrine or in a court decision, may leave you wondering, how this topic is dealt with in other jurisdictions. To find answers, the ESCL-Newsletter provides space for those submitting such topics and, of course, for the comments and answers we hope to provide you with. To be suitable for publication the topics and the answers should be short and to the point. Thomas Siegenthaler will act as the moderator of this section and all answers or topics submitted on the ESCL website (www.escl.org), will be sent to him first for review.

In this first edition of our Newsletter, we present the following topic from Switzerland to our readers:

Defect liability entering the post-factual area?

“Under Swiss law – and most likely under any other national law – a contractor is contractually liable to the building owner if the contractor’s works turn out to be defective. A defect is defined as a difference between the building as it is and the building as it should be according to the contract (including implied terms). In case of a dispute, it is the building owner’s burden to prove the defect. Proving a defect can be difficult and often building owners need the services of expensive experts.

Now a new idea has come up in Swiss legal doctrine: It should be enough for the building owner to prove that there are serious reasons to believe that there could be a defect. Mere suspicion should be enough. The argument runs that the contractor is obliged to deliver, beyond reasonable doubt, a flawless building. If a defect can be reasonably suspected that should in itselfbe considered a defect – with all that goes with it/with all the legal consequences, particularly with a claim for compensation (by an “actio quanti minoris” as the Romans called it).

Example: There are three apartment blocks which have been built by the same contractor at the same time. Two are leaking. One is not leaking. Can the building owner claim compensation for the non-leaking apartment block simply on the basis that, considering the bad experience with the two other blocks, there are serious doubts about the waterproofing of the third block’s building envelope.

(Of course, engineers will tell me that everything can be examined and checked. But let us assume, for the sake of argument, that the necessary examination on the third building is not a realistic option in that particular case – for instance that it would be too expensive.)

How do you deal with this in your jurisdiction?”