The law relating to defects: Urgent need for review

Abstract

Two interesting developments have changed the legal positions of developers and subsequent purchasers in respect of building defects. Until recently, it appeared that developers were bound by the rule that if they do not suffer any loss as a result of defects they would only be entitled to nominal damages. Developers have always had the right to contractual remedies in respect of building. The recent cases have held that a developer is entitled to substantial damages even if the developer did not suffer any loss. In the law of negligence, the courts have held that a subsequent purchaser may not recover from the builder and/or designer. The Singapore courts departed from the English cases and held that the management corporation which is in charge of the maintenance of the common property of a development have a right to claim from both the developer and the architect pure economic loss in the form of the cost of repair of the building defects found in the common property. Accordingly, the law relating to defects appears to be unsatisfactory. This paper advocates a change in the law.