In a dispute over construction quality, a property developer may need to carry out maintenance work on the building in question during the course of legal proceedings. The way in which the developer handles the work may have a direct influence on the final outcome of a case. Moreover, in order to best position themselves in anticipated legal proceedings, property owners have been known to identify quality problems with a building, ask the developer of the building to carry out maintenance work, and then institute legal proceedings suddenly and unexpectedly during the maintenance. They think when the judges see a site which is extremely messy due to the maintenance work, they will have the impression that there really is a quality problem, and will be more likely to make a judgment in the owner’s favour.
Judges’ direction advantageous
In such a situation, a developer should request that the judges direct it to complete the maintenance work to the building in question before the hearings close. (Such a decision must be clearly stated in the trial records.) Making such a request has the following three objectives.
Senior partner
Dacheng Law Offices
Firstly, making such a request may minimize loss to the property owner and reduce the indemnity liability of the property developer. Whether the quality problem has a direct impact on the occupancy of the property by its owner or whether it has been identified prior to occupancy, the developer should fix the building in question as soon as possible to restore it to a state of normal use, in order to prevent further claims by the owner for subsequent losses, and to minimize the indemnity liability of the developer. This is especially important in disputes over quality that are likely to lead to any delay in the delivery of the property by the developers.
Secondly, making such a request may influence the process of establishment of evidence by judges. Property owners can tend to exaggerate quality problems in buildings, and the resulting losses. However, if a property developer fixes the building in question quickly or even proves, from a technical or engineering point of view, that no such quality problem exists, this may help to lead the judge ultimately to find in favour of the developer. This is especially the case if a number of property owners all take legal action against a single landlord.
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Mr Dennis Deng, a senior partner of Dacheng Law Offices, specializes in foreign direct investment, M&A, real estate & construction, litigation and arbitration.
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