A defect can be defined as a deviation from the quality and standard of design, materials or workmanship specified in a contract . According to the RICS guidance notes on defects, there are primarily two major kinds of defects. Patent defects and Latent defects. Patent defects can be easily identified during an inspection but Latent defects are not immediately obvious, but are discovered at a later date. For example a faulty foundation which is not detected until it affects the super structure is a latent defect.
Construction contracts usually have a defect liability period agreed. The defects liability period is the period of time during which the contractor is contractually obliged to repair defects which have appeared in…show more content… In order for third party rights to apply, the contract itself must expressly confer the right, setting out the terms that the third party can rely on, and expressly identify the third party in the contract
This means the contractor can still be found liable for defects several years after project completion, if these defects are discovered within the statutory limitation periods. This liability can be as a result of his contractual obligations or based on negligence in tort especially when the limitation period for bringing an action under contract has passed or if there is no binding contractual relationship between the occupier and the contractor.
These limitation periods are set out in the Limitation Act 1980. Under the act, the time limit for actions founded on a simple contract is six years from the date on which the cause of action occurred but twelve years if created by deed . However, the time limit for actions founded on tort is six years from the date the cause of action accrued .
The Latent damage act provides a limitation period of 3 years from the date of discovery of the latent defect. The act amends the law about limitation of actions (Section 14A of the Limitation Act 1980) in relation to actions for damages for negligence not involving personal injuries; and to provide for a person taking an interest in property to have, in certain circumstances, a cause of action in respect of negligent