New build flats (only 4 years old), owners charged with £425,000 repairs, no insurance

AdrianC

Yes, I know it is... I'm just wondering if there could be a bit of wiggle room for them in saying "But CRL offered a premier level of guarantee, and that's all we ever said."

The time to query the warranty provider, though, was purchase from the developer, not several years later. Especially not for anybody who bought the flat from a previous owner, rather than direct from the developer.

NameUnavailable

I still don't quite understand why the OP and others can't make a claim against the NHBC warranty which is meant to cover defects (not general maintenance) for up to 10 years?

eddddy

NameUnavailable said:

I still don't quite understand why the OP and others can't make a claim against the NHBC warranty which is meant to cover defects (not general maintenance) for up to 10 years?

They don't have an NHBC warranty.

They have a CRL warranty. The roof isn't covered by the CRL warranty.

Crashy_Time

Many of these flats were bought at highly inflated "values", this just exacerbates the debt trap that people have walked into.

mertywerty

eddddy said:

So the OP needs to

• read their warranty CRL warranty documents to see if that's correct 

• try to get hold of Premier's Technical Manual that was current when the flats were built. See: https://www.premierguarantee.com/technical-standards/

• read the Tech Manual to see if the roof would have been covered for those first 2 years

• establish why the solicitor gave incorrect information

 

Regarding the Premier Guarantee vs CRL, this is another topic for another day. Suffice to say the solicitor gave the correct information. The short answer to this is that I purchased this flat offplan, and assurances were given (but not followed through) that a Premier Guarantee would be in place. So to reduce confusion, we can disregard the Premier Guarantee from this conversation (sorry for the confusion). 

For the purposes of this thread, we can assume that it has always been the CRL warranty in place, and in fact there are other flat owners who purchased the flats after they were built and presumably there were no problems raised regarding the this warranty be both their solicitors and mortgage lenders. 

With regards to the CRL policy document, the definition of Major Damage is: 

• Destruction of or physical damage to a load bearing element of the Residential Property caused by a defect in the design, workmanship, material or components of the Structure which adversely affects the structural stability or compromises the effectiveness of the waterproofing elements of the Waterproofing Envelope; or
• A condition requiring immediate remedial action to prevent damage to a load bearing element of the Residential Property which adversely affects the structural stability of the Residential Property or compromises the effectiveness of the waterproofing elements of the Waterproofing Envelope; or
• A condition requiring immediate remedial action to prevent imminent danger to the health and safety of the occupants caused by a defect in the design, workmanship, material, components of the Structure or failure of the Developer to comply with Building Regulations in respect of chimneys and flues; which is discovered and notified to the Insurer during the Structural Damage and Contamination Insurance Period.

When a claim was made to CRL at the end of last year, their reply was: 

It was noted during the inspection that there were defects with the communal roof and a failure of the external drainage system which allowed water to enter the high level walkways and ultimately lower level walkways alike. There was also a lack of good detailing to the falls of the walkways and little or no upstands at the access doors to the common stairwells, therefore allowing water to surcharge the threshold into the stairwell and communal areas.

During his visit, the surveyor found no evidence of any Major Damage as defined under the Policy. As such, insurers are unable to offer any indemnity in respect of this loss. Should you disagree with this position, you will need to provide evidence that there is in fact major damage as defined above under the Policy

I'm guessing the management company tried to claim again last month, as an update was provided (sorry if I repeated this before): 

Nexus have confirmed that the works are not required because of a failure of a load-bearing element of the property or a structural defect, and the works are therefore not covered under the policy. We have been advised that the failure of the roof and drainage is due to a poor design and poor quality workmanship.

Aside from the endorsement (where roof costs are excluded), it seems the missing gap is that the there no failure of a "load bearing element" i.e. structural issue, as the policy document does have cover for "defect in the design, workmanship". 

michael1234

eddddy said:

mertywerty said:

We also do feel £425k is excessively expensive, as the original report stated that they did not expect the entire repairs to be more than the excess on the warranty (£104k), and therefore there was no point claiming on the warranty.

... and just to clarify, 'excessively expensive' in this context means something like:

• A different contractor would do the same job more cheaply
• The job could be carried out more cheaply (e.g. Scaffolding on 3 sides instead of 4)
• Cheaper materials could be used (e.g. PVC drainage pipes instead of stainless steel)

The fact that it's 'a lot of money' or 'more expensive than the estimate' isn't really a legitimate basis for challenging the cost.

There is of course a fourth item in this context which is:

• The contractor was charging an inflated price, considerably above market price to increase his profits at our expense.

Crashy_Time

https://www.globalwitness.org/en/campaigns/corruption-and-money-laundering/anonymous-company-owners/legalised-extortion/

eddddy

michael1234 said:

eddddy said:

mertywerty said:

We also do feel £425k is excessively expensive, as the original report stated that they did not expect the entire repairs to be more than the excess on the warranty (£104k), and therefore there was no point claiming on the warranty.

... and just to clarify, 'excessively expensive' in this context means something like:

• A different contractor would do the same job more cheaply
• The job could be carried out more cheaply (e.g. Scaffolding on 3 sides instead of 4)
• Cheaper materials could be used (e.g. PVC drainage pipes instead of stainless steel)

The fact that it's 'a lot of money' or 'more expensive than the estimate' isn't really a legitimate basis for challenging the cost.

There is of course a fourth item in this context which is:

• The contractor was charging an inflated price, considerably above market price to increase his profits at our expense.

Yep - that's what I mentioned in my first bullet point.

If you suspect that, you'd have to show that the s20 consultation wasn't done correctly. It's always more difficult to do that after the consultation is complete.

As mentioned previously, a tribunal is likely to ask why you didn't say something during the consultation. Rather than waiting until it's finished, and then expecting the freeholder to go through the whole process again.



Edit to add

And you need to be careful about getting the s20 consultation ruled invalid on a technicality - if it just means that it has to be done again, and the cost still comes out as £425k.

That might mean that the leaseholders are worse off, because they've had to pay for 2 consultations instead of just 1.

Indigo_and_Violet

Has anyone queried why the current issues do not fall under the third category of Major Damage:

"A condition requiring immediate remedial action to prevent imminent danger to the health and safety of the occupants caused by a defect in the design, workmanship, material, components of the Structure or failure of the Developer to comply with Building Regulations in respect of chimneys and flues; which is discovered and notified to the Insurer during the Structural Damage and Contamination Insurance Period."

Given the number of slip, trip and falls training courses I've been sent on it seems water on the walkways would present a H&S risk and it results from bad design and workmanship. Is it because it's from the CRL policy and that explicitly excludes the roof? 

user1977

Indigo_and_Violet said:

Has anyone queried why the current issues do not fall under the third category of Major Damage:

"A condition requiring immediate remedial action to prevent imminent danger to the health and safety of the occupants caused by a defect in the design, workmanship, material, components of the Structure or failure of the Developer to comply with Building Regulations in respect of chimneys and flues; which is discovered and notified to the Insurer during the Structural Damage and Contamination Insurance Period."

Given the number of slip, trip and falls training courses I've been sent on it seems water on the walkways would present a H&S risk and it results from bad design and workmanship. Is it because it's from the CRL policy and that explicitly excludes the roof? 

I suspect "imminent danger" means "liable to collapse" etc rather than something which can be mitigated with "slippery floor" signs or the like.