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Property
Thursday, February 1, 2007
Homing in on protection

How many times have you came across a dissatisfied home owner who has just had a house built only to find it is starting to show cracks. Perhaps he has to wait until it rains to finds the roof leaks, but that the builder has disappeared.

In August 1999 a very important peace of legislation, which sought to address issues such as these came into effect. Entitled the Housing Consumers Protection Measures Act 1998 it provided for the establishment of the National Home Builders’ Registration Council.
The main objects of the Act are, inter alia:
• To provide a warranty against defects in new homes;
• To regulate the home building industry;
• To provide protection to housing consumers in respect of the failure of a builder to comply with his obligations in terms of the Act;
• To promote housing consumers’ rights and to provide them with information; and,
• To assist homebuilders through training and inspection in order to achieve and maintain satisfactory technical standards of home building.

In more detail Section 10 of the Act provides that only persons registered with the council may carry on the business of home building; and further that they may not receive any payment in terms of any agreement for the construction of a home. In other words, if you find out your builder is not registered you must stop paying him!
The Council will not register a home builder if he does not satisfy certain technical, financial, construction and management skills necessary for the task at hand. Particular points also refer to structural strength and stability; serviceability; protection against fire; and drainage and storm water management of the property in question.
Failure to register as a homebuilder while operating such a business will result in criminal prosecution. Contravention of Section 10 may result in a fine of up to R 25 000 or imprisonment.
Section 13 of this Act further provides that the agreement between the home builder and the housing consumer has to be in writing and signed by the parties concerned. It must set out all the financial obligations of the housing consumer and it must contain annexures specifying materials that are going to be used by the builder and plans reflecting dimensions and measurements of the property as approved by the local authority.
The homebuilder is obliged to:
• rectify structural defects due to non compliance with the technical requirements for a minimum period of five years from occupation date;
• rectify non compliance with the plans and specifications for a minimum of three years from occupation date;
• repair roof leaks for a minimum period of twelve months from occupation date.

A home builder who demands and receives a deposit from the housing consumer without having concluded the aforesaid agreement may face harsh penalties.
In a case where a builder fails to rectify structural defects the Council will come to the housing consumer’s financial assistance using a special fund that it is provided for in the Act. The builder is then obliged to reimburse the Council.
The information for this article was provided by Simphiwe Maphumulo who is an Associate in the Conveyancing Department at Garlicke & Bousfield Inc. For further information please call (031) 570 5300 or E-mail to :simphiwe.maphumulo@gb.co.za

Copyright © Insurance Times and Investments® Vol:20.1 1st February, 2007
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