If you are the owner of a new property in Spain, now may be the time to check your home carefully for any structural defects. I say this because any newly built home in Spain should have a Decenal Insurance policy (10 year building guarantee in Spain).
So, if you have a Decenal Insurance policy then this may be close to running out – if your home in Spain was built during the early years of the Spanish property boom.
Needless to say, once your 10 year building guarantee in Spain expires you will be liable for any structural defects and remedying these can be extremely expensive. Indeed, if ever you need insurance then it is for remedial structural works! Almost by definition these can be complicated and the costs of rectifying a given problem can be far greater than those incurred during the original building process.
Certainly, the last thing that you should do is to ignore anything that looks as though it may indicate a structural fault. Whilst minor cracking in all properties is common – anything more than that should be checked by a fully qualified (and independent of the builder!) professional. This is particularly true if you see indications of movement (see Indications of Building Defects for examples and images of potential problems).
Decenal Insurance (10 year building guarantee in Spain) was made obligatory on the 6th May 2000 when a law ( ‘La Ley de Ordenación de la Edificación’) was passed which made it obligatory for any new build property in Spain to have an insurance-backed, 10-year guarantee (similar to the NHBC scheme in the UK). In Spain, this scheme is called the seguro decenal and is often referred to as the ‘builder’s guarantee’ or just the Decenal.
Unfortunately, the Decenal is by no means as comprehensive as its UK (NHBC) equivalent (although the NHBC has been criticised for some of its ‘get out’ clauses!). However, you must be especially wary of relying on the Spanish Decenal to resolve all your new building problems in Spain. Indeed, the very term ‘builder’s guarantee’ is misleading. The Decenal essentially only covers issues related to structural stability and resistance. This leaves many other potential issues unprotected, such as leaking roofs or damp.
Nonetheless, it is important to have a Decenal policy and you should be extremely wary of buying a new Spanish property that lacks this cover, if it was built after May 2000. Indeed, the lack of a Decenal may indicate that your property (or intended property!) may not be legal – so beware and make sure that your Spanish conveyancing lawyer checks this detail!!
In theory, Decenal insurers are legally obliged to pay out to the owner of a new build property in Spain if there is a proven structural stability issue that needs correction. This is irrespective of whether the fault is due to the builder or architect and whether the problem is because of negligence, faulty materials or processes.
However, typically decenal insurers are extremely tardy about honouring their obligations. Indeed, usually they refuse to accept a claim unless negligence is proven in court. This is because they know full well that if, for example, an architect is proved negligent, then any remedial costs will be covered by the architect’s own professional indemnity insurance.
So, although Decenal insurers are legally obliged to act, in reality,they rarely do so until forced to do so. This is despite the fact that they can potentially recover their costs from the builder or architect responsible for the defective or negligent work.
If you think that your Spanish property may have structural problems or building defects then contact us.
We can then assess whether your suspicions are right or not. If your worries prove to be correct then we can prepare a formal report and then help you make your claim against your Decencal insurers. Should there be a dispute then our legal department can provide you with the help you will need to process your claim and we can then manage the remedial works required.