Code+ Requirements+ +Second+Edition

8/6/2019 Code+ Requirements+ +Second+Edition

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Consumer Codefor

Home Builders

Sec ond Ed ition Janua ry 2010

This doc ument c onta ins the

ma nda tory Consumer Code

requirements tha t Home Builders

are required to follow


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Co nsumer Cod e fo r Hom e Builders Co de requirem ents

Me aning of words .......................................................................................................... 3

Introduc tion ..................................................................................................................... 4

Sc ope ............................................................................................................................... 5

The Consumer Code requireme nts .............................................................................. 6

1 Ad opting the Co de ....................................................................................................... 6

2 Info rma tio n p re-c ontrac t ........................................................................................... 6

3 Information excha ng e of c ontrac t ........................................................................... 7

4 Informa tion during occ up ation ................................................................................. 7

5 Co mp laints and d isputes .............................................................................................. 7

Appendix A Consumer Code independ ent Dispute Resolution Schem e .......... 8

Contents


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Co nsume r Co de fo r Hom e Builders Co de requirem ents

Meaning of words

In this do c ument , the fo llowing wo rds have spe c ial mea nings:

Agent a pe rson, firm o r com pa ny used by a Home Builder to d ea l with any ma tter on

be half of a Hom e Builder (for examp le, an estate a ge nt or contrac tor).

Consumer Cod e or Code a set o f requireme nts to be ado pte d by Home Builde rs.

Contrac t of Sale , Contrac t Exc hang e, Leg al Com ple tion the leg al doc ument and the

formal stage s used during the sale o f a prop erty.

In Scot land these sta ge s a re know n as Builders Missive , Exchange of Missive , Conc lusion of

Missive and Date of Entry and must b e read as such throughout the d oc ument.

Dispute Resolution Schem e an indep end ent p roc ess set up to d ea l with d ispute s unde r

the Co de tha t do no t fall within the Hom e Warranty Bod ys Hom e Warranty c ove r.

Home a prop erty reg istered by a Home Builde r with a Home Warranty Bod y to ob ta in

Hom e Warranty c ove r, excluding tho se listed in the Sc op e on Pag e 5.

Home Builder or You a builde r or develope r of new o r new ly c onve rted Home s for sa le to

the p ublic , and who is reg istered with a Home Warranty Bod y.

Home Buyer a person w ho Reserves or buys a Hom e, exc luding those no ted in the Scop e

on p ag e 5. For Hom es Reserved o r boug ht jointly by tw o o r more p eople, the rights of the

Hom e Buyer w ill be joint.

Home Warranty an insuranc e-ba c ked wa rranty for the p rotec tion of Home Buyers.

Home Warranty Bod y any orga nisation t hat:

ma intains a reg iste r of b uilders and deve lope rs;

provides Home Warranty c ove r;

has agree d to support the Co nsume r Code fo r Hom e Builders Sc hem e;

has undertaken to enforc e the Co de .

Details of p articipating Home Warranty Bod ies are a vailab le from the Consumer Code

web site: www.consumercodeforhomebuilders.com

Reservation When a Hom e Buyer and a Home Builder jointly make a written sta tem ent o f

intent (subjec t to c ontrac t and whe ther or not a fee is pa id) to buy a nd sell a Home.

Reserved c arries the c orrespo nding mea ning.


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Introduction

1 The Co nsumer Cod e c ome s into forc e o n the 1st April 2010. It sets ma ndatory req uirem ents

tha t a ll Hom e Builders must me et in the ir ma rketing and selling of Home s and their afte r-

sales customer service.

2 The p urpose o f the Code is to ensure tha t Home Buyers:

are trea ted fairly;

know w hat service levels to e xpec t;

are g iven reliab le information up on w hich to ma ke their dec isions;

know how to access speedy, low-cost dispute resolution arrangements if

they are dissatisfied.

3 The Cod e a pp lies to a ll Hom e Buyers and Hom es as set o ut in the Scop e on page 5.

4 The Home Wa rranty Bod ies have a gree d to require a ll the ir reg istered builders to a dop t

and c omp ly with the Cod e a s a c ond ition o f their reg istra tion. Where a Home Builde r is

found to b e in serious brea ch of the Code , Home Warranty Bod ies can a pp ly a range of

sanc tions, inc luding rem ova l from the Hom e Warranty Bod ys register and exc lusion fromall registers run by othe r Hom e Warranty Bod ies tha t partic ipa te in the Code sc hem e.

5 Hom e Buyers who think they have a dispute be c ause a Home Builde r has failed to m eet

the requireme nts of the Cod e m ay refer their dispute to the indep end ent Dispute

Resolution Schem e. See Ap pend ix A for de ta ils.

6 Surveys will be c arried o ut to chec k how we ll the Code is wo rking a nd mea sure c onsumer

satisfac tion. In carrying out the surveys, the releva nt sec tions of the Data Prote c tion Ac t

will be comp lied with.

7 To esta b lish how we ll the C onsume r Code is being a pp lied , or whether it need s to b e

am ende d or upda ted , there ma y also be :

random audits;

mystery shopp ing surveys;

reviews and assessments of customer satisfaction feedback and complaints;

training for Hom e Builde rs.

8 Nothing in this Code a ffec ts Hom e Buyers existing lega l rights.

Further information

Further information, inc luding the c od e d oc uments and the schem e Rules, ca n be ob tained

from the Co nsumer Cod e w eb site: www.consumercodeforhomebuilders.com .


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Sc ope

When reading this document, please bear in mind the following provisions and limitations:

1 The Co de app lies to a ll Hom e Buyers who Reserve to b uy a new or new ly converted Hom e

on o r a fter the 1st Ap ril 2010 and whic h has bee n built by a Home Builder under the

insuranc e p rote c tion of o ne o f the Hom e Warranty Bod ies.

2 The Code requirements app ly from the 1st Ap ril 2010.

3 The C od e is only for com plaints arising a nd ma de in writing to the Hom e Builder within two

yea rs from the sta rt d ate of the Hom e Warranty cove r.

4 Sec ond or subseq uent Home Buyers bene fit from the C od e Req uirem ents but only in

respe c t of afte r-sales ma tters that are repo rted within two yea rs from the start d ate of the

Home Warranty co ver.

5 The Cod e d oes not a pp ly to:

sec ond -hand prope rties (for examp le, hom es taken by Hom e Builders in pa rtexchange and re-sold);

properties acquired by registered social landlords;

prop erties ac quired by c orporate bo dies and pa rtnerships and othe rs for

investme nt purposes;

properties built by self builders for their own occupation;

prop erties built und er a rc hitec ts c ertificates.

6 The Co de a nd the a ssoc iated Dispute Resolution Scheme do not a pp ly to:

personal injury claims;

loss of p rope rty value o r bligh t;

c la ims relating to the land conveyed and its reg istered title; c laims where the am ount of red ress c laimed exceed s the limits of the

Dispute Resolut ion Sc heme .

7 Matters be tter de alt w ith by o ther d ispute resolution or omb udsma n scheme s should b e

refe rred to the releva nt orga nisa tion. In suc h cases, these o ther schem es will ta ke

prec ed enc e o ver this Cod e a nd assoc iated Dispute Resolution Scheme .


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1 Adop ting the Code

The Co nsumer Cod e for Hom e Builders Code requirements

1.1 Adop ting the Code

Home Builders must com ply with the requireme nts of the Co de and have rega rd to the good -

practice g uida nce.

1.2 Making the Code ava ilab le

The Home Builde r must d isplay the Cod e a nd give, without c harge , a c op y to c ustome rs whoask for it a nd to a ll Hom e Buyers who reserve a Hom e.

The Home Builder shou ld a lso inform their custom ers tha t further gu ida nc e is ava ilab le andhow they c an g et this.

1.4 App ropriately trained custome r service staffThe Home Builder must p rovide suitab le training to a ll sta ff who dea l with Hom e Buyers abouttheir responsibilities to t hem and wha t the Cod e m ea ns for the c om pa ny and its direc tors.

1.3 Customer Service

The Home Builder must ha ve suitab le system s and proc ed ures to ensure it can reliab ly andac curate ly meet the c om mitments on service, proce dures and information in the Cod e.

1.5 Sales and ad vertising

Sales and advertising ma terial a nd ac tivity must b e c lea r and truthful.

2.2 Contact information

Home Buyers must b e to ld how their que stions will be d ea lt with and who to c onta c t d uringthe sale, purcha se and c om pletion of the Hom e.

2.3 Warranty cover

Hom e Buyers must be given ac curate and reliab le informa tion ab out the insurance-ba ckedwa rranty p rovided on the Home .

2.5 Pre-c ontrac t informa tion

Hom e Builders must a dvise Home Buyers to appoint a professiona l leg a l ad viser to carry outthe leg a l forma lities of b uying the Hom e a nd to rep resent their interests.

2.1 Pre-purchase information

Home Buyers must b e g iven enoug h p re-purcha se informa tion to he lp them ma ke suitablyinformed purchasing decisions.

In a ll cases this information must inc lude:

a written Reservation a greem ent;

an explana tion of the Home Warranty cover;

a de sc ription of a ny ma nag eme nt services and organisations to w hic h the Home Buyerwill be com mitted a nd a n estimate o f their cost.

Also, if a Home is not ye t c omp leted , the informa tion must include :

a b roc hure or plan reliab ly showing the layout, ap pe aranc e and p lot positionof the Home;

a list of the Home s c ontents;

the stand ards to which the Home is be ing built.

2 Informa tion pre-contrac t

2.4 Health and safety for visitors to developments under construction

Hom e Buyers must b e informed ab out t he he alth and safe ty p rec aut ions they should ta kewhen visiting a de velopm ent und er construc tion.


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2.6 Reservation

Hom e Buyers must be g iven a Reservation agree ment tha t sets out c learly the terms of theReservation, including, but not limited to:

the a mount of the Reservation fee;

wha t is being sold ;

the purchase price;

how a nd w hen the Reservation ag reem ent will end ;

how long the price rema ins va lid;

the estimated c ost a nd nature of a ny ma nag eme nt services the Home Buyer mustpa y for.

The Reservation fee must b e reimbursed if the Reservation a greement is canc elled . TheHome Buyer must be told of a ny ded uctions that ma y be ma de .

While the Reservat ion agree ment is in force , the Home Builder must no t enter into a newReservation ag reement or sale a greem ent w ith anothe r custom er on the same Home .

3 Informa tion exc hange of c ontrac t

3.1 The contrac t

Contrac t o f sale te rms and c ond itions must:

be clear and fair;

com ply with the Unfa ir Terms in Consumer Contrac ts Reg ulations 1999;

c lea rly sta te the contrac t te rmination rights.

3.2 Timing of construc tion, com pletion and ha ndover

The Home Buyer must b e given reliab le a nd rea listic informa tion abo ut w hen c onstruc tion ofthe Home may b e finished, the d ate of Lega l Completion, and the d ate for hand over of theHome.

3.3 Contrac t termination rights

The Home Buyer must be to ld abo ut their right to te rminate the c ontrac t.

3.4 Contrac t dep osits and pre-pa yments

The Home Builder must c learly exp lain how Home Buyers c ont rac t dep osits a re prote c tedand how a ny other pre-payme nts are de alt with.

4 Informa tion during oc c upa tion

4.1 After-sales service

The Hom e Builder must p rovide the Hom e Buyer with a n a c cessible a fter-sa les service , andexplain what the service includes, who to c ontac t, and what gua rantee s and wa rrantiesap ply to the Home .

4.2 Hea lth and safety for Home Buyers on d eve lopm ents unde r co nstruc tion

Home Buyers must b e to ld abo ut the he alth and safe ty prec autions they should ta ke whenliving on a de velopm ent whe re b uilding w ork c ontinues.

5 Complaints and disputes

5.1 Com pla ints hand ling

The Home Builder must ha ve a system and proced ures for rec eiving, hand ling , and resolvingHom e Buyers service c a lls and c om plaints.

The Hom e Builder must let the Hom e Buyer know of this, and of t he d ispute resolutiona rrang em ents op erated as pa rt of this Cod e, in writing.

5.2 Co-op eration with p rofessional ad visers

The Home Builder must c o-op erate w ith ap prop ria tely qua lified p rofessiona l advisersapp ointed by the Hom e Buyer to resolve d ispute s.


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Appendix A

Consumer Code independent Dispute Resolution Scheme

Disputes are resolved using a n ad judica tion p rocess. During this p rocess, a trained

ad judica tor review s written submissions from both p arties and issues an a wa rd b ased on his or

her co nc lusions. They w ill dec ide whether or not a Hom e Buyer has a leg itima te d ispute a ndhas suffered financ ial loss as a result of the ir Hom e Builder failing to c om p ly with the C onsume r

Cod e requirem ents.

The fo llow ing is a summ ary of this p rocess. More d eta iled informa tion will be g iven with ea ch

ap plic ation for ad judica tion and is also a vailab le from the Consumer Cod e we b site.

1. A Hom e Buyer must first com plain to the ir Hom e Builder and give the Home Builder the

op po rtunity to investigate and put things right.

2. If the Home Buyer is not sa tisfied with the Home Builders response, the Hom e Buyer should

conta c t the Home Warranty Bod y that issued the w arranty on the ir Home .

3. The Hom e Warranty Body will:

3.1 de al with the c omp laint unde r the terms of their Home Warranty policy; or

3.2 whe re the co mp laint falls outside the Home Wa rranty Bod ys ow n disputes resolution

sc heme , offer the Home Owne r the op po rtunity to refer their c omp la int to the

independ ent Disputes Resolution Sc hem e p rovider. The Home Buyer must b ring the

c laim within three mo nths of the d a te o f the Home Builders fina l response to t he

original co mp laint, or within three m onths afte r the d ate of the original co mp laint,

whic hever is the la te r.

4 If a Hom e Buyer dec ides to refe r a com plaint to the indep end ent Disputes Resolution

Scheme provider, the follow ing ad judic ation p roc ess hap pe ns:

4.1 If the Hom e Buyer wishes to use this sc hem e, they must com plete an ap p lica tion form

and send it to the indep end ent Disputes Resolution Sc hem e p rovid er with their

sta teme nt of e videnc e a nd a case registration fee of 100 plus VAT(1). Their

sta teme nt of evidenc e must co ntain all the information relevant to the c omp laint

and cop ies of rec eipts or othe r evidenc e of expenditure.

4.2 The inde pendent Disputes Resolution Scheme p rovider will ask the Home Builder to

respond to the Hom e Buyers sta tement of evidenc e. The Home Builder may a t this

stage resolve the c om plaint without a formal ad judica tion going a hea d this is

c alled e arly settlement a nd w ill c ost the Home Builde r a red uced c ase fee of 100

p lus VAT(1).

4.3 If early set tlement d oe s not ha ppen, the Hom e Builder must submit their response to

the Home Buyers stateme nt of evide nce to ge ther with a pa yment o f 300 plus

VAT(1). The Home Buyer will be g iven a cop y of the Hom e Builders response fo r their

informat ion, and for them to respond to if they wish. At this stage , no further new

c om plaints relating to this adjudica tion from the Home Buyer will be allow ed .

4.4 The ad judica tor will consider both submissions and d ec ide whe ther or not the Hom e

Buyer has a legitima te d ispute and has suffered financ ial loss as a result of the Home

Builders fa ilure to com ply with the Co nsume r Code. In any c ase, the Hom e Builder

and the Home Buyer will be expec ted to have ac ted reasonab ly and to have

c ont rolled the ir c osts.

(1) Ca se fee s subjec t to annua l review


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4.5 The adjudicato r will ma ke a dec ision based on the informa tion subm itted a nd send it

to b oth p arties. The dec ision may be to issue a pe rformanc e a wa rd (w here the

Home Builde r has to d o some thing), or a financ ial awa rd (where the Hom e Builde r

has to p ay mo ney to the Home Buyer), or a c omb ination of the two ; the ad judica tor

ma y also d ec ide to reject the c laim. The ma ximum va lue of the c omb ined a wa rd

ava ilab le und er this ad judica tion schem e is 15,000 inclusive o f VAT.

4.6 If the ad jud ica tor ma kes an awa rd, they ma y a lso make a disc retiona ry awa rd for

inc onvenienc e, up to a ma ximum of 250. The 15,000 ma ximum aw ard w ould

include a ny awa rd for inconvenience . A Home Buyer c annot c laim an a ward for

inco nvenienc e a lone.

4.7 The ad judica tor will use his d isc retion when considering whether to awa rd

com pe nsat ion for any inconvenience a Hom e Buyer may ha ve suffered as a result of

how their c omp laint wa s hand led by the Home Builde r.

4.8 The ad judica tor will a lso dec ide whether or not the Home Builder must reimb urse the

Hom e Buyer their c ase reg istration fee. This will be in ad d ition to the a wa rd referred

to in 4.5 abo ve.

4.9 The adjudicato rs de cision ca nnot be app ea led ; it can only be a c ce pted or

rejec ted by the Hom e Buyer.

5. Und er the rules of reg istration, the Home Warranty Bod ies will require ea c h reg istered

builde r to hono ur any a wa rd ma de ag ainst them und er the indep ende nt Dispute

Resolution Schem e. If the Home Buyer ac c ep ts the awa rd , the c ourts will usua lly

recog nise this as evidenc e o f the va lid ity of a Hom e Buyers c laim.

6. A Home Buyer ma y refuse to acc ep t the aw ard, but if they do so any subseq uent leg a l

ac tion is likely to take a c count o f the d ec isions rea c hed in any previous ad jud ica tion.

7. A Home Builder rema ins liab le for an a wa rd , even if they are rem oved from a Home

Warranty Bodys register.

Please note: This Consume r Cod e Dispute Resolution Sc hem e is independ ent of t he Hom e

Warranty Bod ies. Ad judication dec isions ma de unde r the Consumer Code indep end ent

Dispute Resolution Sc hem e a re not insured under the Hom e Wa rranty Bod ies Hom e

Warranty sc hem es.


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Notes

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Notes

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CONSUMER CODE for

HOME BUILDERS SCHEME

Consumer Cod e Sec reta riat - ca re o f:

NHBC House

Davy Avenue

Knowlhill

Milton Keynes

MK5 8FP

www.consumercodeforhomebuilders.com

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