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475 of the TCO.
According to the aforesaid article, in case of a defects liability of
the contractor, the principal shall exercise either of the following
rights:
1. Revocation of contract provided that the completed and deliv-
ered work is not suitable for the intended purpose of principal
or the work is not incompliance with the contract and therefore
it is not justifiable to force the principal to accept the work.
2. Receiving the work as delivered condition and requesting dis-
count proportionate to defect.
3. Requesting the correction of works from the contractor free of
charge unless the repair costs considerable amount.
It is stipulated that apart from the above-mentioned alternative
rights, the principal’s right to claim compensation in accordance with
general rules is reserved. Therefore, in case of an occurrence of defects
liability of the contractor, the principal is legally entitled to claim com-
pensation.
If the work is performed on principal’s immovable property and
removal of works will cause considerable damages, then the principal
cannot exercise right to revocation of contract.
The liability of the principal is regulated under Article 476 of the
TCO. As per the aforesaid article, the principal cannot exercise rights
if defective work results from the principal’s instructions despite the
contractor’s explicit counter notification or if it results from any other
faults attributable to the principal.
Acceptance of Work
Pursuant to Article 477 of the TCO entitled “Acceptance of Work”,
the contractor is exonerated from liability when the principal accepts
the work either explicitly or implicitly. However, the contractor is held
liable if the contractor conceals the defect willfully or if defect is not
apparent and cannot be detected during the regular examination.
If the principal fails to examine the work within a reasonable time
and send notification promptly –or as soon as defects are spotted where
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NEWSLETTER 2012