Responsibilities of property developers and home builders
Brief summary of responsibilities of property developers and home builders:
1. Responsibilities of a residential property developer:
1.1 The developer/the owner (person in whose name the land on which a building was or is erected is registered in the deeds office) is responsible for ensuring compliance with the requirements of the National Building Regulations and Building Standards Act of 1977 and all reviews to it;
1.2 The developer/owner is required to appoint and allocate responsibilities to all required competent persons using prescribed forms and competent persons are required to accept such appointments.
1.3 A person wishing to assume responsibility for aspects of a building in terms of the Regulations is required to apply to the local authority for acceptance as an approved competent person.
1.4 The client (any person for whom construction work is being performed) and the contractor are jointly responsible for ensuring compliance with the provisions of the Occupational Health and Safety Act of 1993.
1.5 A developer and a home builder can, depending on the circumstances, be held jointly or individually responsible for compliance with the NHBRC warranty against defects.
1.6 Extract from amendments of the new Sectional Titles Management Act published on 7 October 2016:
First general meeting:
16. (1) The developer must include with the notice of the first general meeting held in terms of section 2(8) of the Act —
(a) an agenda in accordance with sub-rule (2);
(b) the documents referred to in sub-rule (2); and
(c) a comprehensive summary of the rights and obligations of the body corporate under the policies and contracts referred to in sub-rule (2)(d).
(2) The agenda for the first general meeting of members must include at least the following —
(a) a motion to confirm or vary the terms of the policies of insurance effected by the developer or the body corporate;
(b) a motion to confirm or vary an itemised estimate of the body corporate’s anticipated income and expenses for its first financial year;
(c) a motion to approve, with or without amendment, the developer’s —
(i) evidence of revenue and expenditure concerning the management of the scheme from the date of the first occupation of any unit until the date of the establishment of the body corporate, as required in terms of section 2(8)(c)(iii) of the Act; and
(ii) financial statements relating to the management and administration of the scheme from the date of establishment of the body corporate to the date of notice of the first general meeting referred to in sub-rule (1);
(d) subject to section 15(2) of the Act, a motion to ratify or not to ratify the terms of any contract entered into by the developer on behalf of the body corporate;
(e) a motion confirming that the developer has —
(i) furnished the meeting with copies of the documents referred to in section 2(8) of the Act and in this rule; and
(ii) paid over any residue referred to in section 2(9) of the Act;
(f) a motion appointing an auditor to audit the evidence and financial statements referred to in sub-rule (2)(c);
(g) motions determining the number of trustees and electing trustees;
(h) a motion detailing any restrictions to be imposed or directions to be given in terms of section 7(1) of the Act or confirming that there are no such restrictions or directions.
(3) For the purposes of voting on the items of business referred to in sub-rule (2)(c), (d) and (e), any vote held or controlled by the developer is suspended.
(4) In addition to the documents referred to in section 2(8) of the Act, the developer must at or before the first general meeting furnish the body corporate with copies of —
(a) all building plans approved by the local municipality;
(b) any encroachment permit or other document issued by the local municipality in regard to the improvements in the scheme;
(c) plans showing the location of all pipes, wires, cables and ducts referred to in section (3)(1)(r) of the Act;
(d) names and addresses of all contractors, subcontractors and any other persons whom the developer has employed to render services or supply materials relating to the development of the scheme;
(e) all warranties, manuals, schematic drawings, operating instructions, service guides, documentation from manufacturers and other similar information in respect of the construction, installation, operation, maintenance, repair and servicing of any common property or body corporate assets, occupation certificate, including any guarantee or warranty provided to the developer by a person referred to in sub-rule (4) (d); and
(f) all records the body corporate is required to prepare or retain in terms of rule 27.
(5) If the developer fails to provide the body corporate with any document referred to in section 2(8) of the Act or in this rule, the body corporate must do all things reasonably necessary to obtain or have the specific document prepared and may recover the reasonable costs incurred in doing so from the developer.
(6) If the developer fails to call the first general meeting in compliance with the requirements of section 2(8) of the Act, any member or the body corporate may do so and the body corporate must recover from the developer all costs reasonably incurred in ensuring compliance with the developer’s obligations.
2. Responsibilities of a home builder contractor:
2.1 The home builder is responsible for compliance with the NHBRC Technical Requirements established in terms of the Housing Consumers Protection Measure Act of 1998; and
2.2 The client (any person for whom construction work is being performed) and the contractor are jointly responsible for ensuring compliance with the provisions of the Occupational Health and Safety Act of 1993.
2.3 Every home builder is required by law to be registered with the NHBRC. Registration allows access to funding from financial institutions, access to NHBRC home building information, training programmes and interventions by the NHBRC to maintain a healthy working relationship between the home builder and the housing consumer
2.4 The Housing Consumers Protection Measures Act 1998 requires all new homes to be enrolled with the NHBRC 15 days prior to construction. These home enrolment insures consumers against poor building practises, particularly those relating to the structure and the roof, and permits the NHBRC to conduct building inspections at key stages of construction. Enrolment of homes is subject to a fee which is scaled according to the value of the home.
NHBRC inspections are designed to mitigate building risks for the consumer and to protect against poor workmanship during construction. Depending on the enrolment values of the home, a newly enrolled home can be subject to a minimum of four and a maximum of eight inspections. Where necessary, the NHBRC will provide dispute resolution on site between the builder and consumer. In the situation where the NHBRC inspector identifies a deviation from NHBRC’s Home Building Manual, a non-compliance certificate will be issued to the home builder.
The home builder will be obligated to rectify such non-compliance within a given timeframe. If the home builder is unable or unwilling to rectify it, the NHBRC has the mandate to stop construction and undertake disciplinary action against the builder.
2.5 The complaint procedure aims to resolve disputes between housing consumers and builders by ensuring that home builders meet their obligations. The NHBRC deals with three types of complaints, namely:
1 Three month non-compliance period
2 One year roof leak period
3. Five-year major structural defects period