The Position of Clients in Construction Projects – Blog III 🏗️

Strengthening the Position of Clients in Construction Projects – Blog III

Due to an amendment to the Civil Code effective from 1 January 2024, the position of clients in construction projects has been strengthened. In our first blog in the series 'The Position of the Client in Construction Projects,' we discussed the client's position in relation to post-completion liability. The second blog in the series covered the contractor’s financial information obligation. In this third blog, we address the contractor’s duty to warn, which has also changed concerning construction contracts.

Duty to Warn for All Types of Work Contracts

Until 1 January 2024, the duty to warn was legally stipulated in Article 7:754 of the Civil Code and included the following obligation for the contractor:

‘The contractor is required, when entering into or executing the contract, to warn the client of any inaccuracies in the assignment, to the extent that he knew or should reasonably have known of them. The same applies to defects and unsuitability of items provided by the client, including the land on which the client has the work carried out, as well as errors or defects in the plans, drawings, calculations, specifications, or execution instructions provided by the client.’

This duty to warn has not changed. It applies to all types of work contracts, including, for example, dry cleaning services. It is important that parties may deviate from this legal provision and make different arrangements in their specific contract.

In construction contracts, the duty to warn follows the contractor’s initial obligation in a project: to assess whether he can properly execute the work requested by the client. The contractor must evaluate the client's request and determine the appropriate execution process (materials, equipment, methods, etc.). He will want to align these with the client's requirements and the provided data. The contractor does not have an independent obligation to verify the accuracy of the client's requirements or data. However, if the contractor discovers that the requirements or information are insufficient or incorrect while determining a suitable execution process, he must warn the client!

This warning is important because if the contractor fulfills his duty to warn (and there are no other reasons for his failure), the consequences of defective work execution will fall on the client (Article 7:760, paragraphs 2 and 3, Civil Code).

Specific Duty to Warn for Construction Contracts

For construction contracts, a new rule now applies. The second paragraph of Article 7:754 of the Civil Code states:

‘For construction contracts, the warning referred to in paragraph 1 must be given in writing and unequivocally, and the contractor must timely inform the client of the potential consequences for proper fulfillment of the agreement. This paragraph cannot be deviated from to the disadvantage of the client if the client is a natural person not acting in the course of a profession or business.’

In construction contracts, the contractor must give the warning in writing and unequivocally. In the digital age, ‘in writing’ is a broad term, encompassing email or messaging apps. The warning itself must also be clear (unequivocal). What constitutes clarity depends on the specific circumstances, but it is crucial that there is no ambiguity about whether the contractor has fulfilled his duty to warn. Despite project time constraints, it is advisable to pay sufficient attention to clearly wording and appropriately delivering the warning.

If the written and unequivocal warning requirements are met, there is still another condition the contractor must satisfy. The contractor must inform the client of the potential consequences for proper fulfillment of the agreement. This must be done ‘timely,’ as stated by law. The legal commentary does not fully clarify what ‘informing of potential consequences for proper fulfillment’ means, but in practice, it might include warnings about additional costs (from unchanged continuation) or the need for unusual measures to avoid risks to third parties due to errors in the assignment.

Finally, it is important that the duty to warn in construction contracts cannot be deviated from to the detriment of a consumer client. Non-professional clients are thus given extra protection. If you exclude the duty to warn as stipulated in Article 7:754 of the Civil Code in a construction contract with a private client, you risk that the consumer client can always invoke this article. A differing agreement is, in principle, void.

If you have any questions following this blog, please contact Erwin den Hartog or Petra Lindhout from our office.