Insurance for Build by Neighbour's Son

[Spinny]

Neighbour will be having a side extension built by his son. His son does building work and has previously done some renovation/refurbishment for the neighbour. However we understand he does not have his own building company or limited company shell but operates as a 'sole trader'. The neighbour does not plan to have any building contract for the work 'because it's their son'.

 

Given the work is close to us and the boundary I am concerned to understand what should be done to provide insurance cover for the work ?

 

If the son has any liability cover (?), I would guess that this would only cover contracted work and not casual uncontracted and possibly unpaid work building an extension for his parents ?

 

Clearly without insurance major risks such as a collapse, subsidence, fire etc of the neighbour's property or our property potentially costing life changing sums to fix are not covered. In addition I am concerned that even any modest payments to put right any damage done by the work may create immediate conflict if they are coming directly from the son's 'pocket' and there is no insurance cover.

 

Can anyone clarify or suggest what insurance should be in place and how to verify it ?

[Redbeard]

Unless the son is doing the work entirely financially unrewarded there is an argument that a contract exists. If that is the case then, unless his insurer precludes work for family members, his insurance is probably valid for the work - if he has any. Don't worry much about him being a 'sole trader' as opposed to  ltd co. Many, including me, have no wish to be more than a sole trader, and it's a perfectly acceptable business model if you don't feel the need to limit liability. 

[G and J]

How close to the boundary? I ask because if it were party wall agreement close, this could/would/should prescribe insurance detail. We know this as our build has party wall agreements with both neighbours.

[ToughButterCup]

2 hours ago, Spinny said:

Neighbour will be having a side extension built by his son....

 

Financial arrangements made in respect of a lawful build  have nothing to do with anyone other than the contractor and customer.

[Spinny]

Yes it is party wall agreement close. PWA surveyors are being appointed.

I was hoping that might address it, but I remain nervous given the lack of any independent party (e.g. a third party builder) in the work, and the approach taken to planning permission which has led to previous planning precedents being broken.

In normal circumstances the neighbour would be concerned to oversee a third party builder, but tends to leave his son to do as he wishes.  Likewise a third party builder would be concerned to address risks, very careful not to build in the wrong place, likely include some neighbour contingency in their price, and take their own view re any matters arising. But of course none of that applies here.

I would really like to have predefined certainty over all aspects in advance, as that seems the best way of avoiding disputes.

 

What did your own agreements prescribe re insurance ?

And did you have a mechanism to control the actual build with neighbours - e.g. to confirm footings were not in the wrong place etc etc ?

[Conor]

The building control process will cover most of your build quality/competency concerns. Speak to your own insurance company about third party liabilities and what they would require from other parties.

[Spinny]

32 minutes ago, ToughButterCup said:

 

Financial arrangements made in respect of a lawful build  have nothing to do with anyone other than the contractor and customer.

Perhaps, but I would have thought insurance aspects do to the extent that they impact a third party and work is subject to the PWA. Surely the third party would be entitled to have a copy of the insurance policy and to verify that it covers the relevant risks - or if not a formal written legal statement that the contractor accepts full personal financial liability and has the proven financial means e.g. to rebuild both properties in extremis.

As I understand it the whole reason for the PWA is to avoid the courts filling up with 'considered by others petty' disputes over work with impacts between neighbours.

 

I would also say, how can you be a contractor if you don't have a contract. Yes low value work often gets done based on a written quotation and acceptance which doubtless forms a kind of recognised contract. But as we all know anyone spending major sums with builders without a written contract is daft. If there is no exchange of monies is there a contract ?

 

I took the correct and responsible approach with our own build to protect ourselves, our property and our neighbours properties by taking out proper insurance cover. I simply expect our neighbour to do the same. I also know from speaking with multiple insurers that many require that building work is covered by a contract e.g. JCT and that contractors are verified to have £2M liability insurance, otherwise they will not insure/cover.

 

I think most of us can agree that resort to the courts to determine 'lawfulness' is a last resort best avoided. And it is in everyone's best interest apart from those wishing to break or abuse the law, to ensure builds are 'lawful' before and during their execution. Despite this we sometimes see in the press builds having to be demolished.

 

Anyway, all I am wanting to do is ensure things are done correctly and lawfully. My own experience with building is better to identify, plan and address issues early/asap and 'a stitch in time saves nine' applies to everyone's benefit.

Bit of a digression perhaps, sorry for that.

[G and J]

You say there will be a party wall agreement, so are you aware that as well as their surveyor you have the right to appoint your own surveyor at their cost.

 

This is what we did, i.e. our 2 sets of neighbours had one surveyor, and we had ours. This way the two surveyors hammer out the details and yours will take a brief from you as to what you want. The agreement will stipulate (obviously check) that works on the party wall (ie on or close to the boundary) will be undertaken by skiiled and insured contractors and that appropriate site insurance is in place, which in our case was to be provided to the surveyor before commencement.

 

We have keep in dialogue with the neighbours  and intend to throughout, but they have the reassurance of someone acting on their behalf and a route of raising concerns if they were to feel we were't listening or doing something we shouldn't.......it sounds like this would be the kind of thing you would be looking for?

[Spinny]

G and J,

 

Thanks yes, that is what we want to achieve. We have nominated a surveyor for ourselves in response to a notice from theirs.

 

However it seems rather odd that before even visiting or taking any full brief, our surveyor already seems to have agreed with the other surveyor on a third surveyor to be used in the event of failure to agree. I understand all these PWA surveyors are bound by their professional body and the Party Wall Act and are supposed to operate more like judges do rather than just as advocates for one party with respect to the other. But at the same time in any geographic area there are very few of them and they must work together frequently. One can't help but wonder whether one of them asserts the nomination of their drinking mate to be arbiter of any disagreement.

 

I am possibly a bit paranoid, but our neighbours never even attempted to show us their plans or discuss them with us in any way, and they submitted them directly in for planning approval the day before Xmas eve, so that 2 weeks of the 4 week period for comments went by before we even received any notificaton from the local planning office. I know from our own experience that architects and planning authorities advise people to discuss with their neighbours first. Then I didn't appreciate that our local planning office now seems to be short staffed and populated by new young planning officers in their 20's placed under pressure to process every application at speed. End result - bad for us.

 

Given their son is also doing the work we don't appear to start from a good place with an empathic and considerate neighbour.

 

[G and J]

3 minutes ago, Spinny said:

....we don't appear to start from a good place with an empathic and considerate neighbour.

 

 

Not discussing planning applications, plans etc, is unfortunate.

 

Regard the third surveyor, both other surveyors (yours and theirs) would need to agree, so that bodes well.

 

You're right of course they are bound by professional standards, and the way our surveyor explained it to us, and in fairness the other to our neighbours was that their job is actually to advocate for the "party wall" and therefore neither will take "sides"......it's much more factual.

 

As your neighbours appear not to be keeping you informed so far, one of the items we needed to provide for the agreement was a drawing of the proposed foundations, so you could ask that this is provided and to see that when it, so you can judge whether all is going to plan or if changes (which may be necessary as the build starts) are being made? 

 

Hopefully, in the end all will be well, but in the meantime it's good to be acting as an informed party.

[Jilly]

No one except planning enforcement will care about the correct measurements for the placement of footings, so it’s in your interests to measure  if it bothers you that there might be a breach. Easier to sort out and more neighbourly than calling enforcement. 

[Temp]

51 minutes ago, Jilly said:

No one except planning enforcement will care about the correct measurements for the placement of footings, so it’s in your interests to measure  if it bothers you that there might be a breach. Easier to sort out and more neighbourly than calling enforcement. 

 

A common mistake is to put the wall on the boundary forgetting about the eaves overhang or guttering. 

 

Make sure they start the wall in the right place. Don't wait until the wall is half up or they will never change it without a fight.

[Spinny]

Jilly & Temp, thanks, yes all too conscious of that. I want the exact position of the wall agreed and professionally measured from fixed points and verified at the build when the first footing blocks are laid, And that the position recognises the roof eaves/fascia. And based on construction drawings not the airy fairy planning ones where the architect has shown the land sloping in the opposite direction to reality. Somebody building a giant wall a metre in front of your glass door is not a pleasant prospect.