Contract Law

With the development of construction activity and real estate in Portugal in recent years, often problems arise with the quality of work performed. We will focus on some important aspects of this problem.

In the contract a person or entity (contractor) has the duty to another person or entity (owner of work) to perform a certain work, with payment of a price. The contracts cover all types of building works as well as manual work, such as the arrangement of a motor vehicle or a washing machine.

What can be considered as a default?

In Portugal, the law protects the owner in what is considered to be defects that the contractor is responsible for.
The owner has the benefit of assuming the contractor’s fault, including acts carried out by their representatives, workers and employees. To remove this presumption of guilt, the contractor will have to prove that he did nothing to cause the defect, that he performed the work in accordance with the construction rules and according to what was negotiated with the owner. Only then will the contractor be liable for the defect of the work.

The contractor will have to prove that the defect in the work was due, for example, to completely abnormal climacteric phenomena (for example torrential rains, unusual winds, earthquakes) or acts done by people who integrated into the contract team (for example, a neighbor who rises and walks on the roof of a work and of a tile) or simply the defect itself is justified by the time deterioration of the materials (for example, the color paint of the walls change over the years when exposed to the south). Otherwise, the contractor will always be responsible for the defect.

Accept or refuse the work, which should make the owner?

Once the work is finished, the owner must check very carefully if the work is well executed. In case of more complicated works, the owner or contractor has the right to hire one or more experts for this verification, paying the expert’s report.

If the work is defective, the owner has the right to refuse payment and demand that the defect be repaired. Alternatively, the owner can accept the work with limitation, that is, the owner receives the work on condition that the contractor is responsible for repairing the defect within a set period.

If the developer does not verify the work, it is considered that it accepts the work without limitation, that is, that the work is correct.

What is the warranty period for the contract?

In order to activate the guarantee of the contract it is necessary to pay attention to several deadlines that are coordinated among themselves.

As for the works on goods in general (car mechanics, furniture cabinet, etc.), the warranty period is two years from the completion of the work and delivery of the goods to the owner. However, the owner is obliged to communicate the defect of the work within a maximum period of 60 days, from the day he discovered the defect of the work. This means that the law requires the owner to be aware of the defects in the work and also to promptly inform the contractor. The owner is not allowed to wait for the end of one year to inform the contractor of a work defect he discovered months earlier.

As for the works on real estate (general construction, painting of walls, etc.), the deadlines are longer. The warranty has a term of 5 years, and the owner must report the defect of work within one year after the date on which he became aware of the defect.

In all the contracts can be established, by written document, a longer term of guarantee of the work.

How to claim the contractor to repair the defect?

The responsibility of the contractor for the defects of the work always depends on the previous written communication of the defect in the periods established by the Law.

It is very important that the owner has two proofs. The first proof is that of sending the written, concrete and detailed communication of the defect of the work (preferably with photographs). The second is proof of receipt by the communication contractor, for example, receipt of the letter signed by the contractor.

Another important detail is that the owner of the work shall require to be made to repair within a certain period. The owner must indicate that he requires the repair of the defect of the work until a certain day, month and year.

And what happens if the contractor fails to repair the defect?

In case the contractor fails to correct the defect within the time limit established in the written communication, the owner must submit the case to the courts within one year of the last day of the period established in the letter.

If the owner does not submit the lawsuit against the contractor at that time, the owner will definitely lose his right to demand repair of the defect. The contractor will thus be without any obligation of repair or compensation.
The strict and timely compliance of all legal procedures and deadlines is essential for the proper resolution of the problems of defects of the work and should be advised by a lawyer experienced in the matter.