Buying a house from a private seller makes it harder for the buyer to get full knowledge of the condition of the estate, its flaws and defects than it is for the first owner.

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Since there have appeared many issues relating to defects in buildings over time, with sellers, buyers, or the first owners being the parties to a dispute, the extent of the phenomenon gave rise to the necessity to look into the problem from a broader perspective.

When is a seller responsible for building defects?
The assumptions of the warranty against defects in buildings, laid down in The Protection of Competition and Consumers Act make it easier for the buyer to get compensation in case a defect of a newly bought house is discovered.
In Denmark, a general rule is that a seller is not responsible for defects providing that the building will have:

⦁ a valid tilstandsrapport (a technical report)
⦁ a valid el-installationsrapport (an electrical installation report)
⦁ and the insurance offer against defects – ejerskifteforsikring.

But, there are certain exceptions in which a seller, despite the requirements being fulfilled, can be held accountable for building defects. This happens when a seller knew about a defect and did not report it to the buyer, or to the specialist who draws up a technical report.
In most transactions, a seller will take advantage of the applicable laws in force to limit his or her liability, providing the buyer with protection at the same. In some situations, such as divorce, when a property is divided, or when it is purchased by the family members, technical reports or insurance offers may be omitted.

What are the time limits for submitting a complaint?
The new owner has the right to submit a complaint within 10 years from the date of purchase (or, to be more precise, from the date of the handover). The complaint shall be submitted as soon as the defect is detected, no later than 3 years from the date it is discovered, and within 10 years from the building handover. If, for example, a defect is discovered in the ninth year of the use of the property, the time limit for submitting a complaint expires with the end of the 10-year period of the complaint submission.
A delay in submitting a complaint to get the defect worse in order to obtain a higher compensation from the insurer or from the previous owner is not accepted. Such willful act may be deemed a deliberate negligence and considered detrimental, as a result of which, the insurer may deny the compensation.
The very notification of a defect submitted to the first owner does not suspend or interrupt the 10-year period of the complaint procedure. If, then, the first owner ducks the responsibility, it might be necessary to seek legal advice.

How and where to submit a complaint?
In case a defect is detected (a defect that was not identified in the report) by the buyer during building usage, the new owner has the right to report damage to the insuring company whose ejerskifteforsikring offer the buyer accepted during the purchase transaction, or report the defects to the professionals who drew-up the reports, or to the seller. It is the buyer, who has to carry the burden of proof of the occurrence of a defect after the purchase (or to be more specific, after the handover). It is crucial that the buyer reports the occurrence of a defect without delay, in writing, and should not try to amend or repair it on their own before the responsibility is established. If the owner decides to remove or repair the defect, it may then be difficult to prove the liability, and the insurer may reject the claim.
If, however, it is necessary to protect the property and prevent the defects from worsening, the owner may, for example, protect the roof from flooding, so that the water does not infiltrate other parts of the building.

When is the complaint unjustified?
Once a defect or a fault is listed in the technical report, and the would-be buyer can notice a defect while inspecting the property before the purchase, it cannot be subject to a complaint or insurance claims afterwards.
It is worth noting that if the buyer has not decided to take advantage of the ejerskifteforsikring, it is the buyer who takes the responsibility for the potential costs of repairs, unless they prove that the defects were hidden by the seller, or were not listed in the technical reports. We, therefore, always advise considering the ejerskifteforsikring once the decision of buying a property is made, even that it is not obligatory.

Those interested in buying a house with a cellar or a basement should be aware of the fact, that not all flaws will be regarded as building defects subject to insurance protection. Water and moisture in basement will not be subject to insurance and complaint procedures, as far as the seller does not guarantee that the property is free from this problem, because dampness is considered as an inherent quality of most houses with basements or cellars, especially those built several dozen years ago. What is more, the buyer has the chance to verify the condition of the estate in all its parts before the purchase.

The rules described above can be only applied to houses and apartments with technical reports attached (ejerlejlighed med tilstandsrapport). For buildings such as blocks of flats, other set of rules will be required as these are usually lacking technical reports on their condition.

If you feel that you may need professional advice because you have a problem with your newly purchased estate, contact us via the contact form, or call. We have dealt with such cases since 1997, so you can rely on his experience and expertise.

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Legal note

The publisher of the House in Denmark service is the Advokat Thomas Refning Poulsen law office located in Herning, Denmark. The use of the content of the Service is voluntary, free of charge and generally accessible.
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