The cost of remediation of buildings damaged by the incorporation of pyrites into them is considerable. This is unavoidable where the construction works have been completed and, typically, the pyrites are in the sub-base of the construction. The pyrites expand in certain circumstances, deforming the floor and walls and other structural elements of the building.
The current estimate is for 1,100 private dwellings affected. It has been estimated that each will cost €50,000 to repair. That’s a total of €50 million.
These houses have been built and bought within the recent past.
If a builder supplied construction services only (and supplied the pyrite affected material) but did not supply the land (because the consumer already owned it, say) then the Liability for Defective Products Act 1991 (as amended) would, most likely, apply to the supply of the pyrite affected material. Otherwise, being an immoveable, the building is not covered by the Liability for Defective Products Act 1991.
Of course, in every case, there will have been a contract between the consumer and the builder. In each such contract there will have been incorporated, either expressly or by implication (under statute) a term that the goods supplied under the contract will be of merchantable quality. Clearly, building materials that deform the structures of the building are not of merchantable quality.
Where the claim can be made in contract, only the builder is answerable to the consumer. Where the claim can also be made under the Liability for Defective Products Act 1991, the consumer may also sue the supplier(s) of the pyrite affected material.
Consumers need to know that the Statute of Limitations sets the period for issuing proceedings at six years for breach of contract (irrespective of knowledge) and under the Liability for Defective Products Act 1991, at three years “from the date on which the cause of action accrued or the date (if later) on which the plaintiff became aware, or should reasonably have become aware, of the damage, the defect and the identity of the producer”.
The Pyrite Panel remarked of the difficulties facing these consumers:
“Legal proceedings are costly and beyond the financial capacity of most householders and can be very time-demanding.”
This is a nearly correct description of the “pyrite problem” for consumers. If the builder has gone into liquidation that will probably extinguish the possibility of any successful litigation.
Luckily the problems described by the Panel are mostly practical. Lawyers generally solve these kinds of problems but have to be selective in the kind of person they agree to work for. More and more unscrupulous “free riders” are ruining facilities normally delivered by lawyers to people in need. Solicitors have to be extra careful in taking cases where unscrupulous behaviour on the part of “victims” can rebound on the solicitor
The problem is made more difficult by Irish state failures. In Ireland, we have no provision for a consumer to claim directly on the insurance policy of a defunct company (or person). This is the case even where all the premiums were paid as they fell due and the insurance company is at no disadvantage in settling the claim (except to pay it). It is different in the UK.
Liquidation aside, and in the absence of self-inflicted wounds of missing Limitation period deadlines, householders can generally and practically succeed in making recovery for the damage to their houses.