Abstract

The statutory warranty for defects and the guarantee are two regimes of liability which should protect the interests of the investor (contracting entity) against the consequences of physical defects of a structure. However, it may turn out in practice that without good will on the part of the contractor it may be difficult for the investor (contracting entity) to enforce their rights.

The warranty binds the contractor statutorily, but it may be modified by contract, which ultimately may lead to its total exclusion. Moreover, the manner in which the contracting entity’s rights are exercised, especially counter-rights of the contractor, may result in that a claim is settled otherwise than to the best interest of the investor. The argument for the use of the warranty, especially as regards defects of a structure, is its longer duration, especially for real property, though the obstacle is the need to prove that the defect existed at the time of handing the structure over under Art. 6 of the Civil Code. The guarantee is voluntary and usually of a preventive nature; it is aimed at arousing trust of the contracting entity to the contractor. As regards construction works, the guarantee is of special meaning with respect to the components and appurtenances mounted in a structure. The liability regime: under the warranty or the guarantee is to be selected by the contracting entity.