1. Overall
The takeover is as central to a contract where the end user is the consumer, as it is in contracts between professionals.
The rules of the Bustad Listing Act on takeover and on takeover business are also broadly the same as those found in the standard contracts at the superior and subordinate levels, respectively.
The articles on takeover and takeover business in e.g. the collection of articles on NS 8407 et al are therefore relevant, and we will return to that below.
Nevertheless, there are some differences, and these are primarily the ones that we will focus on in this article.
2. Preparing for takeover business
In the professional contracts, the preparation for takeover business is thoroughly regulated, see, for example, NS 8407 paragraph 36.
Despite that, the bustad entry law does not contain corresponding provisions.
However, we would recommend that all professionals include a provision on final inspection in their contracts and that the corresponding provision be carried forward to the contract with the consumer.
The completion procedure gives all parties an opportunity for an additional check of the contract subject, clarifying possible defects/discrepancies and, secondly, the relevant contractors the opportunity to finalize before the takeover transaction.
Such finalization should take place 2-3 weeks before the agreed takeover transaction with the consumer, and the deadline for the completion of defects/discrepancies should preferably be a few days before the actual takeover.
3. Simultaneous Takeover Briefly
As a rule, takeover deals are carried out simultaneously.
Simultaneous handover means that the time of delivery to the end user becomes common to all parties down the contract chain.
This is the rule in the sub-level contracts (NS 8415, NS 8416 and NS 8417) which all stipulate that the (total) subcontractor's works are taken over by the (total/main) contractor while the latter hands over to the builder.
Normally, the same approach is taken when it comes to handing over apartments or year-round/leisure homes to consumers.
In the case of larger apartment projects, one should think carefully through the takeover process and the need for finishing inspections etc in advance, cf point 2 above.
We recommend that competent assistance be used to design the contracts with the consumers respectively and down to the general contractor or subcontractors, so that the back to back considerations are sufficiently well taken care of.
4th. About Takeover
The rules concerning the takeover and the takeover business are contained in section 14 and 15 of the Buofl.
The rules are largely the same as in the contracts for professional parties. To the extent that there are any inequalities is due to the consumer protection that we have written about in the past.
The starting point is that a takeover shall take place at a takeover business, cf. § 14, first paragraph.
This is also the rule in the professional standards, but in contrast to these, the consumer's takeover of his dwelling can also take place by putting the dwelling into use, cf. § 14, second paragraph.
In order for a use purchase to have effect as a takeover, it is a condition in buofl section 14, second paragraph, that the work is “completed”.
If later it turned out that the dwelling was not “completed” then the consumer “move into the house” is not the condition for takeover met -- and then takeover is not considered to have occurred.
This rule represents a -- in our view -- unnecessarily high risk for contractor.
The consequence of the fact that the dwelling is not considered taken over by use because it was not “completed” will be that the effects of a rightful takeover do not occur.
The effects of the takeover are stated in buofl § 14, third paragraph, letters a — d.
These are the same as described in the professional standard contracts, see for example NS 8407 paragraph 37.4 about which we have written here.
In short, the risk passes to the consumer, the deadline for complaints begins to run, the day deadline stops and the contractor gets the right to send his final settlement claim.
Thus, if the dwelling was taken over by the consumer through use without its completion, none of these effects occur. This can create great challenges for an entrepreneur who has realized that the consumer was satisfied with the use.
Our clear advice is therefore that the entrepreneur does not allow the consumer to take over without the completion of a takeover business.
5. Takeover business
5.1 Overview
Section 15 of the Act is far from coinciding with the rules on takeover business in the standard contracts, but not as detailed.
There are, first of all, three matters governed by section 15 of the Buofl., namely 1) who can convene and when, 2) the rules for implementation if one party fails without a valid reason and 3) the condition for refusing takeover.
5.2 Both parties may convene
With regard to summons, it is stated in section 15, first paragraph of buofl., that each of the parties may convene with at least “seven days' notice” as soon as contractor “has notified the consumer when the work will be completed”.
There is no writing requirement for such a summons, but the contractor should here as otherwise provide for writing. For example, one should not run the risk that the consumer subsequently claims that he was not summoned and then demands daybreak because he did not complete the takeover transaction within the agreed deadline.
5.3 Implementation with only one party — valid reason for absence
Conducting a takeover business without the other party is primarily relevant if a consumer is absent.
The condition for such implementation is that the consumer lacks “valid reason” for not staying. Whether such a reason exists must be assessed concretely, but examples are illness confirmed by a doctor's statement or compulsory work travel.
If the consumer does not meet, the takeover is held and it later turns out that the consumer had a valid reason for his absence, the effect must probably be that the takeover becomes invalid. In that case, one must hold a new takeover business based on a new notice.
Since it is the takeover that interrupts a day-covered deadline, it would have been desirable if the bustad entry act said something about how to deal where a consumer does not meet, and at the same time has a valid reason for not meeting.
The professional standard contracts are also silent about what applies in such a situation.
The starting point is that it is only the takeover that cancels the deadlines imposed by the day. Therefore, if the consumer does not meet, the developer should carry out the takeover business.
If the consumer has given notice in advance that he has a valid reason not to meet, the developer should request the consumer to consider the works as completed at the time when the takeover transaction should have been held, unless a subsequent takeover transaction with the consumer shows otherwise.
Whether such an agreement is legal, we are somewhat uncertain, as to the immutability of the law, but such a dialogue could at least prevent daylight from becoming an issue whose only reason for a possible delay is that the consumer had a valid reason not to attend the originally convened takeover transaction.
A prerequisite for conducting takeover business without the consumer is that the notice -- which should be in writing -- contains information about the consequences of not meeting.
We refer in this regard to buofl § 15, second paragraph, letters a — c.
It must be stated that the takeover transaction can be carried out even if the consumer is absent (letter a), that deficiencies that could have been discovered in the takeover business must be reported as soon as possible (letter b) and that the takeover has the consequences resulting from section 14, third paragraph (letter c) of buofl.
5.4 When can a consumer object to a takeover?
The rules on this follow from buofl. § 15, third paragraph, which states that the consumer may refuse to take over “if there is a shortage that gives reason for the refusal“.
This formulation is somewhat different from the formulation in, for example, NS 8407, paragraph 37.3, where it is stated that the builder must take over if it is only demonstrated “minor deficiencies, and the deficiencies or their rectification have little practical significance for the assumed use of the subject matter of the contract”.
We have written about this provision in the article on takeover which we have posted links to above. In paragraph 5 of this article we deal with the right of the builder to refuse takeover. Serlv if we have posted the link above, it exists here. and the article contains relevant points for the understanding of buofl § 15, third paragraph.
What is “rimeleg reason” To refuse a takeover, of course, must be considered concretely.
Overall, we believe that it is not reasonable to refuse a takeover if all the necessary functions have been taken care of, the dwelling is free from defects of importance for personal safety and a correction of deficiencies can be carried out without this rendering the dwelling virtually uninhabitable. In addition, one should be expected to have a certificate of completion, but in any case a temporary permit for use.
If we were to try some examples we would say that the lack of handrails in a staircase that is absolutely necessary for the use of the dwelling, the lack of a balcony outside a door on the 2nd floor, the lack of electricity or the unfinished kitchen so that food cannot be prepared are deficiencies that should justify not taking over the dwelling.
Similarly, deficiencies that necessitate extensive defect remediation where, for example, dwellings and movable property have to be removed from the accommodation and residents have to stay temporarily in hotels can also justify refusing to take over the accommodation.
5.4 Scripture
It is indirectly stated in Section 15, last paragraph of buofl, that there is no requirement that the parties keep a written record of the takeover transaction.
However, in this provision, the parties are advised to maintain such a protocol, and our request to the developer is that a written protocol be provided.
Most developers are well acquainted with the takeover protocols used when a contract is governed by, for example, NS 8407 and there is no reason not to use something similar in relation to the consumer.
Most often, the takeover between the developer and the consumer will also take place simultaneously with the takeover by a general contractor, or subcontractors, cf. paragraph 2 above. Thus, it is also natural to use the same takeover protocol for all parties.
We have written about takeover protocols in the article on takeover in NS 8407 contracts, item 4 to which we have made a link in the text above.
