Liability for damage caused to third-party property

A recent judgment of the Audiencia Provincial of Vitoria-Gasteiz (SAP VI 58/2024) had the opportunity to address the issue of civil liability in the field of Spanish condominium law.

Damage was caused by inadequate refurbishment work within an apartment. The ruling in question underlines the importance of the care to be expected when carrying out modernization and renovation work and highlights the legal consequences that can result from inadequate planning and execution.

The original lawsuit was directed against the condominium owner and his architect, who were to be held accountable for structural damage caused during the renovation.

One of the most important issues raised concerned the allocation of responsibility between and among the parties involved. The judgment dealt with aspects such as culpa in eligendo (fault in the selection of the agent or vicarious agent), the relevance of joint and several liability and the obligations arising from the Spanish Condominium Act.

As we will see in a moment, the court held both the owner and the architect responsible and thus made it clear that the commissioning of specialists does not necessarily mean that the client can escape responsibility if the commissioned specialists make mistakes. Rather, the client must exercise extreme care in the planning and execution of the work and cannot be content with having commissioned generally qualified specialists alone.

Damage to third-party special property

The background to the legal dispute was damage caused to the plaintiff’s apartment, which was located on the upper floor of an old building, by renovation work carried out in the defendant’s apartment below. The owner of the apartment in which the work had been carried out commissioned an architect with the planning and construction management.

During the execution of the work, which included the demolition of interior walls, structural damage occurred, which affected the apartment on the upper floor, and in particular its floor (and the ceiling of the condominium element below).

The plaintiff demanded compensation for the damage caused and the implementation of structural measures to reinforce the building fabric and restore the safety of the building.

The judgment at first instance ordered the architect to pay damages and, as the plaintiff had requested, to implement measures aimed at strengthening the building fabric as intended and thus restoring the necessary safety.

However, the conviction did not extend to the client, i.e. the owner of the apartment on the upper floor, as he was released from any responsibility.

Both the plaintiff and the convicted architect appealed against this decision.

Reasons for the decision of the Audiencia Provincial

The Spanish regional court came to the conclusion that the first instance judgment should be partially set aside and extended the liability, which was initially limited to the architect, to the owner of the renovated apartment.

The Regional Court based its decision on four arguments:

1. Liability for third-party negligence (Articles 1902 and 1903 of the Civil Code): The Court of Appeal applied the principle of culpa in eligendo and concluded that the owner was negligent in the selection of the architect because, although the architect had relevant professional qualifications in principle – because in the abstract – the specific work commissioned was of such complexity that the architect ultimately commissioned was not sufficiently qualified.

A client should not rely on the fact that the contracted specialist, due to their profession, can generally carry out similar measures, but must make sure that a specific qualification exists.

2. Joint and several liability: The court ruled that, for the above reasons, the owner and the architect were jointly and severally liable, which, among other things, strengthened the protection of the injured party and facilitated the settlement of the claim.
   
   
3. Obligations under the Condominium Act: The court emphasized the importance of Article 9.1 of the Spanish Condominium Act (Ley de Propiedad Horizontal), which obliges all owners to maintain their condominium elements in a suitable condition and not to harm other co-owners.
   
   
4. Continuing damage vs. damage that has finally occurred: The Court of Appeal rejected the plea of limitation by classifying the damages as continuing and continuing to accrue, which is why the calculation of the limitation period started at a later date. As a result, the defendant’s objection that the plaintiffs’ claims were in any case time-barred was rejected.

The court’s reasoning is essentially in line with existing case law. However, the question arises as to whether the extension of the responsibility of the client, i.e. the owner of the apartment to be renovated, is inappropriate.

After all, it is very difficult for a layperson to assess the suitability of the architect commissioned here and it should be assumed that it is the professional who must be able to assess most reliably whether or not he is capable of carrying out the assignment correctly.

The extension of liability to the client could therefore be seen as exaggerated.

Consequences for practice

On the one hand, the decision described above illustrates the importance of classifying the damage and its effects (completed damage vs. continuing or continuing damage) in order to ensure that any impairment that may have occurred can still be claimed in good time and the statute of limitations defense can be avoided. In case of doubt, measures should be taken to interrupt the limitation period. However, claims that appear to be time-barred at first glance may still be enforceable if continued damage can be proven.

“In this case, it is a case of continuous damage, as evidenced by the fact that the damages follow one another in the course of the works, after the demolition of the walls and partitions, which is confirmed by the expert Mr. Juan Ramón in his reports, in which he also includes photographs of the state of the works”

On the other hand, it creates a certain amount of uncertainty with regard to the delimitation of responsibilities when it comes to determining the duties of a specialist’s client.

At first glance, the ruling increases the responsibility of clients when selecting professionals, suggesting that greater caution and care should be exercised when commissioning architectural and construction services.

“As owner and builder, they must be liable for damage caused to third parties, otherwise each owner could exclude their liability simply by hiring a professional. The liability of the owner of the apartment above is joint and several with that of the architect”

However, the fear that this could lead to uncertainty among consumers and influence the way in which this work is commissioned and insured in individual cases is rather unfounded.

If you take a closer look at the facts of the case, you should rather conclude from the decision that the client cannot evade responsibility simply by using a service provider or contractor. If you are looking for someone who is obviously acting inappropriately, you cannot hide behind the alleged qualifications of the professional.

Rather, it is clear that before carrying out extensive and far-reaching refurbishment work in older buildings, which includes the removal of masonry, adequate structural surveys should be carried out and not be content with such an obvious requirement being missed by one specialist or another.

“In such an old building with a wooden structure, the partition walls were stressed, during the demolition this aspect was not taken into account, it was not properly supported and this led to the sinking of the ceiling of the upper apartment, which caused the damage in the plaintiff’s apartment”

Fortunately, the sum involved in this case was comparatively low (the plaintiff claimed just over 25,000 euros in damages), considering that work that can lead to the destruction of a multi-storey property has the potential to cause millions of euros worth of damage.

In this case, the hazard ended relatively lightly because the damage was discovered and contained relatively quickly (lowering of the ceiling) and was also relatively easy to remedy. However, it would have been just as easy to make the building uninhabitable and ready for demolition if the damage had gone on undetected.

On the other hand, this also underlines the sense and purpose of involving the community of owners in construction measures within special property elements.

As long as no community property is affected or the rights of third parties are impaired, it is sufficient, as stipulated in Article 7.1 LPH (Ley de Propiedad Horizontal), to notify or announce the measures to the community.

Nevertheless, in most cases this information is not provided due to ignorance or convenience.

However, if nobody is aware of such measures, it is much more difficult to detect changes – after all, there is then a lack of increased awareness and therefore vigilance and attention on the part of the other owners.

Conclusion

The judgment of the Audiencia Provincial (SAP VI 58/2024) should encourage people not to take structural alterations lightly. Even if the extended responsibility of the client by the Court of Appeal might seem excessive, one should not underestimate the insight the judges had into the behavior of the client and his architect after the commissioned building experts had prepared their reports and explained them to the court.

The Court of Appeal was less concerned with setting a precedent and holding every client responsible for the mishaps or negligence of the specialist than with making it clear that in this specific case, in an obviously very old building that was still built on the basis of a wooden structure, the client also had to be aware that not every modernization request can be implemented without restriction. Regardless of the qualifications of each individual architect, there are “braver” and “more conservative” architects. However, those who knowingly take the path of the “brave” must not hide behind it.

“The architect Ms. Filomena and her colleague did not take this into account. The experts Mr. Fermín and Mr. Manuel give inadequate explanations, exclude that the partitions have taken the load and give examples of other places where they have worked and which do not correspond to this specific case”.

Frequently asked questions (FAQ):

1. What responsibilities do clients have when commissioning renovation work in their home?
   
   Owners are responsible for selecting qualified professionals to carry out the work. The ruling discussed here describes that they can be held liable on the basis of culpa in eligendo (fault in the selection of the contractor) if they do not exercise due care. They must also ensure that the work does not harm other co-owners and complies with the provisions of the Condominium Act.
   
   
2. How does this ruling affect the responsibility of architects during renovation work?
   
   The ruling increases the responsibility of architects in renovation work, especially in old buildings. They are expected to carry out a thorough analysis of the existing structure and plan interventions appropriately in order to avoid damage. Failure to exercise due care will result in civil liability for the damage caused.
   
   
3. What are the implications of classifying the damage as continuing or ongoing rather than final and conclusive?
   
   The classification of the damage as continuing affects the calculation of the limitation period. In the case of continuing losses, this period does not begin to run until the final outcome has occurred, which is why the period in which a claim can be filed may be significantly extended. This provides greater protection for injured parties in cases where damage manifests or develops over a longer period of time.
   
   
4. How can a community of owners protect itself against dubious or problematic construction work in individual apartments?

Communities of owners can:

• In the event of justified doubts or concerns, request detailed documentation of the project.
• Request independent technical reports on the potential impact of the work on the building structure if there is a reasonable suspicion that the measures could trigger hazards.
• Establish protocols for monitoring the work.
• Require the conclusion or presentation of special liability insurance for the work.

The problem with such theoretical claims of the community results from the fact that these possibilities of the community are derived from the fact that it is one of the tasks and rights of the community of owners to monitor the safety of the common elements and other special property elements.

However, in order to be enforceable, these rights must be substantiated by a court. In the meantime, however, changes and damage may occur that cannot be easily undone.

First and foremost, the owners’ association should therefore promote open communication between itself and the owner carrying out the work.

5. What measures can owners take to minimize their liability when carrying out renovation work?
   
   owners can:

• Commission specialists with proven experience in the renovation of old buildings.
• Ask for references and check the qualifications of the specialists commissioned.
• require a complete structural investigation / structural analysis before starting work.
• Maintain effective communication with the community of owners and the affected neighbors.
• Take out special liability insurance that covers possible damage to third parties, or ask the commissioned architect to prove that he has the appropriate insurance.
• Document the entire process from commissioning to completion of the work, including approvals, preliminary investigations and decisions made.

6. what is the role of the technical building inspection (ITE) in such cases?

Although the ITE was not decisive in this case, its role can be important:

– It provides information on the general condition of the building that can be useful for planning refurbishments.
– It can indicate pre-existing structural problems.
– However, as mentioned in the judgment, the ITE does not involve in-depth soundings or structural investigations, so its limitations must be taken into account.

7. what legal action should an owner affected by similar damage take?

Affected i.e. aggrieved owners should:

• Document the damage comprehensively, preferably with expert reports.
• Notify those responsible for the work and the community of owners immediately.
• In the event of serious or progressive damage, apply for interim measures.
• Consider taking legal action against all potentially responsible parties: In other words, against the owner as well as the architect and the contractors.
• The limitation periods must be taken into account, whereby the continuing nature of the damage must be taken into account, which may have an influence on the start of the limitation period.

Relevant legal basis of the judgment:

1. Article 1902 of the Spanish Civil Code: establishes non-contractual liability for damages caused by fault or negligence. In this case, this was the basis for determining the liability of the parties involved.
   
   
2. Article 1903 of the Spanish Civil Code: regulates liability for third-party negligence, in this case applicable to the client with regard to the selection of the architect (culpa in eligendo).
   
   
3. Article 1904 of the Spanish Código Civil: Enables the client to claim recourse against the contractor. The client can thus demand compensation from the architect for the damage resulting from the joint and several liability of the injured parties. The fact that the client is jointly liable to the injured party does not exclude the possibility that he himself may hold the architect liable, as he alone was responsible for the qualified classification of what is possible and feasible and what is not.
   
   
4. Articles 7 and 9 of the Spanish Condominium Act, i.e. the Ley de Propiedad Horizontal (LPH for short): This essentially sets out the obligations of owners with regard to work in their homes and maintenance, which on the other hand must not harm other owners.
   
   
5. Article 1968.2 of the Spanish Civil Code: This regulates the limitation period for claims for non-contractual liability (tort law). The type of damage (completed or continuing damage) is important for the start of the limitation period. In particular, the limitation period for such liability cases is usually one year, which is why measures to interrupt the limitation period must be taken quickly.
   
   
6. Article 394 of the Spanish Code of Civil Procedure (Ley de Enjuiciamiento Civil): This article regulates the imposition of legal costs, and must be referred to when deciding who is to be ordered to pay the legal costs and to what extent.
   
   
7. Law 38/1999 on the Regulation of Construction: Although not mentioned in the judgment, this law is of great importance when it comes to determining the responsibilities between the parties involved in construction. Its provisions are particularly important to know when other professionals are involved in addition to the architect and the delimitation of responsibilities between them is at stake.