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Can anyone tell me whether a developer has a legal responsibility to supply at his own cost services such as electric and water until such time as habitation certificates are supplied. We are in a situation where our developer has stated that he can no longer afford to pay for the deisel for the generators which supply our electric. He has been holding us to ransom now for 5 years -completion should have been in 2006. I would be grateful for a reply.
Thanks
Dear Sir/Madam,Quote:
Originally Posted by Unregistered
Yes it is the responsibility of the developer to supply you with utilities until the granting of the Habitation Licence (AKA LFO).
Another matter being what happens if the developer goes into administration and stops delivering builders supply?
In the first place you should not be dwelling in a property without a Licence of First Occupation being issued by the Town Hall as it is illegal. Only under exceptional circumstances de we solicitors recommend clients to complete without one (e.g. the developer is about to file for bankruptcy and the Building licence is correct and unchallenged without any planning issues only pending the approval of the LFO).
I refer you to our article on Licence of First Occupation and I quote it:
What are the Associated Problems of Completing on a Property without a LFO?
Although it is legal to complete in such a case, it has numerous legal and practical drawbacks which ought to be highlighted by your lawyer to aid you in making an informed decision. To name a few:
1.- Primarily, you will not be able to take out a mortgage on the property or remortgage it - if needed be- by any bank other than the developer’s.
2.-You will not be able to benefit from the official utility supplies; only from the developer’s supplies (water and electricity) with all the associated problems this has, namely that you may be cut off at any time as it is the developer who is paying for it and if they go into receivership you will be shut off. Besides, the site supply electricity doesn’t have the same strength and power surges are fairly common on simultaneously turning on various electrical appliances such as air conditioning.
3.-Any future prospective purchaser, or their lawyer, will haggle with you and only pay a lower purchase price if you lack a LFO in a newly built resale. In a resale, the purchasers in turn will undergo the same problems to secure finance by means of a mortgage loan. A lack of a LFO implies that you are actually reducing the base of potential purchasers for your resale.
4.- If there are planning issues, the Town Hall can set a charge against the property and you as the new owner of an off-plan –and not the developer- may be held liable to pay the fine for the planning illegality.
5.- Needless to say, you cannot let a property legally without a LFO.
Many thanks
You're welcome.