A Current Legal Overview of the Avoidance of Damage to Third Party Property Regulations, 2019
On the 13th June 2019, the Government of Malta ordered an immediate suspension of any works being carried out across Malta and Gozo as an aftermath of a number of unfortunate incidents, inclusive of serious damage to third party property, resulting from construction, demolition and excavation works.
Shortly after, the Minister for Transport, Infrastructure and Capital Projects, published Legal Notice 136 of 2019 entitled Avoidance of Damage to Third Party Property Regulations (the “Regulations”) on the 25th June 2019 which came into force with immediate effect, without transitional provisions.
The scope of the Regulations is to ensure that before demolishing, excavating or construction works commence, methodologies that are technically secure are prepared with the aim of minimising the risk of damages to third party property or injury to persons that may result through the proposed works.
The Applicability of the Regulations
The Regulations are applicable to any construction work which involves:
- excavation, which affects third party property; or
- the demolition or removal of any existing structure or roof adjacent to, underlying or overlying any property belonging to or occupied by third parties or toothing work with existing buildings; or
- the building of additional storeys or load-bearing walls or structures over any property belonging to or occupied by third parties; or
- the construction of new buildings or additional storeys adjacent to existing third-party property1Regulation 4.
The Regulations apply to works of excavation, demolition and construction, that would have started but are not complete on the 25th June 2019, as well as those works of excavation, demolition and construction that are still to begin2Regulation 25.
The Method Statement and Condition Report
A highly detailed method statement is to be prepared by the perit in charge of the project, in collaboration with the site technical officer (“STO”) and the contractor who are responsible for the works covered by such statement3Regulation 8(1). The method statement is to be submitted not later than 2 weeks prior to the start of demolition, construction or excavation works.
The developer shall also be required to submit to the Director, a condition report on properties located opposite, overlying or underlying any construction or excavation site by not later than 2 weeks before works commence. A copy of the report must be sent to the owners or occupants of the third-party property by means of a registered letter.
The Site Technical Officer
The Regulations brought about the controversial decision that the site technical officer (previously known as site manager) of any construction site, must be a perit4Third Schedule to the Regulations. The STO is responsible for the enforcement of the method statement covering the works which the contractor who nominates the said officer is responsible for. Furthermore, this STO must be present on site whenever decisions are being taken that influence the risk of damage to third party property or injury to persons that may be caused by the works.
The contractor (engaged by the developer to execute the works) nominates the STO (a perit) after the latter has been approved by the perit in charge of the project. The developer, on the other hand, is responsible to take all reasonable precautions to ensure that the construction activity will not result in any damage to adjacent properties, including water damage5Regulation 5(3). The developer is also obliged to apply for an appropriate insurance policy (of not less than €750,000) together with a bank guarantee6Regulation 6.
Where does the ultimate liability lie?
Article 1638 of the Civil Code, Chapter 16 of the Laws of Malta divides liability equally between the perit and the contractor7Article 1638 (1) If a building or other considerable stone work erected under a building contract shall, in the course of fifteen years from the day on which the construction of the same was completed, perish, wholly or in part, or be in manifest danger of falling to ruin, owing to a defect in the construction, or even owing to some defect in the ground, the architect and the contractor shall be responsible therefor.
(2) The relative action for damages must be brought within two years from the day on which any of the said cases shall have occurred. The new Regulations however, divides liability as follows:
- The perit in charge of the project who prepares the method statement is professionally responsible for its contents.
- The STO is responsible for the enforcement of the method statement.
- The contractor is responsible for the implementation of the measures in the method statement8Regulation 9.
The STO shall ensure that the contractor is complying with all his obligations as provided for in the Regulations. If the STO notices any violation of these regulations, s/he shall immediately stop the works and notify the perit(i) in charge and the BRO9Regulation 10(2). Should an enforcement notice be issued by the Director, the STO shall immediately communicate this notice to the contractor and the perit(i) and ensure that this order is complied with by ceasing the demolition, excavation and/or construction activity10Regulation 10(3).
For the sake of clarity, the Civil Code should be amended to reflect such changes.
Offences & Penalties11Regulation 21
Should the developer not take out the proper insurance cover, the developer shall be liable to a fine (multa) of €500 and should the offence continue, to a further €100 for each day of default. The same fine would be applicable if the method statement is found to be significantly lacking.
Any person who fails to comply with the method statement shall be guilty of an offence and liable to €10,000 and in case the offence continues, to a further €500 for each day of default.
Any person who fails to abide by an enforcement notice or fails to cease operations or adopt interim measures shall be guilty of an offence and shall be liable to a fine of €50,000 and in case the offence continues, to a further €1,000 for each day of default.
Persons making false declarations shall be liable to a fine of €1,500 without prejudice to any other punishment under any other law.
Administrative penalties may also be imposed by the Director12Regulation 22.
This article is not exhaustive due to the ongoing nature of the situation. It is intended for information purposes and should not be construed as legal advice. For more information, you may contact us on [email protected].