New home owners forced to sign non-disclosure agreements about poor builds

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The Guardian has reported some new home owners are being forced to sign gagging agreements with the NHBC preventing disclosure over poor builds

The NHBC has come under fire again this week. According to a new report from the Guardian some new home owners are being gagged over poor build and compensation claims.

The Guardian said it had been made aware of the gagging orders from homeowners who had contacted the media, but also from talking to neighbours in the development.

NHBC

NHBC provides warranties for most new build properties through its Buildmark scheme, which protects home buyers and their new home for the first 10 years. However, last week the organisation was criticised after it was discovered it is paying developers millions of pounds a year in what was described as a profit-share.

This latest news will undoubtedly be a further blow for the organisation, which is supposed to protect consumers from poor quality homes.

Unfair to gag consumers

Paula Higgins, chief executive of the HomeOwners Alliance, said: “Gagging orders are unfair. NHBC are acting as if they have something to hide.

“As guardians of quality of new homes in Britain they should operate openly and transparently rather than resorting to desperate measures.

“Silencing those who have a reason to complain will make it more likely to push down standards in the industry rather than pushing them up.”

Confidentially clauses are used in rare circumstances

An NHBC spokesperson said in a “small number of rare circumstances” confidentially clauses are enacted, but declined to disclose the number.

They said: “Buildmark is an insurance product. Claims made are settled either by NHBC arranging for repairs to be carried out, or paying the homeowner the cost of doing so.

“When we make a payment, we ask the homeowner to sign a letter to acknowledge that the payment settles their claim. These letters do not include confidentially or non-disclosure clauses.

“Only in a small number of rare circumstances will we include a confidentiality clause on settling a claim.

“In line with standard practice in the insurance industry, and to protect commercial confidentiality, this would be in specific cases that are subject to a formal legal agreement or when NHBC has agreed to meet the costs of a claim over and above the Buildmark policy requirements.”

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