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Consumer Code - Dispute Resolution Scheme

Justice for new home buyers!

Making a claim using the Code's Dispute Resolution Scheme (IDRS)

The Consumer Code provides all new home buyers with an alternative to taking a housebuilder to court. The Consumer Code clearly explains the house builder's responsibilities under the Code and in law, providing a low cost relatively quick, independent dispute resolution scheme. The scheme only applies to complaints made within the first two years from the start date of the home warranty cover and has a maximum claim/award limit of £15,000.


Inconvenience payment

From 1 July 2017, claims for 'inconvenience' can no longer be made by homebuyers! As this was frequently all claimants were often awarded, this change has been made purely to reduce awards against housebuilders.  But also from 1 July 2017, the maximum for 'inconvenience' is being doubled to £500, however, any "awards will be made by the adjudicator at their own discretion and consideration and only where a breach of the Code has been identified." But a homeowner cannot receive an award for "emotional upset and stress, as awards are to be judged as a matter fact and on the resulting financial loss caused." With 4.6 of the guidance stating: "home buyers may not receive an award for inconvenience alone."


Our advice is to claim the full £500 for inconvenience anyway, as it will give you an opportunity to justify it and remind the adjudicator of his option to award it.  


New homebuyers cannot make a claim until 56 days have passed since first raising it with the housebuilder and no later than 12 months after the housebuilder's final response to the original complaint. Claims must be sent with evidence, receipts and a case registration fee of £100 plus vat. (£120) This can be reclaimed but is not always awarded, even when the claim is successful.


The dispute resolution scheme is provided by CEDR Ltd (Centre for Effective Dispute Resolution) and is known as the Consumer Code for Home Builders' Adjudication Scheme (CCHBAS). Once a dispute is submitted, a trained adjudicator reviews written submissions from both parties and issues an award based on his or her conclusions. They will determine if a home buyer has a legitimate claim and has suffered financial loss as a result of the home builder failing to comply with the requirements of the Consumer Code.


This Dispute Resolution Scheme (IDRS) is independent of the home warranty providers. Any awards made to buyers under the Consumer Code IDRS, are not under-written or covered under the warranty provider's policies.


The timeline of the process takes a minimum of 12 weeks to complete. It takes up to eight weeks to reach stage 9 where the decision of the IDRS is sent to both buyer and builder.  The buyer then has six weeks to consider the decision. If the outcome requires money to be paid, this must be done within four weeks.

For more information download pdf:




Adjudication Case Studies

As of December 2015, out of the 157 cases brought by buyers since the code was first launched, just 84 (53%) were found in favour of the new homebuyer, although in most cases only 'in part', often with a minimal financial award. It would appear that a buyer's claims are more likely to succeed if the amount claimed is relatively low such as claiming for refund of reservation fees. In other cases, where amounts claimed were more substantial, the buyer's claims were unsuccessful - often due to a lack of evidence in support of their claim.


In the first 12 reported case summaries to June 2012, house builders were ordered to pay £23,865 (57%) out of a total claimed £41,365 in the six successful cases. Of those dismissed by the adjudicator, house builders were saved a total of £41,450. In the next 13 case summaries to February 2013 only 4 succeeded, with total payments of just £4,180 (20%) out of the total claimed £20,509.  The nine dismissed cases saved house builders around £121,359. In the 2013 case summaries overall, only 10 (45%) succeeded (in part), with total awarded £26,512, again falling short (19%) of the total amount new homebuyers claimed £133,845.


In the 2016 case summaries, the number of successful claims rose to 57 (77% of the total) with house builders ordered to pay £55,401 - 15% of the amount claimed in these cases. To end December 2016, those using the Adjudication Scheme have a higher likelihood of success, due to the pressure for the introduction of a New Homes Ombudsman. However, successful claimants are only likely to be awarded on average, around 18% of the amount they claim. Here is a pdf spreadsheet detailing case outcomes, awards and Code requirements breached for 2016.


It would appear that new home buyers would be well-advised to make audio recordings when asking questions and seeking clarifications in house builder's sales marketing centres. Failing this, everything agreed should be recorded in writing and signed by BOTH the builder's representative and buyer. Buyers should take a copy with them at the time of reservation.


The first 26 Adjudication Case Summaries to February 2013 that have been made public can be seen by clicking on the link. The remainder from January 2013 to December 2016 are below:

Case Summaries to December 2013

Case Summaries to December 2014

Case Summaries to December 2015

Case Summaries to December 2016


(Figures for 2016 in tables based on information in case summaries)



The most frequent breaches to Code (requirements) by housebuilders were:

(in 37% of all successful cases in 2015)

(in 24% of all successful cases in 2015)

(in 54% of all successful cases in 2015)

(in 35% of all successful cases in 2015)


Our advice:

Download a copy of the Consumer Code and read it BEFORE you discuss anything with sales advisors. Be aware of our Do's and Dont's when buying a new home. Ask plenty of questions and make sure you record the answers given, either by making notes and getting the sales advisor to sign and date them or by making an audio recording. Evidence is essential when using the Code's Dispute Resolution Scheme.


Information and Checklist before claiming compensation using the Adjudication Scheme.


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Adjudication Outcome

Total

2016

2015

2014

2013

2012

2011

2010

Unsuccessful

52

16

5

8

9

8

6

0

Succeeded ‘in part’

126

49

37

19

10

5

6

0

Succeeded in full

15

8

3

2

0

1

0

1

Withdrawn

24

1

9

5

3

2

2

2

Case settled before IRDS

13

0

6

6

0

1

0

0

Other

1

0

0

0

0

1

0

0

Totals

231

74

60

40

22

18

14

3

YEAR

Amount

Claimed

Amount

 Awarded

Percentage

 awarded

Total

£ 1,331,249

£ 252,095

18.00%

2016

£  367,559

£  55,401

15.00%

2015

£  374,103

£   93,456

24.98%

2014

£  241,101

£   48,832

20.25%

2013

£  133,845

£   26,512

19%

2012

£  139,615

£     4,680

3.30%

2011

£    70,024

£   18,205

26%

2010

£      5,000

£     5,000

100%

Consumer Code 4th Edition with Builder Guidance