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Old 20.09.2010, 13:55
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Building company in liquidation - outstanding debts?

Apart from getting legal advice (which is happening), I wonder if anyone has any first-hand experience of the same or a similar scenario that my neighbours and I are facing?

We bought flats in small complex. They were finished and we all moved in. Great flats.

A couple of years later, the building company went into liquidation. We had most of the snaggings sorted out under guarantee but not so long ago, a bill came from the local Geminde to pay for the water and other services to be connected. It was around 60K CHF (and two years late!)
As the building company is in liquidation, the bill somehow got sent to us.

So, what do we do with the bill?
My neighbours are suggesting that we may have to pay it.

I don't think they've thought this through. What happens if other bills come in? What if the concrete hadn't been paid for or the crane hire or anything else for that matter? Should we pay for all of that?
The services connection was specifically included in the original contract.

All the directors for the old company are still trading with different companies.

Thanks.
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Old 20.09.2010, 14:09
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Re: Building company in liquidation - outstanding debts?

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Apart from getting legal advice (which is happening), I wonder if anyone has any first-hand experience of the same or a similar scenario that my neighbours and I are facing?

We bought flats in small complex. They were finished and we all moved in. Great flats.

A couple of years later, the building company went into liquidation. We had most of the snaggings sorted out under guarantee but not so long ago, a bill came from the local Geminde to pay for the water and other services to be connected. It was around 60K CHF (and two years late!)
As the building company is in liquidation, the bill somehow got sent to us.

So, what do we do with the bill?
My neighbours are suggesting that we may have to pay it.

I don't think they've thought this through. What happens if other bills come in? What if the concrete hadn't been paid for or the crane hire or anything else for that matter? Should we pay for all of that?
The services connection was specifically included in the original contract.

All the directors for the old company are still trading with different companies.

Thanks.
I suppose the first thing you have to do is check your purchase contract to see if this situation is covered - I mean unpaid bills by the building company, also check your building insurance.
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Old 20.09.2010, 14:29
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Re: Building company in liquidation - outstanding debts?

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I suppose the first thing you have to do is check your purchase contract to see if this situation is covered - I mean unpaid bills by the building company, also check your building insurance.
And consider yourself lucky you are not in this block.
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Old 20.09.2010, 17:46
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Re: Building company in liquidation - outstanding debts?

I don't know about laws in canton Zurich. Here in Vaud I kept a portion of the purchase monies back for things like unpaid bills which are the responsibility of the property owner. Can't remember the amount but it was several percent. They were held by the notaire in escrow for 18 months in case outstanding debts attached to the property were unpaid by the seller. Things like cement would be a contract between the builder and the supplier. Things like unpaid property taxes fall to the property rather than the owner and pass on with the title. Looks like utility connection charges might be the same. You should check with the lawyer/notaire who acted on your purchase before you pay anything but the fact you were billed sounds ominous.
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Old 20.09.2010, 18:21
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Re: Building company in liquidation - outstanding debts?

Isn't there an insurance policy the contractor is required to have for new construction for just this case? It's been a while since I looked into building so I could be mistaken. But it's something to look into.
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Old 20.09.2010, 18:25
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Re: Building company in liquidation - outstanding debts?

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Isn't there an insurance policy the contractor is required to have for new construction for just this case? It's been a while since I looked into building so I could be mistaken. But it's something to look into.
Usually. But I think that's for defective work, not unpaid bills.
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Old 20.09.2010, 18:37
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Re: Building company in liquidation - outstanding debts?

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Apart from getting legal advice (which is happening), I wonder if anyone has any first-hand experience of the same or a similar scenario that my neighbours and I are facing?

We bought flats in small complex. They were finished and we all moved in. Great flats.

A couple of years later, the building company went into liquidation. We had most of the snaggings sorted out under guarantee but not so long ago, a bill came from the local Geminde to pay for the water and other services to be connected. It was around 60K CHF (and two years late!)
As the building company is in liquidation, the bill somehow got sent to us.

So, what do we do with the bill?
My neighbours are suggesting that we may have to pay it.

I don't think they've thought this through. What happens if other bills come in? What if the concrete hadn't been paid for or the crane hire or anything else for that matter? Should we pay for all of that?
The services connection was specifically included in the original contract.

All the directors for the old company are still trading with different companies.

Thanks.
i'm a bit surprised by this - what does your contract say? i would have assumed these were costs of the bankrupt company and that the unpaid creditors will simply have lost out.

is there anything in the contract which makes you responsible for this?

other than that, maybe there is some swiss law which gives you some secondary liability. again, i'd be surprised, but who knows?

i'd be minded not to pay anything unless my lawyer advised otherwise.
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Old 20.09.2010, 19:56
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Re: Building company in liquidation - outstanding debts?

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i'm a bit surprised by this - what does your contract say? i would have assumed these were costs of the bankrupt company and that the unpaid creditors will simply have lost out.

is there anything in the contract which makes you responsible for this?
The contract states that this was included in the purchase price.

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other than that, maybe there is some swiss law which gives you some secondary liability. again, i'd be surprised, but who knows?

Someone on here perhaps?

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i'd be minded not to pay anything unless my lawyer advised otherwise.
I've not intention of paying. However, if it looks like they'll turn off the water then I may have to look at alternative options.
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Old 13.10.2010, 14:20
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Re: Building company in liquidation - outstanding debts?

Judging on the amount, it for all the connections and not the actual use of water during building.

There is a legal loophole in Switzerland. If a company that you've contracted to do the works have sub-contracted another company and then went into liquidation without paying the subcontractor, the end client may be held liable for this bill.

It is very important to specify the subcontracting issue in the contract with the builder or a specialised company, such as a demand of proof of payment to all subcontractors before final payment by the client.

I don't know if this is a cantonal issue, but a client that we know through our architectural practice has faced to this issue few years back.

I can't tell if this is your case, but you have to make a written opposition immediately, within 30 days!
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Old 13.10.2010, 14:50
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Re: Building company in liquidation - outstanding debts?

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There is a legal loophole in Switzerland. If a company that you've contracted to do the works have sub-contracted another company and then went into liquidation without paying the subcontractor, the end client may be held liable for this bill.
That's what we are encountering.

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It is very important to specify the subcontracting issue in the contract with the builder or a specialised company, such as a demand of proof of payment to all subcontractors before final payment by the client.
The bill from the Geminde was two years late and got overlooked.

Is a house buyer really supposed to check that all bills were paid.

If they want me to project-manage the build, I'd expect payment for it.

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I can't tell if this is your case, but you have to make a written opposition immediately, within 30 days!
That was done.
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Old 07.06.2011, 03:48
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Re: Building company in liquidation - outstanding debts?

Hey Tom, what ever happened with this? Has it been resolved?
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Old 07.06.2011, 09:55
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Re: Building company in liquidation - outstanding debts?

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Hey Tom, what ever happened with this? Has it been resolved?
I believe it's still up in the air - we certainly haven't received a bill yet. And we've still got water.

I didn't particularly want to phone up the Geminde to remind them (although I'm sure they haven't forgotten!).


There is some remedial work (bike room leaking ) being done in a few weeks under the "Building work guarantee" but I am uncertain as to whether this is being paid for from insurance or from the monetary assets seized when the company went into liquidation.

Thanks for the reminder to find out what's going on. I'll update when I find out as I'm sure it could be useful for others in the same boat.
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Old 07.06.2011, 16:30
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Re: Building company in liquidation - outstanding debts?

Thanks Tom for the update.
I wouldn't call them either!
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Old 09.06.2011, 12:01
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Re: Building company in liquidation - outstanding debts?

If the building company is in liquidation, you may send the bill to the Konkursamt that is performing the liquidation. But the people behind the company are unfortunately not personally liable.
I believe that in such a case, the Gemeinde can ask that you pay because you are the owner and therfore liable, but I am not sure either.

Good luck!


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Apart from getting legal advice (which is happening), I wonder if anyone has any first-hand experience of the same or a similar scenario that my neighbours and I are facing?

We bought flats in small complex. They were finished and we all moved in. Great flats.

A couple of years later, the building company went into liquidation. We had most of the snaggings sorted out under guarantee but not so long ago, a bill came from the local Geminde to pay for the water and other services to be connected. It was around 60K CHF (and two years late!)
As the building company is in liquidation, the bill somehow got sent to us.

So, what do we do with the bill?
My neighbours are suggesting that we may have to pay it.

I don't think they've thought this through. What happens if other bills come in? What if the concrete hadn't been paid for or the crane hire or anything else for that matter? Should we pay for all of that?
The services connection was specifically included in the original contract.

All the directors for the old company are still trading with different companies.

Thanks.
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Old 09.06.2011, 12:12
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Re: Building company in liquidation - outstanding debts?

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If the building company is in liquidation, you may send the bill to the Konkursamt that is performing the liquidation.
Of course that's what we did.

Unfortunately, I've just found out that we must personally pay for the repair of the building defects that have existed since the beginning and have only come to light now even though this work was supposed to be guaranteed.

We're supposed to be protected by insurance in case something happens such as a fire but if the building suddenly splits into two halves due to a construction error, we're all going to be very much out of pocket. And, we'll have nowhere to live.

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....But the people behind the company are unfortunately not personally liable.
I believe that in such a case, the Gemeinde can ask that you pay because you are the owner and therfore liable, but I am not sure either.

Good luck!
That's what annoys me - the people who owned the company still have their houses which are nice and safe and we take the hit.
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Old 09.06.2011, 13:47
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Re: Building company in liquidation - outstanding debts?

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Of course that's what we did.

Unfortunately, I've just found out that we must personally pay for the repair of the building defects that have existed since the beginning and have only come to light now even though this work was supposed to be guaranteed.

We're supposed to be protected by insurance in case something happens such as a fire but if the building suddenly splits into two halves due to a construction error, we're all going to be very much out of pocket. And, we'll have nowhere to live.



That's what annoys me - the people who owned the company still have their houses which are nice and safe and we take the hit.

I guess it would not amount to much as it has to be split between all the occupiers just like it is for heating costs.
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Old 09.06.2011, 13:51
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Re: Building company in liquidation - outstanding debts?

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I guess it would not amount to much as it has to be split between all the occupiers just like it is for heating costs.
No, luckily it's only about 7000CHF each, which, apart from 375CHF, we have already paid once and the 375CHF should have come under the guarantee.

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Old 09.06.2011, 14:28
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Re: Building company in liquidation - outstanding debts?

how did the company do this? sounds like phoenixism and i wonder if illegal in CH? I know the UK authorities take a dim view of it:

http://www.hmrc.gov.uk/manuals/nimmanual/nim12204.htm

http://www.insolvencylawforum.co.uk/...osts&Itemid=20
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Old 09.06.2011, 15:37
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Re: Building company in liquidation - outstanding debts?

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how did the company do this? sounds like phoenixism and i wonder if illegal in CH? I know the UK authorities take a dim view of it:

http://www.hmrc.gov.uk/manuals/nimmanual/nim12204.htm

http://www.insolvencylawforum.co.uk/...osts&Itemid=20
Lawyers have looked into and it appears to be legal.
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Old 09.06.2011, 16:31
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Re: Building company in liquidation - outstanding debts?

It's described as "Grundpfandrecht".

As I understand it, it's designed to protect the little craftspeople so nobody can cheat them out of their money.
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