SIA 118: Definition, scope, template (Download)

Table of contents

Defects are unavoidable when a property is newly built or renovated. However, if construction projects or maintenance acceptances were carried out some time ago and were not properly documented, conflicts may arise with regard to the notification of defects. This is where SIA 118 comes into play.

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SIA 118

Download template

Download our free SIA118 template now and make it easier for you to record defects and accept construction work! Our templates save valuable time, are already equipped with all the necessary elements and can be modified as required. Whether you are a contractor, architect or site manager, a well-structured template is crucial to the success of your project.

Definition of SIA 118

What does the SIA 118 standard contain and for whom is it relevant?

The SIA Standard 118 “General Conditions for Construction Work” is the most important basis for contracts for work in the Swiss construction industry. It deals with the drafting and execution of construction contracts, so-called building contracts.

Although the Swiss Code of Obligations (CO) provides a legal framework for contracts for work and services and therefore also covers construction law, the particularities and complexity of construction projects are so specific that a more detailed regulation became necessary. The standard was created over 100 years ago by the Swiss Society of Engineers and Architects (SIA).

SIA 118 is therefore relevant for everyone involved in the construction of buildings and facilities – such as architects, building contractors and building owners. The standard helps to address challenges in the construction industry and avoid misunderstandings and conflicts by providing clear instructions on how certain issues are to be regulated.

Scope of the building acceptance report

What exactly must the SIA 118 template contain?

An SIA 118 template serves as the basis for any construction contract and must contain certain key elements to ensure that all aspects are clearly defined and agreed. Among other things:

  • Contracting parties, address and date
  • Designation of the building object
  • Work carried out and, if applicable, the corresponding defects
  • Deadline for remedying the construction defects
  • Signatures of both contracting parties
  • All other relevant data on the construction contract

If you want to make sure that you don’t forget anything and save time at the same time, we recommend using an SIA 118 template, which you can find here, for example.

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Customizable SIA 118 template (Download)

What are the advantages of our Word and PDF templates?

  • Building acceptance and the identification of defects will be simpler and more accurate.
  • Our template is already equipped with all the necessary elements and offers the flexibility to change it as desired.
  • The template saves time, effort and personnel resources that would otherwise have to be spent on the individual preparation of an acceptance report for each project.
  • With the prepared sample letters from BMapp, both internal and external project participants can communicate the project status quickly and easily.
template phone illustration baumaengel

SIA 118

Download template

Download our free SIA118 template now and make it easier for you to record defects and accept construction work! Our templates save valuable time, are already equipped with all the necessary elements and can be modified as required. Whether you are a contractor, architect or site manager, a well-structured template is crucial to the success of your project.

Attention
The SIA 118 standard only provides the legal framework for the execution of construction contracts, including defect management. However, the success and efficiency of defect management depends heavily on the construction software used. Intuitive and powerful construction software such as BMapp can significantly simplify and speed up the process of defect management. Acceptance then becomes a mere formality.

The advantages of SIA 118

What exactly are the advantages of the set of standards?

  1. Clarity and transparency: SIA 118 aims to reduce misunderstandings and conflicts through detailed provisions on the rights and obligations of the parties involved, thus contributing to the smooth handling of construction projects.
  2. Quality assurance: The standard defines standards for the execution of construction work and material quality. This serves to protect the interests of all parties involved and ensures that buildings are safe, functional and durable.
  3. Efficiency and cost-effectiveness: By standardizing procedures and requirements, SIA 118 is intended to help increase efficiency in the planning and execution of construction projects. This also includes the regulation of payment modalities and the handling of supplements.
  4. Dispute resolution: SIA 118 contains provisions for the settlement of disputes between the contracting parties. This should enable conflicts to be resolved efficiently and fairly without the need for lengthy and costly legal disputes.
  5. Adaptation to technological and legal developments: The SIA standards, including SIA 118, are regularly revised in order to adapt them to new technical standards, materials and construction methods as well as to changes in the legal environment.

The limitations of SIA 118

What does the SIA 118 not protect against?

The SIA 118 offers no protection if a contractor files for bankruptcy. However, it counteracts this with two security deposits: Firstly, a portion of the advance payments is withheld in order to secure the fulfillment of the contract. Secondly, a joint and several guarantee for liability for defects is introduced.

It is recommended to provide additional security over and above SIA 118, such as a performance bond, which can be taken out with banks or insurance companies.

Supplementing SIA 118 with SIA 2020:

Introduced in 2017, the SIA 2020 supports the handling of additional security services in the context of contracts for work and services. The information sheet helps to develop a better understanding of the necessity, scope and appropriate design of safety services that go beyond the standard services provided for in the SIA 118 standard.

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SIA 118: What to look out for

What should you look out for and why do misunderstandings often arise?

The greatest misunderstandings arise in the definition of “significant defects” and “insignificant defects”. The following overview is available here:

Significant defects

Definition: Major defects are those that significantly impair the function, safety or use of the building. They prevent the building or part of it from being used as intended or jeopardize safety.

Consequences: The discovery of a significant defect can lead to the client refusing to accept the work until the defect has been rectified. This means that the contractor must correct the defect before the work is considered completed and the final payment is made.

Legal significance: Significant defects often have considerable legal consequences. They can lead to delays in the project handover and usually have an impact on the warranty periods and possible claims for damages.

Insignificant defects

Definition: Insignificant defects are defects that do not significantly impair the use of the building as a whole. They are often cosmetic in nature or relate to minor deviations from the technical specifications that have no significant impact on the function or safety of the structure.

Consequences: Insignificant defects do not generally entitle the client to refuse acceptance of the work. However, they must be rectified by the contractor within an agreed period after acceptance.

Legal significance: Although minor defects do not prevent acceptance, they must still be rectified within the warranty period. Correcting them is important to ensure complete fulfillment of the contract, but usually has less serious legal consequences than major defects.

Importance of the definition of defects in practice

The distinction between material and immaterial defects is of great importance for the execution of the contract. It influences the acceptance processes, the handling of warranty claims and the enforcement of rights in the event of disputes. The correct identification and categorization of defects often requires an expert assessment, as this is crucial in determining the next steps in project management and legal disputes.

It is important that both the client and the contractor understand the importance of this distinction and act accordingly to ensure a fair and efficient resolution of defect claims.

Course of defect management according to SIA 118

How are defects handled in accordance with SIA 118?

  1. Detection of defects: If defects are discovered during the construction work or during the acceptance of the construction work, the client (or his representative) must report these defects to the contractor. It is customary for construction defects to be documented and recorded in a log. The exact type of notification may vary depending on the contract and the specific conditions.
  2. Notification of defects: SIA 118 stipulates that defects discovered during acceptance or during the warranty period must be reported by the client. A notice of defects is therefore an official notification to the contractor in which the defects identified are listed and the rectification of these defects is requested. As a rule, the complaint must be made in writing and there are certain deadlines that must be met, both for the complaint and for the contractor to rectify the defects.
  3. Protocol and acceptance: If defects are identified during acceptance, these are typically recorded in an acceptance protocol. In such cases, acceptance can take place subject to reservation, whereby the rectification of defects is required before final acceptance. The non-acceptance of a protocol due to defects can be regarded as part of the complaint process, whereby the official complaint represents the formal request to rectify defects.
  4. Further process: If defects are not satisfactorily rectified following a complaint, there are further steps that can be taken, including the use of guarantees or the initiation of legal action. The specific options and procedures depend on the terms of the contract and the applicable legislation.
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The function of SIA 118 in different construction phases

1st contract signature (4)

  • Contract drafting and review: Detailed definition of services, obligations, rights and risks in accordance with SIA 118.
  • Contract signature: Both parties sign the construction contract, which includes SIA 118 as an integral part.

2nd construction phase (5)

  • Execution planning: Detailed planning of the execution, taking into account the relevant SIA standards.
  • Construction: Execution of the construction work in accordance with the contractual agreements and technical standards.
  • Communication and documentation: Regular exchange and documentation of construction progress, including any changes or additional work.

3. preliminary acceptance (5)

  • Notification of completion: The contractor notifies the client of the imminent completion of the work.
  • Pre-acceptance inspection: Joint inspection and examination of the work for obvious defects or deviations from the contractual agreements.

4. building acceptance (5)

  • Official acceptance: Official acceptance of the work, during which the work is formally checked and accepted.
  • List of defects: Creation of a list of defects for work to be rectified, if necessary.
  • Acceptance report: Preparation and signing of the acceptance report, which documents the condition of the work upon acceptance.

5. rectification of defects (5)

  • Rectification period: Setting a reasonable deadline for the rectification of identified defects.
  • Correction of defects: Carrying out the necessary rectification work by the contractor.

6. final acceptance (5)

  • Inspection of the rectification of defects: Final inspection to ensure that all defects have been properly rectified.
  • Final acceptance: Formal acceptance of the work after rectification of defects, if applicable.

7. final invoice (5)

  • Preparation of the final invoice: The contractor issues the final invoice taking into account all contractual services and additional work.
  • Review and payment: The client reviews the final invoice and makes the payment.

8. warranty phase (6)

  • Beginning of the warranty period: The warranty period according to SIA 118 begins with the acceptance.
  • Notification of defects: The client can report any defects that occur during the warranty period.

9. limitation period (6)

  • Expiry of the limitation period: After expiry of the limitation period stipulated in SIA 118 (generally 2 years for buildings), claims arising from warranty rights lose their validity, unless other agreements have been made.

10. documentation and archiving (5)

  • Final documentation: All relevant documents, such as the acceptance report, lists of defects, correspondence and the final invoice, should be carefully archived.

What happens next? Impact of standards on competition and cost structures in Switzerland

How do SIA 118 and SIA 2020 influence competition and costs in the construction industry?

The SIA standards 118 and 2020 have a significant impact on competition and cost structures in the Swiss construction industry. The introduction of specific standards and requirements for construction contracts (SIA 118) and for security services (SIA 2020) promotes transparency and fairness in the award process. This can lead to increased competition, as clear regulations create a more level playing field for all providers.

However, the requirements for additional security services, as set out in the SIA 2020, can pose challenges for smaller companies. The need for bank guarantees or other forms of security ties up capital and can restrict the participation of smaller providers in competition, as they may not have the necessary financial resources.

At the same time, the mechanisms introduced by the SIA 2020 for additional security services lead to an increase in project and administrative costs, particularly in the case of complex or high-risk projects. These costs can have an impact on the overall cost structure of construction projects, as additional safety measures have to be financed. The increased requirements may also lead to a reduction in the number of potential bidders, which will reduce the intensity of competition and possibly increase costs for developers.

Overall, the effective application of SIA 118 and SIA 2020 requires a careful balance between the need to minimize contractor risk and the desire to maintain open and fair competition. Careful planning and risk assessment play a key role in maximizing the benefits of these standards while minimizing negative effects on costs and competition.

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