You are hiring a technical supervisor –

Who is liable for a construction defect alongside the contractor

An investor who discovers a defect in a completed building usually turns only to the contractor. However, under Czech legislation, the scope of liable parties for construction projects is broader. Alongside the contractor, their subcontractor, the party who provided the construction documentation, and the party who supervised the construction are also liable. Each of them is liable only with respect to what they themselves supplied, but jointly and severally with the contractor (Section 2630 of the Civil Code).

For supervision, the law reverses the burden of proof. The supervisor is liable unless they prove that the construction defect was not caused by their failure. The investor therefore does not have to prove that the supervisor made a mistake. However, they must document the defect and the fact that it arose in a part of the construction over which the supervisor exercised supervision according to the contract. It is then up to the supervisor to show that they inspected properly and could not have detected the defect, or that they pointed it out in a timely and emphatic manner.

The investor's technical supervisor is a person hired by the investor to check on-site whether the contractor is building according to the project design, contract, and regulations. It is neither the building authority nor the contractor's site manager. They work for the investor, and their duties stem mainly from the contract concluded with the investor. Therefore, the scope of their liability begins with the text of this contract.

For the investor, this brings a practical advantage: they have more debtors. If the contractor goes bankrupt or refuses to remedy the defect, the investor can turn to the supervisor or, if applicable, the designer, and claim the entire amount for which they are liable. The supervisor is often insured for such cases, which increases the chance that the investor will actually receive the money. Which of them ultimately bears the damage is then resolved among the liable parties themselves.

The flip side of supervision: when the chosen supervisor exonerates the contractor

The same provision has a flip side that investors often forget. The contractor is released from liability for a construction defect if they prove that the defect was caused solely by the failure of the supervisor chosen by the client. The same applies to an error in the construction documentation from a designer chosen by the client. An investor who hires weak supervision may thus lose their claim against the contractor.

The contractor is released only if the defect was caused exclusively by the failure of the supervisor. If the defect was caused by the contractor's own mistake and the supervisor merely failed to catch it, the contractor remains liable, and the supervisor is liable alongside them. A typical dispute involves an incorrect instruction given to the contractor by the supervisor. However, the contractor must warn the client of an inappropriate instruction; if they fail to do so, even though they could have identified the inappropriateness, they are also liable for the defect. Therefore, the investor should not entrust technical changes to the supervisor without their own verification.

In practice, contractors seize upon this defense in disputes over extra work and changes. They claim that the supervisor approved the change, and therefore the supervisor caused the defect. The investor then finds themselves caught between two parties pointing fingers at each other. A clear contract helps, showing what the supervisor is authorized to approve and what only the investor can. How the handover of the construction should take place and how defects are recorded is described in the article on handover and acceptance of construction works.

The choice of supervisor is therefore a decision for which the investor bears the consequences. Anyone who chooses the cheapest provider who visits the site once a month pays less but risks the contractor blaming the defects on the supervisor, and the supervisor successfully defending that they fulfilled the inspection according to the contract. The savings on supervision then return in a dispute as a claim that cannot be asserted against anyone.

How to choose a supervisor and what to assign to them

The procedure below describes the usual steps; the scope of supervision a construction project needs is determined by its technical complexity, financing, and how many decisions the investor wants to leave to the supervisor. Therefore, the Czech legal team at ARROWS law firm always sets up the contract with the supervisor alongside the contract with the contractor to ensure the two contracts do not contradict each other. The steps vary depending on the size of the project.

The first step is to clarify what the supervisor is supposed to inspect. Typically, this includes compliance of the works with the project design and contract, quality of materials, inspection of structures before they are covered up, participation in tests, and checking the construction log and statements of completed works. Each of these activities should be listed in the contract. A general formulation such as 'performance of supervision in the usual scope' is interpreted to the detriment of the investor in a dispute.

The second step is to define how the supervisor should react to identified errors. The contract should establish an obligation to record findings in the construction log, inform the investor in writing within a specified period, and propose measures. For serious errors, the contract may require the supervisor to convene a control meeting or recommend stopping the work. Without these rules, the supervisor will claim in a dispute that they mentioned the error verbally and did not need to do more.

The third step is to determine the supervisor's powers. The contract should state whether the supervisor is allowed to approve changes, sign off on statements of work, and sign handover protocols on behalf of the investor. The more powers the supervisor has, the more decisions can later be blamed on them. It is reasonable to leave inspection and recommendations to the supervisor, while the investor retains the authority to approve changes and extra work.

The fourth step is to verify insurance and professional qualifications. The investor should request proof of authorization, references, and an insurance policy with a limit corresponding to the value of the construction. The contract with the supervisor is usually concluded as a mandate contract, under which the mandatary acts honestly and diligently and uses the means required by the nature of the matter (Section 2432 of the Civil Code). However, specific obligations are only supplemented by the contract.

When supervision is mandatory by law

For most private construction projects, supervision is voluntary, and it is up to the investor whether to hire one. Under Czech legislation, exceptions apply to constructions funded by public resources carried out by a construction entrepreneur as a contractor. For these, the builder must ensure supervision by an authorized natural person (Section 161 of the Building Act). If the project documentation was prepared by a designer, the builder must also ensure their supervision, except for technical infrastructure network projects.

A private investor who draws public funds for construction must also keep mandatory supervision in mind. Grants and subsidies may condition disbursement on the construction being inspected by a professional supervisor, and missing records could jeopardize the funding. The investor should therefore know whether their project falls under this obligation and set up the supervision to meet the conditions of the support provider as well. Designer supervision is also mandatory for reserved constructions.

Furthermore, the Building Act anticipates that the builder will notify the building authority of who is carrying out the construction, and for self-help construction projects, the site manager or the person performing building supervision. This public-law building supervision is not the same as the technical supervision hired by the investor to inspect the contractor. However, public-law rules do not determine what the supervisor is liable for to the investor; that is determined by the contract and the Civil Code. A supervisor can fulfill all obligations towards the authority and still be liable to the investor for failing to catch a defect.

Where the supervisor's liability ends

Towards the investor, the supervisor is liable in two ways: for the construction defect jointly with the contractor according to the rules on construction defects, and for damage caused by breaching their contract. Compensation for damage may include the costs of remedying the defect, expert opinions, and the repair project design. The contract with the supervisor often limits this liability, for example, to the amount of the fee or insurance payout.

Limitation of liability has a legal boundary. An agreement that excludes or limits in advance the obligation to compensate for harm caused intentionally or through gross negligence has no legal effect (Section 2898 of the Civil Code). The same applies to a limitation that would affect the weaker party. However, in the case of ordinary negligence between entrepreneurs, a validly agreed cap usually holds, and the investor should compare it with the value of the construction and the supervisor's insurance.

How courts evaluate a supervisor who knew about an error is shown by a dispute over a family house assessed under the previous legislation. The Regional Court ordered the supervisor to compensate for the repair costs: although the supervisor was not obliged to correct errors in the project design, they knew about the discrepancy in the roof execution and should have done more than just forward correspondence, such as recording the finding in the construction log or convening a meeting. In its ruling case no. 23 Cdo 2762/2024, the Supreme Court rejected the supervisor's appeal. It concerned compensation for damage from a breach of their own contract, and according to the court, the fact that each party breached a different contract does not change the joint liability of the tortfeasors.

Whether the supervisor is liable for a specific defect depends on the scope of their contract, what they knew about the error, and how they reacted to it. These circumstances are assessed by the Czech legal team at ARROWS law firm based on the construction log, minutes of meetings, and emails before the investor decides whom to sue. A poorly chosen group of defendants can cost the investor both time and litigation costs.

How supervision is set up on projects where it works

On construction sites where supervision fulfills its role, the supervisor has a clear inspection plan linked to the contractor's schedule. They know in advance when insulation will be covered, when pressure tests will take place, and when load-bearing structures will be concreted. The contractor has a contractual obligation to invite the supervisor to these steps in a timely manner. Without an invitation, a defect hidden under the floor or in the building envelope is only discovered years later.

The second sign is consistent work with the construction log. The supervisor records findings in it, the contractor responds to them, and the investor reads them regularly. The construction log is the strongest evidence in a dispute over defects because it captures who knew what and when. A supervisor who keeps their own notes only in emails helps the investor less and protects themselves worse.

The third sign is the separation of inspection from the approval of changes. The supervisor assesses and recommends changes, the investor approves them, and the contractor executes them only after written consent. This limits the room for disputes over who caused the change and who should pay for it. How to handle changes in specifications and additional payments for extra work is discussed in the article on when the client changes specifications during implementation.

A warning sign is a contract with the supervisor without specific deliverables. If the supervisor does not have to submit regular reports, has no specified frequency of inspections, and their remuneration does not depend on what they actually did, the investor has no way to verify that the supervisor is working. A reasonable contract therefore includes monthly reports, photo documentation of inspected structures, and a list of open findings with deadlines for their resolution.

Errors that deprive the investor of a claim against the supervisor

The most common mistake is a one-page contract with the supervisor without a scope of activities. The investor signs the supervisor's proposal, which contains only an hourly rate and a general description of the service. In a dispute, the supervisor then claims they never promised the inspection the investor expected. Prevention lies in an annex listing inspections, frequency of presence, and duties upon discovering errors.

The second mistake is delegating the authority to approve changes to the supervisor without limits. The supervisor approves a change in technology proposed by the contractor, and it later turns out that the change caused a defect. The contractor defends themselves by saying they followed the supervisor's instruction, and the supervisor claims they merely approved a specialist's proposal. The investor is left caught in the middle. The supervisor's authority to approve changes should have financial and technical limits and be in writing.

The third mistake is suing only the contractor. The investor forgets that alongside the contractor, the supervisor and the designer are also liable, and when the contractor loses the dispute but has no assets to pay, the investor has to start over. Moreover, the deadlines for claiming defects may expire in the meantime. How to seek the repair of poorly executed construction work in court is described in the article on how to win a lawsuit for the repair of construction works.

The fourth mistake is letting only the supervisor claim the defect. The investor reports the defect to the supervisor, who passes it on to the contractor informally. In a dispute, however, the court examines to whom and when the defect was notified, and the investor should therefore claim the defect in writing to both the contractor and the supervisor. How much these mistakes cost depends on the size of the defect and the contractor's solvency, and how to remedy them is assessed by the Czech legal team at ARROWS law firm based on contracts with all construction participants.

Investor's risks when hiring a supervisor

Summary for owners and management

The article has shown that construction supervision is not just morally responsible for defects. Under Czech legislation, the law places the supervisor alongside the contractor and reverses the burden of proof, so the supervisor must prove that the defect was not caused by their failure. At the same time, the reverse is true: if a defect is caused exclusively by a supervisor chosen by the investor, the contractor is exonerated from liability.

For the investor's management, supervision is a risk management tool, not an item to cut costs on. Well-structured supervision expands the circle of liable parties and provides evidence for potential disputes. Conversely, weak supervision without a clear contract gives the contractor an argument and leaves the investor with the damage. Postponing the setup of the supervision contract until after construction begins does not pay off, as the first covered structures are built in the very first weeks.

Therefore, it is necessary to prepare the contract with the supervisor alongside the contracts with the contractor and the designer so that they align with each other. It is equally important to monitor the construction log and minutes of meetings throughout the construction period, as these are precisely what provide the answer in a dispute as to who is liable for a defect.

The Czech legal team at ARROWS law firm prepares and reviews contracts with supervisors, designers, and contractors, and represents investors in court disputes regarding construction defects and damages. Write to us at consultation@arws.cz or see how we handle commercial and court disputes.