New Build Contracts: Comparing Eason v Wong and Hunt v Optima – 5 Key Checks for 2026 Buyers
Table of Contents
Eason v Wong [2017] EWHC 209 (Ch) and Hunt v Optima (Cambridge) Ltd [2014] EWCA Civ 714 both highlight serious risks in new build purchases, but they address different stages and protections.
Editors note:– These contracts really are very difficult. A good conveyancer thinks ‘check the title’, a great conveyancer thinks ‘check the logistics’ – For example – a good conveyancer would ask you to check the red boundary line is correct. A great conveyancer would go further and ask…
- How do I get to my house with the red boundary line from the nearest adopted road
- Do I park on my land, or one someone elses land?
- Do I share my land with anyone?
- Where are the sewers and drains?
- Are the private or publicly adopted?
- Where do the phone cables and electricity cables run, are they shared with neighbouring land owners,
- Is the house build over existing easements,
- Do your services go through land you don’t own? etc etc
Disclaimers of Liability – urban myths in conveyancing…
There is one really big issue with conveyancing new builds, and conveyancing generally. Solicitors / conveyancers cannot ‘disclaim’ liability – although a lot believe they can. If you go to buy a new build and take advice, and the advice is correct e.g. you may lose your deposit if you exchange contracts as the deposit is held as ‘agent’ and passed immediately to the builder – [see below] – the conveyancer or solicitor must always act in your best interests.
Arguably, the solicitor is not acting in your best interests if they exchange contracts without any deposit where it’s passed to the builder under the agency rule – even if you agree and consent to them doing so. Typically, your solicitor may ask you to sign a disclaim, limit or waive liability on the basis that you took the risk. This is not correct. If you’ve signed a such disclaimer then it may simply be an admission that the firm has not acted in your best interests and you’ll have a claim to recover the deposit from the firm.
This is not to say you cannot consent to buying a title which is less than good – many people do in fact see this as a good opportunity and a risk worth taking. But if the quality of the title is so bad, a reasonable person would say it is not in your best interest to act, then the solicitor must resign – they must always act in your best interests without qualification.
Key Comparison
- Eason v Wong focuses on pre-completion insolvency. Buyers paid large deposits (often 50%) on off-plan student suites. The developer went bust before construction; the court ruled buyers held equitable liens over the land/proceeds for their deposits, even on an unfinished building. It helps buyers in insolvency but does not prevent loss.
- Hunt v Optima concerns post-completion defects. Buyers of new flats relied on architects’ certificates that overstated quality. The Court of Appeal limited architects’ liability for negligent misstatements (especially if certificates issued after exchange/completion) but held the developer liable for defects. It underscores reliance on professional assurances in new builds.
Together, the cases show buyers need strong due diligence on financial risk (Eason) and build quality (Hunt).
Check 1: Developer Financial Stability
Review the developer’s accounts, track record, and SPV structure via Companies House. Eason shows that weak developers can collapse before finishing the build, putting “deposit as agent” funds at risk. Prefer established developers with strong balance sheets.
Check 2: Deposit Holding Terms
Insist on seeing exact wording — most new build contracts use “as agent,” releasing funds to the developer immediately. Eason v Wong confirms the danger: deposits can be lost or only partially recovered via equitable lien in insolvency. Push for stakeholder holding or accept the heightened exposure only with excellent alternatives.
Check 3: Independent Specialist Solicitor Review
Never use a developer-nominated solicitor. Your own lawyer must flag deposit risks (Eason-style insolvency) and contract weaknesses. They should also scrutinise warranties and any certificates relied upon, as Hunt v Optima shows reliance on professional sign-offs can be problematic if issued late or negligently.
Check 4: Warranty and Quality Protections
Verify NHBC (or equivalent) cover and its deposit/insolvency limits. Read architects’ or inspectors’ certificates carefully before exchange. Hunt v Optima demonstrates that defects can emerge later and that third-party liability (e.g., architects) is often limited, leaving buyers pursuing the developer.
Check 5: Completion Dates, Exit Rights & Contingency
Examine long-stop dates, delay penalties, and withdrawal rights. Understand your equitable lien position if the project stalls (Eason). Combine this with realistic build timelines and site visit protocols to mitigate Hunt-style hidden defects that appear after completion.
Final 2026 Advice
Eason protects deposits after failure; Hunt highlights quality risks that survive completion. The best defence is rigorous independent legal advice before exchanging on any new build contract. Failing these checks can lead to lost deposits or expensive remedial works.
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