How long is a builder liable for defects? For structural defects, ten years from handover and acceptance of the works. For other hidden defects you can rely on them for at most two years from acceptance.
A construction contract in Montenegro must be in writing. The builder is liable for defects affecting the structural soundness of the building for ten years from handover and acceptance of the works, and the contract can neither exclude nor limit that liability. The builder may raise the price only under the conditions of the Law on Obligations, and with a "turnkey" clause the agreed price also covers unforeseen works and extra works.
This guide explains what a contract with a builder should contain, how the price can change, what turnkey means, how and within which deadlines defects are reported, and what to check before signing.
What is a construction contract and when must it be in writing?
A construction contract is a contract for work under which the builder undertakes to build, according to a specific design and within the agreed deadline, a building on specific land or to carry out other construction works on land or an existing structure, and the client undertakes to pay the price. The law requires this contract to be in writing. Buildings and other structures that require larger and more complex works count as a construction, and where this chapter has no special rule, the general rules on contracts for work apply.
What should a contract with a builder contain?
| Item | Why it matters |
| Design and description of works | The builder builds to a specific design; every deviation needs your written consent |
| Completion deadline | If the builder is so late that they clearly will not finish on time and the deadline is essential, you can terminate and claim damages |
| Price and method of calculation | A unit price per measure of work or a total price for the whole structure |
| Right of supervision | The builder must allow constant supervision of the works and control of the materials |
| Builder's licence | Construction work is carried out by a builder with at least one employed licensed architect or construction engineer |
| A turnkey clause, if you want one | Changes the rules on unforeseen works and extra works |
Under the Law on Building Construction, the builder, among other things, carries out the works according to the reviewed main design, keeps a construction diary and a construction book and, before construction starts, appoints a site manager and responsible engineers.
When may the builder raise the price?
| Situation | Rule |
| Works without your consent | The builder cannot claim a higher price for works carried out without your consent |
| Costs of price elements rose, works finished on time | An increase can be claimed if the price would be more than two percent higher, and only for the difference above two percent |
| Costs of price elements rose, builder late through their own fault | The threshold is five percent, measured up to the date the works should have been finished |
| A fixed price was agreed | A change is possible only if the price would be more than ten percent higher, and only for the difference above ten percent |
| Costs of price elements fell | The client can ask for a price reduction above the same thresholds |
| A significant increase | The client can terminate the contract and pay for the works done and necessary costs |
The builder may carry out urgent unforeseen works without your consent if they were necessary for the stability of the structure, the safety of people or to prevent damage, and were caused by unexpected ground conditions, the appearance of water or a similar extraordinary event. The builder must inform you immediately and is entitled to fair compensation, and you can terminate the contract if the price would rise significantly as a result.
What does a "turnkey" clause mean?
When the contract contains a turnkey clause, the builder alone undertakes to carry out all the works needed to build and use a complete structure. The agreed price then covers the value of all unforeseen works and extra works, and shortfalls in works do not affect the price. If several builders are parties to such a contract, they are jointly and severally liable to you.
How are defects reported and within which deadlines?
| Type of defect | Deadline |
| Visible defects | Inspect the works as soon as possible and notify the builder immediately; after inspection and acceptance the builder is no longer liable for defects visible on an ordinary inspection, unless they knew of them and kept quiet |
| Hidden defects | Notify the builder within one month of discovery at the latest; after two years from acceptance you can no longer rely on defects |
| Court claim | One year from notifying the builder |
| Defects in structural soundness | The builder is liable if they appear within ten years of handover and acceptance of the works |
| Notice of a structural defect | Six months from discovery, and the right lapses one year after the notice |
Because of a defect you can ask the builder to remedy it within a reasonable time, ask for a price reduction or, if the defect makes the works unusable, terminate the contract, and in every case claim damages. Rights arising from defects in a building pass to later buyers of the building, but no new deadline starts for them. Liability for structural soundness also extends to the designer when the defect comes from the design.
That is why a buyer of a flat in a new building can also turn to the builder over structural defects; how to check a developer before buying is explained in our article on buying off plan.
How do you choose a builder for renovation or construction?
- ask for a written offer with a description of the works, the price and the deadline;
- for works that need a permit, check the licence and the employed licensed engineer;
- write the right of supervision and the need for written consent to deviations into the contract;
- agree to pay by completed stages; by law you do not have to pay before you have inspected and approved the work, unless agreed otherwise.
You can find builders for renovation and construction and compare offers on the Glatko platform. Whether works in a flat need a notification or a permit is explained in our article on renovating a flat, and the path from plot to building in our article on buying land to build a villa.
Checklist before signing
| Check | Why |
| Written contract | The law requires written form |
| Design and bill of quantities | The basis for the price and for deviations |
| Type of price | Unit or total, variable or fixed |
| Turnkey or not | Who bears unforeseen works and extra works |
| Deadline and consequences of delay | Grounds for termination and damages |
| Builder's licence | A condition for construction work |
| Handover record | The deadlines for defects run from it |
You can find or list plots and houses in our real estate category.
Frequently asked questions
Does a contract with a builder have to be in writing? Yes. The Law on Obligations requires a construction contract to be concluded in writing.
Can the builder ask for more money than agreed? Only under the legal conditions, for example if the costs of price elements rose by more than two percent and the works were finished on time. For works done without your consent, no.
What does a turnkey contract mean? The builder alone carries out all the works for a complete structure, and the price also covers unforeseen works and extra works.
Can liability for structural soundness be excluded by contract? No. The builder and the designer are liable to the client and to every later acquirer, and that liability can neither be excluded nor limited.
What if the builder is late? If the deadline is essential and it is clear that the works will not be finished on time, you can terminate the contract and claim damages.
Sources
Construction contracts are governed by the Law on Obligations (Official Gazette of Montenegro 47/2008, 22/2017, 123/2024, 94/2026 and 117/2026, articles 676 to 692 and 699 to 715; the 2024 and 2026 amendments do not change these articles). The builder's duties are governed by the Law on Building Construction (Official Gazette of Montenegro 19/2025, 92/2025, 160/2025 and 114/2026, articles 45, 63 and 84). The legislation was checked on 24 September 2026. Fijaka is a classifieds platform and does not provide legal advice; for a specific contract, consult a lawyer.