Fortunately, collateral warranties do not infest housebuilding in quite the same way as they do commercial projects but we do see them in larger residential projects. Just about any project which is externally funded would usually require collateral warranties in favour of the funders and sometimes even for residential purchasers if they are making a large enough investment. Any decent sized project can produce literally hundreds of warranties and they can be a real pain to shuffle around, but the people who put out the money seem to be very attached to them and I do not think that will change.<p></p><p> The point of a collateral warranty is very simple - to create a new contractual relationship where none otherwise exists, for instance between a contractor and a funder so that the funder can rely in a tangible way (i.e. sue for it!) on the contractor&amp;’s performance of his obligations to his employer in the building contract. As such, warranties ought to be a very short and simple statement by providers of warranties that they have performed and will continue to perform their contractual obligations. Unfortunately, warranties have tended to become overblown with all sorts of separate obligations and qualifications. …