In this article, Arbicon explore professional negligence claims in construction contracts and how Arbicon can assist in disputes between consultants and contract administrators
It is not uncommon for consultants such as architects, engineers, and project managers to be blamed for losses due to defective design or poor supervision. Common issues are late issue of design information, or they simply get it wrong, causing delay or loss in the delivery of the building.
Where a consultant takes design responsibility, which proves to be defective, there is a high duty of care in law to have got it right than the “ordinary competent builder” who built the work to the designer’s wishes. The builder is not clear of blame; he must point out any concerns prior to construction to negate his liability. There are also factors to take into account where the client insists on a particular product or design and concerns are pointed out to him.
Examples of professional negligence claims
Arbicon has dealt with professional negligence claims where the Contract Administrator negligently did the following:
- Procured an insolvent contractor without providing any credit checks.
- Procured a JCT Design and Build Contract without any consideration for amendments.
- Failed to manage and ensure the contractor procured the working design.
- Failed to ensure the contractor took out professional indemnity insurance.
- Failed to supervise the quality of the work leading to non-compliant work and failing to ensure tests were carried out.
- Failing to value the works properly.
- Having discovered the non-compliant works, continuing and incorrectly advising the Client and allowing significant overpayment to be made in respect of the non-compliant work.
- Failing to issue a non-completion notice.
- Failing to procure adequate liquidated damages.
- Failing to impose liquidated damages.
- Failing to understand the design responsibility requirements of the contractor.
- Advising the client they were liable to pay for an Expert Report when this was a cost in the cause.
For the contract administrator, the client suffered losses on many points; it does not thus pay to employ a contract administrator with little experience in contract procurement and dispute resolution.
Adequate expertise may not be apparent at the outset, and incompetence will only emerge often after it is too late!
If funds cannot be recovered from the builder or he cannot rectify the problems, others are employed, liquidated, and ascertained damages (LADs) become due and legal and claim costs are incurred.
Consultants carry professional indemnity insurance which is normally compulsory where they are members of a professional institution (such as RICS, RIBA). If insurance is held, that is the claim route.
Call Arbicon for a free consultation today
Arbicon can assist by preparing professional negligence claims as appropriate against consultants and take you through the ADR or Adjudication process with it.
For advice from one of our experts, please use our contact form or call our offices below:
01733 233737 Peterborough
0207 406 1494 London
0121 262 4086 Birmingham
