Caution when contracting

30th May 2007

Developers, contractors & consultants alike are familiar with the various suites of standard form building contracts covering every single type of project and design team appointment. Use of the standard forms is an accepted way of contracting which

Developers are slowly getting to grips with the new JCT 2005 standard forms. One particular point to watch out for in the Design and Build form is responsibility for design and in particular the checking of design contained within the Employer?s Requirements.

Employers like design & build because it apparently creates a single point of liability and places the risk of the time and cost consequences arising from design issues on the contractor. Often clients commission the design or concept design directly and wish to pass liability for such on to a contractor.

Clause 2 of the JCT form (both the 98 WCD and the 2005 DB versions) deals with ?Carrying out the Works? both the design and construction. The contract actually says, ?The Contractor shall ?carry out and complete the Works referred to in the Employer?s Requirements, the Contractor?s Proposals?and shall complete the design?? . The completion of the works and the actual construction work to be done clearly falls to the contractor. The completion of the design may mean different things; If the ERs contain any design work then this phrase would mean the contractor is to take the design, develop it and construct the end result. Alternatively the phrase could mean simply developing and completing preliminary design work contained in the CPs. Assuming the contractor relies on the preliminary design work presented to him in the ERs, can the client hold the contractor liable for mistakes in the ERs? The new JCT 2005 Design and Build standard form makes it very clear that the contractor is not responsible for checking the design contained within the Employer?s Requirements thus potentially side stepping the single point design liability sought by the client. The 98 edition of the contract was a source of frequent disputes as to the exact level of responsibility taken on by contractors adopting designs contained in the ERs. It may be prudent for a client to amend the contract to make it clear who is liable for which design work .

Author: Bryan Hoare