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Making sense of liability and the law (Part 2)

Paul Finch’s letter from London: Four lawyers discuss risk and architecture

Last week we looked at attitudes to liability and risk in the second of three memorial seminars for Peter and Muriel Melvin, held at the RIBA and chaired by Margaret Bickford-Smith QC. This week we turn to the views of the four lawyers who spoke.

John Barber, of King’s College London, said things had started to go wrong in 1972 when the House of Lords made decisions that undermined the architect’s quasi-judicial role in certification, and also ruled that architects could be sued in tort as well as contract. This, allied with joint and several liability and the fact that architects were invariably insured, resulted in a feeding frenzy of claims.

Despite attempts by the upper house in 1990 to stop tort claims, he continued, clever lawyers devised collateral warranties to keep a bad insurance-underwritten system going. A report to government recommending decennial insurance (aka latent defects insurance), paid by developers, was never pursued as policy.

He had this advice for designers: first, warn clients of risk in relation to innovation; second, remember that, if something goes wrong, it does not automatically imply negligence; third, if innovation is introduced, it must be closely monitored, and amended if necessary; fourth, remember that involving a specialist may discharge a duty of care; fifth, if junior staff are used, they must be supervised appropriately; and finally, that a sensible strategy towards construction could act as a strategy for avoiding lawsuits.

David Jones, a solicitor and adjudicator, reminded us that the law had never stopped innovation. Most liability cases were about cost overruns and defects, with actions complicated by the fact that architects had given away too much authority and responsibility. Design and build contracts made things worse, because several parties were automatically involved if something went wrong. The important thing for designers was to identify areas of risk and price them, rather than pretend they didn’t exist.

Architects should ‘take a dominant role’ and, Jones thought, the RIBA should set a ‘gold standard’. But he feared architects had undersold their own importance.

Robert Hogarth, senior partner at Reynolds Porter Chamberlain, noted the dangers of innovation prompted by the quest for cheaper construction and/or fame. He believed that inherent (latent) defects insurance was a good way forward, though, to work properly, it needed buy-in from contractors, whose margins are so low they are reluctant to get involved. This insurance would save money in the long term. Importantly, analysis of the risks and rewards of litigation should be undertaken to avoid legal marathons.

The star of the afternoon seminar was High Court judge Sir Peter Coulson, who sits in the Technology and Construction Court. His pithy analysis was an object lesson in concision, starting with the comparison between the 19th century (professionals more or less immune from lawsuits) to the present day, where the claim in relation to Wembley Stadium started at £440 million, and £20 million was spent on experts and £45 million on claims preparation. While Sir Peter praised experts in general, he said he had been ‘surprised and disappointed’ by the standard of some, who, at worst, could be ‘rogues, partisan and uncompromising’. 

He was concerned about the role of project managers, because it made liability much clearer if design was seen all the way through by the architect; project management contracts could create ‘grey areas’, where it was difficult to pin down failures of co-ordination and liaison.

Sir Peter didn’t see clever appointment documents as a defence against claims. In the end, ‘reasonable skill and care’ would always be required. ‘Openness from the outset and take the client with you’, should be the approach, with information about risk and innovation always shared. ‘Architecture is the last activity where we want no innovation,’ he declared. Sir Peter regretted that the reason for litigation was usually that people and teams had fallen out, and the dispute had taken over their lives. It should never get to that. Peter Melvin would have agreed.

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