Legal: contract administration
Andrew Butler outlines architects’ administrative responsibilities
Employers disgruntled with the performance of their builders have always been willing to look to their architect as an alternative, and possibly more solvent, means of redress. As economic circumstances deteriorate, and more and more builders go to the wall, it can be expected that this trend will continue and perhaps increase. But in what respects is an architect answerable for failures on the part of a contractor – and what must he or she do to discharge these obligations?
Subject always to the terms of any express agreement between the parties, the architect’s duties as regards the contractor commence before work starts. An architect is generally expected to make reasonable enquiry as to the competence of a proposed contractor and also as to its financial stability. What will constitute ‘reasonable enquiry’ in this regard will vary greatly with the facts of each case.
So far as competence is concerned, if the architect has personal experience of a particular contractor it may be possible for him to rely simply on that; if not, investigation of previous relevant work and the taking of references from former employers or contract administrators may be required. It is also worth making sure that the tender document makes sense - a Court is likely to need some convincing that sufficient care was taken by the architect if clear and obvious errors in the tender have been overlooked.
Of perhaps greater relevance in the current climate are the obligations to investigate the financial stability of a contractor. This duty is often overlooked in practice, but there is authority for the proposition that an architect should where appropriate obtain bank or trade credit references, undertake a company search or ask for the provision of audited accounts [Partridge –v– Morris CILL 1095]. Again, the extent of the necessary enquiries will vary with the status and reputation of the contractor in question; greater care will undoubtedly be needed with a small and newly-established local contractor than with a large and reputable multi-national.
Closely associated with the need to check the financial standing of the contractor is the need to verify its insurance position. The Architect’s Job Book describes it as ‘vital’ to ensure that the required insurances are in place before work commences. While this need not involve trawling through the detailed provisions of a policy – that is the job of the employer or his advisers – it does require checking that cover (compliant with the requirements of the works contract, if any are stipulated) is in place, and that the level of cover is adequate. Action J273 in the Job Book specifically warns against simply accepting assurances that sufficient insurance is in place, and in one recent case [Jacobs –v- Crammond-Browne, HHJ Wilcox QC, Technology and Construction Court, 3rd December 2008], criticism was levelled at an architect whose check had simply involved a cursory glance at a schedule.
Once works start, the proper administration of the contract involves making periodic inspections of the work so as to ensure that the job is being done to a satisfactory standard and to deal with any problems. In this context, questions routinely arise about how regularly inspections need to be carried out, and in what detail. Judicial attitudes have changed somewhat over the years. In East Ham Corporation –v- Bernard Sunley & Sons Ltd. 1 AC 406, the House of Lords took the view that a mere failure to spot a defect which reasonable examination would have disclosed would not inevitably lead to a finding of negligence. Subsequent decisions however suggest that an architect will rarely escape liability in such circumstances.
What the Courts will generally look for in this context is evidence that an architect has done as much as he reasonably can to ascertain when the key stages of any project are going to be reached, and to be present when that work is undertaken. This of course begs the question of what the ‘key stages’ are. As a general rule, architects engaged in the administration of contracts would be well advised simply not to allow any work of substance to be covered up until it has been checked. Examples of findings of negligence over the years include situations where an architect failed to inspect formwork and reinforcement before concrete was poured, or to check the internal structure of a roof before it was concealed.
Courts are rarely impressed even by cogent evidence that inspections were being carried out with sufficient frequency; what matters is the quality of the inspections and their timing, not simply the number of days which elapse between visits. It is therefore essential to keep a record not only of when an inspection takes place, but what the purpose of the inspection was and what was observed on site. A photographic record will also no doubt provide an invaluable aide memoire in the event of subsequent allegations of negligence.
What does or does not constitute a reasonable level of supervision may also depend on considerations other than the progress of the work. Factors which have been held to have a bearing on the extent of the administrator’s supervisory obligations include the value of the project, the particular susceptibility of a building to its environment (e.g. where a property is built near disused mineshafts, or in an exposed coastal region), and the implications of defective work on health and safety. The conduct of the contractor is also relevant; if the contractor’s performance of the work has eroded the administrator’s confidence for any reason, it may be necessary to undertake a higher level of supervision than would otherwise have been required.
By contrast, one factor which will make little or no difference is the presence on site of a clerk of works. In a number of cases, the Courts have concluded that while the presence of a clerk of works may be of some factual significance, (for example, a contract administrator will be entitled to take at face value a clerk’s reports about events on site), ultimately it does not displace or even greatly impact on the duties of supervision. If as a result of inadequate inspection the work is improperly executed, it is reasonable to expect that liability for that failure will attach to the contract administrator, whether or not blame is also attributable to the clerk.
The buck does not always stop with the architect: a series of decisions in the 1960’s established that architects and other contract administrators are generally not responsible where accidents are caused by unsafe working practices. That responsibility for adopting a safe method of work lies with the building contractor is shown by decisions such as Clayton –v- Woodman & Sons  1 WLR 585, in which an architect escaped liability despite having insisted (contrary to the wishes of the contractor) that work should be done in accordance with a specification which subsequently caused a gable to collapse. But this is not a universal rule; where for example the terms of the particular retainer impose some liability for ensuring that work can be carried out in safety, the outcome may well be different. The advent of the Construction (Design and Management) Regulations 1994, requiring an architect to have regard to the health and safety of workers in relation to the design for a project, also constitutes a fairly significant erosion of this doctrine.
Ultimately it may seem invidious that the law finds so many ways of making contract administrators liable for mistakes which ought primarily to be placed at the door of an incompetent contractor. But three things must be borne in mind:
- The law is not completely inflexible; courts have the power to apportion fault between wrongdoers, and will do so if satisfied that it would be unjust to hold one or other party solely responsible for a project which has gone wrong.
- Like any other professional accused of negligence, an architect will be accorded a considerable degree of leeway; if he can show that he acted in accordance with a respectable body of opinion, that will generally afford him a defence even if a different architect or body of architects would have done things differently.
- As wide-ranging as an architect’s supervisory obligations may seem when presented in the somewhat arid terms of an article like this, ultimately they do not amount to very much more than the application of common sense – the precautions which any sensible property owner, given the relevant expertise, would take in safeguarding his property against the vagaries of the average builder.