Paul Hyett's article on 'the ever-shifting sands of indemnity issues' (aj 6.3.00) as usual raises areas of legitimate concern deserving attention by our profession.
The limitation of an architect's liability, in the discharge of his professional responsibilities to a 'reasonable' level for specific projects, must be clearly established in the interests of clients and architects alike. The current arb guidelines relating the level of professional indemnity (pi) cover to the architect's fee income, may be the first steps towards a basis for such limitation, but does not necessarily relate to project certified values, which will be of more concern to a client.
After all, it is unfortunately not so unusual for a project at inception stage to be estimated at a low value of say, £225,000 and for this value to rise a contract sum of say £500,000, and then to a claimed final account sum in excess of £1 million. It can also result in an increase of architects' fees on an agreed percentage basis, but rarely to a level in excess of the initial building cost estimate.
In those unusual circumstances, the reasonable competent architect will prudently maintain records of such price vacillations and of the client's specific agreements to those increases, but at the same time prudently increase any liability limitation and associated pi cover to a commensurate value, consistent with the architect's responsibility of disclosure to pi insurers, and set out in theconditions of appointment, whether sfa/92 or sfa/99, and not seek to hide behind 'indemnification of legal costs' as proposed by the new clause 9.6 in the sfa/99.
For every vexatious client claiming against a beleaguered architect, there are aggrieved clients suffering from the depredations of unscrupulous architects. From my expert witness work, it is apparent that there is an unacceptable underbelly of the architectural profession, who are not caring, sharing, creative, innovative, sustainable architects, but who steer a tightrope course between maximising commercial imperatives and narrow interpretations of professional responsibilities, to the detriment of their client's immediate interests and the longer term interests of the profession.
In a commercial environment, the uncertainty of outcome and expense of litigation exacts unacceptable burdens on both client and architect in the identification, resolution and settlement of complex and detailed issues for alleged professional negligence claims.
Neither the arb or riba, in conjunction with pi insurers, has yet evolved acceptable and meaningful procedures in which aggrieved clients, or architects, can test the resilience of potential claims against each other, without resorting to civil courts. Indeed, it is often the adversarial attitude and culture of the insurance industry that mitigates against a more conciliatory approach.
It may be that a way forward could stem from the expert witnesses for each party taking an early draw on the Ikarian Reefer, inhaling deeply, and narrowing issues and potential liability, well before the expensive juggernaut of the legal profession has its bite of the cherry.
In alleged professional negligence issues, where legal costs can exceed the potential liability settlement, the arb could adopt a more proactive stance in the public interest and demonstrate a clear commitment to the maintenance of professional standards of behaviour for the benefit of our profession as a whole.
Vincent Hastwell, Hastwell Associates, Holmwood, Surrey