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In the recent case of Workman Properties Limited v Adi Building and Refurbishment Limited [2024] EWHC 2627 (TCC), the court dealt with some interesting questions about design responsibility .
In recent years, we have seen a few arguments raised by Design and Build ("D&B") contractors or others suggesting that, because statements are made about the level of progress of 'existing' designs at the contract stage, those contractors should be released from broader obligations to develop the design or complete it to a relevant standard. That kind of argument has always felt a bit odd. If you take on responsibility for an existing design, you should make sure you know what you have taken on and whether you can develop it to a final version. It seems odd to argue, after the event, that you could not, because the existing design was deficient.
Thankfully, the court agrees.
The parties had entered into an amended JCT Design and Build (2016 ed.) ("the Contract") in 2022 for works involving an expansion of a dairy's facilities. A dispute arose as to whether it was the claimant or defendant who was responsible for completing the project's design to RIBA Stage 4 (and/or BSRIA stage 4.4(i)). For ease, this article will refer solely to RIBA Stage 4 throughout.
The Employers Requirements ("the ERs") provided that the contractor would be "fully responsible for the complete design, construction, completion, commissioning and defects rectification of the works" – a fairly standard position under D&B contracts – yet went on to also state that the design would be taken to RIBA Stage 4 at the time of entry into the contract.
Further provisions within the ERs (as usual) obliged the contractor to verify the design and satisfy itself that the design's development was as anticipated. This was also reflected in some of the parties' amendments to the Contract's standard wording.
When the parties entered into the Contract, the design had not reached RIBA Stage 4 and a dispute arose.
In 2023, the matter was referred to a first adjudication where the adjudicator found that the defendant was not responsible for completing the design to RIBA Stage 4 by virtue of the wording within the ERs relating to the design's development stage. Rather, the claimant had breached the Contract and the warranty to complete the design to that stage.
In 2024 another adjudication followed, where the adjudicator awarded £3 million plus interest to the defendant for its claims for extensions of time and loss and expense.
Although the court in this case primarily had to decide on questions concerning the use of the Part 8 court procedure and what constitutes "adjudication business", the court also offered some useful guidance on contractual statements concerning design responsibility.
In this instance, the judge held that the paragraph of ERs requiring the design to be developed to RIBA Stage 4 simply could not amount to a warranty or obligation to get the design to that stage. This was because, when reading this paragraph alongside the rest of the Contract (including the ERs), that would not reflect the intention of the parties.
Being a D&B contract, it is common practice for a contractor to take full responsibility for the design and this was further reflected in the standard JCT D&B wording and indeed in one of the parties' amendments to a recital within the Contract, which was materially different from the unamended version.
It was clear from the wording of the Contract that the contractor should have verified the design and made itself comfortable that it had indeed been completed to the expected standard. The judge noted that "if [the contractor] decided simply to accept that the consultants had done what they had said that they had done, then that was at their own risk".
This judgment is helpful in that it clarifies the position in relation to statements parties seek to make about the extent of any design responsibility and acts as a good reminder that D&B contracts tend to operate on the basis that the contractor will take full responsibility for any project design. It will be useful authority for pushing this argument off in the future.
Given that the Contract was an amended version of the JCT D&B 2016 contract, this case does turn on its own facts to a certain extent. However, it does highlight that parties need to take special care when drafting provisions on design responsibility and seek to ensure that any terms are as unambiguous as possible to avoid any confusion (and liability!) down the line.
If you have questions about design responsibility or any other issues arising out of your construction contracts, the expert team at Foot Anstey is here to support you, so please do get in touch.