Architectural schizophrenia

Architects have always had to be schizophrenic to an extent in performing their duties under construction contracts. They have, on the one hand, to act as their employer’s agent in supervising the works. On the other, they are obliged to act as independent certifier, deciding the value of the works carried out by the contractor and determining claims by the contractor, both usually on an interim basis.

In the 19th and first half of the 20th century, architects often found themselves in an even more invidious position. Not only were they the agent of the employer and interim certifier, they are often also the final arbiter of any disputes between the contractor and the employer, unless bad faith or fraud by the architect could be shown. This was the case even though the architect clearly had a relationship with the employer.

The 1950 Arbitration Act effectively put a stop to this situation. The architect could not act as final arbiter if it was not or may not have been impartial because of its relationship with the employer. It made no difference if the parties had known about the relationship at the outset.

Two questions dealing with the architect’s obligations as independent certifier have passed across my desk in recent weeks. The first arose in a construction contract where there were also piling works. Problems had arisen in relation to these piling works and an independent structural engineer’s report had been obtained by the employer. The architect wanted to know whether he could rely on the independent engineer’s report when determining the contractor’s claims for delay and loss and expense because he did not regard himself as qualified to determine the rights and wrongs of the technical problems that had arisen.

To answer the question, we had to go back to first principles. Where an architect is acting in his independent capacity, he is obliged to act in a fair and unbiased manner and any determination made by him must be his own and have been reached by exercising his professional skill. Of course, in exercising that skill he can refer to any number of sources, including text books, academic papers, industry standards and so on. Such reference materials could, however, also include other experts’ reports, views of the employer or even the employer’s legal advisers. The essential point is that reference to all of these materials is acceptable provided the architect maintains his ability to reach a decision independently. Having said this, it is good practice for architects to take any advice they require from independent sources so as to minimise the risk of being accused of not acting impartially. Our architect in this case was therefore able to have regard to the engineer’s report as long as his decision at the end of the day was his own.

The second related question arose where a contractor was dissatisfied with the architect’s decision and wanted to know whether the fact that the architect was also a director of the employer company meant that the architect’s decision could be challenged on the grounds of partiality. In a nutshell, the answer to this is that provided the contractor either knows of the architect’s relationship with the employer at the time of entering into the contract, or can be taken to have appreciated the existence of that relationship at the outset, then the architect will not be disqualified automatically from exercising his independent function.

Although some may find this last point surprising, the legal roots for this approach can be traced back to the situation that I referred to before, where the architect was not only an agent and independent certifier, but also the final arbiter of disputes between the parties. There are a series of 19th- and early 20th-century cases that decide that where the contractor knew or was taken to have known of any particular relationship between the architect and the employer, then the courts should not allow the mere existence of that relationship to displace the contractual arrangement. Although the 1950 act changed the law as far as an architect also acting as a final arbiter was concerned, it did not affect the position in relation to an architect’s independent certifying function and therefore the court’s historic approach still holds good.