Chrysler settled Mr Hawkins' action. The action continued between Chrysler and Burne Associates.
Chrysler alleged that it was a term of the unwritten contract that Burne would use reasonable care and skill in selecting the material to be used for the floor, and that there was an implied warranty that the material used for the floor would be fit for use in a wet shower room.
How much care is enough?
Burne Associates had looked into flooring possibilities, and had selected one of a flooring manufacturer's two vinyl non-slip safety floor coverings – 'Standard' rather than 'Extra'. The manufacturer's brochures indicated that both types were slip-resistant when wet. 'Extra' was better for increased grip underfoot in very wet and greasy areas, but was not suitable for dry areas. Burne Associates did not directly consult the manufacturer, but did discuss the matter with the floor covering subcontractor (which, as it happened, was well known to the manufacturer). The manufacturer gave evidence to the effect that there was "no such thing as a floor that is safe under all conditions". Mr Burne of Burne Associates had gone into the foundry and even gone as far as using the showers in the shower area. Had Burne Associates done enough, however?
Burne Associates did not dispute that they were under an obligation to exercise reasonable skill and care. And the judge who first heard the case agreed Burne Associates had not been negligent in their work.
However, Burne Associates lost before a second judge on the issue of whether the company was obliged to provide an express or implied warranty that the floor surface would be fit for use in a wet shower room, ie a fitness for purpose obligation.
Fitness for purpose
In the Court of Appeal, Chrysler relied on an earlier Court of Appeal decision, Greaves versus Baynham Meikle, a case between a turnkey contractor and a structural engineer. In the case the floors designed by the structural engineer were not able to withstand resonance forces set up by the movement of trucks carrying oil drums. The Court of Appeal decided that the design and build contractor was liable to the owner for a suitable design, fit for its purpose, and so the structural engineers were liable to the contractor under a term to be implied from the particular facts.
However, the Court of Appeal in Hawkins versus Chrysler and Burne, while paying careful lip service to Greaves versus Baynham Meikle, came to a very different decision. The Court said that where a contracting party is a professional providing advice or designs alone, without supplying a product, no warranty will normally be implied beyond a term that reasonable skill and care will be used in giving the advice or preparing the designs. That is, it was enough for the contractor to take reasonable care, and there was no implied obligation to provide the floor as fit for purpose.
Legal reasonings
Does this make sense? If the flaw lies in the design rather than in the construction, why should someone undertaking design and construction be liable to a greater extent than the designer who has not undertaken construction? Lord Justice Neill recognised in Hawkins versus Chrysler and Burne Associates that this distinction might be anomalous, but it is currently the position.
It has been suggested (by the very eminent author of Hudson's Building and Engineering Contracts) that powerful and valid reasons for the distinction are that a design and build contractor is under competitive pressures to "design down" as near as possible to the minimum acceptable standards of quality, while a professional will tend (for financial reasons), if anything, to over-design; and that a fitness for purpose liability might inhibit innovation by professional designers. You may or may not find these reasons convincing.
What can you do in practice?
Given the legal position, what should a designer do in practice? Ideally, whether designing only, or designing and installing an item or system, the designer will not enter into a contract or a collateral warranty which imposes an obligation of fitness for purpose. If it is commercially impractical to avoid doing so, a designer should at least, before doing so, check that any relevant insurance policy will cover such an obligation. Fitness for purpose may sound harmless, but can require a much higher standard than reasonable skill and care, particularly, for example, where the design is novel and untested, or the intended purpose is unusual.
In a design only contract, in the absence of a provision requiring fitness for purpose, the duty will be to act with reasonable care and skill.
If the contract is for design and build, however, then, in the absence of a term limiting the duty to reasonable care and skill, the obligation will be to provide a product (system/item) fit for its purpose. The terms of a contract can expressly exclude any term implied by law as to fitness for purpose.
One further, different but related point. The Court of Appeal has recently (December 1999) held that a subcontractor has a duty to warn the main contractor when the subcontractor knows (or, possibly, ought to know), that (although the subcontractor did not produce the design) works are obviously dangerous (or, possibly, merely defective). How strong should the warning be? In Plant Construction versus Clive Adams Associates and JMH Construction Services, the Court said that the subcontractor should "advise as vigorously as possible."
Crispin Owen is an assistant solicitor at Nicholson Graham Jones. Tel: 0207 360 8124, or e-mail crispin.owen@ngj.co.uk
Source
Building Sustainable Design
