In a recent decision the TCC found that construction professionals may discharge their duty to take reasonable care if they rely on the advice or design of a specialist, provided that they act reasonably in doing so. The Court also considered the reliance that can be placed on expert agreed statements.
Background
Cliveden Estates Limited was engaged by Co-operative Retail
Services Limited (whose rights and obligations were later
transferred to the Co-operative Group Limited ("CGL")) to
develop a supermarket in Kent. Cliveden engaged consultants,
appointing John Allen Associates Ltd to provide consulting civil
and structural engineering services. Cliveden contracted with
John Mowlem & Company Plc to build the supermarket. The
contract between Cliveden and Mowlem contained a provisional sum
for vibro compacting ground improvement and a Performance
Specification for soil stabilisation by Vibro Replacement
Techniques, which had been prepared by John Allen following receipt
of specialist advice from a contractor, Keller. Mowlem
sub-contracted the ground improvement works, including full design
of the ground improvement scheme to Pennine Vibropiling
Ltd.
Following completion of the ground improvement scheme, a concrete
slab was laid, and the supermarket structure built on that
slab. The slab settled to such a degree, however, that the
supermarket floor began to slope and remedial work was
required.
CGL commenced proceedings against John Allen, claiming damages for
breach of the consultant's collateral warranty to provide
'reasonable skill care and diligence in the performance of its
duties to the Client under the Appointment'. CGL claimed
that John Allen failed to carry out adequate checks of the design
calculations produced by Keller and ought to have advised CGL to
seek advice from a geotechnical engineer. John Allen brought
Mowlem into the proceedings, who then brought Pennine into the
proceedings as a fourth party. On the second day of the
trial, John Allen, Mowlem and Pennine settled the claim between
themselves, the latter two parties taking no further part in the
proceedings.
The decision
CGL's claim against John Allen failed at the first hurdle,
the Court finding that vibro-replacement was not an inappropriate
choice of technique, and was not inevitably going to fail.
The Court did, however, go on to say that if this had not been the
case, John Allen was nevertheless entitled to and did reasonably
rely on the advice of Keller as a contractor with specialist
expertise in vibro replacement techniques, and was not under a duty
to undertake independent evaluation of the feasibility and risks of
vibro replacement, nor recommend that geotechnical advice be sought
from a consultant other than a specialist
sub-contractor.
Of specific interest were two questions answered by the Court:
Could CGL rely on the expert evidence disclosed by the parties no longer in the proceedings?
The Court highlighted the purpose of expert reports, namely to come to agreements, define disagreements, and make comments which are intended to assist the Court by narrowing issues to be dealt with in expert reports. It would, therefore, be artificial for the Court to consider passages within expert reports but exclude from consideration comments, agreements or disagreements which had been included in the joint statements. Expert joint statements can, therefore, be relied upon where one or more of the participants in the statements are not called to give evidence but submit an expert report. In such circumstances, the experts' statements would assist in showing the scope of agreement on expert issues, and in clarifying or amending matters contained in an expert's report.
Was John Allen able to rely on specialist advice as a defence to the claim?
The Court found that construction professionals do not, by the
mere act of obtaining advice or a design from another party,
thereby divest themselves of their duty in respect of that advice
or design. Construction professionals can, however, discharge
their duty to take reasonable care by relying on the advice or
design of a specialist provided that they act reasonably in doing
so. In determining whether construction professionals act
reasonably in discharging their duty to the client, the Court
considered:
- whether assistance is taken from an appropriate specialist
- whether it was reasonable to seek assistance from other professionals, research or other associations or other sources;
- whether there was information which should have led the professional to give a warning;
- whether and to what extent the client might have a remedy in respect of the advice from the other specialist;
- whether the construction professional should have advised the client to seek advice elsewhere or should themselves have taken professional advice under a separate retainer.
Comment
Whilst this decision will be welcomed by those consultants relying on specialist advice within the construction industry, the facts of each case will always determine the extent to which the consultant has ultimately fulfilled its duty of reasonable skill care and diligence in the performance of its duties.
Further reading: Cooperative Group Limited v John Allen Associates Limited [2010] EWHC 2300 (TCC)
This article was written for Law-Now, CMS Cameron McKenna's free online information service. To register for Law-Now, please go to www.law-now.com/law-now/mondaq
Law-Now information is for general purposes and guidance only. The information and opinions expressed in all Law-Now articles are not necessarily comprehensive and do not purport to give professional or legal advice. All Law-Now information relates to circumstances prevailing at the date of its original publication and may not have been updated to reflect subsequent developments.
The original publication date for this article was 19/01/2011.
