When it comes it comes to supply of materials in a building contract the contractor will agree to carry out the construction work in a good and workmanlike manner and to supply materials or goods which are reasonably fit for purpose for which they will be used.
The obligation of “fitness for purpose” is also to be found in design and build contracts. Where a contractor takes on the responsibility of both the designing of a building and constructing it the courts will find that the contractor has the duty to deliver the finished product to the standard that is reasonably fit for the purpose for which it was built. This is a much stricter obligation than the lower standard of reasonable care and skill which the contractor must meet when he merely carries out the building work without designing the building.
This standard of reasonable skill and care is a much lower standard and if it is written into the contract it will mean the building employer has to show that the contractor was so careless that he was negligent in the design and construction. This becomes much more difficult task for the employer to do than merely having to show that the building is not fit for its purpose.
The importance of the distinction between the standard of reasonable skill and care and an obligation of fitness for purpose in a design and build contract is that in the former case negligence of the contractor has to be proved whereas a fitness for purpose obligation is an absolute obligation which the contractor must meet irrespective of his negligence. Put simply, the building employer does not have to prove negligence of the contractor where the contractor has both designed and built the building. Instead the contractor will be held liable for all losses of the building employer that flow from the building not being fit for its purpose.
Therefore where the building employer can show what the purpose of the building is and that construction is not fit for that purpose the contractor will be liable for the building employer’s losses even though the contractor has not been negligent.
This is why building contractors engage Construction lawyers who advise contractors of the appropriate wording to be contained in design and build contracts and ask them to make changes to the wording of draft contracts prepared by employer’s lawyers in order to limit the legal liability of contractors. This is done by making sure that their responsibility in the contract wording is restricted to the standard of the reasonable skill and care of a professional Architect. In short they routinely delete the fitness for purpose obligation and replace it with the lower standard of reasonable skill and care.
For these reasons Contractors would benefit from having their design and build contracts checked before they sign away their liability for untold losses, which could easily be limited by ensuring that the correct wording is written into the contract.
Anthony Philpott
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