DESIGN, MATERIALS & WORKMANSHIP – Example Cases

Liability for Design

Brunswick Construction Ltd v Nolan (1974) 21 BLR 27

Facts Nolan engaged an architect to design a house and then contracted with the appellant to build
the house according to the architect’s design (set out in drawings and specification). The
design was faulty and made insufficient provision for ventilation of the roof space and timbers.
The result was serious rot.

Held The appellant was held liable. An experienced contractor should have known that the design
was defective and since there was no architect to supervise the works, Nolan had relied
exclusively upon the contractor. It followed that the contractor was under a duty to warn of
defects in the architect's plans. The contractor had an obligation to carry out the work in such
a way that it performs its intended function and that duty overrode an obligation to comply
with the plans and specifications. The contractor was liable although he had complied with the
architect’s plans.

George Hawkins v Chrysler (UK) Ltd (1986) 38 BLR 36

Facts Chrysler appointed engineers (Burne) to produce a design and specification for a new shower
room at their factory and to supervise the installation. After the work had been completed the
plaintiff, an employee of Chrysler, was injured when he slipped on the wet floor. Chrysler
joined Burne as co-defendants alleging that he should have used reasonable skill and care in
selecting the flooring material and that there should be an implied term that the flooring would
be fit for use in a shower room. It was accepted that Burne had chosen the flooring material
himself. The manufacturer's evidence was that it was satisfactory in wet areas, but an
alternative was available for really wet and greasy areas. Use in showers was specially
mentioned in relation to the alternative material but either was suitable.

Held Burne was not in breach of a duty to exercise reasonable skill and care. He had considered
both materials. had investigated conditions in the factory. had taken advice from a flooring
contractor and had instructed the defendant in the maintenance and cleaning of the flooring.

Standards of Liability

Greaves (Contractors) Ltd v Baynham Meikle & Partners (1975) 3 ALL ER99

Facts The plaintiff was a contractor engaged to design & build a warehouse for the storage of barrels
of oil. The plaintiff engaged the defendant as structural engineers to design the structure
telling them that the floors had to take forklift trucks carrying barrels. It was clear that both the
plaintiff and defendant knew the purpose for which the building was to be used and that the
employer relied on the contractors' skill and judgment. It followed that the contractor had a
duty to see that the work was reasonably fit for its purpose, not merely a duty to use
reasonable care.
Following construction the floor cracked due to vibration of the forklift trucks. The floor was of
insufficient strength. The question arose whether there was an implied term in the engineers'
contract that the design should be fit for use (purpose) by loaded forklift trucks and whether
there had been a breach of that duty.

Held The parties had a common but unexpressed intention that the defendant should design a
warehouse which would be fit for the purpose for which it was required and that if the work

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 was carried out in accordance with the design the building would be reasonably fit for use by
laden fork lift trucks. In reaching this conclusion the courts relied upon answers given by the
defendants' witnesses in cross examination when it was admitted that it was the engineer’s job
to produce a building which would be fit for use as a store for oil drums and for the use of fork
lift trucks. A warranty of fitness for the purpose would be implied.

In the above case the liability of a professional was lifted up from reasonable skill and care to fitness
for the purpose. This was done because the parties had expressly (not necessarily in writing) agreed
that would be the extent of design liability.

Refer to later standard forms of contract (JCT CD98 and JCT DB 05) which include design by a
contractor: the liability of the contractor in the JCT CD98 and JCT DB 05 forms is reduced to that of
reasonable skill and care.

Victoria University of Manchester v Hughes Wilson & Lewis Wormsley (1984) 2 Con LR

Facts The plaintiff claimed damages against the first defendant (the architect), the second defendant
(the contractor), and third defendant (the sub-contractor) when ceramic tiles used to clad a
reinforced concrete building fell off. The court considered the duties of the respective
defendants.

Held A term should be implied obliging the contractor to warn of any defects in the design which he
believes exist. This requires more than a mere doubt about adequacy of the design but less
than actual knowledge. On the facts in this case the contractor was not in breach of the
implied term.

Materials

Bower v Chapel-en-le-Frith Rural District Council (1911) 9 LGR 339

Facts The plaintiff was the successful tenderer for the erection of a new waterworks for the Council.
The contract was for a lump sum and contained a specification and bills of quantities. The
plaintiff was instructed by the contract to buy a windmill tower and pump from a named
supplier at a named price and to install them. The windmill pump in itself was not defective but
it proved incapable of doing the work that it was being asked to do. The Council claimed that
the plaintiff should replace the pump with one that would do the job. The plaintiff argued that
they were not responsible as they had played no part in the selection of the windmill. It was not
argued that the failure was due to defective installation.

Held The plaintiff was held not liable. The plaintiffs obligation was not to make the mill answered its
purpose but to install the mill in accordance with the plans and specifications which had been
prepared by the Council or they had caused to be prepared.

University of Warwick v Sir Robert McAlpine (1989) (ABCC4 pp 96-103)

Facts McAlpine were main contractors to the University. The buildings had reinforced concrete
frames with a white ceramic tile external cladding. The cladding had been carried out by
nominated sub-contractors. The cladding began to fail. The architects blamed bad
workmanship and McAlpines blamed the design. Eventually, the University decided to remedy
the defects by a resin injection process, a recent development. The architects recommend a
specialist firm be employed by McAlpines to perform the remedial works and the contract was
varied accordingly. Technically, the specialist firm were not nominated sub-contractors but

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 were employed by McAlpine. The remedial works failed and the University alleged that
McAlpine were in breach of an implied warranty of fitness for purpose.

Held A term that the resin be fit for its purpose could only be implied if the University had relied on
McAlpine. As they had not done so, no such term could be implied. The University lost its
claim against the contractor.

Other important cases in this area are:

Hancock v Brazier (1966) ALL ER 901 (ABCC4 pp85-87)

Young and Marten Ltd. v McManus Childs Ltd (1969), 9 BLR 77 (ABCC4 pp90-92)

Gloucestershire County Council v Richardson (1969), (ABCC4 pp92-95)

Norta Wallpapers (Ireland) Ltd v John Sisk & Sons (Dublin)Ltd (1977), (ABCC4 pp95-96)

Rotherham Metropolitan Borough Council v Frank Haslam Milan & Co. Ltd and M J Gleeson
(Northern) Ltd (1996) 78 BLR 1. (ABCC4 pp103-105)

Fitness for purpose

A more recent case is a valuable reminder of the general law on fitness for purpose, and will be of
interest to both buyers and sellers of goods.

J Murphy & Sons Ltd v Johnston Precast Ltd [2008] EWHC 3024 (TCC)

Background
The claimant was a contractor responsible for designing and installing a water main under a main
contract with Thames Water in the Holland Park area of London. A sub-contractor manufactured and
supplied the contractor with a pipe for use in the main works. The contractor laid the pipe in a tunnel
and surrounded it with foam concrete, which is highly alkaline. The pipe burst four years later due to
alkaline attack, causing extensive damage to homes and businesses. Under arbitration proceedings,
the contractor paid damages to Thames Water for the damage caused, and then sought to recover
this money from the sub-contractor.
Among other things, the contractor argued that the sub-contractor should have ensured that the pipe
was fit for a foam concrete (i.e. alkaline) environment on the basis that the sub-contract between them
contained an implied term under the Sale of Goods Act 1979 that the pipe would be fit for that
particular purpose. Under the Act, there is an implied term that goods will be reasonably fit for a
particular purpose where a buyer makes that purpose known to the seller (either expressly or by
implication) whether the purpose is that for which those goods are commonly supplied, except where
circumstances show that the buyer does not rely on the seller, or that it is unreasonable for him to rely
on the seller’s skill and judgement.

Outcome
The court didn’t accept the contractor’s argument in relation to fitness for purpose for the following
main reasons:
It was an express term of the sub-contract that the pipe’s purpose was to carry potable water (i.e.
water which was fit for drinking), rather than to be fit for a foam concrete (i.e. alkaline) environment,
since the sub-contractor had expressly qualified its tender with the promise that the pipe would be fit
for the purpose of carrying potable water

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There was no clear evidence that, either before or at the time of entering into the sub-contract, the
contractor had told its sub-contractor that the pipe was to be fit for a foam concrete (i.e. alkaline)
environment or that foam concrete might be used around the pipe
There was also no clear evidence that, either before or at the time of entering into the sub-contract,
the contractor had relied on the sub-contractor’s skill and judgement in relation to the decision to use
foam concrete
There was nothing which the sub-contractor knew or ought reasonably to have known about foam
concrete in general
Therefore, the sub-contract did not include an implied term under the Sale of Goods Act 1979 that
the pipe would be fit for the particular purpose of a foam concrete (i.e. alkaline) environment.

If you are a buyer of goods, and you intend the goods which you are buying to be fit for a particular
purpose, the safest option is probably to make this purpose an express term of the contract.
Otherwise, you will need to identify clearly that particular purpose to the seller and be able to show
clear evidence of having done so (in drawings, specifications, method statements and meeting notes,
for example).

(Source: CSM Cameron Mckenna – Law-Now web site accessed September 2009)

PROFESSIONAL APPOINTMENTS: CONTRIBUTORY NEGLIGENCE AND REASONABLE SKILL

AND CARE

The Court of Appeal has rejected arguments that a designer and supplier of equipment should bear
full responsibility for damage caused by a fire. The right to damages had correctly been reduced by
75% for contributory negligence.

Background

ADT designed, supplied, installed and commissioned a fire suppression system for a factory owned
and operated by Trebor Bassett and Cadbury. In June 2005 a catastrophic fire developed which
ADT’s system failed to extinguish. Trebor and Cadbury sued ADT for damages in the sum of £100
million.

In July 2011, the High Court found that ADT had failed to design the system with reasonable skill and
care, and was accordingly in breach of contractual and tortious duties to Cadbury. However there
was a sting in the tail for Cadbury. The Judge also found that Cadbury shared in the responsibility for
the damage, and reduced the damages owed to Cadbury by a sizeable 75%. Unsurprisingly Cadbury
sought to overturn the High Court’s decision.

Cadbury’s appeal

Cadbury argued the judge should have found that ADT was in breach of contractual duties that went
beyond an obligation to use reasonable skill and care in the design of the system (and as such there
was no co-extensive tortious duty). If successful, this would preclude the application of the Law
Reform (Contributory Negligence) Act 1945, and the court would have no power to reduce the
damages recoverable by Cadbury to reflect any fault on Cadbury’s part.

Cadbury used two lines of argument to expand the scope of ADT’s contractual duties:

• Cadbury argued that the design and supply of the system constituted a supply of “goods” and so
under the Supply of Goods and Services Act 1982 was subject to express and implied terms of

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satisfactory quality and fitness for purpose. The court rejected this argument. ADT was agreeing to
supply design skills, and reasonable care in exercising them, not mere goods. ADT was not supplying
an off-the-shelf product, but a bespoke system; the flaws in the system were matters of design and
did not concern the inherent quality, or fitness for purpose, of the goods.

• Cadbury also alleged that the Specification amounted to a warranty or guarantee of the success of
the system. The Court of Appeal agreed with the High Court judge that imposing an absolute
obligation was an implausible construction of the Specification. Very clear words would be required to
bring about the result that a designer and supplier of fire suppression systems had contracted to
extinguish all fires, as it would be highly unusual for a professional to accept that type of liability.

The Court of Appeal dismissed the appeal; the High Court judge was right to conclude that Cadbury’s
damages should be reduced to reflect its responsibility for the damage caused by the fire.

Comment

This decision will be welcomed by professionals (and their insurers) who undertake to perform
contractual obligations with reasonable care and skill. Professionals are selected based on reputation
and experience in the expectation that they will perform their obligations with reasonable skill and
care. Extremely clear words would be required to extend this obligation to a point at which the
professional undertakes to bring about a certain result. This case should also, however, remind
professionals that they will also owe tortious duties in addition to contractual duties.

Further reading: (1) Trebor Bassett Holdings Limited (2) The Cadbury UK Partnership v ADT Fire and
Security Plc [2012] EWCA Civ 1158

(Source: CSM Cameron Mckenna – Law-Now web site accessed October 2012)

Tips for searching for Law Reports

Cases from the mid-1990s are available online. You can access these resources via the University
web site.

Go to the Library Online; click on Subject Guides; click on Law; click on Law Reports. Use the
Legal databases such as Westlaw or Lawtel and the online Tutorial “Introduction to Researching
Case law” (see also the link from the X-Stream home page folder)

Alternatively, for older cases use the library text book and journal resources. See the case citations
above and look for the All England Law Reports (AER) or Building Law Reports (BLR) in the Civic
Quarter Library, second floor, Law Section. A Library Catalogue search will also help you locate the
resources. A Google Scholar search using the case reference e.g. Hancock v Brazier may also lead
you to related resources, cases and case commentaries.