| Date | 27 October 1999 |
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| Judgment | Outwing Construction Ltd -v- Thomas Weatherald Ltd, TCC 13 September 1999 |
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| The Issue | Liability for defects in the context of design and construct works. |
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| Implication |
The importance of tactical considerations in resolving disputes concerning defects in building works. |
printFrom a client's perspective, the use of a design and build form of procurement offers one distinct advantage. In the event of defects in the works, the client will not be faced with the difficult process of establishing whether the fault is one of design, whereby responsibility will lie at the door of the consultant team, or instead involves failures of workmanship or materials for which the contractor must be held responsible. Clearly in design and construct projects where the contractor has a full design responsibility, the client may expect its contractor to remedy defects regardless of the primary cause of the problem. This does not mean that arguments concerning whether defects are the consequence of faulty design or faulty workmanship are a thing of the past. Quite simply these arguments are passed to the main contractor to resolve. The case of Outwing Construction Limited -v- Thomas Weatherald Limited illustrates the point. Weatherald was the main contractor engaged on a design and build basis to construct a new nursing home at a site in Bramley Hill in Croydon. It engaged Hubert Jenkins and Partners as consulting engineers to prepare the structural design. Amongst others it placed a subcontract with Outwing to carry out the required groundworks and substructure construction up to damp proof course level. The works included a basement which was designed with blockwork retaining walls taken up from a reinforced concrete floor slab. The case concerned the responsibility of Outwing for water penetration to the basement, and the allegation that the cause lay in workmanship failures on the part of Outwing in connection with the external tanking system. From the outset, Weatherald took a straightforward approach to the matter. It blamed Outwing for failure to exercise reasonable skill and care in the installation of the tanking membrane to the basement, and argued that it was Outwing's responsibility to resolve the problem. Unsurprisingly, Outwing did not accept this, and identified other possible sources of the water. To support its view, Outwing engaged the services of its own consultant specialising in basement construction. His advice was that a design fault lay at the heart of the problem. In particular he advised that the fault lay with a land drain adjacent to the basement wall, both because of the manner of which the drain had been installed and the height at which it lay. He considered that this was creating water pressure against the tanking, which the tanking could not be expected to withstand. Weatherald forwarded this report to its consulting engineer, whose response was a spirited and unequivocal rejection of the criticism of its design coupled with the statement that the moisture in the basement appeared to be the direct consequence of damage, inadequacies or installation faults of the primary waterproofing membrane. At this point, had it wished, Weatherald could have stood aside on the basis that it was indifferent whether responsibility lay with its consulting engineer or with its subcontractor, or with both of them. Instead Weatherald chose to unequivocally endorse the consulting engineer's views and adopt them as its views. The demand for Outwing to take action to rectify the problem was repeated. At the conclusion of these exchanges, Weatherald stated that the only viable method of dealing with the problem was for an internal waterproof rendering system to be installed. No investigation works to determine the condition of the membrane carried out by Outwing were to be undertaken. Instead Weatherald elected to proceed with the internal remedial works with the intention of recovering the cost of so doing from Outwing under the terms of the subcontract. Tactically this was a high risk approach. It meant that Weatherald would be unable to provide particulars of the failures in workmanship which it alleged. Simply put, its case was that since there was no design fault, Outwing's defective workmanship, or failure to use materials which were fit for their purpose, could be the only cause of the water penetration. Colin Reese QC sitting as a Recorder in the Technology and Construction Court, readily came to the view that in the absence of any evidence to that effect, he could see no basis upon which the court could possibly infer that unsuitable or substandard materials had been used. The real question was whether it could be inferred that Outwing had failed to carry out the subcontract works with reasonable skill and care. Firstly, evidence concerning the manner in which the works had been carried out was considered. Two relatively minor issues had been raised, and in each case Outwing had noted the comments and put the work right. No other problems had been noted by Weatherald during construction, and Mr Reese concluded that the work appeared to have been carried out properly in accordance with the manufacturer's recommendations or guidelines. Experts for both parties were heard, and each adopted party lines. The manner in which Weatherald's case had been presented, however, proved decisive. Mr Reese pointed out that whether or not the engineer was at fault in producing the particular design was not an issue in these proceedings. In his view however, having heard the experts, design factors could not be ignored or discounted. Accordingly it could not be assumed that defective workmanship (or the use of defective materials) must exist and be the sole cause of the water penetration. The counterclaim against Outwing therefore fell to be dismissed and judgment was given for Outwing in the amount of its claim for unpaid monies and interest.
CJ-9941
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