I recently read an interesting article on “fitness for purpose” in the context of construction contracts and it got me thinking about whether the revile held for these words was actually justified.
I have been involved in negotiations where contractors or professional consultants insist on removing any requirement that the finished building will be “fit for purpose”.
The argument runs something like this: “I will not accept a fitness for purpose obligation because it is too onerous and is not insurable”.
As the author of the article quite rightly points out: if an employer wishes to construct a building for a particular purpose as set out in his employer’s requirements then shouldn’t he be entitled to expect his chosen contractor to construct such a building on the basis that this is what the contractor is being paid for?
The starting point is that professionals must exercise reasonable skill and care in the provision of their services – and this is generally what will be covered by professional indemnity insurance policies. This gives rise to a reluctance to agree to any higher standard of care either under the building contract or appointment.
The question raised by the author is why the JCT design and build contract appears to differentiate between workmanship (where there is an absolute obligation to carry out and complete the works “in a proper and workmanlike manner and in compliance with the Contract Documents…”) and design (where liability is measured against the standard of care generally imposed on architects, in other words the “reasonable skill and care” test).
The contractor is contracted to both design and construct the building so why should there be any difference in the standard of care required? After all there are other obligations which contractors willingly sign up to and which are not insurable.
The problem may stem from the wording in the Supply of Goods and Services Act which provides that where an employer either expressly or by implication makes known to a contractor any particular purpose for which the building is to be built, there will be an implied term the building will be reasonably fit for that purpose, whether or not that is a purpose for which such goods are commonly supplied.
The solution is simple: if the building is required to fulfil a particular purpose then there can be no objection to requiring the contractor to ensure that certain performance requirements are met. This avoids having to actually use the words “fit for purpose”, and means that the contractor will not be required to ensure fitness for any other currently unknown purpose to which the building might be put in the future.
Author: James Coppinger, Head of Construction and Engineering.
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