When it comes to appointing the professional team, one of the key issues is to ensure that you clearly define what it is you want them to do. The last thing an employer client wants is for something to happen or not get done and for liability to fall down a black hole.
The extent of a consultant’s obligations can, to an extent, also be determined by the language used. Such an issue arose in Sweett (UK) Limited v Michael Wright Homes Limited.
Sweett (formerly Cyril Sweett) was appointed by Michael Wright Homes as Employer’s Agent in relation to works to be carried out by a contractor under a JCT2005 DB contract.
Sweett’s appointment required it to: “prepare contract documents and arrange for such documents to be executed by the parties thereto”.
Sweett prepared a performance Bond to be provided by the contractor and which was included in the contract documents.
One of the questions the Court had to consider was: Was Sweett under an absolute obligation to ensure the Performance Bond was provided, or was its duty limited to exercising reasonable skill and care?
The Court applied a common sense interpretation on the word “arrange” which was held to mean “put in place arrangements for”. In the circumstances, the wording did not impose an absolute obligation on Sweett to ensure the contractor provided the performance bond.
Given that Sweett had drafted the performance bond, included it as a contract document, explained its effect to the contractor, and requested the contractor to sign it both in correspondence and at meetings, the Court found that Sweett had discharged its duty and was not in breach of the terms of its appointment.
COMMENT: This decision will come as a relief to professional consultants who are engaged to fulfil certain obligations – particularly those in relation to the preparation and execution of important documents. Employer clients should therefore ensure that where it is intended to create absolute obligations, the drafting of the appointment uses clear and unambiguous language. Even where there is no absolute obligation, consultants are still required to undertake their duties with reasonable skill and care.
Author: James Coppinger, Head of Construction and Engineering.
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