Management

Alisdair Matheson's Case notes

7 January 2011

Dhamija & another v Sunningdale Joineries & others

Technology and Construction Court, October 2010

In 2009 Mr and Mrs Dhamija pursued their contractor Sunningdale Joineries, along with their architects and quantity surveyors, alleging hundreds of defects to their newly constructed house.

The QS, McBains Cooper, was accused by the Dhamijas of overvaluation and also a breach of an alleged duty “to only value work that had been properly executed by the contractor and was not obviously defective”. McBains sought to strike out the second allegation on the grounds that it was the architect’s duty to report any defects.

The building contract was a standard JCT form which provided for interim certificates prepared monthly after consideration of documentation and site visits by the QS.

The leading case on this subject is Sutcliffe v Chippendale & Edmondson (1971). It concerned an allegation of negligence against a firm of architects that their interim certificates hadn’t made proper allowance for defective work by contractors.
The court held that the architects had a duty to tell the QS to exclude defective work from the valuations, but the QS did not
have to advise them of defects.

The Judge, Mr Justice Coulson, referred to textbooks. Two (including one of which he co-authored and could therefore give little weight to) considered the architect had a duty to decide whether works were “properly executed” and advise the QS. The QS would focus on quantities and take into account the architect’s information as to what ought to be valued.

Meanwhile, Hudson’s Building & Engineering Contracts, 11th edition, states that a QS does bear a duty to bring defective work to the architect’s attention in case the latter has missed it. But the Judge considered this paragraph unreliable as it referred only to the Sutcliffe case which did not support the point.

McBains Cooper’s legal position was backed up as its valuations stated it had relied on the architect for advice on what was defective work. The architect had also attended the property and provided lists of defects requiring deductions from valuations.

The Judge therefore considered that there was no such implied duty alleged in the parties’ contract. While McBains should only value works which had been “properly executed” in the light of the JCT form of contract, it was the architect’s duty to inform them what had not been “properly executed” so they could apply the correct value to it. It would have been illogical to turn the duty on its head and have the QS advise the architect what was defective.

The Judge did not strike out this aspect of the case as further evidence might set out more fully the terms of the contract, but he warned the Dhamijas that if they proceeded, it was possible that an indemnity costs order be made against them if they lost.

Alisdair Matheson's analysis

The ruling in this case is good news for quantity surveyors as it restricts their obligations to an employer and clearly delineates where their responsibility ends and that of an architect or other contract administrator begins.

In the last recession, it was common for disgruntled employers to pursue whole design and professional teams together with the contractor as jointly and severally liable if they considered there was a defect in workmanship or design, hoping that someone would pay up. In the absence of express contractual agreement, this decision certainly acts as a deterrent to such actions.

But it may go further, supporting attempts in the future by other professionals, or rather their indemnity insurers, to avoid that kind of joint and several case by arguing that the individual professions have clearly defined roles in a traditional construction contract.

The problem is that it is very difficult in the current climate for any professional, including quantity surveyors, to dictate terms to an employer. Not only is it possible that the obligation to note and exclude defective work be made express, but it is not unheard of for employers to go further, seeking to make a QS almost a clerk of works.

Particular care has to be taken by the QS if such a role is outlined in a contract as that might prejudice their insurance position. It also means the employer seeking to include such a clause may have a worthless right to pursue.

Comments

Indeed this is good news to the quantity surveying profession. One cannot over emphasise the tendency by most clients to put the quantity surveyors in a defensive position when it comes to payments made for work which the clients believes to be unsatisfactory.

Clients should be helped to understand the meaning of the specifications notes on drawings. In most instances, design documents / or drawings usually contain information such as "to the engineers specification or to the architects approval". This can be used by the quantity surveyors to defend their positions, should they be sued for failure to highlight the defects, which in any case should have been highlighted by the Architect as part of his duty.

Lawrence Mutale, 14 January 2011

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