Fosters faces bill of £3.6m after losing hotel case
The planned hotel was never built
Foster + Partners is facing a £3.6m bill following a High Court ruling on a Heathrow hotel scheme it worked on almost a decade ago.
A claim was made against the world-renowned architectural practice by four companies owned by businessman John Dhanoa.
He commissioned Foster + Partners to design a hotel on the site of a bowling alley near Heathrow in 2007.
However, it was never built, because Dhanoa said the architect’s design would have cost £195m to build, far exceeding his budget of £70m, later increased to £100m.
The judgement handed down by the Technology & Construction Court said that Foster + Partners had failed to establish the project’s budget, and had also indicated that the scheme could be value-engineered down to the £100m budget of Dhanoa.
Mr Justice Peter Fraser said it was “blindingly obvious” that this was not possible and that “Fosters had a duty, in my judgement, positively to advise Mr Dhanoa of that fact”.
He said that the four claimants – Riva Properties Ltd, Riva Bowl LLP, Riva Bowl Ltd and Wellstone Management Ltd – were entitled to recover £3,604,694.36 from Foster + Partners.
Stephen Homer of Ashfords LLP, who acted for the claimants, said: “This case serves as a warning to designers that they cannot design in a vacuum. Cost and budget is a key constraint and should always be identified and considered when designing any project, even when the provision of cost advice is expressly excluded from the designer’s obligations.”
Foster + Partners disputed the allegations made against the practice, denied that any budget was provided by Mr Dhanoa, and denied giving value engineering advice.
Its design for the five-star hotel on Bath Road, close to Heathrow Airport, was a glass-shelled 13-storey building, six of which were below ground. It included 600 beds, a 1,200 capacity ballroom, plus leisure facilities.
A spokesperson for Foster + Partners said: “We are shocked and disappointed by the judgement. We do however take the judge’s comments seriously and are undertaking a review led by our independent directors, supported by Travers Smith, an independent law firm, to see what lessons or actions should be taken from this case.”