Michael F. James

Liability of Surveyors

We have seen in Chapters 2 and 6 that in the absence of a contract it is extremely difficult now for the purchaser of a defective building to bring a successful action against either the builder or the designer of the building. The reason for this is that the loss in such circumstances is likely to be economic and such loss is irrecoverable in the tort of negligence except where the relationship between the plaintiff and defendant can be brought within the scope of the principle in Hedley Byrne v. Heller.1 This has had vital implications for surveyors because, following the decisions of the House of Lords in Murphy v. Brentwood District Council2 and Department of the Environment v. Bates,3 the only means by which a purchaser of a defective building may be able to recover his losses is to sue his surveyor. The liability of surveyors has, therefore, assumed a unique, and, for surveyors, an ominous, importance in Construction Law.

Liability of Subcontractors

Under the traditional form of contracting in the construction industry, initially one contractor, known as the main contractor, is engaged to construct the whole of the works. However, it is usual for the majority of the work on a substantial construction contract to be carried out by a large number of (specialist) subcontractors. The subject of this chapter is the duties and liabilities of these subcontractors and the liability of the main contractor for their work.

Liability of Architects and Engineers

This chapter is concerned with the liability in professional negligence of those professions who provide services in connection with building and engineering projects, especially large-scale ones. The most important of those professions are architecture and engineering. Essentially the services which they provide in relation to a construction project can be divided into two broad categories: i the preparation of skilful and economic designs for the works; and ii the supervision and administration of the works in the best interest of the employer.

Builders’ Liability in Negligence

This chapter is concerned first with the liability of the builder to a subsequent owner of a building. In such a case there is no contractual relationship between the parties and the basis of the builder’s liability under the common law is the tort of negligence. The liability of the builder in negligence may, in certain cases, also be of relevance to the first purchaser. Thus, where a defective house has been purchased from a developer, rather than the builder, and the developer then goes into liquidation, the purchaser’s only worthwhile cause of action will be against the builder. Under the common law this will have to be based on tortious negligence, since in such circumstances there will be no privity of contract between the purchaser and the builder. In the event of a purchase of a defective house from a vendor/builder who goes into liquidation, the purchaser’s only means of recovery will be against any subcontractor if he has been responsible for the defect. Again, under the common law such recovery will have to be based on the tort of negligence. It must also be remembered that, as we have seen in Chapter 1, the purchaser of a defective building will in any case rarely have an action against his vendor because of the doctrine of caveat emptor, and so he is forced to seek elsewhere for a remedy.

The Defective Premises Act and the NHBC Scheme

This chapter examines the liability of the builder under the provisions of sections 1 and 2 of the Defective Premises Act 1972 and the National House-Building Council (NHBC) scheme.

Construction Products Liability

There are three measures of the EC which affect liability for construction products: (1) the Product Liability Directive 1985,1 which has been implemented into United Kingdom law by Part I of the Consumer Protection Act 1987;2 2 the Construction Products Directive 1988,3 which has been implemented into United Kingdom law by the Construction Product Regulations 1991;4 and 3 the General Product Safety Directive 1992,5 which is due to be implemented by the Member States by June 1994.

The Building Regulations

The Building Regulations are a comprehensive set of rules which provide a detailed system of quality control for all stages of building work. They cover a wide range of matters including drains, sewage and sanitary conveniences, foundations and building materials. They were originally model by-laws which were made under the Public Health Act 1875 and which many local authorities adopted with modification. The Public Health Act 1961 replaced these by-laws by the Building Regulations, which came into effect in 1966.

Introduction to the European Community

One of the principal aims of the European Community (the EC) is the creation of a single market, with an unrestricted flow of goods, persons, services and capital between the Member States. This is expressed in Article 2 of the Treaty of Rome 1957: The Community shall have as its task, by establishing a common market ... to promote throughout the Community a harmonious development of economic activities, a continuous and balanced expansion, an increase in stability, an accelerated raising of the standard of living and closer relations between the States belonging to it.

Reform of Construction Law

Construction Law at present can hardly be said to be in a satisfactory state and a number of proposals have been put forward for its reform. It is the object of this chapter to examine these proposals.

Builders’ Liability in Contract

Before examining in detail the potential liability of a builder for defective premises two things must be made clear: the complexity of many building projects and the nature of the contract entered into by the builder.