The judgment given by HHJ Stephen Davies in the case of Blackpool Borough Council v Volkerfitz Patrick Ltd & Ors [2020] EWHC 1523 (TCC) (15 June 2020) provides some guidance in answer to these questions.
The Claim
The facts of the Blackpool case involve the construction of a new, steel framed, tram depot at the promenade in Blackpool under a modified NEC3 design and build contract with the Defendant Volkerfitzpatrick Ltd. The depot was completed in 2009 and in operation by 2012.
In 2015 a large section of the roof became detached during high winds.
Following inspection, the claim made was that certain elements of the coating to the steel components had eroded to a greater extent than expected in its four year operational life.
The Claimant, as owner of the tram depot issued proceedings against the Defendant claiming £6m for remedial works. The allegation was that a number of external component parts of the tram depot did not meet the required design life of 50 years nor were they suitable for the exposed coastal marine environment where the tram depot was located, and which suffered direct exposure to the elements.
The Defendant disagreed, arguing that the contractual design life was in fact either 25 years or 20 years, depending upon the elements in question, and any corrosion was due to a failure to maintain.
The Claimant succeeded in its claim in part only, being awarded £1,110,781.80. The Judge found almost entirely for the defendant in relation to the integrity of the design. He accepted that the design life obligation period was 25/ 20 years and that certain elements of the structure were not found to be inadequate or otherwise unsuitable. Further that in a number of instances, only limited replacement or repair rather than full replacement was required.
Design Life
Although “design life” is referred to in most construction contracts the term itself is rarely defined, so what does it mean? In his judgment HHJ Stephen Davies referred to relevant standards to form his view. BS ISO 15686-1:2000 defines it as the service life intended by the designer, with “service life” defined as a minimum acceptable level of critical property. Further, BS EN 1990:2002 refers to “design working life”, the “assumed period for which a structure or part of it is to be used for its intended purpose with anticipated maintenance but without major repair being necessary.”
However does the inclusion of a minimum design life impose a strict liability or is it a reasonable care obligation?
Unfortunately there is no clear answer and much will depend upon what terms are included within the contract.
In the Blackpool case the Claimant’s position was that the minimum design life obligation, the suitability obligation and the maintenance all imposed strict contractual obligations upon the Defendant, based on the wording contained in two clauses of the conditions. These were:
- “the contractor is to provide the works in accordance with the Works Information” (Works having been earlier defined as including the design, hence this obligation extended to design and
- the contractors “warranted and undertook” that the works, when completed would satisfy any performance specification or other requirement included in the contact – this included the design obligation.
The Defendant submitted that they were reasonable care obligations and both parties relied on the decision of the Supreme Court in MT Hojgaard v E.ON [2017] UKSC 59. – where the clause used included a requirement that the design of the foundations “shall ensure a lifetime of 20 years without replacement”. It was held that such a clause should be construed as a strict liability obligation.
Having looked at what the phrase may mean, what arguments can be made to defend a claim for breach of a design life requirement?
The starting point is to determine whether the correct design life has been applied. For example it could be that there are different design life requirements attached to each component. The question of adequate maintenance can and should be raised but is there an obligation upon a claimant to carry out maintenance?
Again there is no definitive answer. It will always depend upon the facts of each case and the terms of the contract. However, as a guide, the comments made by HHJ Stephen Davies below are useful. He said:
“[I]t cannot realistically be thought that a structure should be intended to be maintenance free for the whole of its design life, whereas it can reasonably be assumed that it ought not to need major repairs over that period.” he went on to confirm “acceptable maintenance” as being “maintenance which is not ‘non-standard’ or not ‘unusually onerous’ having regard to the normal construction operations and maintenance requirements which are applicable for works of a similar character.”
So what is not “non-standard” or “not unusually onerous”?
By way of an example, in the Blackpool case , there was evidence of some localised white rusting due to zinc corrosion in a small number of specific locations to the galvanised steel cold form components (purlins, cladding rails and connecting brackets). His honour made the following comment:
“I am satisfied that over the remainder of the 25-year period a prudent owner of the tram depot, with knowledge of the limited localised zinc corrosion and its causes, might reasonably be expected to take steps to undertake limited and localised works, not going beyond reasonable maintenance, namely a) removing the worst of the deposits on the affected surfaces of upwards facing components; b) removing any modest zinc corrosion near the tram doors; and c) if and where necessary, applying localised zinc paint to replace any zinc lost by such modest corrosion. This is not requiring the claimant to undertake non-standard or unduly onerous maintenance.”
Conclusion
Thus if an allegation is made that a design does not achieve the required “design life”, always review the contractual terms; determine which design life requirement is applicable. This may involve a review of all documents which are said to form part of the “contract”.
Consider the basis of the claim?
Ask yourself: ”what are the defects”?
When addressing whether or not the design life can be achieved, ask whether or not this can be satisfied leaving the claimant carrying out maintenance which is not unduly onerous or non-standard? This may be a point which requires expert advice.
If they have known about the defect for some time, find out what maintenance they have carried out, if any.
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