What is the extent of the Contractor’s design responsibility under a JCT Design & Build Contract?

In the recent case of BNP Paribas Depository Services Ltd and another v Briggs & Forrester Engineering Services Ltd [2024], HHJ Stephen Davies, sitting as a High Court Judge in the Technology and Construction Court, found the contractor had accepted full design responsibility and declared that it had not been entitled to terminate its building contract – meaning that its purported termination amounted to a repudiatory breach of contract which the employer was entitled to accept.

The case related to upgrade work to a stair pressurisation system in an office tower block. This system was needed for maintaining smoke-free fire escape routes. The work was undertaken under the JCT Design and Build Contact 2016 (JCT DB 2016) to which extensive bespoke amendments had been made. The contract included:

• A description of the works with the contractor being responsible for the design and compliance with statutory requirements.
• A requirement for the contractor to inspect the site and familiarise itself with the site conditions which included the need to remove asbestos.
• Reference to a specification prepared on behalf of the employer which indicated that structural issues, as well as the M&E works, would need to be considered.

The dispute predominantly concerned which party bore the risk of (a) additional asbestos being encountered on site and (b) structural defects in the existing building being discovered after works had started.

Although these issues had not been comprehensively identified in the Employer’s Requirements, the judge held that the extensive bespoke amendments made to the JCT DB 2016 made it clear that the contractor accepted full design responsibility for the works including the Employer’s Requirements. The amendments to the JCT DB 2016 which the contractor had accepted had the effect of putting the employer in a stronger position than it would have been in if the work had been carried out under an unamended JCT contract.

The unamended JCT DB 2016 contract does not make the contractor responsible for all design – rather, it merely provides that:

1. The contractor is responsible completing the design and for the Contractor’s Proposals and the Contractor’s Design Documents.
2. The contractor is not responsible for the contents of the Employer’s Requirements or verifying the adequacy of any design contained in them.
3. If an inadequacy is found in any design in the Employer’s Requirements and the contractor is not responsible for verifying its adequacy, the Employer’s Requirements will be corrected, and this will be treated as a Change under the contract’s change process – which may entitle the contractor to more money and/or time for dealing with it.

This position is regularly reversed by incorporating a schedule of amendments into the contract to make the contractor liable for all design including the designs carried out by others and contained in the Employer’s Requirements. This is typically done by amendments such as the following:

1. Altering the contractor’s obligation to comply with the Statutory Requirements so that the obligation applies even if the Employer’s Requirements specifically state that they comply with the Statutory Requirements
2. Removing the provisions mentioned at paragraphs 2 and 3 above.
3. Softening the provisions allow the contractor to claim for a Change (i.e. for more time and/or money) as a result of change in the Statutory Requirements after the Base Date, e.g. so the contractor can only make a claim if the change to the Statutory Requirements wasn’t foreseen by the contractor (and couldn’t have been reasonably foreseen) as at the Base Date.

The JCT DB 2016 was updated earlier this year by the new JCT DB 2024. This includes the following additional clarifications as to the limited extent of the contractor’s design responsibility:

• The contractor has no greater duty, obligation or liability in respect of design than to exercise reasonable skill and care.
• No fitness for purpose obligation is imposed on the contractor.

This recent case serves as a reminder for parties to review and consider the impact of any schedule of amendments that may accompany a JCT contract, especially the extent of the design obligations which can have long-term effects and may impact not only the employer under the JCT contract but other interested parties, such as funders, purchasers and tenants of the development which receive the benefit of collateral warranties or third-party rights.

If you have any questions arising from this article or in relation to JCT contracts more generally, please contact us at [email protected]