Case notes

Most NHS projects nowadays are on a design and build basis. Many will use standard form project agreements, mainly PFI, LIFT or Procure 21 agreements. Failure to understand the subtle allocation of design responsibility between client and project company could lead to fitness for purpose defects and disputes.

With most healthcare buildings, the contractor takes primary responsibility for the design but the NHS trust may have responsibility for clinical functionality. At the outset, it will provide its requirements, specifying the service functionality of the building, for which the contractor will provide a design solution. Secondly, the trust will sign off certain aspects of the bidder’s proposals at financial close. Finally, the trust will review the contractor’s design proposals for clinical functionality.

Large projects (over £25m) are procured using the health sector standard project agreement SF3. When the agreement is signed, the trust may have initialled certain pages of the project company’s proposals (in construction terms, the contractor’s proposals). Signing off means the trust accepts (subject to written comments) that the initialled proposals satisfy its requirements of clinical functionality. The trust could be signing off plans, layouts, room data sheets, schedules of internal areas and schedules of accommodation.

After the project agreement is signed, the trust will participate in the ‘reviewable design data’ process, which provides that the trust signs off drawings and other details. The effect of making data ‘approved RDD’ is that the design information satisfies ‘clinical functionality’, which means appropriateness of access, relationship on site, adjacencies between departments and between rooms, the quantities, descriptions and areas of those rooms and spaces in the schedules of accommodation, location and relationship of equipment, furniture and fittings. The client is signing off the detailed design drawings.

Under some healthcare project agreements, the NHS trust may be signing off plans, layouts, room data sheets and schedules of accommodation.

LIFT schemes are generally for facilities up to £20m. A LIFT company will have been awarded exclusive rights in a particular area to procure healthcare facilities, being jointly owned by the private sector and the NHS. The trust is tenant and the LIFT company the landlord, normally for 27 years plus the construction period. As with SF3, there is a standard LIFT lease agreement which provides for development obligations, collateral warranties and appointment of the independent tester.

For facilities that do not involve complex procedures, such as day surgery, the design is within the responsibility of the LIFT company. These are treated as normal construction projects with single point responsibility (apart from responsibility for the client’s requirements) placed on the LIFT company .

Where there are complex facilities, the agreement between the trust and the LIFT company will provide that where the trust initials any pages of the landlord’s proposals at signature of the LIFT project agreement, the initialled proposals are accepted as satisfying the requirements of clinical functionality.

Procure 21 projects involve direct procurement by trusts at the design stage and then the construction stage. These contracts are awarded to framework construction partners, and are procured often on the NEC Option C, target cost standard conditions. The design is worked up by the contractor in consultation with the trust, but there are no special provisions for sign-off by the trust for design regarding clinical functionality within the standard form documentation. The default position is that the contractor has single point responsibility with no pass-back to the trust.