A disaster waiting to happen

Our building is a potential fire hazard

We commissioned a building that was practically complete in June 2003. The £100,000 works were let using a design-and-build form of contract with many of the design team novated to the builder.

In March it was noticed that in several areas where cables and pipes passed through fire separation walls the additional fire-stopping to make up the openings was missing. We have not yet been in a position to inspect the whole of the building but are concerned that this situation might be widespread. While I could look to the builder and address this as a latent defect I am concerned that the safety of the occupants is at risk should a fire occur.

In undertaking any remedial work we are going to be significantly inconvenienced and who is to say that all situations can now be viewed and checked let alone rectified?

Who is responsible under the contract for ensuring that this work has been completed and would it be worth perusing a claim for negligence?

Your overriding concern should be safetyBefore looking at liability, we need to think about safety. Two things spring to mind.

First, have you notified your insurers? If not, you must do so immediately and comply with any directions that they may give, so that your insurance policies will respond if a claim is made.

Second, have you notified the fire officer? Given that you have discovered a serious breach of the fire regulations it is surely best to consult him as to any interim measures that can be taken to alleviate the risk to occupants?

You then need to consider the remedial works to be undertaken. Do you think that your employer's agent under the original contract has the expertise necessary to comment on the proposed remedial works and to inspect the execution of them? Do you need to bring in a specialist to assist you? This might be wise. The expert should also be briefed to make a complete and accurate record of the existing state of the building, so that there can be no dispute as to that.

You are right to look to the builder to address the issue. As a design-and-build contractor it should propose a remedial works scheme and a method statement for implementing it quickly, but with minimal disruption to the occupation of the building. If out-of-hours working is required, then presumably it will do this. It does need to understand the urgency of the situation given the dangers to health and safety. If it is not prepared to implement the remedial works urgently, you will need to put it on notice and bring in another contractor to execute them. Your overriding concern must be the safety

of the occupants and if this means bringing someone else in, paying them and suing your original builder, then you should be prepared to do this.

I would leave the contractor to join in anyone else he may feel shares responsibility, including perhaps the firm that acted as your employer's agent.

Ann Minogue is a partner at Linklaters

You may be able to claim for negligence

We are not told what the terms of this contract were. Normally, the contractor is under an obligation to complete the works in accordance with the contract. If it fails to do this, it is in breach of contract.

Another party may certify that practical completion has occurred and thereafter may be able to require the contractor to rectify any defects that come to light during any defects liability period. Under adesign-and-build contract, this person is likely to be the employer's representative. Subject to the terms of its engagement, such a person is unlikely to be liable for defects that it did not know about, unless it ought reasonably to have done so.

In some circumstances there may be a claim for negligence against the designer of the relevant part of the works (architect or engineer) if that designer had any duty of inspection during construction and should reasonably have noticed the defect while performing that duty. However, one would have to consider the precise duties of the designer. Further, if the engagement of the designer had been novated to the contractor prior to construction, the designer may not owe any relevant duty to the employer. One would have to consider the terms of the novation, and in particular whether the employer has the benefit of a warranty from the designer and, if so, the terms of that warranty.

Rachel Barnes is a partner with Beale & Company

l-r: Ann Minogue, Julian Holloway, Rachel Barnes, Rudi Klein, Andrew Hemsley

You have a statutory duty of care

I am surprise that you were able to obtain the necessary approvals under the Building Regulations and fire regulations. You will need to act quickly

The college owes a statutory duty of care to all its visitors to ensure that they are reasonably safe. If there is an accident owing to the insufficiency of fire-stopping material, which the college has knowledge of, it is likely that the college will be obliged to compensate any claimants. Even though the damage has in fact been caused by the builder's faulty construction work this will not absolve the college of liability.

However, if a claim did arise against the college, the college might also be able to reclaim the amount of any settlement from the contractor. The contractor is obliged under a design-and-build contract to ensure that the works comply with any applicable statutory regulations. The lack of appropriate fire regulations such as fire-stopping appears to be a breach of fire regulations such as the Regulatory Reform (Fire Safety) Order 2005.

The college could therefore have a claim in breach of contract against the contractor and will be entitled to damages based on the cost of reinstating the works so that they comply with the statutory regulations. The damages would include the cost of a survey to ascertain the extent of the defects.

There is little point in pursuing a claim in negligence (that is, tort) as the college's claim in contract will cover such claims as it has in tort and will be wider based. It may be possible to pursue an action against whoever certified practical completion of the works if the defects were patent at the time.

Jonathan Holloway, partner at Berwin Leighton Paisner

Be prepared for drastic action

First you should address the issue of health and safety. The college needs to have a survey carried out to establish whether this is a general problem or an isolated one and to obtain information on its extent. If that shows real problems, take advice and be prepared for drastic action if need be, including not using the building.

Presumably your comment about negligence is angled at an employer's agent, which was running the contract. You can have a pop at it for failing in its monitoring role but the design-and-build contractor was responsible for the design and construction of the works, and on the basis that this was a design or a construction issue, the easiest avenue for redress would seem to be the contractor.

The contractor may try to run the "I only completed the design and others told me what to build" defence. It would be difficult for it to make this stick as it would have to comply with statutory requirements for the building, which will include fire safety.

The contractor might be persuaded to fix the odd bit of defective work for free. If the problem is extensive and correcting it will cause you disruption, inconvenience and cost then you should take advice from my learned colleagues on this page.

Andrew Hemsley is a partner at Cyril Sweett

Your building is not fit for purpose

I have no information about the form of contract on which the work was let but it appears that your new building is not fit for purpose.

As you acknowledge, the safety of those in occupation has been compromised. The basic obligation of a design-and-build contractor is to deliver a building that is reasonably fit for purpose. JCT forms, however, reduce this obligation to one of reasonable skill and care, akin to the standard expected of a consultant such as an architect. In this context the upshot is likely to be the same irrespective of the standard of care that is applied.

Since your builder is likely to be in breach of its contract you have a claim for damages to cover the costs of remedial work. However, you should invite your builder to return to carry out this work before going elsewhere.

It will be in his interests to do so since this would be the cheaper option for him.

If the builder is not able to carry out the work (for instance, because of insolvency) you may have a claim against one or more consultants if they have provided you with design warranties. But you may have difficulties showing that the failure to provide the additional fire-stopping was the result of design shortcomings.

Finally, I must add that I'm surprised that you were able to obtain the necessary approvals under the Building Regulations and fire regulations. You will need to act quickly to ensure that the building is compliant with the fire regulations.

Rudi Klein is chief executive of the Specialist Engineering Contractors Group