Don’t sign crazy contracts!
02 June 2021, Paul Finch
It may only be in the UK that clients and their lawyers see architects as soft targets for unethical and penalising contract negotiations. Possibly not, but wherever it may happen, it is similarly unethical.
What happens is this, though nobody wants to talk about it: client on lawyer’s advice says to architects in the bidding for a job, ‘You need to scrap the usual ‘net contribution’ clause before we will employ you.’
This clause limits the liability of the architect to mistakes for which the architects are themselves responsible. If liable, the indemnity insurance will kick in, and said architect will no doubt suffer the consequences of their performance in respect of future insurance premiums.
Critical point: the designer is only responsible for errors committed under their contract as designers.
Flip to the creepy and dishonest contracts dreamed up by lawyers who have never designed or built anything in their lives. This time round, the architect – having waived the net contribution clause – becomes liable to an unlimited extent for the mistakes of others in the design and construction team. Everyone else may go into liquidation at the first sign of trouble, but the idiot professional architect, complete with indemnity policy, is the sucker who picks up the tab.
In theory, it doesn’t stop at the level of cover provided by an indemnity policy. It might not even stop at the level of a limited liability company. Warning to architects (and families) -- they can come for you.
I have only heard about this recently, which suggests that while the situation may not be new, it has not been hugely common or discussed. All information welcome via email@example.com. All one can say is that, on the face of it, the pressure to sign your life away looks like something that was intended to be covered by the Unfair Contract Terms Act, but no doubt clever lawyers who (I repeat) have never designed or built anything, have sorted all this out.
This set me thinking about the world view of lawyers who, in the round and on average, are found to be wrong half the time. Their views and analysis are held to be fundamentally flawed at worst, and incorrect at best, in the event of a civil action or criminal case in which they are on the ‘losing’ side.
In other words, in a classic case of psychological transference, their demonstrable failings, for which they suffer no financial loss, are projected onto working professionals whose level of success is infinitely greater, by definition, because they are involved in the creation of reality, rather than arguing about law. How would the lawyers react to a suggestion that they themselves should be parties to construction litigation because they have set the terms of contracts which may turn out to be the problem (cf Grenfell). You can hear them racing out of the room and consoling themselves with a substantial glass of Chateau Hypocrite.
The horrible logic of the unethical race to the bottom proposed by unscrupulous lawyers is that architects, and other professionals, behave like everybody else in the ‘devil take the hindmost’ scenarios the lawyers have created. That is to say the design professionals create a ‘special purpose vehicle’, just like the clients, to undertake work on a specific project – and wind it up on completion. You can imagine the shrieking: ‘You can’t do that, you’re a professional!’ But at the point where the cynical client and venal lawyer (possibly the other way round) treat the professional as a punching-bag is surely the point where the professionals take an equally venal and cynical look at their options.
Can’t we live in a world where professionals accept liability when they have made a mistake, but don’t get penalised when it’s nothing to do with them? This is about fairness, honesty and trust. Are contract lawyers interested in this? This is, of course, a rhetorical question.
Planning shake-up won’t solve housing shortage
Bogus claims that the planning system is responsible for our housing shortage are the stock-in-trade of less-than-credible housebuilders with an axe to grind, plus politicians who should know better.
The case for a re-working of the planning system should be divorced from arguments about the housing shortage. Government reform of planning is a good idea, and the basic proposition is sound: get the system to work positively to identify where we should build in the future and embed that into local plan policies.
This should not be confused with resolving the housing ‘crisis’, which stems from decisions taken 40 years ago to stop building social housing, presented with a flourish by that fake national treasure, Michael Heseltine. If you stop building, you get a shortage. C’est tout.