Case Studies where Architects have been found liable to torts and Contracts

Essentially an architect is appointed to provide a professional service which carries with it a

required duty of care. The architect must perform their duties properly and failure to do so means
they may be liable for damages.

Riva Properties Ltd v Foster & Partners Ltd [2017] EWHC 2574 (TCC)
A world-famous architectural firm versus a business man aspiring to build a five-star hotel
operating through his four businesses. In short, the Claimants (Riva) alleged that the Defendant
(Fosters - architects) were in breach of their duty to exercise reasonable skill and care in their
professional performance, following their appointment as architects to design a hotel at a site at
London Heathrow.
The central issue in this case was the cost to build the Defendant’s design. The Claimants had a
budget of £70 million but the Defendant’s initial design was costed at £195 million, the
Defendant stated that the build could be value engineered down to around £100 million. The cost
proved to be impossible and the Claimants could not obtain funding. They subsequently claimed
for professional fees expended in reliance on the Defendant’s advice and lost profit of the build.
The Defendant had tried to deny that a budget existed, and that they had advised that value
engineering could succeed in achieving a costing of £100 million. The court found in favour of
the Claimants on both of these matters of fact. When finding on this issue, Mr. Justice Fraser had
to consider the scope of the Defendant’s duty towards the Claimants, and in particular the extent
to which they had to ascertain the budget and/or advise their client generally about the budget
and whether it was realistic or not.
The court found that the Defendant had been professionally negligent in two respects; failing to
ascertain and consider the budget in its design; failing to advise the Claimants that its design
could not be value engineered down to £100 million.
On the basis of that negligence, the Claimants were awarded damages of £3.6 million. They were
however, unsuccessful in a claim for loss of profit as it failed on the ground of causation. It was
held that in addition to the expense of the scheme designed by the Defendant, the Claimants’
inability to secure funding was partly attributable to its lack of cash reserves and to the 2007
global financial crisis. These factors were sufficient enough to break the chain of causation and
prevent recovery for loss of profit.
This case stresses the importance of architects having regard to budget when scoping and
designing a project and illustrates how a professional’s inappropriate attitude towards a client
can flow into negligence and lead to financial liability. The court described the Defendant’s
behaviour as “grubby”, “disingenuous” and “wholly unprofessional”.
Burgess v Lejonvarn [2017] EWCA Civ 254
In this claim, it was alleged that an architect had acted negligently in the provision of
professional services for which there had been no payment. The Claimants (Mr and Mrs
Burgess) and the Defendant (Mrs Lejonvarn) had been good friends for several years when the
Defendant volunteered to help the Claimants with a landscaping project for their garden. The
Defendant provided professional services for free, but the relationship ended badly.
At a preliminary hearing it was established that given the lack of intention to create legal
relations no contract existed between the parties, but that the Defendant did owe a duty of care to
exercise reasonable skill and care in relation to the professional services she provided. This was
due to the fact that the claimants relied on the Defendant to properly perform the services she
provided, which reflected skills which they themselves did not possess.
The Court of Appeal upheld that decision and clarified that a professional consultant did not
have a positive duty to provided services, only to carry out those services they did perform with
reasonable skill and care. The architect in this case had not given ad hoc advice, the services
were provided over a lengthy period of time and involved considerable input and commitment on
both sides.
The judge in this case described it as a “cautionary tale”. Helping a friend for free does not
however always mean that person providing the services has no liability, each case will turn on
its facts and will depend on their circumstances. All professionals, not only architects, will have
to pay particular care given that professional indemnity policies do not automatically cover
negligence for gratuitous advice.

Unfortunately for architects, the potential for negligence claims is always going to be part and
parcel of the services provided. It is critical that architects understand the scope of their
instructions, and the extent of the services to be provided. Failure to do this proves to be an even
greater risk if the client is not sophisticated in the design and construction area and/or has
incorrect or unrealistic expectations of their designer.
It is also important to design within a client’s objectives and budget; these designs also need to
be realistic. It is possible that the objective for each project is going to expand as time goes on,
so it is important for the client to understand that expansion and change has an impact on costs,
and always avoid situations where the budget is maxed out before the client realises the budget
they set is not enough.

References
England and Wales High Court (Technology and Construction Court) Decisions >> Riva
Properties Ltd & Ors v Foster + Partners Ltd [2017] EWHC 2574 (TCC) (18 October 2017
http://www.bailii.org/ew/cases/EWHC/TCC/2017/2574.html
England and Wales Court of Appeal (Civil Division) Decisions >> Lejonvarn v Burgess & Anor
[2017] EWCA Civ 254 (07 April 2017)
http://www.bailii.org/ew/cases/EWCA/Civ/2017/254.html