Are your boilerplate documents assuming greater responsibility than you bargain for?

Last week, the Grenfell Tower Inquiry (the Inquiry) heard evidence from Exova, Studio E and Rydon the fire engineer, architect and main contractor on the Grenfell Tower project respectively. The consultants on the Grenfell Tower project are expected to be the focus of much investigation throughout the Inquiry. A common thread in the evidence from each of these consultants appears to be assumptions concerning the scope of the roles and responsibilities of each.

It is commonplace for multiple consultants to be engaged on a construction project at any given time. They often review and rely on documents prepared by other consultants as well as operating under tight turnaround times. Simple misunderstandings or miscommunications concerning each consultant’s obligations and responsibilities are all too common and unfortunately such misunderstandings are often not discovered until a dispute arises.

While there is little judicial commentary on the attribution and apportionment of liability regarding the use of aluminum composite panels (ACP), the Lacrosse Judgment (Owners Corporation No. 1 of PS613436T v L.U. Simon Builders Pty Ltd (ACN 006 137 220) [2019]) made by the Australian Victorian Civil and Administrative Tribunal (the Tribunal) may inform other jurisdictions, including the UK. The Lacrosse judgment resulted in a finding that the consultant parties were liable to pay up to A$5.7 million in damages. However this decision is being appealed.

The Lacrosse proceedings concerned the attribution of responsibility amongst the following:

  • The fire engineer (ordered to pay 39% of the awarded damages)
  • The building surveyor and his employer (ordered to pay 33% of the awarded damages)
  • The architect (ordered to pay 25% of the awarded damages)
  • The builder (ordered to pay 3% of the awarded damages)
  • Others including the occupier of the apartment the fire originated in, the individual whose discarded cigarette caused the ignition source of the fire and the superintendent.

A key takeaway from the Lacrosse judgment for any consultant is that in assigning the highest apportionment of liability to the fire engineer, the Tribunal held he had failed to exercise due care and skill in failing to conduct a full engineering assessment of the tower. This was despite the fire engineer giving evidence of his understanding, namely that his role did not extend that far. The Tribunal found there was a disconnect between how the fire engineer viewed his role and the obligations he in fact assumed, pursuant to the applicable consultant agreement.

The Tribunal also held the consultant agreement assumed an express obligation to at least assess the construction materials for any fire hazards and this required some proactive investigation and assessment of the principal building materials.

The Tribunal noted the reason for the fire engineer’s apparent disconnect between his understanding of his role and the terms of the consultant agreement may be the result of the use of template or ‘boilerplate’ documents. The Tribunal found there were a number of instances of the use of template or ‘boilerplate’ language without much attention being given to what the words actually meant or required.

The Tribunal went on to note it is often the case that diligent and competent professionals “blithely reuse standard documents” and that it is only when something goes wrong and the lawyers become involved, that any real attention is given to how that boilerplate language informs potential liability.

Comment

While determinations regarding apportionment amongst the consultants in the Lacrosse Judgment are being appealed, the Tribunal’s comments concerning the use of templates or ‘boilerplate’ documents should caution any consultant to ensure contractual documents and agreements are critically reviewed for each project and to confirm that they accurately reflect the consultant’s understanding of his organisation’s roles and responsibilities.

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