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This book, Design and Build in Action, examines the design and build (D&B) method of procurement in the construction industry: its strengths, weaknesses and idiosyncrasies. Crucially, case studies of D&B projects on which the author has worked are included. The book begins by looking at the reasons for the increasing interest in D&B; it then examines the basic components and principles of D&B, covering such issues as what is a D&B contract, the level and scope of liabilities, hybrids - what do they really mean and how many of them are there (design, manage, construct etc.)? Chapters include: the basic principles; the basic law; legal and practical pitfalls; the role of the professionals; novation; extra contractual protections; subcontractors and suppliers; health and safety; D&B in housing and urban regeneration; D&B in commercial/complex projects; D&B on contaminated land; D&B and partnering; D&G and the public finance initiative; JCT 81 amendment 12; appendix - D&B standard forms.
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(a) the PI cover may be rendered void, either in total or as regards that particular contract,
leaving the construction client relying only on the design and build contractor's net
assets; or
(b) the design and build contractor may be left uninsured as regards any liability beyond that
of reasonable skill and care, leaving the construction client unclear as to the extent of the
remaining PI cover and as to which claims or parts of claims are not covered.
No construction client and no design and build contractor will wish to do anything that
prejudices the latter's PI cover. However, in practice, it is difficult for the client to obtain full
information as to the contractor's PI insurance position and thereby to have a full and frank
negotiation. This is due to the unhelpful practice of PI insurers refusing to allow the insured to
reveal the terms of his policy to third parties. Legend has it that this would encourage spurious
claims, but logically the same is true of any other policy of insurance. So why, in relation to
other types of insurance, are similar constraints not imposed? The secretive attitude adopted by
PI insurers remains an anomaly, at odds with their own expectation that the insured must be open
in all matters and demonstrate the utmost good faith.
The fact that PI insurance is only generally available on an annually renewable basis, covering
claims made during the year in question, creates further uncertainty as to the value of the
warranty of a design and build contractor which such cover may support. Not that this is an
argument against design and build as a method of procurement, as the PI insurance available to
independent designers working on a traditionally procured project is provided on exactly the
same basis.
It is interesting to note in the context of projects under the Government's Private Finance
Initiative ("PFI") (see Chapter 14) that certain public sector clients are attempting to impose a
fitness for purpose obligationon PFI providers, which in turn will need to be imposed on the PFI
provider's design and build contractor. The PI marketplace is continually changing and insurers
will always try to underwrite the risks that they consider worth taking: as the PFI gathers
momentum, this may be another area where fitness for purpose is an insurable duty of care.
