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No duty of care for approved inspectors under the 1972 Act

Blogs08/01/2019

High Court finds approved inspectors do not owe a duty of care under Defective Premises Act 1972

Introduction

Claimant solicitors often assume that on projects involving the provision of a dwelling, s1(1) of the Defective Premises Act 1972 imposes a duty on approved inspectors. However, we have long argued that this is not the case, and, in the case of Herons Court –v- NHBC Building Control Services et al [2018] EWCH 3309 (TCC), the High Court has now reached the same conclusion, taking a very similar approach to our own.

 The 1972 Act

 Section 1(1) of the Defective Premises Act 1972 states:

A person taking on work for or in connection with the provision of a dwelling (whether the dwelling is provided by the erection or by the conversion or enlargement of a building) owes a duty:

(a) if the dwelling is provided to the order of any person, to that person; and

(b) without prejudice to paragraph (a) above, to every person who acquires an interest (whether legal or equitable) in the dwelling;

to see that the work which he takes on is done in a workmanlike or, as the case may be, professional manner, with proper materials and so that as regards that work the dwelling will be fit for habitation when completed.

The Decision

To determine whether s1(1) of the 1972 Act imposes a duty on approved inspectors on projects involving the provision of a dwelling, Waksman J considered whether they take “on work for in connection with the provision of a dwelling” for the purposes of the 1972 Act.

Taking the approach of Davies J in Hadfield v Health Insurance 1987 15 FCA 487 to the interpretation of “in connection with” (who stated that these words “are subject to the context at which they are used, the words with which they are associated, and the object or purpose of the statutory provision in which they appear”) Waksman J found that s1(1) of the 1972 Act did not impose a duty on approved inspectors. In particular, he noted that:

  • In Law Commission Report No. 40, which led to the enactment of the 1972 Act, “the Law Commission considered that those who would fall within clause 1, other than builders, would be architects, designers and those supervising the construction of the works on behalf of one of the building or designing parties. This is quite different from an inspector, whose essential function is … to certify simply whether the construction is lawful in a building sense”.   
  • Section 38 of the Building Act 1984 (which is not in force) indicates that in relation to a breach of duty imposed by the Building Regulations “it is contemplated that there will be a separate regime for any civil liability. That militates to some extent against the notion that approved inspectors should be subject to Section 1 (1) of The 1972 Act, a different statute and a prior statute. At the very least, one might have expected the 1972 Act to have been amended so as to include approved inspectors via the Building Act, if that was the intention. That is so, especially since the duty imposed by Section 1(1) is different to and almost certainly stricter than, the building regulation duty…”

Furthermore, Waksman J found support for his decision in obiter comments from earlier decisions of the higher courts:

  • in the Court of Appeal, in Sparham –Souter v Town and Country Developments (Essex) Ltd [1976] QB 858, Lord Denning stated that “it’s doubtful if the statute gives a remedy” against a local authority inspector; and  
  • in the House of Lords, in Murphy v Brentwood DC [1991] 1 AC 398, Lord Mackay, Lord Bridge, and Lord Oliver all appeared to proceed on the basis that “local authority inspector’s activities are not within The 1972 Act”.

 Whilst these decisions were concerned with local authority inspectors rather than approved inspectors, Waksman J did not accept that the position of approved inspectors under the 1972 Act should be any different to that of local authority inspectors:

“…the expression ‘take on’ connotes ‘undertakes’. Both a local authority and an approved inspector undertake their statutory roles…The fact that one is employed by the local authority and the other may be an independent contractor cannot possibly make any difference…”   

The Impact

There has recently been an increasing number of claims under the 1972 Act by flat owners/tenants for allegedly defective cladding following the Grenfell Tower disaster.

Irrespective of the question of liability, such claims are now unlikely to succeed against approved inspectors, which may leave other professionals with a greater liability.

However, approved inspectors are not completely home and dry: 

  • Homeowners/tenants could still have a cause of action against an approved inspector:
    • under the 1972 Act, if the approved inspector has gone beyond performing its usual duties under the Regulations; and/or
    • in contract and/or tort, if, for example, the claimant has the benefit of a Collateral Warranty (although where a claim has been brought exclusively under the 1972 Act, this is usually because there is no cause of action in contract and/or tort).
  • A party being pursued under the 1972 Act by a homeowner/tenant, who has a contract with the approved inspector (such as an appointment or collateral warranty), may be able to seek an indemnity/contribution from the approved inspector for breach of that contract and/or breach of a concurrent duty of care in tort.

Author Jonathan Anslow is a partner in Keoghs’ professional and financial risks team, specialising in construction; janslow@keoghs.co.uk