Impact of climate change on claims against construction professionals

These claims are more likely to arise in the renewable energy space, where PI claims have already started to gain traction. This is likely to be a result of having no, or limited, experience of designing and deploying these new technologies, without historical data or designs on which to rely.

The case of MT Hojgaard v Eon [2017] is one of the most high profile PI claims against those involved in the renewable energy space and concerned new wind turbine technologies. An incorrect formula in an international standard for the design of offshore wind turbines resulted in €26 million in costs for remedial works and subsequent litigation to decide who was liable to bear the risk of the error in the international standard and therefore pay the costs. The contract between the parties provided a “fitness for purpose” obligation and the requirement that the design life of the wind turbines would be 20 years. The Supreme Court decided MT Hojgaard, which was engaged by Eon to design, manufacture and install the foundation structures for the wind turbines, owed a contractual duty to ensure the design life of 20 years and that it had breached that duty, notwithstanding that the incorrect international standard relied upon did not provide for this length of time.

The case demonstrates the issues facing construction professionals, particularly those who have to rely on new and relatively untested technologies. Waste to energy, solar energy and hydroelectric energy sectors are also likely to see claims as they gain popularity as alternative energy sources to fossil fuels.

Claims in this category are also increasing. In 2013, the issues with the Walkie-Talkie building at 20 Fenchurch Street, which resulted in melting cars, eggs frying on the street and significant fire risks for local business, highlighted how claims of this nature may manifest in real life. The design of the building caused a “death-ray”, focussing a ray of light onto the street below with temperatures reaching 117°C. The building itself was affectionately dubbed the “Walkie-Scorchie” and the “Fryscraper”. Astonishingly, the architect had previously designed buildings with similar issues but did not consider it would be an issue in London as he did not think it would be so hot there, going so far as to say that climate change was the reason for the discrepancy.

Failures such as these can have costly consequences and construction professionals will fail to take into account climate change and climate change related events at their peril. RIBA Principle 2 and the ICE Code of Professional Conduct, require architects to “strive to protect and enhance…the natural environment” and engineers to “show due regard for the environment and for the sustainable management of natural resources” and have regard to the wellbeing of future generations, respectively. Stricter regulation of environmental building standards is inevitable.

Construction professionals must take into account more frequent and more severe weather, floods, resultant cracking and subsidence, as well as rising sea levels and water tables. This must be balanced against a background of trying to win work and stay competitive on price whilst avoiding over-design. An issue particular to the UK construction sector is the alternating periods between heavy rainfall and drought which raises the risk of subsidence and heave, as well as flooding. Those designing and constructing buildings face obvious risks in dealing with these idiosyncrasies.

Surveyors too are likely to face claims where property portfolios lose value as flooding spreads and assets become “stranded”. As more extreme climate events occur, it is inevitable that, as the construction sector adapts to take them into account, construction professionals are likely to see more frequent claims falling into this category.