Designer liability and indemnity

Why liability rests with the designer

In the building process the designer is the one who decides what is built. The contractor builds what the drawings specify; the authority checks compliance with the rules. So the designer is liable for the correctness of the technical content.

Two specific duties that follow from legislation:

• The designer is liable for the content of the documentation.
• The content of the construction documentation may not depart from what the final and enforceable permit contains — and the designer is liable for observing that too.

Where the limits of liability lie

What the designer cannot see

If the client withholds a circumstance — the condition of an existing structure, a previous alteration, the real loading — the design is based on what was stated. So the preconditions have to be recorded in the design.

What the contractor changes

If the work departs from the drawings on site, the consequence is the contractor’s. That can only be established if the design was unambiguous — which is why the level of detail in the detailed design matters.

The boundaries between disciplines

Where there are several designers, liability divides at the boundaries between disciplines. In general design it is therefore important that those boundaries are recorded in writing. Boundaries of responsibility.

Professional indemnity insurance

The professional practice decree also provides for designers’ liability insurance. The insurance does not relieve the designer of liability — it is there to handle the financial consequences.

Worth knowing about it:

• What it covers: damage arising from design error, up to a given limit.
• What it does not: intentional damage, activity without qualification, failure to meet an agreed deadline.
• When it applies: typically tied to the date of the damage or of the notification — so the period after the contract ends has to be handled too.

What this means for the client

When choosing a designer, check three things: whether they hold the qualification for that field, whether they have valid insurance, and what they undertake in writing in the contract — particularly the content of the design stages and the boundaries between disciplines.

This is not legal advice

Liability and insurance rules change, and the actual cover is always determined by the particular insurance contract.