Potential TORT Liabilities of Parties - Essay Example

The potential liabilities in respect of tortuous conduct between a main contractor and a project manager/architect are dependant upon the duty of care and the exercise of that duty of care together with contractual obligations between the parties. Much will turn on who owes a duty of care to whom and whether or not that duty of care was breached. A close examination of the relationship between a main contractor and a project manager/architect is necessary for making that determination. In a typical construction scenario the relationship between a main contractor and project manager requires that they work within close proximity of each other. While the project manager designs the construction of infrastructure, the main contractor conducts the actual construction. Therefore, at common law a duty of care exist between the parties. The existence of a duty of care gives way to liability in all tortuous claims. Lord Diplock opined in Dorset Yacht Co Ltd v Home Office that sometimes it is important to determine whether or not ‘a duty of care ought to exist,’ as a matter of policy. (Dorset Yacht Co. Ltd v Home Office (1970) AC p. 1004) Lord Diplock took pains to explain that a duty of care is owed for the safety and security of persons on premises under the custody and control of another. (Dorset Yacht Co. Ltd v Home Office (1970) AC p. 1004) In this sense it is safe to assume, that the project manager is vicariously and jointly liable for foreseeable damages sustained to a third party by the main contractor. Likewise the project manager is vicariously and jointly liable in respect of foreseeable damages sustained by employees of the main contractor. This is so because to a certain extent the project manager as the actual director of construction has custody and control of the premises under construction, together with the main contractor. This application of the common law doctrine of a duty of care rests in large part on concepts of propriety rights. Lord Diplock said; ‘In the context of proprietary rights, the concept of a duty of reasonable care was one with which the courts were familiar in the nineteenth century as constituting a cause of action in negligence.’ (Dorset Yacht Co. Ltd v Home Office (1970) AC p. 1004) The applicable test for the existence of a duty of care has long been established by the hallmark case Donoghue v Stevenson. In this case Lord Atkin developed the firmly established and respected neighborhood principle in determining to whom a duty of care is owed. He maintained that a duty of care exist to the extent that one must take all necessary precaution to prevent injury to one’s neighbor. ‘Who then in law is my neighbour? The answer seems to be persons who are so closely and directly affected by my act that I ought to have them in contemplation as being so affected when I am directing my mind to the acts or omissions which are called to question’. ( Donoghue v Stevenson (1932) AC 562) The neighborhood principle was enunciated throughout the years and is now firmly established, although varied only slightly to reflect firmer application of the rule. In Anns v Merton London Borough Council the court held that test for the duty of care had three primary functions. It was first necessary to determine the remoteness of damage. In other words, the harm suffered must have been foreseeable. Secondly, the relationship between the parties must be of sufficient proximity for a duty of care to exist. This of course turns on the question of custody and control of the place and circumstances giving rise to the harm. Last, but not least, is it fair in all the circumstances of the case to impose a duty of care. (Anns v Merton London Borough Council (1978) AC 728) Moreover, it was determined by the court in Murphy v Brentwood proximity is a useful tool for the determination of a duty of care. Significant clues as to proximity are such things as responsibility of the parties involved as well as reliance issues. (Murphy v Brentwood District Council [1991] 1 AC 398) In cases involving matters of contracts for construction, the duty of care between a main contractor and the project manager is primarily one of contract. It is not possible for the delictual liability of contracting parties to be greater than the specific liability outlined in their contract. It makes no difference whether or not a duty of care existed in the abstract. (Tai Hing Cotton Mill v Liu Chong Hing Bank [1986] AC p 107) Lord Scarman, delivering the ruling for the Privy Council in Tai Hing Cotton Mill v Liu Chong Hing Bank specifically said; ‘Their Lordships do not, however, accept that the parties mutual obligations in tort can be any greater than those to be found expressly or by necessary implication in their contract.’ (Tai Hing Cotton Mill v Liu Chong Hing Bank [1986] AC p 107) In following this line of thinking Lord Carloway said in the Scottish case John Joseph Hughes v Barratt Urban Construction (Scotland) Ltd‘…where a case simply concerns the parties economic relations, it is their contract which must be allowed to govern these relations and not any supposed quasi delictual duty. For that reason alone, I consider the delictual case here irrelevant.’ (John Joseph Hughes v Barratt Urban Construction (Scotland) Ltd March 2002) Project managers can sometimes be vicariously liable for the negligence of main contractors. Much will depend on the terms of the contract between them. Generally speaking vicarious liability applies to employers for the negligent conduct of persons within their employ. Joint liability can also be applicable to situations in which vicarious liability arises making it possible for the employer to recover damages from the employee under the provisions of the Civil Liability (Contributions) Act 1978. Section 1(1) of the Act provides as follows:- ‘… any person liable in respect of any damage suffered by another person may recover contribution from any other person liable in respect of the same damage (whether jointly with him or otherwise)’ (Civil Liability (Contributions) Act 1978 Section 1(1)) Determination of who is an employee in law is not always obvious. The ‘control test’ which was established at common law very early on is useful for ascertaining an employment relationship. In an old case it was held that an employee is a person who is liable to the instructions and command of someone who has authority to direct how he should or should not conduct his duties. This control principle is good law today and continues to define the basic elements of employee/employer relationships. (In Yewens v Noakes (1880) 6 QBD 530.) In 1952, the British courts devised the integral test. If a person’s duties forms an integral part of the work then that person is an employee. However, if an individual’s duties are only incidental to the work or business being carried out then he is in all likelihood not an employee. (Stevenson, Jordan and Harrison v M&E (1952) 1 TLR 101) This is what is known as the integral test at common law. Another test for determination of employment status is the multiple test. This is the most important test and incorporates both the control and the integral tests. This tests involves consideration of the following factors: 1- Is the individual paid for the work provided? 2- Is he or she implicitly or expressly under the control of an employer or a person in the position of authority? 3- Are there terms under the contract which are indistinguishable from employment contracts or contracts for service? (Ready Mix Concrete (South East) Ltd v Minister of Pensions (1968) 2 QB 497) Once it has been established that a person’s duties and relationship to another in respect of his duties, it is left to be determined whether or not the employee’s actions which give rise to damages were conducted in the course of his or her employment. The action must have been authorized by the terms of his or her employment in order for vicarious liability to arise. A distinction has to be made between actual duty and whether or not the employee was off on some frolic of his or her own. If the employee was off on some frolic of his or her own the employer will not be vicariously liable. If the work is authorized by the terms of the employment contract and is conducted in an improper or negligent manner the employer will be vicariously liable. In one case an employee driving a fork lift attempted to move a lorry that was obstructing his authorized duties. The truck was at least five tons in weight and in the course of moving the truck so that the employer could carry out his authorized duties he caused some damages. It was held that the employee operated under an implied duty to move the obstruction to his regular and authorized duties. (Kay v ITW Limited (1968) 1 QB 140.) In another case, a milkman permitting children to ride on the milk rounds incurred liability to his employers for injury suffered by the children, despite the fact that the act was specifically prohibited under the terms of his employment. It was held that the act of permitting the children to ride on the milk truck during milk rounds because it only went to the manner in which the milk man carried out his authorized duties. (Rose v Plenty (1976) 1 WLR 141) An employer was off on a frolic of his own when he deliberately went off his designated route as a driver for the purpose of running an errand for his brother-in-law. Running errands for his brother-in-law did not form a part of his duties. (Storey v. Ashton (1869) LR 4 QB 476) This case can be distinguished from Rose and Plenty on the grounds that the milkman while permitting children to ride on his milk truck was actually carrying out his designated duties. In Storey’s case the driver went off duty to run errands for a member of his family. It was actually a personal matter for which his employer was under no duty to reward him for. A contract for service in respect of an independent contractor usually does not attract vicarious liability. However, when there is a statutory duty to provide a safe and secure place of work the duty of care cannot be delegated. Especially under the provisions of The Health and Safety At Work Act 1974. (Wilson & Clyde Coat Co v English (1938) AC 57 ). In Honeywill & Stein Ltd v Larkin Bros (London Commercial Photographers) Ltd it was held that in respect of an independent contractor the duty was not capable of being delegated where the independent contractor was secured for the carrying our of works that were deemed hazardous. It was further held that an ‘employer’ is not discharged of vicarious liability on the grounds that he hired a competent independent contractor. (Honeywill & Stein Ltd v Larkin Bros (London Commercial Photographers) Ltd (1934) 1 KB 191). There is a limit to the scope and range of shared liability between main contractors and project mangers. By virtue of the Occupiers Liability Act 1957 that the entity against whom a tortuous claim is made is at liberty to expect that ‘a person in the exercise of his calling’ is able to take note of the ordinary hazards of his work and to take necessary precautions against them. (Occupiers Liability Act 1957 S.3(3)(b)) While there is a shared duty as to liability for the premises under construction that duty is limited by the provisions of the Occupiers Liability Act 1957. There is a general duty of care to guard against damages or injury to all persons who lawfully enter the premises under construction. Section 1(1) (a) provides that a common duty of care is expected of persons in the custody and control of premises ‘in respect of dangers due to the state of the premises or to things done or omitted to be done on them’.( Occupiers Liability Act 1957 S1(1)(a)) Lord Wilberforce maintained that ‘…first, it is sound principle that where a person has, by breach of duty of care, created a risk, and injury occurs within the area of that risk, the loss should be born by him unless he [the defendant] shows that it had some other cause. Secondly, ...just because honest medical opinion can not segregate the cause of an illness between compound causes. ...as a matter of policy or justice ... it is the creator of the risk who, ex hypothesis, must be taken to have foreseen the possibility of damage, who should bear its consequences.’(Fairchild v Glenhaven Funeral Services Ltd (2002) 1 WLR 1052) Defences available to both the main contractor and the project manager will rest primarily on the question of remoteness of damages. As discussed in n earlier part of this paper, the defence that the persons functioning under either party was acting on a frolic or his or her own will be equally applicable to either party in an appropriate case. Remoteness of damage is available to either party or both in order to escape or limit liability. The test for remoteness of damages was derived in 1921. But this test was only applicable to intentional torts such as trespass. (RE: Polemis and Furness, Withy & Co LTD (1921) ALL ER Rep 40) Since that time the principle was broadened by Wagon Mound (1961) AC 388. In the Wagon Mound case, a ship that was in the process of being unloaded by crew members caught on fire when plank fell setting off sparks that ignited petrol. The House of Lords held that this kind of consequence was reasonably foreseeable. Lord Wilberforce said: ‘a man must be responsible for the probable consequences of his act…not because they are natural or probable but because …it is judged by the standard of a reasonable man that he ought to have foreseen them. …if some limitation must be imposed …why should that test [reasonable foreseeability] be rejected, since the wrongdoer is judged by what the reasonable man ought to foresee and a test [of direct consequence] be substituted which leads to nowhere but to the never ending and insoluble problems of causation. …the essential factor in determining liability is whether the damage is of such a kind as the reasonable man should have foreseen it.’(Wagon Mound (1961) AC 388.) Therefore in the event damages occur as a result of some unforeseen event, one that neither the main contractor nor the project manager could have been expected to take precautions against, liability is nullified. The criteria for presenting a viable defense as set out by the Wagon Mound case can be summarized as follows: 1- Was the claimant’s involvement such that neither the project manager or the main contractor could have reasonably contemplated that they owed a duty of care to this claimant? 2- Could either of the parties reasonably foreseen the type of damages actually sustained? 3- Could either of the parties have reasonably anticipated that the accident was probable? Main contractors and project managers are required to exercise extra special precautions in respect of children who might wander onto premises that are under construction. In a recent case two children were on a boat abandoned on property owned by the council. The children used a jack in attempting to lift the boat so as to work beneath the boat. At that point the boat fell and the children sustained injuries as a result. The defence submitted that while the probability that a rotten boat might fall was reasonably foreseeable it was not foreseeable that children might wander on the property and employ the use of jack. The court found that the council was liable anyway. Lord Hoffman went on to opine that children often get up to mischief and as such the council should have reasonably foreseen that some sort of accident would occur. (Jolley v Sutton London Borough Council (2000) 1 WLR 1082.) Bibliography Anns v Merton London Borough Council (1978) AC 728 Civil Liability (Contributions) Act 1978 Donoghue v Stevenson (1932) AC 562 Dorset Yacht Co. Ltd v Home Office (1970) AC 1004 Fairchild v Glenhaven Funeral Services Ltd (2002) 1 WLR 1052 Honeywill & Stein Ltd v Larkin Bros (London Commercial Photographers) Ltd (1934) 1 KB 191 John Joseph Hughes v Barratt Urban Construction (Scotland) Ltd March 2002 http://www.scotcourts.gov.uk/opinions/CAR1103.html Viewed October 28, 2006 Jolley v Sutton London Borough Council (2000) 1 WLR 1082 Kay v ITW Limited (1968) 1 QB 140 Murphy v Brentwood District Council [1991] 1 AC 398 Occupiers Liability Act 1957 Ready Mix Concrete (South East) Ltd v Minister of Pensions (1968) 2 QB 497 RE: Polemis and Furness, Withy & Co LTD (1921) ALL ER Rep 40 Rose v Plenty (1976) 1 WLR 141 Stevenson, Jordan and Harrison v M&E (1952) 1 TLR 101 Tai Hing Cotton Mill v Liu Chong Hing Bank [1986] AC 80 Wilson & Clyde Coat Co v English (1938) Yewens v Noakes (1880) 6 QBD 530 Read More