Hanging by a Slender Thread: Design Obligations in Construction Contracts Following MT Højgaard v E.ON

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Ryan Turner

May 2018

A paper based on the joint second prize winning entry in the Hudson essay competition 2017 and presented to the Society of Construction Law at a meeting in London on 8th May 2018

This paper considers the extent to which MT Højgaard v E.ON can be said to have changed or clarified the law regarding the interpretation of contracts, especially in relation to the issue of contracts of ‘double obligation’.  The author suggests that, despite initial industry concerns, the judgment is best understood as an application of conventional principles to the specific facts of the case.  The paper goes on to comment on the varying treatment of ‘design life’ by the courts when assessing the allocation of risk of design failure between contractors and employers. The paper concludes with thoughts on how the risks illustrated by the case may be controlled.

Introduction – MT Hojgaard v E.ON background – The contract – Hanging by a slender thread – The Supreme Court – Construing the contract as a whole – Contracts of double obligation – Standard form contracts – Distinguishing design life and service life – Controlling risk of design failure – Conclusion.

The author: Ryan Turner is a pupil barrister at Keating Chambers, London.

Text: 12 pages

Paper number: 
May 2018, printed and online, 230k

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