A recent case in Wales involving asbestos has highlighted the fact that contractors can’t always rely on third party asbestos reports.
Building Contractors will often rely upon asbestos reports and other information regarding the site which the employer has compiled.
But this recent case shows that an asbestos report isn’t always accurate, and as a result the Contractor may face some difficulties.
The case in Wales involved two companies – BDW Trading Ltd and Integral Geotechnique (Wales) Ltd EWHC
Integral Geotechnique (IGL) were employed by Bridgend County Council to carry out a geotechnical report on some land they intended to sell for a new residential development.
The council informed IGL that any potential buyers would be relying on this report.
However, IGL’s terms of appointment excluded any third-party rights and highlighted that the report could only be assigned with its prior consent.
When the asbestos report was completed and handed over, it contained a statement stating that it was for Bridgend Council’s use only, but did state they could assign to a site purchaser if they wished.
As a result, BDW Trading were provided with a copy of the report.
BDW went onto purchase the site, however, no actual assignment of the report took place.
And there was no collateral warranty provided or even a letter of reliance.
It was during development of the land that ACM’s (asbestos containing materials) were found that the asbestos report hadn’t picked up on.
So BDW decided to bring a claim against IGL.
BDW took IGL to court as they wanted to prove that IGL owed them a duty of care.
And some things did go in BDW’s favour, such as the fact that IGL were aware the report was to be provided to any prospective buyers.
However, the court decided that even so, on the whole, IGL didn’t owe a duty of care to BDW.
The court’s decision was based upon the fact that the statement made in IGL’s report made it very clear they were willing to allow any potential site buyer to place legal reliance on the report.
Although, this would only be if the required legal instrument was put in place to allow it to do so.
For example, this could be done by assignment, reliance letter, or by collateral warranty.
This particular case is a stark reminder to any Contractor that if they rely on a survey or asbestos report that is prepared by a consultant they didn’t directly employ, they should insist on a letter of reliance or some other contractual link.
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