International Construction Law Review
LETTER TO THE EDITORS
Dear Sirs:
In the Introduction to your January 1999 issue, you took FIDIC to task because in the test edition of FIDIC’s “Silver Book” (Conditions of Contract for EPC Turnkey Projects) published in 1998, the contractor was held to a strict “fitness for purpose” obligation, as was the case in FIDIC’s “Orange Book” (Conditions of Contract for Design-Build and Turnkey) published in 1995.
In a letter in your April 1999 issue, Mr Ian Duncan Wallace, QC strongly disagreed with your Introduction and supported the position taken by FIDIC on this issue. He considered that it was appropriate that the contractor under a design-build or turnkey contract has a “fitness for purpose” obligation as he argued—very persuasively I thought—that the position of the contractor was analogous to that of a seller under a contract for the sale of goods, and, under such a contract, the seller has such an obligation. Writing from a US perspective, Professor Justin Sweet, while critical of the degree of risk allocated to the contractor by the test edition of the Silver Book, supported “the goods analogy” and went along with the position of FIDIC and Mr Duncan Wallace on this issue.
As your French Correspondent (and as member of FIDIC’s Task Group for updating FIDIC’s International Conditions of Contract), I would like to draw your attention to the position of French law on this question.
While French law takes a different approach from English and US law to contractor’s liability, by virtue of Article 1792 of the French Civil Code, the outcome for the contractor, after completion, is basically the same as if he had a “fitness for purpose” obligation.
Article 1792 of the French Civil Code establishes that, after completion, contractors (and other “builders” in contract with the owner) have strict liability, that is, liability without proof of “fault” (negligence or intentional wrong), to the owner or purchaser for substantial defects which may appear. This Article provides as follows (translation):
“Any builder of a work (ouvrage)
shall be liable as a matter of law towards the owner or purchaser of the work for damages, even resulting from a defect in the ground, which weaken the solidity (solidite)
of the work or which, by affecting an essential element or necessary equipment, render it unsuitable for its purpose.
Such liability does not arise if the builder proves that the damages resulted from an extraneous cause.”
By virtue of Article 2270 of the French Civil Code, builders are relieved of this presumption of liability only 10 years after completion of the works.
Under Article 1792, a turnkey contractor, for example, will be liable for any damage of the kind described above to the work unless the contractor can prove that the damage resulted from an extraneous cause, e.g. an act of the employer or force majeure
(as defined by French law). Where there has been a
[2000
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