International Construction Law Review
BOOK REVIEWS
SARAH LUPTON and HUMPHREY LLOYD
European Architect Law: Towards a New Design. By Stephanie van Gulijk. Apeldoorn, The Netherlands: Maklu Publishers, 2009. ISBN 978–90–466–0145–7. 250pp. €49.50
This interesting and unusual book uses a law and economics analytical framework to examine various aspects of the architect-client relationship in selected European countries, namely, the Netherlands, Belgium, France, Germany and England.
The book begins by outlining and explaining the research question to be answered, i.e., “which combination of regulation options on market entry, architect liability, limitation of architect liability and insurance is optimal in view of the European architect’s and client’s legitimate interests”. It then presents an overview of relevant European law, including the nature of design contracts in the five selected countries (drawing on earlier research of the author as a contributor to Principles of European Law on Service Contracts, Barendrecht et al., 2005). The following chapters compare the current position in each country on market access, the nature and extent of liability, and insurance. In respect of liability, seven specific duties are investigated; design, site inspection, selection of materials, advice on applicable law and rules, cost advice, authority to act on behalf of the client, and supervision of the works. The next section establishes the analytical framework that will be adopted, and the remainder of the book systematically applies this analysis to the topics listed above. The final chapter presents the conclusions.
The book is valuable on several levels. The first is for its comparative study of the differing legislative frameworks and contractual terms used in the selected countries. It is interesting to note, for example, that in all five the title “architect” is protected, and additionally the function is protected in the Netherlands, Belgium and France. Whereas on the whole the liability of the architect is to use a reasonable level of skill and care, in France the liability for many of the duties is strict, and in Belgium and Germany it is strict in relation to matters of soundness of construction. In relation to some aspects of liability a more detailed account might have been helpful, and coverage of a wider range of countries might have given an even more varied picture, for example, including some of the Mediterranean countries such as Spain, and the “new” European countries such as Romania. However, this is to do the book a disservice, in that it is not intended to be a comprehensive account of the law throughout Europe. The country profiles are set out to give a basis for the analysis, not as a guide in themselves. Nevertheless, the comparative study provides a useful and informed insight into the varying regimes, and would be a helpful introduction for anyone unfamiliar with the position in those countries.
The second level is the law and economics aspect. This is extensively researched, referring to a wide range of law and economics literature, from definitive texts of the 1970s by authors such as Goldberg, Coase, Calbresi and Akerlof through to contemporary papers. The law and economics approach (which explores the economic basis of legal rules) originated in the USA in the 1960s, and has subsequently developed several different branches. From time to time it is applied to construction industry issues, for example, more recently, the “relational contracting” theories have been applied to lean construction and to partnering procurement. Until now, however, little work has been done on the architect-client relationship.
In this book the author focuses on three alternative approaches, the Pareto and Kalder-Hicks efficiency criteria, the Coase theorem and the Calabresi cost reduction theory. She selects Calabresi’s approach as the most suitable for the analysis she proposes to conduct. This involves examining the costs of prevention and costs of damage (the primary costs), the costs of spreading the damage (the secondary costs) and the administrative costs (the tertiary costs) which result from the application of differing legal rules, in order to show what the overall effect will be on the costs of the architect and the client. In many cases the existing position is demonstrated to be the likely optimum, but in some the author suggests that an alternative should be considered, for example, she argues that a strict liability rule for design and selection of materials may have overall economic benefits, particularly in cases where a traditional rather than an innovative design is required by the client.
The book is very well presented, in fact the structure and layout are so clear as to be a model for teaching purposes. The research question is explained clearly at the beginning, each chapter opens by outlining what will be covered and concludes with a brief summary of what has been shown. Throughout there are useful diagrams that act as a road map to the theoretical framework. Tables are used extensively as a means of summarising the results of the analysis, and are presented on a cumulative basis.
Altogether this is a very thought provoking book, both for its comparative legal study and its cost reduction analysis. It ought to make a valuable contribution to the current debate within professional and policy-making bodies about the standard of attainment to be expected of architects and other professionals. The author indicates that there are many areas where further exploration is required, and it is to be hoped that she continues her research and writing in this field.
Legal Aspects of Architecture, Engineering and the Construction Process. Eighth Edition by Justin Sweet and Mark M Schneier. Stamford, Connecticut, USA: Cengage Learning, 2009. ISBN 1378–0–495–41121–5; ISBN 10–495–411213. 769 pp. plus appendices, tables and index. Hardback. Price approx. $190.
It is exactly four years since I reviewed the Seventh Edition of this work ([2005] ICLR 416). I shall not repeat what I then said about the value of this well-established work. But I asked myself: why has this Eighth Edition appeared so soon after the Seventh Edition? The answer that the authors might give is in their Preface: there have been new standard forms and some new cases. The work now covers the latest editions of the contracts issued by the American Institute of Architects (AIA) for design services (B101—2007), prime construction services (A101—2007) and (A201—2007), and subcontracting services (A401—2007). The authors point out that the first two have been greatly changed from the 1997 editions. As they are “the backbone of the contractual aspects of the American construction industry” it is clearly necessary to cover developments in the AIA forms. The structure and much of the content of the new forms is very different from the 1997 editions and they are given careful consideration in the Eighth Edition. For example, provision for arbitration is now found in Article 15 of A201—2007 as the culmination of the section on “Claims and Disputes” instead of being buried in Article 4 of A201—1997 (Administration of the Contract). Arbitration is now optional in that the parties have to select it as it is no longer built in as mandatory. In addition, the Engineers Joint Contracts Documents Committee (EJCDC) published some new general conditions (C700) and a new agreement between owner and contractor (C520) but these documents are reproduced in the appendices as they came out whilst the work was going to press.
The authors note that in 2007 the Associated General Contractors of America refused to endorse the new AIA forms and, in conjunction with other organisations, produced a new set of contract documents, known as “ConsensusDOCS”. The main reason appears to be because the AIA forms are thought not to represent a fair allocation of risk. The ConsensusDOCS are endorsed by some 21 organisations. However, whilst the authors mention these documents, they are not reproduced in the appendices and are not discussed in any depth. The reason given is that “both the market impact and judicial treatment of the ConsensusDOCS are unknown”. However, the same could equally well be said of the new AIA forms, particularly in the light of the potential competition that they now face and the fact that, necessarily, the many new provisions in the AIA forms allied to the changes in structure cannot yet be the subject of judicial consideration. Some changes are quite radical, such as the arrival of Initial Decision Maker. The ConsensusDOCS have been well received and are considered, at least within the legal profession, to be serious alternatives. It is therefore somewhat disappointing that the authors, renowned as they are for their perception and erudition, have not considered these new forms, so as to provide the reader with critical insight as to the choice between ConsensusDOCS and the AIA family. In addition, as the AIA forms no longer stipulate arbitration, courts are more likely to look to established commentaries such as that of Professor Sweet and Mr Schneier for guidance on interpretation.
The other area where there has been change over the last four or so years is the law. The authors have revised many sections such as those relating to product liability, the economic loss rule and other areas. However, there do not appear to be any major decisions that affect basic principles. The authors have taken the opportunity to rewrite the passages dealing with United States v. Spearin
1 in which the United States Supreme Court declared that when the government issues detailed plans and specifications to the contractor, it impliedly warrants the adequacy of the design in those documents. Not only is the Court’s reasoning difficult for many outside the United States but the case has had wide implications. The “Spearin doctrine” has been accepted universally throughout the United States. A restatement of its effects is particularly welcome.
Readers who are or who are likely to be active in the United States in the near future in sectors covered by AIA forms will certainly need this edition. Those who already have the Seventh Edition but have no such need for a new edition may prefer to wait until the Ninth Edition which will no doubt cover ConsensusDOCS as well as much else. By that time the eagerly awaited new supplement to Bruner and O’Connor on Construction Law, the major competitor to Legal Aspects of Architecture, Engineering and the Construction Process, should also have appeared.