Defects during progress - Construction Contracts - page 182

108 If the contractor is liable for a very
serious defect, must it do whatever the
employer requires to correct it?
A common problem concerns what remedy is appropriate when a serious defect occurs in
the Works. Small defects do not tend to cause real problems. If a window is defective or a
door is warped, it is clear that the contractor must replace the window or door with a new
one, and it is seldom that the contractor tries to argue that they need not be replaced. The
principle is plain: If there is a breach of contract, such as a building defect, the injured party
(the employer) must be put in the same position, so far as money can do it, as if the breach
hadnotoccurred.Inpractice,however,thepartiescaneasilyfailtoagreewhatisappropriate
when serious defects occur which are expensive to rectify. The contractor naturally wishes
to apply the cheapest possible remedy, while the employer wants to make sure that the rem-
edy is 100 per cent effective.
The court had to deal with just such a situation in Albert Bartlett & Sons (Airdrie) Ltd
v Gilchrist & Lynn Ltd, 7 in which the major defect was a badly leaking roof over a potato
processing and packaging plant. The roof construction was factory applied plastic coating
onmetalsheetroofing,withcorrugatedplasticsheetsforlighting.Theevidencewasthatthe
roof was allowing water into the building even as it was being constructed, and the situation
did not improve after completion. The water penetration was through virtually all the end
laps of the panels. There was also water vapour condensing in the double skin rooflights.
The parties arrived in court because they could not agree on the most appropriate remedy
for the defects. For the purpose of the proceedings, the contractor admitted breach of con-
tract.Asthebuildingwasinconstantuse,itwasagreedthatitwasnotfeasibletostripitand
re-roof. The employer had advice that the whole roof should be overclad in a single metal
skinonametalgridabouttwoinchesabovetheexistingroof.However,thecontractormain-
tained that a perfectly satisfactory job could be achieved by applying a liquid waterproofing
system to the parts of the roof which leaked.
Thecostofovercladdingwasatleast£1.3million,whereasthecostoftheliquidtreatment
was only £145,000. The court held that the employer had a duty to mitigate its loss and that
thecostoftheremedyshouldnotoutweighthebenefit.Areasonableapproachmustbeused.
Other courts have held that where two systems of repair are equally effective, the cheapest
must be chosen. 8 In this case, not only were the costs of the opposing approaches vastly
different, but the overcladding system had not been properly worked out and there was a
distinct possibility that the cost might eventually reach £2 million. The liquid waterproofing
system would work, but the overcladding was doubtful. Moreover, the two proposals had a