The new building control regime: A new form of appointment for Principal Designers

This is the second of our articles considering new industry standard forms released this year in response to the new roles under the revised building control regime. In our previous article, we considered the new Contract for the Appointment of a Building Control Approver published by the Association of Building Control Approvers. This time, we are reviewing the new principal designer appointment published by the Royal Institute of British Architects (RIBA).

Part 2A of the Building Regulations 2010

New dutyholder roles apply under Part 2A of the Building Regulations 2010 (see our previous blog Building Safety Act Duties - not just for residential projects). These roles were introduced as part of the many changes under the Building Safety Act 2022. The principal designer under the Building Regulations 2010 (BRPD) is engaged by the client and must plan, manage and monitor design work during the design phase of a project, and must take all reasonable steps to ensure that a project built in accordance with the design will be compliant with the relevant requirements of the Building Regulations 2010.

The new RIBA appointment

In response to the introduction of the new principal designer role, RIBA published a new standard form – the RIBA Building Regulations Principal Designer Professional Services Contract 2024 (BRPD PSC).

The BRPD PSC is separate to the appointment already published by RIBA for the role of a principal designer under the Construction (Design and Management) Regulations 2015 (CDM 2015) – the RIBA CDM Regulations Principal Designer Professional Services Contract. Although both the Building Regulations 2010 and CDM 2015 require a principal designer, the role requires different competencies under each set of regulations, so a particular consultant may not necessarily have the competency to perform both roles. To comply with its duties under the Building Regulations 2010, the client must make sure that the principal designer's competency is considered in the context of the particular project for which it is being appointed.

RIBA's guidance notes to the BRPD PSC state that the form is suitable for use on commercial projects but not for domestic or consumer clients. RIBA recommends that domestic and consumer clients instruct a principal designer using the RIBA Domestic Professional Services Contract.

As with the other forms of contract published by RIBA (and the ABCA form reviewed previously), the terms of the BRPD PSC are generally more favourable to the consultant than a client may typically propose. Key provisions to note are set out below.

Client obligations

The client has various obligations under the BRPD PSC. The client must inform the BRPD of the Project Brief and the services required from the BRPD, as well as notify the BRPD of any subsequent changes to the Brief or services, and agree on steps to mitigate the consequences of such changes. The client must fulfil its own duties under the Building Regulations 2010 (and the regulations applicable to higher-risk building projects (HRBs), if relevant) to enable the BRPD to perform its services. Additionally, the client must provide information, make decisions, and give approvals necessary for the proper and timely performance of the services.

For HRBs, the client must provide the BRPD with continuous access to the electronic Golden Thread Information, together with an archive of the Golden Thread Information at the conclusion of the services.

BRPD obligations

All duties and obligations of the BRPD are to be discharged using the reasonable skill, care and diligence expected of a member of its profession in providing services for projects of a similar size, nature and complexity to the project. Nothing in the agreement or elsewhere is to be construed as imposing a greater duty on the BRPD. Clients will typically prefer to see this standard of skill and care applied only to the performance of the services by the BRPD – rather than all of the consultant's duties and obligations.

The client also acknowledges that the BRPD does not warrant compliance with the project programme or construction cost. Nor does it warrant the competence, performance, works or services of any of the other consultants or the contractor, and it will not provide any statement of compliance beyond those expressly required by law. The scope of this exoneration is open to interpretation, but it could potentially cut across some of the BRPD's duties under its role.

The BRPD must assess whether it is competent to carry out its obligations under Part 2A of the Building Regulations 2010 and must inform the client if it ceases to be competent.

Limitations on liability

The BRPD PSC contains an express time limitation for bringing actions or proceedings arising out of or in connection with the appointment of 6 or 12 years from either practical completion or completion of the last services, whichever is earlier. No express exception is made for liability under the Defective Premises Act 1972 (which applies to dwellings) under which the statutory limitation period is 15 years.

The BRPD PSC also contains a cap on the BRPD's liability for loss or damage up to the amount of the agreed level of the BRPD's professional indemnity insurance for the project (which is to be specified in the contract particulars). The terms also contain a wide-ranging net contribution clause which limits the BRPD's liability to such sum as agreed between the parties, or the amount which is judged by a court as the proportion of the loss to the client caused by the BRPD's failure to exercise reasonable skill and care (which is not necessary given the complete exoneration in respect of other consultants and contractors mentioned above). There is also an exclusion of personal liability for any employee or agent of the BRPD.

Payment

Extensive payment provisions allow the fees to be calculated as a specified percentage applied to the construction cost, a percentage specified for each RIBA work stage, a lump sum, time charge, or other method (or any combination of these). Lump sums and time charge rates will be revised every 12 months in accordance with changes in the Consumer Price Index.

The fee can be increased to account for loss and expense incurred by the BRPD if material changes are made to the Project Brief, the latest approved estimate of costs, or the Project Programme. Where percentage fees apply, the BRPD is also to be compensated for reductions to the construction cost in deflationary market conditions. Additional fees for extra work or extra expense incurred for reasons beyond the BRPD's reasonable control are calculated on a time charge basis.

The client can only withhold payment from the BRPD where a tribunal has determined that the payment is not due to the BRPD, or where the BRPD agrees to the amount being withheld. All rights of set-off or in equity that the client would otherwise have are excluded. The client's ability to withhold payment is therefore severely restricted even in the event of a genuine dispute.

The BRPD is entitled to interest at 8% per year over the dealing rate of the Bank of England for late payment in addition to rights to suspend or terminate performance of the services for non-payment. Clients will generally prefer a somewhat lower rate (particularly as the base rate is currently higher than it has been for some time).

Assignment and third party rights

Neither party may assign the appointment without the prior written consent of the other, such consent not to be unreasonably withheld or delayed. The BRPD PSC expressly provides that there is no intention to grant third party rights, and there is also no provision for collateral warranties. This could be problematic for projects where the granting of rights against the project team would typically be expected or where the assignment of the client's rights is expected.

Copyright

The client has a licence to copy and use all documents provided by the BRPD for purposes related to the construction of the project or its subsequent use or sale, but this is subject to the payment of the fees and other amounts properly due having been paid. Where the client has not paid sums due, the BRPD may suspend use of the licence to which the unpaid monies relate by giving seven days' notice. This can cause problems where the parties are in genuine dispute as to the sums due to be paid.

Confidentiality

Neither party is permitted to disclose confidential information unless: such disclosure is necessary to obtain professional advice in relation to the contract or the services, the confidential information is already public, or the disclosure is required by law. However, the BRPD is permitted to disclose confidential information where necessary for the proper performance of the services.

Subject to the confidentiality provisions, the BRPD also has the right to publish photographs and other information regarding the project and is allowed reasonable access to the project for two years after practical completion.

Termination

The client may suspend or terminate the performance of any or all services and other obligations under the appointment by giving seven days’ written notice and stating the reason for doing so. The BRPD can also suspend or terminate by giving seven days' notice and specifying the grounds for doing so – including for payment default, where the client is in material or persistent breach of its obligations, where the BRPD is prevented from or impeded in performing the services for reasons beyond its control, force majeure, or for any other reasonable grounds for suspension or termination (which could be widely interpreted and is unlikely to be acceptable to a client).

Performance of the services and/or other obligations may also be terminated immediately by notice from either party if the other becomes insolvent or becomes unable to perform its obligations due to death or incapacity.

Services

The BRPD PSC includes a schedule of services, split into two parts with the second part only applying if the project includes an HRB. The services that apply to both HRBs and non-HRBs reflect the requirements for the principal designer role under Part 2A of the Building Regulations 2010.

There are additional services that will apply if the project includes an HRB, including periodically reviewing the effectiveness of the Change Control Plan, services relating to the establishment and management of a mandatory occurrence reporting system required under the Building (Higher-Risk Buildings Procedures) (England) Regulations 2023 (HRB Regulations), ensuring that the Golden Thread Information is up to date, and providing a written statement confirming that the BRPD has fulfilled its duties under the Building Regulations 2010 as is required under the HRB Regulations at completion.

Conclusion

Consultants carrying out the role of principal designer under the Building Regulations 2010 may welcome the publication of a standard form that they can propose for use on projects they are involved with. However, the BRPD PSC is relatively favourable to the consultant, and many clients will seek to use their own bespoke forms of appointment when engaging a principal designer to align with the other professional team appointments.