Construction and design professionals should check their insurance to see if they are protected against claims for economic loss following a recent court ruling that allowed client Mirant-Asia to pursue Ove Arup for a claim of US$62.5m arising out of the failure of foundations of a boiler house at a power Station in the Philippines.

The decision, delivered in London at the Technology and Construction Court recently could 鈥渙pen the floodgates鈥� for similar cases, says Stephen Homer, a construction lawyer from firm Ashfords. This is because it appears to end the courts鈥� resolve to restrict liability for negligence by a designer to physical damage to people or property.

鈥淭hey are now liable to third parties for financial losses suffered by them as a result of their negligence,鈥� Homer warned. He said architects, engineers and quantity surveyors should make sure their professional indemnity policies cover them for claims of pure economic loss.

Source

Construction Manager