Do contractors owe a duty of care to employers?

Two paragraphs buried amongst a 256-page Supreme Court judgment delivered recently may indicate a change in the Court’s approach to whether a contractor owes a duty of care to its employer alongside its contractual obligations.

Previous authority from the Court of Appeal in Robinson v P.E.Jones (Contractors) Ltd [2011] EWCA Civ 9was quite clear:

“Absent any assumption of responsibility, there do not spring up between the parties duties of care co-extensive with their contractual obligations.”

That case was not without its critics – many consider it was wrongly decided and led the law down an unhelpful path, but it has been good authority since it was decided.

However, the Supreme Court’s first judgment this year appears to move away from the position held in Robinson. Paul & Anor v Royal Wolverhampton NHS Trust [2024] UKSC 1 was a case focused on the duty owed personally by doctors to patients, but buried amongst the judgment it mentions building contractors in passing in a way which suggests that it may now be easier to establish a duty of care:

“131. The relevant relationship between the manufacturer of a product and the ultimate consumer arises only at the point of use. Similarly, two road users one of whom injures the other by careless driving may have been complete strangers before the accident in which the injury is inflicted. Sometimes, however, proximity is established by a pre-existing relationship between the parties. A concept used to explain how such a relationship may give rise to a duty of care is that of assumption of responsibility. The core of this idea is that a person (A) who provides a service to another person (B) who reasonably relies on A’s expertise in performing the service assumes a responsibility to B to perform the service with reasonable care and skill.

132. It is this principle which underlies the relationship of proximity between an architect or building contractor and their employer, between a lawyer or accountant and their client, and between a doctor or other medical practitioner and their patient. By providing a service, whether under a contract for reward between the doctor and the patient or – as in the case of a patient entitled to treatment under the National Health Service – where the doctor is paid by the state, the service-provider assumes a responsibility towards the person to whom the service is provided, which gives rise to a duty of care.”

Those two paragraphs appear to give force to arguments that the simple proximity of the relationship between employer and contractor is likely to give rise to a duty of care over and above that contained within the contract itself. We still need further authority directly on the point, as the above is likely only to be persuasive to lower Courts, rather than binding. It is useful nonetheless as an indication of the direction of travel of judicial thinking.

The Birketts view

Contractual claims are often preferable as they do not exclude claimants from seeking to recover pure economic loss. In most cases, the contractual obligations (if properly documented) will also provide a more straightforward route to bringing a claim, particularly as the statutory framework does not permit parties to commence an adjudication for a claim based solely in tort. However, there are cases where contractual claims are not an option and the Judge’s obiter comments here will no doubt be welcome relief for those who find themselves in such a situation.

It remains to be seen how influential this decision will be given the relatively glancing blow dealt to Robinson v Jones, but it will undoubtedly be useful to have better authority for claims in tort.

We expect this area to develop in the near future, possibly in tandem with developments arising from building safety claims. In the interim, getting your contract documentation right remains the best route for recovery against a contractor and/ or consultant;  ensuring you don’t need to establish a claim in tort to recover losses for a breach of duty of care.