Net contribution clause upheld

17 April 2009

Langstane Housing Association v Ramsay & Chalmers

Net contribution clauses have been commonly used by professionals, most notably engineers and architects, for a few years now. The aim of the clause is to contract out of joint and several liability, so that in the event of something going wrong in, for example, a construction contract, the professional is only required to pay such damages as arose from his own actions, and is not jointly and severally liable for the failings of other members of the construction team. However, the use of such clauses is controversial, with some commentators suggesting that their use is illegitimate or infringes the principles of UCTA. In his recent decision in the case of Langstane Housing Association v Ramsay & Chalmers (http://www.scotcourts.gov.uk/opinions/2009CSOH52.html) , Lord Glennie has approved the use of a net contribution clause by consultant engineers, ruling that the clause was acceptable at common law, and neither unfair nor unreasonable under UCTA.

Axiom Advocates provided all of the counsel appearing in the case, with the Dean of Faculty and Roddy Dunlop, Advocate acting for the engineers, and Alastair Clark QC acting for the pursuing housing authority.