How can you protect your practice from the risk of unauthorised third parties using your design without permission?
This can happen in a variety of scenarios, including the Internet.
• Acoustic consultants find that local authorities tend to post their advice on the Internet for public information, but with the result that the whole world, not just residents affected by a scheme, can read and download it.
Downloading pop tracks free from the Internet is all very well, but professional advice which has been prepared on certain assumptions may well not be applicable to different scenarios faced by a third party. From your point of view, without a disclaimer, the risk is that a third party will claim damages based on their use of your advice.
• If you are working as a specialist subconsultant to a lead architect, you may well be asked for all your supporting files, in editable form, as well as your report.
Here the lead designer’s intentions might be to incorporate your conclusions seamlessly into a single report, for ease of presentation, which is all very well, or to have on hand a standard report which can be reused on future jobs, without attribution or payment.
Either scenario may be met by including a suitable disclaimer in your standard conditions, so that unauthorized third parties cannot rely on your advice without your express permission.
Prima facie, PI cover would normally respond to a third party claim arising from unauthorised use of your design work, as the extent of liability to an unauthorised third party would be the no greater.
However there are good risk management reasons to limit who is entitled to rely on your advice. Similarly, valuers and surveyors working for lenders routinely use some form of reliance clause so that only the lender is able to rely on their advice.
Acoustic specialists have reported that local authorities often upload information such as acoustic reports, for ease of reference by their tenants or residents. However as materials on the Internet are prima facie visible to the whole world, this creates a potential risk management issue for designers, who have no control over what use third parties make of their uploaded advice.
It would assist, up to a point, if local authorities were to take steps to limit who could access such materials, whether by redacting identifying features, or protecting by a password, but you would have to rely on them carrying this out correctly. Here also the better course of action would be to use a disclaimer in the report itself. The disclaimer could be set out in full; alternatively a short notice to the effect that you will not allow unauthorised use and an invitation for a third party to seek permission, would be acceptable.
Advice to a lead designer
Requests for files or calculations in editable form give rise to risk management and practical concerns. Normally we would recommend only releasing design work in a form which cannot be altered after it leaves you, as editable files can readily be altered without your authorisation.
• Firstly, this would enable your advice to be drawn on for future jobs without authorisation, as above.
• Secondly, unauthorised alterations could well cause confusion between you and your client, especially if a claims scenario arises.
Where a head designer wishes to make a single presentation to their client, we would recommend the following course of action:
• You provide your advice in a non-editable form, as above:
• The head designer appends copies of your report to their advices
• If the head designer wants to draw on your advice in their advice to the ultimate client, then they should seek your sign off on the final form of advice, so that all can be sure that your advice is being used and interpreted appropriately.
• Alternatively a detailed responsibility matrix may be incorporated into your appointment.
This will make clear to all concerned, who has advised on what aspect. The ultimate client will then rely on your advice (to that extent) and will rely on the head designer for aspects on which they advise, and, of course, coordination issues.
If, for whatever reason, a head designer wanted to draw on your advice without attribution, then this would create risk management issues for them as well as for you. Prima facie this course would not serve either their clients’ or their own interests.
• Using advice out of context, or in a different context, would be prima facie negligent on their part;
• It would be a little sloppy for a head designer to continue to use advice on future jobs; the risk is that rules or Building Regulations might change, leaving the advice out of date. Again, this would be prima facie negligent.
Towergate offer a contracts review service for clients placing their PI through us, and will be happy to review disclaimers in your standard terms with these issues in mind for our clients. Please contact Alan Eyre firstname.lastname@example.org or Hilary Nicholls Hilary.email@example.com, or telephone 0844 892 1789.