Engineers and building surveyors even if you are an employee you can be sued personally

Engineers and building surveyors EVEN if you are an employee you can be sued personally!!!!

• Is that news to YOU!? Probably…I get surprise all the time. But as a professional liability lawyer specialising in building and PI I explain this a lot.

It usually starts with your statutory role in relation to the Building Act 1993 (Vic).

• Do YOU agree with it!? Absolutely NOT, I hear that all the time and I get it. BUT the law is there and if you get sued that opinion is not a relevant legal question.

• BUT what is relevant? Just because you are sued doesn’t mean you are liable. What matters is legal defence and PI insurance can pay!

Especially when your employer has gone insolvent. AND we all know how common this is in the building industry.

As your employer takes out cover - YOU need to be able to locate and access the insurance policy.

Isn’t that easy? Not always. Especially when a company is insolvent - who can you ask?

Further, which policy year applies is complicated too. With professional indemnity insurance the cover is provided on a claims made basis. Meaning a claim is usually made on the policy year when you are sued or a demand is made. But notifications of circumstances that may give rise to a later claim can also be made to an earlier policy.

So even the correct policy year can be complicated.

Confusing?

I get it. BUT the simple thing is to know where your policy is, ie who is the broker and insurer for each policy period. We can help with locating this.

But heres the thing I get asked all the time.

REALLY!? Can this REALLY happen, an employee get sued?

YES. Let me explain the situation typical to a structural engineer:

Many know, an engineer owes a client a duty to exercise reasonable skill and care and whilst a contract exists between the engineering company and client (usually to prepare a soil report, structural drawings and computations) it is usually the statutory certificates of compliance that draw in the employee.

The regulation 126 Certificate in Victoria in many cases is signed by an engineer employee.

Where an engineer performs a statuory function under Regulation 126 and Regulation 238 of the Building Regulations 2018 it can be relied on and is often requested by a building surveyor.

The older system was a Regulation 1507: Certificate of Compliance - Design or Inspection.

Anyway, the certificate follows a standard form which makes declarations signed off by the individual engineer that the design complies with the Building Act, Regulations and NCC. If they turn out to be wrong the repercussions can be proceedings including the individual.

Another situation is drawings and computations often having initials such as B.E.M identifying the person responsible for preparation.

Engineers and Building Surveyors, you are in a high risk, high insolvency sector. Professional indemntiy insurance is critical!

If you have questions feel free to reach out blair@bulawyers.com.au

This article is a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

Tagged as:

• building law
• professional liability