A fitness-for-purpose obligation can require an engineer to achieve a particular outcome, rather than simply exercise reasonable professional skill and care.
This distinction can be important from a Professional Indemnity perspective.
Examples might include obligations stating that:
- the design will achieve a specified performance
- the project will be suitable for a particular purpose
- the completed works will meet a guaranteed outcome
Professional Indemnity policies may restrict or exclude liability arising from contractual guarantees that go beyond the engineer’s normal professional duty.
Engineers should therefore identify fitness-for-purpose wording before signing a contract and consider whether the obligation is appropriate and insurable.
Where the wording is unclear or materially increases the engineer’s responsibility, legal review may be appropriate.
Consult Australia’s Centre for Contracting & Risk provides further industry guidance on fitness-for-purpose obligations and other contractual risks affecting consulting businesses.
