MT Hojgaard A/s v E.ON Climate And Renewables Robin Rigg East Ltd [2017] UKSC 59

The Respondent (‘MTH’) designed and installed foundation structures for two offshore wind farms owned by the Appellant (‘E.ON’) utilities provider at Robin Rigg in the Solway Firth. The foundations failed shortly after completion of the project. The contract provided that: “The design of the foundations shall ensure a lifetime of 20 years in every aspect without planned replacement.” It also incorporated the J101 (2004) edition which was the internationally recognised standard for offshore structures at the time of the contract. The intention of J101 was to produce structures with a design life of 20 years. Provisions of the technical requirements specified that they were to be the minimum requirements, and that it was the contractor’s responsibility to identify areas where the works were to be designed to additional or more rigorous requirements. It was later found that there was an error in J101 and it was this which caused the foundations to fail. MTH argued that by designing the foundations in compliance with J101 it had met its contractual responsibility. At first instance, the Judge had found that MTH had warranted that the foundations would have a service life of 30 years. The Court of Appeal overturned this, finding that compliance with J101 was expected, but not guaranteed, to produce a life of 20 years, and that the other terms of the Contract did not create a guarantee of a 20 year life. The Supreme Court upheld the E.ON’s appeal, the Courts were inclined to give full effect to a requirement that an item as produced would comply a prescribed criteria, on the basis that it is the contractor who can be expected to take the risk if he agreed to work to a design which would render the item incapable of meeting the criteria to which it had agreed. The Contract was consistent with this.