On October 22, 2013 the Council of State has rendered two judgments that are highly relevant for local PPP projects (nr. 225.191 and 225.192).
The first judgment was rendered at the request of, among others, the Belgian Confederation of Architects. The Confederation requested for the annulment of “Article 51 §2 of the Royal Decree of July 15, 2001 concerning public tenders in the classical sectors, to the extent and insofar this provision provides for joint and several liability of the parties jointly submitting an offer”. More specifically, annulment was requested of the phrase ‘(The participants) are jointly and severally liable and (…)”. The Confederation and the other complainants upheld before the Council Of State that a legal provision that has as a consequence that architects and general contractors can only submit a joint offer on the condition that they are jointly and severally liable violates specific legal provisions regarding the independence of an architect in his relation with general contractors.
The Council of State effectively annulled the abovementioned legal provision, but only to the extent that it regards combinations between general contractors and architects. The judgment is based on the following reasoning. Article 6 of the Act of February 20, 1939 states that “practicing the profession of architect is incompatible with that of a contractor of public or private works”. In the general interest of both professions, this incompatibility was implemented to make sure that the supervision and the execution of works are separated. An effective supervision on the execution of the contractor will be impossible if the supervising architect is in any way connected to the executing contractor. According to the contested Article 51 §2 of the Royal Decree, the contracting authority could request, in the event of default of a contractor, the architect to execute the agreement of the defaulting contractor, which is legally impossible Considering the mentioned legal incompatibility, the architect cannot execute the agreement of the contractor in kind. Consequently, there must be a substitute compensation.
However, even in the case of a substitute compensation, the independence of the architect is jeopardized substantially. After all, when, in case of default of the contractor, the architect is held to execute the agreement of the contractor, be it in kind or in the form of a substitute compensation, the task of the architect of supervising the execution of the contractor will be fundamentally burdened. If the architect were to find an error in the execution of the contractor, he could be addressed for this error himself, in the absence of any error on his part. This affects the independence of the architect substantially, since he works on behalf of the contracting authority and not on behalf of the contractor.
In the same vein, the Council Of State rendered on October 22 a second, similar judgment at the request of the National Chamber of Architects in which the provisions of the tender specs for a DBF-contract for a youth hostel in Bruges, providing for joint and several liability between a general contractor and an architect, were annulled, for the same reason. Interestingly, this judgment also states that any contractual relation between a general contractor and an architect in which the architect acts as a subcontractor, an employee or a co-shareholder of the general contractor violates the architects’ legal obligations with regard to his professional independence from general contractors.
Both judgments have as a consequence that parties, especially public authorities, seeking to enter into a contractual relationship with both general contractors and architects for design-and-build projects should carefully consider and draft the terms of the agreement with the architect and the general contractor.
