Collateral Warranties

This text provides expert and practical guidance on collateral warranties. Related areas of the law are clearly and comprehensively explained, providing an account of this controversial subject.

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The use of collateral warranties has been rapidly growing in the UK since the mid 1980s. Following the recent ruling in July 1990 of the House of Lords in Murphy v. Brentwood District Council (extending its decision in D & F Estates Ltd v. The Church Commissioners (1988)) the prospects of success of tenants and subsequent purchasers in a claim for negligence have been severely restricted. This radical change in the law has led developers, tenants, subsequent purchasers and funding institutions to seek a direct contractural relationship with architects, engineers, contractors and sub-contractors. The remedy has its own problems. Very few standard forms of collateral warranty exist and even those recently introduced are not yet widely used; developers, tenants, purchasers and funding institutions have therefore produced their own forms which they seek to impose. In commercial transactions the courts are not necessarily concerned with fairness.
Collateral warranties may create extremely onerous legal burdens, often greater and longer lasting than those which exist under the contract to which they relate, and which may cause serious problems in relation to professional indemnity insurance cover. This book provides expert and practical guidance on collateral warranties. Related areas of the law are clearly explained, providing an account of this controversial subject. It is designed for those involved in the construction industry and their legal advisers.