- April 25, 2014
- Posted by: Josiah Hincks Solicitors
- Category: Business Law Updates
A High Court decision has dealt with the consequences of a mathematical error in the industry standard used in the design of foundations of offshore wind farms that resulted in the unexpected settling of 60 turbines in the Solway Firth and a Euros 26.25 million repair bill.
Company A had been employed by company B to design, fabricate and install the turbines’ foundations. An international standard produced by an independent classification and certification agency had been used in the design work. Only after the turbines were installed did it emerge that the value attributed to a variable used in one of the equations in the standard was underestimated by a factor of about 10.
The turbines were supposed to last 20 years; however, they had been in place for less than three years when movement was discovered in grouted connections that had been designed according to the standard. The cost of remedial work was agreed at Euros 26.25 million and the underlying issue for the Court to decide was whether company A, or company B, should bear the consequences.
The Court found that, on a correct interpretation of the contract, company A had accepted full responsibility for the design work. Notwithstanding that company A had met its obligation to perform its task in accordance with the standard, company B was entitled to rely upon the warranty that the turbines’ foundations would have a service life of 20 years.
Since the grouted connections had failed within two to three years, company A was in breach of that obligation. Further argument as to costs and the appropriate relief consequent on the Court’s decision was left over for further consideration.