Scope of duty is the legal question of which losses a negligent professional is answerable for. For architects and their PI insurers, the answer changed shape in June 2021 with Manchester Building Society v Grant Thornton UK LLP [2021] UKSC 20 and its companion Khan v Meadows [2021] UKSC 21. Both reframed the analysis that had governed professional negligence since South Australia Asset Management Corp v York Montague [1997] AC 191 (SAAMCO) and BPE Solicitors v Hughes-Holland [2017] UKSC 21. This entry explains how the reframed test applies to architect claims and how it affects loss quantum in residential and higher-risk building work.
Under SAAMCO, as restated in BPE v Hughes-Holland, the courts asked whether the professional had given advice (guiding the whole decision) or merely information (one input into a decision the client took on their own account). An advice-giver was on the hook for all foreseeable loss flowing from the transaction. An information-giver was answerable only for loss attributable to that piece of information being wrong.
For architects the distinction was awkward. Architects design, but they also advise on planning strategy, specification, contractor selection, site supervision and contract administration. A single claim could involve elements of both categories, and the answer determined whether a large repair bill was recoverable in full or only to the extent of a much smaller information slice.
In Manchester Building Society the Supreme Court set out a six-stage analysis, demoting the advice-versus-information label from a binary gateway to a descriptor of what the professional had actually agreed to do. The court now asks, in order: duty; scope; breach; factual causation; whether the loss is within the scope of the duty; and any deduction for contributory fault or mitigation.
Scope is answered by identifying the purpose of the service. If the architect was retained to guide the client's decision on a matter, losses flowing from that matter being got wrong fall within scope. If retained only to supply information for someone else's decision, only losses attributable to that information being wrong are within scope. Khan v Meadows confirmed this is now the general test across professional negligence.
Most architect retainers under the RIBA Standard Professional Services Contract or a bespoke appointment involve design work that is advisory in character. The architect is guiding the client's decision about what to build and how to comply with the Building Regulations and planning consents. Standard 6 of the ARB Architects Code requires work carried out with skill and care and accurate information to the client — which in scope-of-duty terms points to an advice-heavy characterisation.
Design errors, specification advice on cladding, fire strategy or structural elements, planning advice, site-supervision advice under a contract-administration role and defects-liability advice typically sit inside the advice category. Pure information tasks — such as transmitting a measured survey figure without adopting it as design advice — remain narrower.
Practically, the court now asks a counterfactual: but for the negligent advice, what would the client have done, and what loss would have followed? The comparison is between the actual outcome and the outcome under competent advice. Loss that would have occurred anyway is not attributable to the breach; loss that would have been avoided is.
Worked example (illustrative only). An architect designs a residential block in 2019 and obtains planning consent. The specification names a cladding product later found, in 2022, to be non-compliant with the Building Regulations for a building of that height and use. Remediation costs £2.5m. Under the pre-2021 analysis the insurer would have argued the architect merely supplied information about product performance, capping recovery at the difference in value. Under Manchester Building Society, specifying cladding is advisory — the architect was guiding the client's decision.
The counterfactual: had the architect specified compliant cladding at the outset, the client would have built with a compliant product at an extra £150,000. The client would not have avoided cladding altogether. Loss attributable to the breach is therefore £2.5m repair minus the £150,000 the client would have spent anyway — around £2.35m, subject to further reduction for contributory fault, betterment, mitigation and any legal-responsibility limit the court imposes at the final stage.
The reframing tends to increase recoverable loss on advice-type architect engagements, which is most of them. That puts pressure on limit adequacy — particularly for practices working on residential blocks and higher-risk buildings under the Building Safety Act 2022, where remediation costs run into millions. Aggregate wording, one-claim-per-project wording, and defence-costs-inside-limit clauses all deserve fresh scrutiny. Apex Insurance Brokers arranges architect PI on a considered, plain-English basis and helps clients think about scope-of-duty exposure when setting limits and choosing wording.
Related reading: architects PI insurance guide, advice vs information scope of duty, Building Safety Act 2022 architect PI implications, surveyors PI, engineers PI and solicitors PI.
Apex Insurance Brokers Limited is authorised and regulated by the Financial Conduct Authority. Firm reference number 724952. This entry is general information, not advice on any particular policy.