Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Background Information for all questions: These facts apply to all questions except where modified by further explanatory notes : Distributed Modular Generation (UK) Limited (DMG(UK)Ltd)

Background Information for all questions:

These facts apply to all questions except where modified by further explanatory notes:

  1. Distributed Modular Generation (UK) Limited (DMG(UK)Ltd) is a UK company which converts plastic wasteinto synthesis gas from which it extracts hydrogen for a variety of uses. It wants to build its first New Zealand plant at Wiri, South Auckland. It has made a scale model of the plant as below:

First plastic-to-hydrogen plant to be built at Wiri

  1. DMG(UK)Ltd's subsidiary company in New Zealand, Distributed Modular Generation (NZ) Limited (DMG(NZ)Ltd) wants a contractor to build Phase 1 buildings of the proposed plant, as shown in the bottom left hand corner of the picture above.
  2. The drawings and specifications for design of the Wiri plastic-to-hydrogen plant are being supplied from the UK by DMG(UK)Ltd.
  3. Shed Builders Limited (SBLtd) is a contractor which designs and builds low rise commercial and industrial buildings in the Auckland region.
  4. Pete Sampras (Pete) is an architectural draftsperson qualified as a licensed building practitioner under s286 Building Act 2004. He is a full-time employee of SBLtd and is registered under s298 of the Act, with a Design Licence AoP 3. He is competent to design and sign off any work that SBLtd performs as being compliant with the building code or the building consent.

  1. Martine Macron (Martine), another full-time employee of SBLtd, is a licensed building practitioner. She holds a Site Licence AoP 3, and is competent to supervise and sign off any work that SBLtd performs as complying with the building consent. Martine also does planning, and she calculates how long it should take SBLtd to construct any new projects it tenders for.
  2. Jim Lin (Jim), a chartered professional engineer, is competent to design and sign off any structural work SBLtd performs as being compliant with the building code or the building consent. SBLtd employs Jim as an independent consultant on a job by job basis, and pays him according to the time he spends on whatever project SBLtd engages him to work on.
  3. Lorna Doone (Lorna ) is one of two partners in the quantity surveying firm of Doone and Oot (D&O). The other partner is Jane Oot (Jane). Lorna and Jane are both quantity surveyors.
  4. When SBLtd tenders for a new project D&O is responsible for estimating costs and preparing risk analysis reports. Roger Sheffield (Roger) is SBLtd's contracts director. Roger adds a percentage figure to D&O's cost estimate to cover SBLtd's overheads and profit and submits that as SBLtd's tender price offer.
  5. After securing a project, D&O is responsible for placing orders for materials and subcontracts with the necessary suppliers and trade contractors. It also manages payment claims to the client employing SBLtd to carry out its project, and agrees payment claims SBLtd receives from subcontractors and suppliers.
  6. If a client wants changes to a design and build project that has started, Roger has to approve the change, Martine determines its impact on the project's time for completion, D&O agrees the cost of the change with the client, and Pete redesigns any architectural work in consultation with Jim who does the structural design work including any necessary calculations. Pete deals with the consent authority regarding any changes that must be notified to the consent authority for building consent purposes.
  7. SBLtd pays D&O for its services on a scale of fees based mainly on a percentage of the contract price for a project which takes into account any design changes.
  8. SBLtd engages a chartered accountancy firm to deal with actual money movement, payments received and payments made, and is also responsible for accounting services including dealings with the Inland Revenue Department (for the purpose of answering EXAM questions, this aspect of business management is NOT included).

  1. Roger is responsible for securing work for SBLtd and he signs on behalf of SBLtd: [1] every contract which commits SBLtd to the performance of work in excess of $30,000 in value; and [2] every subcontract which SBLtd enters into including suppliers in excess of $5,000 in value.
  2. Lorna and Jane are both authorised to sign off all and any other contract less than $5,000 in value on behalf of SBLtd.

  1. Lorna and Jane are responsible for the administrative off-site aspect of all construction work carried out by SBLtd including financial control and progress of the work on site .

  1. Roger nominates Martine as SBLtd's site located agent with the title project manager for the Wiri plastic-to-hydrogen plant with authority to represent SBLtd as its principal* to "supervise" as defined by s7 Building Act 2004 all aspects of on-site construction work.

*the 'law of agency' principle i.e. SBLtd is the principal and Martine is the agent for SBLtd

  1. Additional site supervisory staff is engaged by Roger for SBLtd as required to cope with its workload.
  2. After a project starts and D&O begin to receive prices for materials and subcontract work, Roger decides which offers to accept. Lorna or Jane place orders for materials and make simple written agreements with subcontractors in letter form [see 20. below] which are signed off by Roger, Lorna, or Jane depending on their $ value.

  1. "We accept your price of $X excl.GST to carry out (relevant trade inserted) work as

shown on the drawings and specification as the attached list (list inserted)

for the (name inserted) project.

Conditions of contract where applicable to be as the main contract conditions.

A full set of drawings, specifications, and contract conditions are available

for your inspection at our head office by appointment and upon your request.

Please carry out the work in accordance with a programme to be agreed.

Yours faithfully

Shed Builders Limited

LornaDooneor Jane Oot or Roger Sheffield

All SBLtd projects whether they are done under a traditional contract or a design and

build contract are carried out this way.

  1. Distributed Modular Generation (NZ) Limited representatives negotiate with Roger and Lorna. After their negotiations conclude, Shed Builders Limited enters into an Agreement with DMG(NZ)Ltd to build the Phase 1 buildings for the Wiri plastic-to-hydrogen plant for an agreed lump sum price of $35,000,000.

  1. Under separate contracts with specialist suppliers and subcontractors, Distributed Modular Generation (NZ) Limited will install the necessary plant and equipment in the buildings constructed by Shed Builders Ltd that will recycle the plastic waste.
  2. Contract documents for the construction contract between DMG(NZ)Ltd and SBLtd include plans and specification with the critical dimensions and locations for the recycling plant and machinery to be installed under the DMG(NZ)Ltd separate contracts in the buildings that will house it.

  1. DMG(UK)Ltd had permission from the Overseas Investment Office of New Zealand to buy land at Wiri for the plastic-to-hydrogen plant. The plant was to built through DMG(NZ)Ltd which got a necessary resource consent as required by the Resource Management Act 1991 before DMG(NZ)Ltd entered into the construction contract with SBLtd.

  1. Pete typically designs the buildings which are the subject of a usual design and build contract performed by SBLtd. Jim assists Pete on structural issues. Jim provides structural calculations and design detail but he has no involvement with the work done on site.
  2. The Wiri plastic-to-hydrogen plant is more complex than the type of construction work SBLtd typically undertakes. SBLtd is experienced in both designing and constructing warehouse type buildings, but requirements for the Wiri project are more complicated particularly the machinery and pipework to be installed under separate contracts.
  3. DMG(NZ)Ltd employed Site Investigations (2019) Limited (SI(2019)Ltd) a geotechnical survey company to investigate the ground at the Wiri site. SI(2019)Ltd boredseveral trial holes and tested the soil for its strength. It recorded its findings in a soils report which it gave to DMG(NZ)Ltd who passed it on to DMG(UK)Ltd to use for their design of the plant.
  4. DMG(NZ)Ltd also gave a copy of the soils report to Roger to help SBLtd prepare its lump sum price for building the Wiri plant. Roger gave a copy of the soils report to Jim. SBLtd did no further site investigation work at the Wiri site before entering into a lump sum price construction contract with DMG(NZ)Ltd.

  1. DMG(NZ)Ltd gets a building consent from the territorial authority (s12 Building Act 2004) in the name of Distributed Modular Generation (UK) Limited ( s14B(a) Building Act 2004 and s7 "owner" defined).
  2. Shed Builders Ltd starts work on site.

Extracts from the Health and Safety at Work Act 2015:

Section 3 Purpose of the Act -

(1)...main purpose...provide...balanced framework to secure... health and safety of workers and

workplaces by

(a) protecting workers and others (from) harm to their health, safety, and welfare by

eliminating or minimising risksarising from work or... high-risk plant[i];...

(b) providing...fair...workplace representation, consultation, co-operation, and resolution

of issues (regarding) work health and safety;...

(c) encouraging unions and employer organisations to... promote improvements in

work...practices...assisting PCBUs and workers (get) healthier and safer working

environment;...

(d) promote...advice, information, education, and training...

(e) securing compliance(with) compliance and enforcement measures;...

(f) ensuring...scrutiny and review (of those) performing functions or exercising powers

under...Act; and

(g) providing...framework for continuous improvement and...higher standards...

(2) In furthering subsection (1)(a), (have) regard (to) principle that workers and others (are)

given...highest level of protection against harm to...health, safety, and welfare from hazards

and risks...from work or...specified...plant as is reasonably practicable.

Section 17 Meaning of PCBU

(1) ...a person conducting a business or undertaking or PCBU

(a) means a person conducting a business or undertaking

(i) whether the person conducts a business or undertaking alone or

with others; and

(ii) whether or not the business or undertaking is conducted for profit

or gain; but

(b) does not include

(i) a person...employed or engaged solely as a worker in, or as an officer

of, the business or undertaking:

Section 22 Meaning of reasonably practicable

...reasonably practicable, in relation to a duty of a PCBU...means (what was) reasonably able to be done...to ensure health and safety...weighing up all relevant matters, including

(a) the likelihood of the hazard or the risk concerned occurring; and

(b) the degree of harm that might result from the hazard or risk; and

(c) what the person concerned knows, or ought reasonably to know, about

(i) the hazard or risk; and

(ii) ways of eliminating or minimising the risk; and

(d) the availability and suitability of ways to eliminate or minimise the risk; and

(e) after assessing the extent of the risk and the available ways of eliminating

or minimising the risk, the cost associated with available ways of eliminating or

minimising the risk, including whether the cost is grossly disproportionate to the risk.

Section 16 Interpretation defines hazard as...including...behaviour (with) the potential to cause

death, injury, or illness to a person (whether or not (it) results from physical or mental fatigue,

drugs, alcohol, traumatic shock, or (any) temporary condition...affecting a person's behaviour)

Section 20 Meaning of workplace defines workplace as meaning

(a)...a place where work is...carried out...for a business or undertaking; and

(b) includes any place where a worker goes, or is likely to be, while at work.

Section 24 Meaning of notifiable incident...

(1)...a notifiable incident means an unplanned or uncontrolled incident in relation to a

workplace that exposes a worker or any other person to a serious risk to that person's health or safety arising from an immediate or imminent exposure to

...(g) the collapse, overturning, failure, or malfunction of, or damage to, any plant that is

required to be authorised for use in accordance with regulations; or

(h) the collapse or partial collapse of a structure;...

Section 19 Meaning of worker

(1)...a worker means...individual who carries out work...for a PCBU, including work as

(a) an employee; or

(b) a contractor or subcontractor; or

(c) an employee of a contractor or subcontractor; or

(d) employee of...labour hire company...assigned to work in...business or undertaking; or

(f) an apprentice or a trainee; or

(g) a person gaining work experience or undertaking a work trial; or

Section 25 Meaning of notifiable event...notifiable event means any of the following events that arise from work:

(a) the death of a person; or

(b) a notifiable injury or illness; or

(c) a notifiable incident.

Section 36 Primary duty of care

(1)A PCBU must ensure, so far as is reasonably practicable, the health and safety of

(a)workers...working for the PCBU, while...at work in the business or undertaking; and

(b)workers whose activities...are influenced or directed by the PCBU, while...carrying out the work.

(2)A PCBU must ensure, so far as is reasonably practicable, that the health and safety of other persons is not put at risk from work carried out as part of the conduct of the business or undertaking.

(3) ...a PCBU must ensure, so far as is reasonably practicable,

(a) ...provision...of...work environment...without risks to health and

safety; and

(b) ...provision...of safe plant and structures; and

(c) the provision...of safe systems of work; and

(d) the safe use, handling, and storage of plant, substances, and

structures; and

(e) ...provision of...facilities for the welfare at work of workers...including

...access...; and

(f) ...provision of...information, training, instruction, or supervision...

to protect all persons from risks to their health and safety...; and

(g)...health of workers and...conditions at the workplace are monitored

(to) prevent injury or illness of workers...

.

(6) A PCBU who is a self-employed person must ensure, so far as is reasonably

practicable, his/her own health and safety while at work.

Section 23 Meaning of notifiable injury or illness

(1)...a notifiable injury or illness...to a person, means

(a)any of the following injuries or illnesses that require the person to have immediate treatment (other than first aid):

(i)...amputation...:

(ii) a serious head injury:

(iii) a serious eye injury:

(iv) a serious burn:

(v) the separation of...skin...:

(vi) a spinal injury:

(vii)...loss of a bodily function:

(viii) serious lacerations:

(b)an injury or illness that requires, or would...require, the person to be admitted to a hospital for immediate treatment:

(c)an injury or illness that requires, or would usually require, the person to have medical treatment within 48 hours of exposure to a substance:

(d)...serious infection...to which (doing) work is a significant contributing

factor, including any infection that is attributable to carrying out work

(i) with micro-organisms; or

(ii) that involves providing treatment or care to a person; or

(iii) that involves contact with human blood or bodily substances; or

(iv) that involves...contact with animals...or

(v) that involves...contact with fish or marine mammals:

(d)any other injury or illness declared by regulations to be a notifiable injury or illness...

Section 30 Management of risks

(1) A duty imposed on a person by or under this Act requires the person

(a) to eliminate risks to health and safety...as is reasonably practicable; and

(b) if it is not reasonably practicable to eliminate risks to health and safety,

to minimise those risks so far as is reasonably practicable.

(2)A person must comply with subsection (1) to the extent...the person has, or would reasonably be expected to have, the ability to influence and control the matter to which the risks relate.

Section 56 Duty to notify notifiable event

(1)A PCBU must, as soon as possible after becoming aware that a notifiable event arising out of the conduct of the business or undertaking has occurred, ensure...the regulator is notified of the event.

Section 16 Interpretation the regulator is ...as the case requires, (a) WorkSafe; or (b) the relevant designated agency.

Section 37 Duty of PCBU who manages or controls workplace must:

(1)ensure, so far as is reasonably practicable, that...means of entering and exiting the workplace, and anything arising from the workplace are without risks to the health and safety of any person.

(4) In this section (s37), a PCBU who manages or controls a workplace

(a) means a PCBU to the extent that the business or undertaking

involves the management or control (in whole or in part) of the workplace;...

Section 44 Duty of officers

(1)If a PCBU has a duty or an obligation under this Act, an officer of the PCBU

must exercise due diligence to ensure that the PCBU complies with that duty or

obligation.

(2)For the purposes of subsection (1), an officer of a PCBU must exercise the

care, diligence, and skill that a reasonable officer would exercise in the same

circumstances, taking into account (without limitation)

(a) the nature of the business or undertaking; and

(b) the position of the officer and the nature of the responsibilities undertaken

by the officer.

(3)Despite subsection (1), a member of the governing body of a territorial authority

or regional council elected in accordance with the Local Electoral Act 2001 does not have

a duty to exercise due diligence to ensure that any council-controlled organisation (as

defined in section 6 of the Local Government Act 2002) complies with its duties or

obligations under this Act unless that member is also an officer of that council-controlled

organisation.

(4)In this section, due diligence includes taking reasonable steps

(a)to acquire, and keep up to date, knowledge of work health and safety matters;

and

(b)to gain an understanding of the nature of the operations of the business

or undertaking of the PCBU and generally of the hazards and risks associated

with those operations; and

(c)to ensure that the PCBU has available for use, and uses, appropriate resources

and processes to eliminate or minimise risks to health and safety from work carried out as part of the conduct of the business or undertaking; and

(d)to ensure that the PCBU has appropriate processes for receiving and considering

information regarding incidents, hazards, and risks and for responding in a timely way to that information; and

(e)to ensure that the PCBU has, and implements, processes for complying with any

duty or obligation of the PCBU under this Act; and

(f)to verify the provision and use of the resources and processes referred to

in paragraphs (c) to (e).

Section 45 Duties of workers While at work, a worker must

(a) take reasonable care for his/her own health and safety; and

(b) take reasonable care that his/her acts or omissions do not adversely

affect the health and safety of other persons; and

(c) comply, as far as the worker is reasonably able, with any reasonable

instruction that is given by the PCBU to allow the PCBU to comply with

this Act or regulations; and

(d) co-operate with any reasonable policy or procedure of the PCBU relating

to health or safety at the workplace that has been notified to workers

QUESTION 1(12 MARKS)

After construction of the plastic-to-hydrogen project is finished and Distributed Modular Generation (NZ) Limited is in occupation of the plant, cracking is noticed in one of the buildings which has reinforced concrete ground beam and pad construction foundations.

Investigations show the following contributory factors are likely causes of the cracking:

1.. The subsoil is mostly as indicated by the soils report and has adequate strength to support the

building on the ground beam foundations as designed, but there are places where old existing fill,

not indicated by the report, has created differential settlement i.e. the ground beams have lost

support over parts of their length and have significant cracks.

2. The concrete has been poured direct to sandy soil in several places, which has caused the water to

be sucked out of the freshly poured concrete, proper hydration has not taken place, with the

result that the concrete strength has been significantly reduced.

3. Foundation pads under structural columns are not designed with sufficient reinforcing steel to

cope with New Zealand's seismic requirements, possibly because they were designed by engineers

in the UK where seismic (i.e. earthquake) action is not generally expected to occur.

4. The mechanical plant installed in the building under separate contract is significantly heavier than

shown in any specifications or on any drawings that were given to Shed Builders Limited.

Advise possible liability with reasons for the costs of rectifying the work done on site, by the parties listed below. You are NOT required to allocate any percentage of liability to individual parties or to estimate the probability of a claim against them succeeding. You are only required to state possible grounds in law for each listed party having to accept some liability for the failure.

(i)Shed Builders Limited

(ii)Martine Macron

(iii)Distributed Modular Generation (NZ) Limited

(iv)Distributed Modular Generation (UK) Limited

(v)The consent authority

(vi)Site Investigations (2019) Limited

QUESTION 2

The costings for the plastic-to-hydrogen plant prepared by D&O and presented to Roger to add the necessary margins for on-site plant and SBLtd's profit etc. were calculated entirely by Lorna. Jane was busy working on other D&O projects.

The figures were prepared in the usual way and presented to Roger on sheets of A4 paper, in this case 34 sheets of A4 paper. In the bottom right hand corner of each sheet the sheet numbers were written by hand i.e. 1 of 34; 2 of 34; 3 of 34; and so on, up to and including sheet 34 of 34.

On the last sheet i.e. sheet number 34, were written the subtotals for each of the 33 preceding sheets with the grand total of Cost at the bottom of the list. All calculations for SBLtd projects were presented to Roger in this manner.

A 'junior' person in the D&O office, not Lorna or Jane, had brought the 33 individual costs forward to sheet number 34 so as to advise Roger of the total cost of the plastic-to-hydrogen project, a figure in excess of $30 million to which Roger added SBLtd's and other costs to produce the lump sum offer of $35,000,000, which DMG(NZ)Ltd eventually agreed to accept as the Contract Price.

Roger was very busy when D&O presented its costings to him and he mainly focussed on the sum total on page 34. After work has started on site Roger looks closer at the list on page 34 and notices that the subtotal on one of the sheets has been brought forward to page 34 twice, and one page total does not appear on page 34 at all.

The difference in the total is in excess of$100,000 which lowered the price that SBLtd agreed with DMG(NZ)Ltd by the same amount. The mistake by D&O has effectively lost SBLtd over $100,000.

If SBLtd decided to go to court to recover its loss, advise: [1] the legal grounds for suing the following parties; [2] what would have to be proved for a claim to succeed; and [3] whether or not a claim would be likely to succeed against:

(i)The quantity surveying firm Doone and Oot

(ii)The partner Lorna Doone

(iii)The partner Jane Oot

(iv)The 'junior' in the quantity surveying firm

(v)Roger Sheffield

QUESTION 3

Two general operatives are loading up roof sheets on an ancillary building for the roofers. They are experiencing some difficulty in getting roofing sheets into place on the roof. They ask Martine if they can remove some edge protection guardrails to make it easier for them to load up the sheets. Martine asks them where the scaffolder is and they tell her that he has finished work for the day and won't be back until tomorrow.Martine tells them it is ok providing they don't remove more rails than are necessary. Martine doesn't say anything about putting them back again.

The general operatives tell the senior roofer they have finished loading up the roof. The roofer tells their apprentice to go up on the roof and count the number of sheets. The apprentice does this, expecting guardrails all around the perimeter of the building, so doesn't take sufficient care to notice that a section of the guardrail is missing, slips near where guardrails have been removed, and falls to the ground.

The apprentice is taken to hospital with several fractured bones.

There are signs around the site reading:

No-one on site is designated to be responsible for safe working generally, no site safety meetings are held regularly or otherwise, and the signs are the only reference on site to safety issues.

Answer the questions below. You must include all relevant sections of the legislation and fully explain your answers. Extracting the wording contained in the edited extracts from the Health and Safety at Work Act 2015 above is sufficient. You do not need to refer to the Act itself and additional detail is not required.

2a. Why is the Health and Safety at Work Act 2015 relevant to this situation?

2b. Who has to report to the "regulator" and what must they report?

2c. What responsibility do the following have under the Health and Safety at

Work Act 2015 for failure to replace the edge protection guardrails and the

resulting injury to the apprentice and why?

(i)Martine Macron

(ii)The two general operatives who removed the guardrails

(iii)Shed Builders Limited

(iv)Roger Sheffield

(v)The roofer who sent the apprentice onto the roof

(vi)The injured apprentice employee

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Andersons Business Law and the Legal Environment

Authors: David P. Twomey, Marianne M. Jennings, Stephanie M Greene

23rd edition

1305575083, 978-1305856516, 1305856511, 978-0357689868, 978-1305575080

More Books

Students also viewed these Law questions

Question

What does this look like?

Answered: 1 week ago