CERTIFIED, BUT NOT INDEPENDENT: REVISITING THE DUTIES OF A CERTIFIER IN BUILDING CONTRACTS
Recently, the Supreme Court of Victoria in Hale Corp Pty Ltd v Cheng Lam Ng and Anor [2026] VSC 492 (“Hale Corp”) considered the obligations of an architect when assessing a contractor’s claim for an extension of time and associated time costs.
The underlying contract concerned the construction of a residential development in Victoria. Although the parties’ dispute extended beyond the certification issue and included claims concerning delay, defective works and termination, for present purposes, this article will focus only on the Court’s ruling on an architect’s duties when acting as a certifier.
This decision provides a useful reminder that certifiers must act independently when discharging their certification function.
Background. Hale Corp Pty Ltd (“Hale”) was engaged by the owners to construct a residential development: [42] of Hale Corp.
The owners appointed Louis Choido Architects to design the development and perform the contractual functions of the “architect” (the “Architect”): [44] of Hale Corp.
The relevant clause is clause A6 in the underlying contract, which provides that the Architect is the owner’s agent when giving instructions to the contractor, but that the Architect is to act independently and not as an agent when acting as assessor, valuer or certifier: [117] of Hale Corp.
The dispute relevant to certificate concerned Hale’s claim for an adjustment of time and time costs.
By 15 April 2020, the Architect had assessed Hale’s entitlement at 105 working days and the corresponding time costs at $1,758.69 per day: [139]-[140] of Hale Corp.
The Architect then asked Hale to resubmit its claim in accordance with that assessment. Instead of assessing Hale’s resubmitted claim, the Architect proceeded to correspond with the owners regarding that claim: [141]-[142] of Hale Corp.
The owners expressed concern about the size of the claim, sought to negotiate this claim, and stated that they would not bear certain costs claimed by Hale: [143]-[146] of Hale Corp.
On 30 June 2020, LCA rejected Hale’s claim in its entirety: [104] of Hale Corp.
The duty of a certifier. The Court observed that those performing certification function must act independently, impartially and fairly. They must not exercise that function in a manner that advances the owner’s interest over those of the contractor: [120] of Hale Corp.
Hale Corp cited with approval earlier Australian decisions establishing the following relevant principles:
The circumstances which may vitiate a certifier’s decision cannot be exhaustively defined, but they include, amongst others, fraud, interference by the owner, conduct falling short of the required standard of independence and impartiality, unreasonable refusal to consider the matter and taking into account improper considerations: [122] of Hale Corp.
Indications that a certifier lost the required independence include, amongst others, allowing the owner to influence the certifier’s judgments, acting at the direction of the owner, failing to show sufficient firmness to decide in accordance with his own opinion and considering the owner’s assent as necessary before making a decision: [123] of Hale Corp.
A certifier may lose independence without intending to or realising that it has happened: [123] of Hale Corp.
The Court’s findings against the Architect. The Court found that the Architect had not exercised the independence required of a certifier.
It found on the balance of probabilities that the Architect had failed to act independently, fairly and impartially: [136] of Hale Corp.
It also found that that the Architect engaged with the owners in a manner that demonstrated that she regarded their assent as necessary before her decision could be issued: [142]-[144] of Hale Corp.
The Court therefore awarded Hale damages representing the time costs it would have recovered: [155]-[156] of Hale Corp.
The Singapore position. The Singapore position is substantially similar as regards the nature of the certifier’s duty.
For example, in the Singapore Court of Appeal’s decision in Hiap Hong & Co Pte Ltd v Hong Huat Development Co (Pte) Ltd [2001] 1 SLR(R) 458 (“Hiap Hong”), the Court of Appeal held that an architect under a building contract performs a dual function, where on some matters, he is bound to act on his employer’s instructions, but for others, he must act fairly and in an unbiased manner: [15] – [16] of Hiap Hong.
Thus, even though architects are generally appointed by the employer, neither party may unfairly nor unduly influence the architect when he is performing his functions: [16] of Hiap Hong.
The architect therefore cannot be treated as the employer’s agent when exercising the certification function because the nature of that function is inconsistent with agency: [35] of Hiap Hong.
Accordingly, the central principle is the same in Australia and Singapore.
Practical implications. It is important for architects to bear in mind their dual functions. Just because an architect acts, on some matters, as the employer’s agent, does not mean that the architect abdicates his duty to act independently and impartially when it comes to certification duties.
A certifier does not cease to be independent merely because the certifier listens to both the employer and contractor before making a decision. However, listening to both parties is not the same as treating either party’s assent as “necessary” before a decision can be made. A certifier must be careful not to cross the line.
This publication is not intended to be, nor should it be taken as, legal advice; it is not a substitute for specific legal advice for specific circumstances. You should not take, nor refrain from taking, actions based on this publication. Chancery Law Corporation is not responsible for, and does not accept any responsibility for, any loss or damage that may arise from any reliance based on this publication.