Key takeaways
Performance obligations prevail over minimum standards
A higher performance obligation governs and is not diluted by 'minimum standard' wording.
Compliance with flawed specifications
This is no defence to breach of fitness for purpose obligations.
'Skill and care' -v- 'fitness'
Even where design duties are limited to skill and care, contractors remain exposed for performance or workmanship failures.
This article looks at the Supreme Court decision in MT Hojgaard -v- E.ON Climate & Renewables UK Robin Rigg East Ltd & another [2017] UKSC 59 and subsequent cases and considers what light they shed on the English Court’s approach when bespoke contractual provisions conflict with standard industry specifications.
Background
On 14 January 2026, the UK announced a record breaking offshore wind auction, awarding 8.4 GW of new capacity under its Contracts for Difference scheme - the largest offshore wind award ever made in Europe.
To put 8.4 GW in context: a single modern nuclear reactor typically has a capacity of about 1–1.6 GW (the new Hinkley Point C plant will be ~3.2 GW across its two reactors). So, 8.4 GW is roughly two and a half Hinkley Point Cs in capacity terms. According to government and press briefings, the projects are expected to generate enough electricity to power around 12 million homes when operating.
As this new capacity moves from award to execution, contractual clarity on performance outcomes versus minimum technical standards becomes decisive. That is precisely the tension at the heart of MT Højgaard -v- E.ON.
In that case, the Robin Rigg offshore wind farm required MT Højgaard (MTH) to design, fabricate and install turbine foundations in accordance with DNV OS J101 and E.ON’s Technical Requirements (TRs), and to deliver a 20 year design/service life. After completion, a fundamental error in a key J101 equation came to light, meaning the design - although compliant with the standard - did not satisfy the promised service life. That discrepancy set the stage for the central question: when technical standards and performance outcomes apparently conflict, which obligation governs?
The High Court originally found for E.ON; the Court of Appeal reversed that decision, characterising the 20 year life language in the TRs as 'too slender a thread' for a standalone warranty against the backdrop of J101 and general skill and care duties. The Supreme Court restored the first instance position, holding that the performance promise was binding and not qualified by minimum standard references.
The Supreme Court decision
Co-existing obligations and the 'higher standard' rule
The Supreme Court held that the contract imposed co existing obligations: (a) to comply with J101; and (b) to ensure a 20 year service life. Where those conflicted, the more demanding obligation - the TR performance outcome - prevailed. J101 was expressly treated as a minimum standard, not a ceiling. Consequently, the contractor’s risk allocation included the possibility that following a standard might still fail to achieve the promised outcome; the duty was not merely to follow J101 but to deliver foundations capable of lasting 20 years.
Fitness for purpose -v- compliance with standards
The Court’s approach aligns with long standing principles that compliance with specifications does not displace a fitness for purpose obligation, absent clear contractual language to that effect. Put differently, performance warranties and technical standards operate cumulatively, and a standard referenced as a minimum does not negate a robust outcome promise. The Supreme Court emphasised reading the documents as a whole and giving effect to all provisions, resisting an interpretation that would render the 20 year life promise toothless.
Practical effect
In practical terms, the decision confirms that where parties include a service life or fitness promise, courts will enforce it even if an accepted industry standard later proves inadequate. Contractors are expected to identify and bridge any gaps between minimum standards and the promised outcome - through enhanced analysis, conservatism in design, validation testing, or departures from the standard as necessary. The fact that a standard was widely used and accepted is not a safe harbour if the result falls short.
Related decisions
Lendlease Construction (Europe) Ltd -v- AECOM Ltd [2023] EWHC 2620 (TCC)
The Technology and Construction Court examined a consultant’s duties on the St James’s University Hospital Oncology Centre project. The consultancy agreement imposed reasonable skill and care, not a fitness for purpose obligation. The Court addressed scope of duty, any continuing duties to review or warn, limitation (including whether the agreement took effect as a deed and instances where estoppel may arise from imperfect execution), and the effect of prior settlements and upstream decisions. The claim failed; among other things, the Court held that the contract’s language and context did not elevate the consultant’s obligations into a result based warranty, and limitation points were decisive.
Why it matters
Lendlease -v- AECOM illustrates the consequences of drafting - when an agreement confines a professional’s obligations to skill and care, the court will not imply a fitness obligation simply because minimum standards or performance aspirations appear elsewhere.
The decision also highlights the high stakes around limitation (including deed execution) and the need for careful pleading where contribution or indemnity is sought by reference to upstream outcomes.
SSE Generation Ltd -v- Hochtief Solutions AG [2018] CSIH 26 (Inner House, Scotland)
This case followed the collapse of a hydroelectric tunnel soon after completion under an NEC based design and build contract. Although the contract included an option limiting design duties to reasonable skill and care (akin to NEC’s X15.1), the Inner House found the collapse resulted from a defect existing at takeover and was substantially a matter of implementation/workmanship rather than compliant design per se. The contractor was liable to correct the defect and bear the remedial costs despite having met skill and care on design.
Why it matters
SSE -v- Hochtief shows two things. First, risk turns on where the defect sits: if it lies in execution or workmanship, a design skill and care clause is of limited utility. Second, where the contract contains performance or fitness language (for example, a required service life), that can impose liability notwithstanding design compliance - echoing MT Højgaard’s insistence that outcome promises bite.
Commercial implications
1) Draft to reflect a conscious hierarchy
If outcomes truly matter - service life, availability, output - say so expressly and frame any referenced standards as minimum or baseline requirements. Conversely, if the intention is to limit exposure to a skill and care design duty, avoid language that reads like a performance warranty, and ensure that 'design life' references are tied to methodology rather than absolute outcomes. Courts will prioritise clear outcome provisions over generic standard compliance wording when the two conflict.
2) Close the loop between standards, verification and warranty
When a standard is known (or suspected) to be evolving, parties should:
build in verification and validation steps (for example, independent checks and test regimes) calibrated to the performance obligation;
include a mechanism for updating or departing from a standard where necessary to hit outcomes; and
align defects, testing and certification clauses with the service life promise to avoid a disconnect between short defect periods and long performance promises.
3) Back to back risk transfer
Prime contracts, subcontracts and consultant appointments should be back to back: if the head contract contains a performance or fitness commitment, ensure downstream parties assume matching obligations (or that pricing and insurances reflect any gap). Failing to mirror obligations can leave the main contractor carrying performance risk that it cannot pass on to designers or specialist suppliers.
4) Understand the workmanship/design split
SSE -v- Hochtief underscores that even perfect design (on a skill and care standard) will not protect against liability where defects stem from implementation. Drafting should address workmanship standards explicitly, link construction procedures to the outcome obligation, and ensure quality assurance processes are robust enough to support the promised performance.
5) Limitation and deeds - formality matters
Lendlease -v- AECOM is a reminder that deed execution formalities, estoppel, and clear limitation drafting can be dispositive. If a 12 year period is intended, confirm the agreement is validly executed as a deed or that the drafting unmistakably contracts out of the six year default for simple contracts. Maintain a documented audit trail of authority for signatories and any reliance on deed status.
Practical drafting checklist
State outcomes plainly (e.g., 'The Works shall achieve a service life of 20 years') and label referenced standards as minimum.
Tie standards to outcomes: 'Where compliance with [Standard] is insufficient to achieve the Outcomes, the Contractor shall adopt more stringent measures.'
Define 'Design Life/Service Life' (scope, conditions, inspection/maintenance assumptions) and link it to testing and certification regimes.
Clarify workmanship obligations and QA/QC processes; require method statements and hold points aligned to the performance obligation.
Ensure back to back appointments for designers and specialist suppliers; include express fitness wording where needed or recognise residual risk and price/insure accordingly.
Validate deed execution or draft explicit contractual limitation periods with clear language; avoid ambiguity on longstops.
Comment
The Supreme Court’s decision in MT Højgaard is now the touchstone for reconciling competing contractual obligations in complex engineering projects: when an industry standard and an outcome obligation pull in different directions, courts will enforce the outcome if the drafting supports it. That approach promotes contractual certainty and ensures that performance requirements are not neutralised by generic 'comply with standards' obligations.
The subsequent decisions show how fact sensitive the analysis can be. In Lendlease -v- AECOM, the absence of express fitness language, coupled with limitation and deed execution issues, meant a skill and care framework governed; the consultant was not retrospectively saddled with a performance guarantee.
In SSE -v- Hochtief, by contrast, a defect at takeover and the workmanship/implementation dimension drove liability, notwithstanding arguments about design diligence. Together, these cases offer a coherent message: be explicit about the result you want, align standards and processes to that result, and ensure your contract architecture (including downstream appointments and limitation provisions) matches the risks you intend to carry.
