Panel Contracts in plan and design projects - Which one?

Panel contracts or 'standing offers' are commonly used by principals for the provision of engineering services to plan and design projects, as and when required, over a specified period. They can achieve substantial savings and benefits by reducing purchasing, administration and transactional costs.

However, uncertainty can arise as to a consultant's liability for design carried out under earlier contractual arrangements where further work is carried out on that design under a later panel contract. This was highlighted in the recent decision of Cardno BSD Pty Ltd v Water Corporation [2011] WASCA 161 where a consultant's $18,700 invoice for design services under a panel contract was met with a $352,772 judgment for flawed design.