Standard of care clause: how good the work has to be

Sample clause

a structural engineering services agreement between Coolibah Consulting Engineers, a fictional firm, and a developer adding two storeys to an office building in Townsville

5. Standard of Care 5.1 The Consultant must perform the Services with the degree of skill, care and diligence reasonably expected of a competent structural engineer experienced in services of a similar scope, size and complexity. 5.2 The Consultant must perform the Services in accordance with the Brief, all applicable laws, and the codes and standards listed in Schedule 3 as in force at the date of this agreement. 5.3 The Consultant does not warrant that the Services will achieve any particular outcome unless that outcome is stated as a warranty in clause 11. 5.4 Nothing in this clause excludes, restricts or modifies any consumer guarantee under the Australian Consumer Law that cannot lawfully be excluded, restricted or modified. 5.5 If the Consultant becomes aware that it cannot meet the standard in clause 5.1 for any part of the Services, it must promptly notify the Client in writing.

Sample wording, not legal advice.

Variants

What to negotiate

• Reasonable care or fitness for purpose

  A reasonable care standard is breached only if the supplier fell below what a competent practitioner would have done. Fitness for purpose is breached if the result does not work, however carefully it was produced. Customers prefer the second for design and construct work, while consultants prefer the first, because professional indemnity cover is usually written around negligence and may not respond to a guarantee of outcome.

• Best, reasonable or all reasonable endeavours

  These phrases are not interchangeable. Best endeavours is generally read as requiring a party to take all reasonable steps available to reach the goal, sometimes at cost to itself, while reasonable endeavours lets a party weigh its own commercial interests. Because each phrase is read in context, listing the specific steps expected gives far more certainty than the adjective alone.

• Whose benchmark applies

  A standard tied to a generally competent practitioner is lower than one tied to a specialist experienced in projects of similar size and complexity. Customers who chose a firm for its specialism ask for the higher benchmark. Suppliers accept it where the scope is well defined and resist it where the brief is loose, since the higher test then applies to work nobody fully specified.

The risk of leaving it out

Without the clause the customer relies on implied standards: the Australian Consumer Law guarantee that services to a consumer, as that Act defines the term, are rendered with due care and skill, and an implied term of reasonable care in many commercial contracts. Those give no benchmark, no named codes and no duty to warn, so each quality complaint becomes an argument about expectations.

The statutory floor underneath the clause

Australian law already imposes a minimum. Section 60 of the Australian Consumer Law guarantees that services supplied to a consumer are rendered with due care and skill, and section 61 adds guarantees of fitness for a disclosed purpose where the consumer relies on the supplier. The consumer definition reaches many small business purchases, and the guarantees cannot be contracted out of, although liability can be limited for some supplies not ordinarily acquired for personal or household use. In the United Kingdom, section 49 of the Consumer Rights Act 2015 and section 13 of the Supply of Goods and Services Act 1982 imply a term of reasonable care and skill. A contractual standard builds on those floors by naming the benchmark, the codes and the process.

Care standards and insurance

Professional indemnity policies are generally written to respond to liability arising from negligence in professional work. An obligation that goes further, such as a promise that a design will be fit for purpose or that a result will be achieved, can fall outside that cover and leave the supplier carrying the gap itself. That is why consultants tend to negotiate fitness for purpose out of their agreements or confine it to measurable performance criteria, and why customers who need an outcome guarantee often seek it from the contractor who builds the thing rather than the designer.

Where it sits in a generated document

A generated consulting agreement usually states the standard of care directly after the scope of services and before warranties and the liability cap, because both depend on it. The codes and standards the work must follow are best named in the description, so they can be listed in a schedule. The document is written in a legal register, and any statutory section in a draft still needs checking, since generated text does not print its sources.

Documents that carry this clause

Master services agreementA data consultancy and an insurer sign this once and then buy work under it for three years. It is the rare contract whose whole purpose is to make the next twenty contracts short.Software development agreement with sprints and an acceptance testCustom software goes wrong in the space between delivered and accepted, where one side thinks a sprint is finished and the other is still writing a list. This agreement fixes a ten business day acceptance window against criteria written before the sprint started, and assigns the intellectual property sprint by sprint as each invoice is paid.Roofing contract template with a materials table and a weather ruleA roof replacement is the one job where the house is open to the sky at the end of the day, so the clause that matters most is the one about closing it. This contract limits how much roof can be stripped at once, names every product with its warranty years, and says who pays when water gets in.Consulting agreementAn advisory firm reviews three bakeries over seven weeks. What makes this agreement useful is not the fee clause but the two clauses that say what the advice is not.

Questions people ask