Alderson and Another v Beetham Organisation Ltd
| Jurisdiction | England & Wales |
| Judge | Lord Justice Aldous,Lord Justice Judge,Lord Justice Longmore |
| Judgment Date | 02 April 2003 |
| Neutral Citation | [2003] EWCA Civ 408 |
| Court | Court of Appeal (Civil Division) |
| Docket Number | Case No: A1/2002/2130 |
| Date | 02 April 2003 |
[2003] EWCA Civ 408
IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
TECHNOLOGY AND CONSTRUCTION COURT
LIVERPOOL DISTRICT REGISTRY
HHJ MACKAY (SITTING AS A DEPUTY JUDGE)
ON APPEAL FROM QUEEN'S BENCH DIVISION
Lord Justice Aldous
Lord Justice Judge and
Lord Justice Longmore
Case No: A1/2002/2130
Mr K. Musaheb (instructed by D.P. Hardy & Co) for the Appellants
Mr A. Edwards-Stuart QC and Mr I. Swan (instructed by Bullivant Jones) for the Respondent
With permission of this Court, Mrs Hilda Alderson and her daughter, Avril Alderson, appeal the decision and order of 3rd October 2002 of HHJ MacKay sitting as a deputy judge of the High Court. By that order the judge struck out the claims of the Aldersons as they were statute barred.
The issue between the parties concerns the construction of section 1(5) of the Defective Premises Act 1972 which sets the limitation period in respect of the statutory duty imposed by the Act upon developers and others who take on work in connection with the provision of dwellings.
The facts have not as yet been determined, but the background is not in dispute. In 1994, 1 Livingstone Drive North, Liverpool 17 was developed by the respondents, Beetham Organisation Ltd. The development, a conversion of the property into flats, was completed around the end of May 1994.
By a written agreement dated 6th January 1995, Mrs Alderson agreed to purchase a leasehold interest and on 23rd January she became the lessee of Flat 1 for a term of 125 years. She paid £48,000. At the same time, a lease of Flat 2 was granted to Avril Alderson for a similar term and for a similar price. Both flats were in the basement.
On 27th April 1995 Avril Alderson noticed black mould and fungus growth on the bedroom walls of both flats. She complained and on 4th May 1995 she met on site Beetham's work manager, a Mr Allmark, where it was agreed that there appeared to be a problem. Following that meeting, Avril Alderson met the respondent's works foreman, Mr Alfred Grant, to discuss remedial works. The works foreman recommended relaying the flagstones outside the flat at an angle to the external wall and also laying extra drainage pipes under the pathway running alongside Flat 1. Between 12th and 30th May those works were carried out.
On 31st May 1995, the Aldersons moved into their flats. In September 1995 Flat 1 was flooded by water seeping in, such that the fire brigade had to attend. That resulted in Mr Allmark carrying out further work, but it did not prevent the damp. The Aldersons consulted solicitors who instructed Mr Dears, a chartered surveyor. He inspected the flats in October and November 1995. He reported that the flats had been constructed in breach of the terms of the Defective Premises Act 1972. In his view, the premises had not been made habitable as the subterranean accommodation of the flats had not been properly tanked and therefore did not have adequate damp proofing. He advised removal of all fittings so that substantial alterations could be carried out to provide adequate tanking. He recommended that the Aldersons should be compensated for their purchases and indeed should receive further compensation for the considerable disturbance and inconvenience caused after they moved into the flats.
Mrs Alderson and her daughter took no legal action until 19th January 2001. On that date they both issued proceedings. As the allegations were for all relevant purposes the same, I will consider the proceedings as having been consolidated from the start. The particulars of claim alleged breach by Beetham of an implied obligation to provide quiet enjoyment and also a breach of the duty provided by section 1 of the Defective Premises Act 1972. Damages were claimed due to water penetration and the need to carry out repairs to the damp proofing. The defence disputed that there was an implied obligation of quiet enjoyment between the Aldersons and Beetham. It went on to admit that, as developer, Beetham owed to the claimants a duty pursuant to section 1 of the Defective Premises Act, but pleaded that the cause of action for breach of that duty had accrued on completion of the dwelling, namely on the 25th May 1994. It went on to allege that the claim for breach of duty under the 1972 Act was statute barred in that the claim, commenced on 19th January 2001, was more than six years after accrual of the cause of action.
The allegation that Beetham was liable for breach of an implied obligation for quiet enjoyment was struck out. There followed an application notice dated 13th February 2002 in which Beetham sought to strike out the rest of the particulars of claim upon the basis that the claim was statute barred. That issue came before the judge and resulted in his order of 3rd October 2002, which struck out the claims of the Aldersons as being statute barred.
The relevant parts of section 1 of the Defective Premises Act 1972 are as follows:
"1. Duty to build dwellings properly.
(1) A person taking on work for or in connection with the provision of a dwelling (whether the dwelling is provided by the erection or by the conversion or enlargement of a building) owes a duty –
(a) if the dwelling is provided to the order of any person, to that person; and
(b) without prejudice to paragraph (a) above, to every person who acquires an interest (whether legal or equitable) in the dwelling;
to see that the work which he takes on is done in a workmanlike or, as the case may be, professional manner, with proper materials and so that as regards that work the dwelling will be fit for habitation when completed.
…
(5) Any cause of action in respect of a breach of the duty imposed by this section shall be deemed, for the purposes of the Limitation Act 1939, the Law Reform (Limitation of Actions, &c.) Act 1954 and the Limitation Act 1963, to have accrued at the time when the dwelling was completed, but if after that time a person who has done work for or in connection with the provision of the dwelling does further work to rectify the work he has already done, any such cause of action in respect of that further work shall be deemed for those purposes to have accrued at the time when the further work was finished."
It is accepted that the limitation period in respect of the main development expired some time in May 2000 and thereafter any claim in respect of it was statute barred. However the argument addressed on behalf of the Aldersons was that the relevant limitation period did not run from completion of the original building works, but started from the time when the developer carried out the further ineffective works in May and September 1995. Thus the relevant limitation period of 6 years did not expire until May 2001 at the earliest. The judge rejected that argument. He said:
"10. It seems to me that the words of the section are quite conclusive. Section 1(5) of the Defective Premises Act states that the exemption and limitation period is extended to take into account further work and the claimant has a cause of action in respect of the further work. It does not provide a claimant with a justification for the court exercising the view that the limitation period is extended in respect of all works carried out which were not, in fact, the subject matter of the further work and so in this case, regrettably, I find against the claimants and this case is therefore statute barred."
Mr Musaheb on behalf of the Aldersons submitted that the judge had wrongly construed section 1(5) of the 1972 Act. He submitted that that section required consideration not only of the further work that was carried out, but also of the reason why the developer came back to do the further work. Thus where a developer does further work to rectify the work that he has already done, but fails to rectify the defective work, the limitation period in respect of the cause of action in relation to the defect runs from the further work which failed to rectify the defect. He did not assert that the cause of action which arose under the proviso of section 1(5) of the 1972 Act applied in respect of all the work the builder had carried out prior to completion, as he accepted that it only applied in relation to that part of the original work that the further work was supposed to rectify.
Mr Musaheb drew to our attention Andrews v Schooling [1991] 1 WLR 783. In that case the plaintiff was the owner of a 199 year lease of a flat in premises which had been developed in Essex. The plaintiff sought compensation under the 1972 Act because of damp coming from the cellar. The defence was that the development had not included work done on the cellar and therefore section 1 of the 1972 Act did not apply. That defence was rejected by the Court of Appeal. Balcombe LJ said at page 789:
"Thus supposing that the owner of a plot of land instructs a builder to erect a dwelling house on a plot. The builder erects the house but fails to include a damp course. Without the damp course the house, when completed, is not fit for human habitation because of rising damp. I cannot conceive that Parliament could have intended that in those circumstances the builder would be free from any duty under section 1(1). And what, I ask forensically, in those circumstances would be the need for the exception (and the exception to the exception) under subsection (2)?
But it seems to me that subsection (4) is conclusive in favour of the construction that includes nonfeasance within the scope of the duty. Again suppose a...
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