Avantage (Cheshire) Ltd v GB Building Solutions Ltd ((in Administration))
| Jurisdiction | England & Wales |
| Judge | Mrs Judgice Joanna Smith DBE,Mrs Justice Joanna Smith |
| Judgment Date | 31 January 2022 |
| Neutral Citation | [2022] EWHC 171 (TCC) |
| Docket Number | Case No: HT-2019-000359 |
| Year | 2022 |
| Court | Queen's Bench Division (Technology and Construction Court) |
[2022] EWHC 171 (TCC)
THE HONOURABLE Mrs Justice Joanna Smith DBE
Case No: HT-2019-000359
IN THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
TECHNOLOGY AND CONSTRUCTION COURT (QBD)
Royal Courts of Justice, Rolls Building
Fetter Lane, London, EC4A 1NL
Alison Padfield QC and Tom Asquith (instructed by Reynolds Porter Chamberlain LLP) for the Claimants
Simon Hale and Benjamin Fowler (instructed by Weightmans LLP) for the Fifth Defendant
Hearing date: 16 November 2021
Approved Judgment
I direct that pursuant to CPR PD 39A para 6.1 no official shorthand note shall be taken of this Judgment and that copies of this version as handed down may be treated as authentic.
THE HONOURABLE Mrs Judgice Joanna Smith DBE
This is an application by the Fifth Defendant to these proceedings (“ WSP”) for reverse summary judgment on the Claimants' claim pursuant to CPR 24.2(a)(i) and (b), alternatively to strike out part of the Claimants' claim pursuant to CPR 3.4(2) (“ the Application”).
Introduction
The litigation concerns a fire which substantially destroyed a supported living facility known as Beechmere Retirement Village, Crewe (“ Beechmere”) on 8 August 2019. The fire was ignited during hot works which were being performed by MAC Roofing outside a flat on the top floor of the central part of the building. Fortunately there was no loss of life, but the Claimants contend that in excess of £30 million of losses have been suffered as a consequence of the failings of the various Defendants, all of whom were involved in the construction of Beechmere.
The First Claimant (“ Avantage”) was engaged through a PFI agreement as the contractor to build five properties (“ the Project”), including Beechmere. On 10 October 2007, Avantage entered into a design and build contract as employer, with the First Defendant (formerly known as Gleeson Building Limited, “ Gleeson”) as the main design and build contractor. Avantage also employed the Sixth Defendant (“ Mascot”) as employer's agent and clerk of works. Avantage remains responsible under the PFI agreement for the management and maintenance of Beechmere and it is contractually responsible to the Second Claimant (“ the Authority”) for the reinstatement of Beechmere following the fire. Avantage also has the benefit of a charge over Beechmere.
Neither the Authority nor the Third Claimant (“ YHL”) had any contemporaneous involvement in the design and construction of Beechmere. They are respectively the freehold and leasehold owners pursuant to transfers made by predecessor entities (Cheshire County Council and Manchester & District Housing Association Limited (“ MDHAL”)). For the purposes of this application it is accepted by WSP that the pleading of those transfers in the Particulars of Claim is correct and that any cause of action formerly vested in the two predecessor entities was validly transferred to the Authority and to YHL.
Gleeson is now in administration and has not been actively participating in the proceedings. The Second Defendant (“ PRP”) was engaged by Gleeson to provide architectural and design services in relation to the construction of Beechmere. The Fourth Defendant (“ Prestoplan”) was employed by Gleeson as a sub-contractor to design, install and commission timber frames.
WSP was retained by Gleeson in 2006 as a consultant in relation to fire engineering design (“ the WSP Appointment”) for the Project including the construction of Beechmere. While both PRP and Prestoplan executed collateral warranties in favour of one or more of the Claimants, it is common ground that WSP had no contractual relationship with any of the Claimants and that the claim against WSP is therefore brought only in the tort of negligence.
The WSP Appointment
The WSP Appointment with Gleeson arose following a letter sent by WSP to Gleeson dated 29 August 2006 (“ the Fee Proposal”), setting out the scope of WSP's services and deliverables in a series of seven bullet points. These included producing a detailed fire safety strategy (“ the FSS”) (described in WSP's evidence as “the key deliverable” albeit not identified in such terms in the Fee Proposal), supporting the design team in developing fire strategy plans for submission to the local authority, attending design and project team meetings when required and providing “continuous support” to the project team. In addition, the Fee Proposal identified the importance of “continuity between the design and operation of buildings” with respect to fire safety, and proposed that WSP should also be involved in developing “an operational version of the fire safety strategy” which would “confirm the key responsibilities and ongoing management controls applicable to the scheme”. The operators of the scheme would then “develop management plans incorporating the operational fire strategy” and WSP would “review the management plan(s) and support the operator in finalising the management plans”.
The Fee Proposal stated that “All works are in accordance with WSP standard terms and conditions which can be made available upon request” (“ the WSP Terms”).
It is common ground on this application that the reference in the Fee Proposal to “the operators” is a reference to the Claimants and/or their predecessors and further that WSP knew that the Project involved a PFI arrangement.
On 6 November 2006, Gleeson confirmed acceptance of WSP's proposal insofar as it related to the production of a detailed fire strategy. Thereafter, WSP prepared the FSS, which it issued in draft on 5 January 2007 and 21 March 2007, and then in final form on 2 October 2007. At the same time, WSP accepts that its services also involved “providing fire safety-related advice, input and support to “the design team””, including at various meetings.
The FSS included a disclaimer (“ the Disclaimer”) in the following terms:
“10.1.2 The report is intended for the sole use of Gleeson Building Ltd. The information contained herein will not be relied upon by any third party and WSP Group will not accept any responsibility for matters arising as a result of third party use”.
Following an exchange of emails in September and October 2008 between Gleeson and WSP, on 22 December 2008 and 22 September 2009 respectively, WSP issued an Operational Fire Safety Management report (“ the OFSM”) and a Fire Risk Assessment (“ the FRA”) in respect of Beechmere. Gleeson paid additional fees for these services and it is WSP's case that they were entirely independent of its FSS, issued some time earlier. The Claimants say, however, that there was no bright line between the three strands of WSP's work and that those strands were all interdependent. This is an important factual issue in the context of the Application.
The Application
Against the background set out above, it is WSP's case on the Application that the Claimants have no real prospect of establishing that WSP owed them (or any of them) a duty of care at common law to protect them from the economic loss that they have suffered and that there is no other compelling reason for the claim against WSP to go to trial. This case is supported by two witness statements from Ms Helen Turner, in-house solicitor and senior legal advisor employed by WSP.
The Claimants oppose the Application on the grounds that they do have a real prospect of establishing a duty of care at trial, that the Application is premature as it is being heard before Extended Disclosure (which, in WSP's case, has been ordered to take place by 18 February 2022) and/or that there are three other compelling reasons why the claims against WSP should go to trial; namely that (i) the duty of care based on an assumption of responsibility is a developing area of law; (ii) it is likely that documents pertinent to WSP's duty of care will be disclosed in due course; and (iii) contribution claims are pursued against WSP such that there is therefore a risk of inconsistent findings. The Claimants rely upon the third witness statement of Mr Michael Allan, a partner at Reynolds Porter Chamberlain LLP, the Claimants' solicitors, together with a fourth witness statement from Mr Allan, correcting some factual evidence given in his third witness statement and providing some additional information.
Following the hearing, the Court of Appeal handed down judgment in Rushbond PLC v The JS Design Partnership LLP [2021] EWCA Civ 1889, and I invited the parties to make such further short written submissions addressing this case as they thought fit. Both parties provided further submissions and I shall return to these in due course.
The Pleadings
I must begin by looking in some detail at the way in which the case is currently pleaded against WSP. That case is set forth between paragraphs 39 and 47 of the Particulars of Claim as follows:
“WSP
39. On 29 August 2006, WSP submitted a fee proposal to Gleeson for advice on fire strategy in two work packages, one for Properties with atria (including Beechmere) and the other for Properties without atria. The fee proposal recorded that one of the purposes for the appointment was to produce a detailed fire strategy report to accompany a formal submission for Building Regulation and/or local authority approval in respect of the Properties. It also recorded that...
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...trial would put the current evidence in another light. (4) In Avantage (Cheshire) Ltd v GB Building Solutions Ltd (in administration) [2022] EWHC 171 (TCC), the application for summary judgment (which would have been determinative if successful) in relation to a negligence claim was reject......