BDW Trading Ltd v URS Corporation Ltd
| Jurisdiction | England & Wales |
| Judge | Mr Justice Fraser |
| Judgment Date | 22 October 2021 |
| Neutral Citation | [2021] EWHC 2796 (TCC) |
| Docket Number | Case No: HT-2020-000084 |
| Court | Queen's Bench Division (Technology and Construction Court) |
[2021] EWHC 2796 (TCC)
IN THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS
TECHNOLOGY AND CONSTRUCTION COURT (QB)
Rolls Building
Fetter Lane
London, EC4A 1NL
THE HONOURABLE Mr Justice Fraser
Case No: HT-2020-000084
Simon Hargreaves QC and David Sheard (instructed by Osborne Clarke LLP) for the Claimant
Fiona Parkin QC and Christopher Reid (instructed by CMS Cameron McKenna Nabarro Olswang LLP) for the Defendants
Hearing Dates: 5, 6 and 7 October 2021
Introduction
In these proceedings the court is asked to answer some preliminary issues on the basis of assumed facts. This is the judgment on those issues which were agreed by the parties. The assumed facts are included in Appendix A to this judgment. They are high level, in the sense that the assumptions of fact that are made by the parties (and which the court is asked to assume) are very general. The nature of the claim brought in these proceedings is one in tort in relation to structural defects in a number of high-rise buildings. The Claimant, BDW Trading Ltd (“BDW”) was the owner and developer of the buildings at the time that they were built. The Defendants, URS Corporation Ltd (“URS”) and Cameron Taylor One Ltd (only the Second Defendant URS has been involved in this trial) were responsible for the structural designs that are said to have been negligent. As a result of negligent design, the structures are said to be inadequate. In very general terms, the structural designs are said to be seriously defective such that remedial works were required. The claims against the Defendants are tortious ones for professional negligence.
There are two unusual aspects to these proceedings. The first is that BDW is said to have had no legal obligation to make payment of the very sizeable losses which are said to have been incurred or arisen as a result of the dangerous structural state of the buildings to which the claims relate. This is because it is said by the Defendants that BDW would, if so minded, have been entitled to defend any claims brought against it by relying upon the benefit of a range of defences, including limitation. Given some of these buildings were constructed in 2005, and the problems were discovered in 2019, limitation is doubtless a central feature in the litigation as a whole. Only URS appears on the Preliminary Issues. Another defendant, Cameron Taylor One Ltd, was given permission to appeal by the Court of Appeal on 5 February 2021 in respect of an earlier decision by HHJ Kramer sitting as a judge of the High Court. In that decision, in October 2020, HHJ Kramer permitted BDW to amend its claims in certain respects, including substituting Cameron Taylor One Ltd for another defendant (no longer, pending that appeal, involved) called Cameron Taylor Consulting or CTC. That appeal concerns, inter alia, substitution of parties and also, importantly, issues of limitation. That appeal will be heard in December 2021.
These preliminary issues do not concern those issues on that appeal. If that appeal succeeds– and the Court of Appeal have decided it has real prospects of success – then the shape of the litigation may change. The decision on these preliminary issues may in any event turn out to be hypothetical or academic, if any of the assumptions in the assumed facts are not made out. The application for the hearing of preliminary issues was sought by consent, and approved by the court in June 2021. Because an order had already been made (albeit a consent order), and the parties had expended much time and expense in preparing for the trial of the Preliminary Issues, it was sensible to hear it. However, I do question it being listed prior to the outcome of the appeal, and also in circumstances where the outcome may become wholly academic. I am reminded of the warning given many years ago by Lord Scarman in Tilling v Whiteman [1980] AC 1, 25 that “preliminary points of law are too often treacherous short cuts”. The Technology and Construction Court Guide also expressly refers to the potential pitfalls of using preliminary issues. It is to be hoped that the answers to these issues will assist both BDW and URS in terms of the litigation going forward.
Here, the assumed facts include what could be said to be whole swathes of the likely battleground between the parties should the matter proceed, absent settlement. Both the existence of the defects, their severity, and indeed causation, are all assumed. These preliminary issues are therefore examples of the parties setting the court a series of questions as though it were sitting an academic examination. Having said that, however, the subject matter of the issues is, given the factual background, potentially interesting, and the parties have cited much authority to the court, both English and Commonwealth. I will not refer to all the cases in this judgment; there are over fifty of them. I will only refer to such authority as is necessary for me to answer the isssues.
It is a curiosity of this trial of Preliminary Issues that, for buildings that were designed – and then constructed – so long ago, limitation per se does not form part of the issues that the parties wish the court to resolve at this stage. This is particularly surprising given the number of times that URS in particular included reference in its submissions to the fact that claims against BDW were, or would be, time-barred. This may very well be because limitation is such a central part of the ongoing appeal. Whatever the reason for the strange sequence of amendment, application for permission to appeal, preliminary issues and then appeal, it is a sequence that ought not to be routinely followed. I doubt it is entirely in accordance with the overriding objective.
The second unusual feature is that, because of the particular facts, BDW – who discovered the structural inadequacies in 2019 – contends for the accrual of its cause of action as early as possible, and URS, the negligent designer (on the basis of the assumed facts), is arguing for it to be as late as possible. The usual positions of tortfeasor and claimant are reversed, in that a tortfeasor would normally contend for a far earlier date for accrual of cause of action, and a claimant for a later one. This does not affect the legal analysis of accrual of cause of action, and scope of duty, but it is unusual nonetheless.
The Preliminary Issues are as follows, and these were included in the consent order dated June 2021 to which I have referred:
“On the basis of the Assumed Facts:
(a) Did the scope of URS' duties extend to the alleged losses?
(b) Are BDW's alleged losses recoverable in principle as a matter of law in tort?
(c) In particular as to (b), is it nonetheless, and on the basis of those Assumed Facts, a defence to URS in law that: (i) the losses were not in the contemplation of the parties at the time of entering into the appointments; (ii) the losses are too remote; (iii) BDW has caused its own losses; (iv) BDW's actions broke the chain of causation; and (v) BDW has failed to mitigate its loss?”
It will be noted that Preliminary Issue (c) asks whether it is “a defence to URS in law that…..” and then poses a number of different questions, including whether BDW caused its own losses, had broken the chain of causation, or failed to mitigate its loss. Mr Hargreaves also clarified orally that by use of the term “health and safety” in the assumed facts, the parties intended to mean defects that presented a danger to life and limb, rather than those defects being contrary to the Health and Safety Regulations. In other words, they are of a far more serious character than the term “health and safety” is sometimes interpreted to mean.
Causation, and mitigation of loss, are highly fact sensitive. The assumed facts do not provide a sufficient basis for any proper consideration (still less a finding that would be binding at first instance) that the chain of causation has been broken, or that BDW has failed to mitigate its loss. I therefore do not consider that Preliminary Issue (c)(iii), (iv) and (v) can properly be addressed at this stage in the action, and without full consideration of the facts. I do not therefore propose to address these parts of that third issue. Those points can only be resolved at trial.
URS has also issued a separate application to strike out BDW's claims because, even if the Court determines the Preliminary Issues in BDW's favour, URS contends that BDW's Particulars of Claim disclose no reasonable cause of action against it and should be struck out on that basis in any event. Broadly the same legal issues arise, in the sense that consideration of the law under the Preliminary Issues is required properly to consider the strike out application. URS issued this application only quite recently on 16 September 2021 and wishes to have it heard at the same time as the Preliminary Issues.
URS explained that it had done this because URS was also concerned that the Preliminary Issues as drafted might not “catch” all of the problems that BDW had in terms of its claims. BDW took a pragmatic course and did not object to the strike out application being heard at the same time as the Preliminary Issues. That application will have to be considered against the relevant rules in the CPR dealing with the striking out of pleadings, but I will turn to do that after considering the Preliminary Issues themselves.
Factual background to the proceedings
BDW itself may not be a household name, but it has as some of its...
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