Biosol Renewables UK Ltd v Robert Nigel Lovering
| Jurisdiction | England & Wales |
| Judge | Keyser |
| Judgment Date | 21 January 2021 |
| Neutral Citation | [2021] EWHC 71 (Comm) |
| Date | 21 January 2021 |
| Docket Number | Case No: CC-2018-CDF-000001 |
| Court | Queen's Bench Division (Commercial Court) |
[2021] EWHC 71 (Comm)
IN THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS IN WALES
CIRCUIT COMMERCIAL COURT (QBD)
Cardiff Civil Justice Centre
2 Park Street, Cardiff, CF10 1ET
HIS HONOUR JUDGE Keyser Q.C.
sitting as a Judge of the High Court
Case No: CC-2018-CDF-000001
Steven Walker QC (instructed by W. Parry & Co Solicitors) for the Claimant
Laurence Emmett (instructed by Hugh James) for the Defendants
Hearing dates: 7, 8, 9, 10, 13, 14 July, and 24 August 2020
Written submissions: 24 July and 3 August 2020
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.
HIS HONOUR JUDGE Keyser QC
JUDGE Keyser QC:
Introduction
The claimant (“Biosol”) supplies biomass boiler systems and the fuel for use in them. The defendants carry on business in partnership together in the name R&A Properties (“R&A”) and own and operate Stradey Park Business Centre in Llanelli (“the Property”).
Between June 2016 and June 2017 Biosol supplied, installed and commissioned ten biomass boilers for R&A at the Property pursuant to a series of contracts. The boilers were supplied and commissioned in four groups: Boilers 1 and 2; Boilers 3 and 4; Boilers 5, 6 and 7; and Boilers 8, 9 and 10.
In these proceedings, Biosol makes three claims against R&A: first, £371,987.30 in respect of the balance of the price for the boilers; second, £310,602.74 for ancillary works to facilitate the installation of the boilers and for the supply of woodchip; third, damages for the loss of profit on a separate contract for maintenance of the boilers and the supply of woodchip; the lost profit is said to be £661,358.
R&A denies liability on the claims. As well as raising particular contractual disputes on the second and third claims, it contends more generally that it is entitled to exercise a right of abatement or set-off in respect of matters raised on its counterclaim. The counterclaim alleges that Biosol (a) induced R&A to enter the contracts for the supply, installation and commissioning of the boilers by misrepresentations as to their performance and capacity, (b) was in breach of a common law duty to exercise reasonable care in making recommendations as to the installation of the boilers, and (c) was in breach of various contractual obligations and warranties. R&A counterclaims damages in excess of £6,000,000. The counterclaim is denied in its entirety by Biosol.
The remainder of this judgment will be structured as follows. First, I shall set out the main facts in chronological order. For convenience, I shall divide up the narrative with sub-headings, with however the caveat that not all of the facts fit neatly into just one of these divisions. Second, I shall identify and consider the various heads of claim and cross-claim in turn.
I am grateful to Mr Steven Walker QC and Mr Laurence Emmett, counsel respectively for Biosol and for R&A, for their oral and written submissions.
The Facts
Background: Persons
Biosol was incorporated on 3 June 2014. The majority shareholder and, effectively, managing director is Neil Bundock; he is a retired police officer and has no background in engineering. The two other directors are his children, Benjamin (“Ben”) Bundock and Amber Bundock. Neil Bundock and Ben Bundock gave evidence. References to “Mr Bundock” will be to Neil Bundock.
The three defendants (I shall sometimes refer to them as “the partners”) formed R&A in 2008. Mr Lovering is an experienced businessman in several fields, including telecommunications, IT solutions and water purification, and he was the partner who had the main involvement in the matters with which the case is concerned. Mr Pickering is well known as a former rugby union player and administrator. He also had some involvement in the dealings with Biosol, though to a lesser extent than Mr Lovering. They both gave evidence at the trial. Mr Preece had no material involvement and did not give evidence. At the time in question, all three partners were also directors of a company called Hydro Industries Limited. That company is not directly concerned with the matter of the proceedings, but it occupied a unit at the Property and is sometimes referred to in that connection.
Two other people feature prominently in the narrative. Mr Ceri Golding was employed by Biosol until the summer of 2017. He was R&A's initial point of contact with Biosol, and he was closely involved with most of the relevant discussions and agreements. When he left Biosol's employment, he went onto R&A's payroll, though he has not been in their employ since 2019. He did not give evidence. Mr James Partridge was the sole member and director of JBP Industries Limited (“JBPI”), which was incorporated in May 2014 and provides consultancy services for biomass heating systems. Mr Partridge was never employed by Biosol, though at one stage there was talk of forming a joint venture between JBPI and Biosol, but Biosol used him as a sub-contracting consultant in respect of some of the technical design and commissioning work for biomass systems. Mr Partridge was accredited by Fröling, the boiler manufacturer, as an approved engineer for its boilers; he says that it was only through him that Biosol was able to obtain Fröling products and even discounted prices on them, although Mr Bundock denies that. Mr Partridge gave evidence at trial on behalf of R&A.
In the course of hearing, reading and reviewing the evidence adduced at trial, I have reached conclusions regarding the various witnesses. These conclusions will become apparent from what follows. At this point I make only the briefest of comments on the main factual witnesses.
• None of them were entirely convincing.
• Neil Bundock's evidence was marked by his display of a rather defensive attitude, which did not assist an assessment of his truthfulness. I formed the view, however, that he was an essentially honest witness.
• Ben Bundock added little, though I regarded him as an honest witness.
• Mr Lovering was in my view a dishonest witness. This is demonstrated by objective evidence, which in turn casts light on the remarkable extent to which Mr Lovering avoided answering questions that were put to him and instead sought to confuse matters by flannel or irrelevance. That is not to say that his evidence was not sometimes accurate, when his perceived self-interest coincided with the facts. But it does mean that Mr Lovering's evidence cannot be relied on in respect of any significantly contentious issue in the absence of credible supporting evidence.
• Mr Pickering had relatively little material evidence to add to that of Mr Lovering and his recollections were very imperfect, probably because of the peripheral role he played in material events. His credibility is adversely affected by his willingness to align himself with Mr Lovering's evidence and by the evidence that he gave concerning the “whiteboard”, discussed below.
• Mr Partridge's recollections were very imperfect and sometimes inaccurate. Parts of his evidence were affected by manifest animosity to Mr Bundock, and I find that in at least one important respect his evidence was deliberately untruthful.
There were some notable absences from the cast of witnesses. Most importantly, Mr Golding did not give evidence, although he would have been a most material witness and might have been expected to be called by R&A.
Background: The Property
The Property comprises a 37-acre site, containing 22 detached units and office blocks, as well as boiler houses. Many of the buildings are let out on a commercial basis; some are used for offices, more are used for storage.
Only two of the buildings at the Property, namely Building 2 and Building 4 (both of which were occupied by the NHS for keeping records), had operational heating systems before the Biosol boilers were installed. Building 200, which was by far the largest building, had a gas heating system but it was non-operational; Mr Lovering's evidence was that the heating had been turned off when the previous tenants left in 2013 and had not been reconnected because the cost of gas was prohibitive. Half of Building 200 was occupied by the Ministry of Defence, Protec Fire Protection plc, and Hydro Industries Limited. The other half of the building was empty. Because part of Building 200 was occupied by Hydro Industries, it is sometimes referred to as the “Hydro” building or unit.
In summary, the Biosol boilers were eventually installed to heat the following buildings:
• Boilers 1 and 2 were for the upper part of Building 200 and for a nearby office cabin that was occupied by European Telecoms Solutions, a firm in which Mr Lovering was a partner. They were installed in an existing plant room that had previously housed gas-fired boilers.
• Boiler 3 was for Building 2 and Building 17. The plant room housing the boiler and fuel store was built by Biosol.
• Boiler 4 was for Building 3 and Building 4. The plant room housing the boiler and fuel store was built by Biosol.
• Boiler 5 was for the northern half of Building 52 (the second-largest building at the Property, sometimes referred to as “the white building”) and also for an adjacent office block. The plant room housing the boiler was a pre-existing building, but Biosol extended it to incorporate the fuel store.
• Boiler 6 was for Building 53 (which was also...
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