Board of Trustees of the Tate Gallery v Duffy Construction Ltd and another

JurisdictionEngland & Wales
JudgeMR. JUSTICE JACKSON
Judgment Date15 February 2007
Neutral Citation[2007] EWHC 361 (TCC)
Date15 February 2007
CourtQueen's Bench Division (Technology and Construction Court)
Docket NumberCase No.: HT 06–249

[2007] EWHC 361 (TCC)

IN THE HIGH COURT OF JUSTICE

QUEEN's BENCH DIVISION

TECHNOLOGY AND CONSTRUCTION COURT

St. Dunstan's House

Before

Mr. Justice Jackson

Case No.: HT 06–249

Between
The Board of Trustees of the Tate Gallery
Claimant
and
Duffy Construction Ltd. & Anor.
Defendants

MR. A. BARTLETT QC and MR. J. FIELD (instructed by Davies Arnold Cooper) appeared on behalf of the Claimant.

MR. R. WILMOT-SMITH QC and MR. K. GHALY (instructed by Davies-Lavery) appeared on behalf of the First Defendant.

MR. JUSTICE JACKSON
1

This judgment is in seven parts, namely Part 1, Introduction; Part 2, The Facts; Part 3, The Present Proceedings; Part 4, Issues 1(A) and 1(B); Part 5, Issues 2(B) and 3; Part 6, Issues 4 and 5; Part 7, Conclusion.

2

The Tate Gallery in London was first opened to the public in 1897. Over the years the gallery has been expanded and further buildings have been added. In 1997 the trustees of the Tate Gallery marked the centenary of the gallery by embarking upon the Tate Gallery Centenary Development. The present litigation concerns water damage which occurred at the Tate Gallery in the course of the Centenary Development, causing, it is said, some £5 million worth of damage.

3

The claimant in this action is the board of trustees of the Tate Gallery (“the trustees”). The first defendant is Duffy Construction Limited, the trade contractor which undertook the hard landscaping works that formed part of the Centenary Development (“Duffy”). The second defendant is Specialist Services Electrical Limited, a subcontractor of Duffy (“SSEL”). One other company will feature briefly in the narrative. That is Mace Limited, which acted as construction manager for the trustees (“Mace”).

4

The present trial is a trial of preliminary issues as between the trustees and Duffy. The purpose of this trial is to determine the extent to which the trustees' claim is soundly based in law. It is sensible for this to be established before the parties incur the substantial costs of a full trial including expert evidence on both sides. After these introductory remarks I must now turn to the facts.

5

The Tate Gallery Centenary Development Project consists of upgrading the northwest quadrant of the Tate Gallery to incorporate new and improved facilities for both the public and the gallery. The project includes the following: a new public entrance off Atterbury Street, providing level access to the ground floor of the building and linking it to a large entrance hall and orientation gallery; a new lift providing access between ground and gallery floors (this is a 40-person passenger lift suitable for wheelchairs and classified as an evacuation lift); a new staircase within the northwest quadrant hall which makes a positive visual connection between ground and gallery floors; the provision of six new galleries and nine fully refurbished galleries within the northwest quadrant; an additional retail outlet at ground floor level; a new audio-visual projection room; an area for entertainment and public functions; new public lavatories; a new greatly enlarged cloakroom; extensive upgrading of the service installation including new plant rooms, new infrastructure and new substation with capacity for four transformers; an improvement to the external environment and landscape to Millbank and Atterbury Street.

6

The works comprising this development were divided into 38 separate packages. Each package of work was entrusted to a trade contractor with whom the trustees entered into a separate trade contract. The hard landscaping around the gallery constituted Package 8100. This package included excavation, sub-bases, bedding, drainage and finishes in connection with the external improvements to the Tate Gallery.

7

On 23 rd June 1998 the trustees took out a “combined contract works and third party liability insurance” policy in respect of the Tate Gallery Centenary Development Project, No.CR954980140. I shall refer to this either as “the policy” or by its full policy number, as the context requires. The policy comprises three sections. Section one provides insurance cover for the works; section two provides insurance cover for increased costs of outstanding construction works; section three provides insurance cover for third party liability. The trustees, the project manager and the construction manager are named as insured for the purposes of all three sections of the policy. In addition, in respect of section one only of the policy, the following are named as being insured:

“4. All other contractors and/or trade contractors of whatsoever tier and/or suppliers engaged for the purpose of the project (as to the extent stated in Memorandum 15).”

8

The specification to section one of the policy provides:

“Contract works.

“Insuring clause.

“The Insurer(s) will indemnify the Insured against loss of or damage to the Insured Property from any cause other than as hereinafter excepted.

“The Insured Property.

“(a) The whole of the works whether permanent or temporary including materials incorporated or to be incorporated therein and other things the property of the Insured or for which they are responsible

“(b) Constructional plant and equipment and temporary buildings and their contents the property of the Insured (1), (2) and (3) or for which they are responsible

“(c) Clothing and Personal Effects the property of employees of the Insured insofar as the same are not otherwise insured

“(d) Existing marble architraves and skirting boards

“whilst on or adjacent to the Project Site and within the Territorial Limits in respect of the Project as defined herein

“(e) Existing Millais Statue on the Project Site.”

9

Memorandum 15 to section 1of the policy provides:

“The indemnity provided by this Section of the Policy to the Insured (4) is restricted to loss or damage due to any of the Specified Perils as defined in the JCT (1980 Edition) of the Standard Form of Building Contract.”

10

The definition of “specified perils” in the 1980 JCT standard form of building contract (which is incorporated by reference into Memorandum 15 of the present policy) reads as follows:

“Fire, lightning, explosion, storm, tempest, flood, bursting or overflowing of water tanks, apparatus or pipes, earthquake, aircraft and other aerial devices or articles dropped therefrom, riot and civil commotion but excluding excepted risks.”

11

The policy contains general conditions which are applicable to all three sections. Those general conditions include the following:

“4. Precautions

“(a) The Insured shall take and cause to be taken all reasonable precautions to prevent injury illness loss or damage and to comply with all statutory obligations and regulations imposed by any authority…

“(c) The Insured shall take all reasonable precautions to maintain in efficient condition all plant and appliances used in connection with the contract and the Insurer(s) shall at all reasonable times have by their representatives access to examine such plant and appliances. The Insured shall also take and cause to be taken all reasonable precautions for the safety of the Insured Property and in the event of an occurrence covered by this Policy shall take such immediate action as is necessary to minimise the loss

“5. Observance.

“The due observance and fulfilment of the terms of this Policy so far as they relate to anything to be done or complied with by the Insured and the truth of the information supplied shall be conditions precedent to any liability of the Insurer(s) to make any payment against this Policy

“6. Non-Invalidation

“Notwithstanding General Conditions 4 and 5 no act or omission or default on the part of any of the Insured parties nor any breach of any term or condition of this insurance by any such party shall operate to avoid invalidate or otherwise prejudice the cover thereby provided for the benefit or advantage of any of the other Insured parties”

12

By a trade contract dated 21 st December 1999 made between the trustees and Duffy, Duffy agreed to carry out the hard landscaping works comprised in Package 8100. Thus Duffy became one of the insured contractors under the policy to the extent provided in the policy. The trade contract includes the following provisions:

“1.2. Terms used in this Contract shall have the meanings given to them in Appendix 1…

“2.1. The Trade Contractor shall execute and complete the Works in strict accordance with the Contract Documents and shall comply with and adhere strictly to any instructions issued to him by the Construction Manager relating to the Works, including, but not by way of limitation, instructions relating to the sequencing and timing of the execution of the Works…

“2.2. Without prejudice to any express or implied warranties or conditions, the Trade Contractor shall exercise in the performance of his obligations under this Contract all the reasonable skill, care and diligence to be expected of a competent specialist contractor experienced in carrying out work of a similar scope, nature and size to the Works within a project of similar scope, nature and size to the Project.

“2.3. The Trade Contractor shall indemnify the Client and keep the Client indemnified against each and every liability which the Client may incur to any person whatsoever and against all damage, expense, loss, cost, claim or proceedings suffered or incurred by the Client to the extent that the same arises out of or in connection with any negligence or breach of duty by the Trade Contractor, his servants, agents, sub-contractors, suppliers or other persons engaged by the Trade Contractor upon the Works or any breach by the Trade Contractor of any of his obligations under this Contract…

“14.1...

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