Glasgow Airport Limited V. Messrs Kirkman And Bradford

JurisdictionScotland
JudgeLord Eassie,Lord Kingarth,Lord Wheatley
Neutral Citation[2007] CSIH 47
Published date06 June 2007
Docket NumberCA5/05
Date06 June 2007
CourtCourt of Session

EXTRA DIVISION, INNER HOUSE, COURT OF SESSION

Lord Kingarth Lord Eassie Lord Wheatley [2007] CSIH 47 CA5/05

OPINION OF THE COURT

delivered by LORD KINGARTH

in

RECLAIMING MOTION

in the cause

GLASGOW AIRPORT LIMITED

Pursuers and Respondents;

against

MESSRS KIRKMAN & BRADFORD

Defenders and Reclaimers:

_______

Act: Woolman, Q.C., Gardiner; Brodies (Pursuers and Respondents)

Alt: Moynihan, Q.C., Fairley; Dundas & Wilson CS, LLP (Defenders and Reclaimers)

6 June 2007

[1] In 1998 the pursuers and Fritz Companies Inc. (now known as UPS Supply Chain Solutions Inc.) ("the tenants") entered into missives and an Agreement for Lease relative to Block 2, Unit A, Ayr Cargo Centre, Douglas Terrace, Glasgow Airport. In terms of clause 2 of the Agreement for Lease the pursuers were obliged to proceed with the construction of "the Landlord's works", which were defined as "the works to be carried out by or on behalf of the Landlord in the construction of the Premises ... as more particularly shown on and described in the Plans and Specifications." In terms of said clause 2, the pursuers further undertook "to procure that the Landlord's Works will be carried out in a good and workmanlike manner in accordance with good building practice using good quality materials of their several kinds ...". It was understood under the Agreement for Lease that the relevant works would be carried out under and in terms of a building contract to be let by the pursuers for the design and construction of the premises. The pursuers, as employers, (together with another company, BAA Lynton plc) entered into the relevant building contract with Kensteel Structures Limited as main contractors. In relation to the floor slab the defenders, who are consulting engineers, were engaged in respect of its design, and A.J. Clark Construction Limited were engaged as specialist sub-contractors. The defenders were engaged by virtue of an Appointment dated 10 November 1997 by the main contractor. Their liability thereunder was limited to £2 million.

[2] In the present action the pursuers seek to recover £2 million with interest as damages for breach of a collateral warranty provided by the defenders on 18 June 1999. It is averred that the tenants, after taking occupation of the premises, experienced serious problems and difficulties with the floor slab. The pursuers claim that the problems were the result of the defenders' failure to exercise reasonable skill and care in the performance of their duties under the Appointment. The defenders deny liability and further claim inter alia that any liability to the pursuers has prescribed.

[3] The preamble and clause 1(a) of the warranty (in which the pursuers and BAA Lynton plc are referred to as "the Employer" and the defenders are referred to as "the Sub-consultant") are in the following terms:

"WHEREAS

A. The Employer has entered into an agreement with Kensteel Structures Limited ('the Building Contractor') under which the Building Contractor is to design and construct the Phase 2 Building A Shell and Fit Out Works at the Air Cargo Centre, Douglas Terrace, Abbotsinch Road, Glasgow Airport ('the Works').

B. By an appointment ('the Appointment') dated 10th day of November 1997 the Contractor has appointed the Sub-Consultant to carry out and complete the Services as described in the Appointment.

NOW IT IS HEREBY AGREED

1. The Sub-Consultant warrants that it has exercised and will continue to exercise reasonable skill, care and diligence in the performance of the Services under the Appointment. In the event of any breach of this warranty:

(a) The Sub-Consultant's liability for costs under this Agreement shall be limited to that proportion of such costs which it would be just and equitable to require the Sub-Consultant to pay having regard to the extent of the Sub-Consultant's responsibility for the same and on the basis that the Contractor and its sub-consultants and sub-contractors shall be deemed to have provided contractual undertakings on terms no less onerous than this Clause 1 to the Employer in respect of the performance of their obligations in connection with the Works (other than those obligations which relate to the Services) and shall be deemed to have paid to the Employer such proportion which it would be just and equitable for them to pay having regard to the extent of their responsibility".

[4] Other relevant clauses provide:

"1(b) The Sub-Consultant shall be entitled in any action or proceedings by the Employer to rely on any limitation in the Appointment and to raise the equivalent rights in defence of liability as it would have against the Contractor under the Appointment. ...

6 The Sub-Consultant shall take out and maintain professional indemnity insurance in an amount of two million pounds (£2,000,000) for any occurrence or series of occurrences except for pollution and contamination which will be for any one claim and in total during each twelve month period arising out of any one event for a period of 12 years from the date of Practical Completion of the Works under the Building Contract ... .

7 This Agreement may be assigned twice by either party comprising the Employer to another person taking an assignation of the Employer's interest in the Works without the consent of the Sub-Consultant being required and such assignation shall be effective upon written notice thereof being given to the Sub-Consultant. No further or other assignation of this Agreement shall be permitted save as is expressly provided for herein.

9 No action or proceedings for any breach of this Agreement shall be commenced against the Sub-Consultant after the expiry of 12 years from the date of Practical Completion of the Works...

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1 books & journal articles
  • Security for performance
    • United Kingdom
    • Construction Law. Volume II - Third Edition
    • 13 Abril 2020
    ...by the person to whom it was made as intended to constitute a contractual 558 See also Glasgow Airport Ltd v Kirkman & Bradford [2007] CSIh 47; Oakapple Homes (Glossop) Ltd v DTR (2009) Ltd [2013] EWhC 2394 (TCC); Friends Provident Life Assurance Ltd v Sir Robert McAlpine Ltd [2014] CSOh 74......

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