Guinness Peat Properties Ltd v Fitzroy Robinson Partnership

JurisdictionEngland & Wales
CourtCourt of Appeal (Civil Division)
JudgeLORD JUSTICE SLADE,LORD JUSTICE WOOLF,SIR GEORGE WALLER
Judgment Date15 Apr 1987
Judgment citation (vLex)[1987] EWCA Civ J0415-2
Docket Number87/0296

[1987] EWCA Civ J0415-2

IN THE SUPREME COURT OF JUDICATURE

COURT OF APPEAL (CIVIL DIVISION)

ON APPEAL FROM THE QUEEN'S BENCH DIVISION

OFFICIAL REFEREE'S BUSINESS

HIS HONOUR JUDGE FOX-ANDREWS

Royal Courts of Justice

Before:

Lord Justice Slade

Lord Justice Woolf

and

Sir George Waller

87/0296

Guinness Peat Properties Ltd (Formerly Guinness Peat Property Services Ltd.)
First Appellants (First Plaintiffs)

and

G. M. Group Finance Ltd. (Formerly Lewis And Peat Group Ltd.)
Second Appellants (Second Plaintiffs)
and
The Fitzroy Robinson Partnership (A Firm)
Respondents (Defendants)

MR. STANLEY BURNTON Q.C. and MISS MARY MORGAN (instructed by Messrs McKenna & Co.) appeared on behalf of the Appellants (Plaintiffs).

MR. JOHN SLATER and MR. S. BROWN (instructed by Messrs Warner

Cranston) appeared on behalf of the Respondents (Defendants).

LORD JUSTICE SLADE
1

This is an appeal by the two plaintiffs in an action, Guinness Peat Properties Ltd. and G.M.Group Finance Ltd., from an order of His Honour Judge Fox-Andrews, Q.C. made on 27th March 1987. It concerns a claim for privilege made in respect of a letter which was dated 27th June 1984. The defendants to the action and respondents to the appeal are a firm of architects, the Fitzroy Robinson Partnership, to whom I will refer as "FRP".

2

The first plaintiffs are the building developers of an office site known as 33 Lombard Street, London E.C.3. The second plaintiffs are its tenants. In March 1980 the first plaintiffs engaged FRP to act as architects in connection with the development of the premises. The building contemplated was to be of modern design and to contain an area known as the atrium. In November 1981 the defendants produced drawings and a specification specifying some glass known as Varitran grey glass for the atrium. In about April 1984 the scaffolding was removed from the atrium and, according to the plaintiffs' case, a lack of natural light became evident.

3

On 18th June 1984 Mr. Landau of the first plaintiffs wrote to Mr. McGuinness, a partner in FRP, saying: "I think I must place on record at this point in time not only our serious concern, but our intention, to hold your firm responsible for the costs involved in putting the atrium into the sort of state which is generally acceptable by funding institutions and tenants alike". This letter was marked "Without Prejudice", but it has not been contended that this marking rendered it a privileged document. On 21st June 1984 the first plaintiffs instructed FRP to replace the Varitran glass with clear glass.

4

In June 1984 FRP had a professional indemnity policy with the Home Insurance Company. That company underwrote the architects' professional indemnity scheme on behalf of the AFIA Worldwide Insurance Group ("AFIA"). FRP have put in evidence what is said to be a specimen of the policy. I think it would have been preferable for the original, or at least a copy, of the policy itself to be exhibited. However, for present purposes, it is common ground that it included the following provisions. The front cover of the policy required that in the event of a claim immediate notification should be sent to ABS. Insurance Agency Ltd. FRP's evidence is that the latter company were insurance brokers who were obliged to receive all written notices of claims sent by firms of architects covered by the professional indemnity scheme and to forward them to the insurers. Section 1 of the policy, headed "Professional Liability", afforded the insured indemnity against loss arising from claims for breach of duty in their professional capacity first made against them during a stated period. "Loss", as referred to in section 1, was defined in the policy as meaning "(a) damages, (b) legal costs and expenses awarded against the insured to any claimant or claimants". Condition 4 of the policy provided:—

"The insured shall as a condition precedent to their right to be indemnitif ed under Sections 1 and 2 of this Policy, give to the Company immediate notice in writing:—

  • (a) of any claim made against them

  • (b) of the receipt of notice from any person of an intention to make a claim against them."

5

In paragraph 5 of an affidavit sworn on 23rd March 1987, Mr. McLeish, who was in June 1984, the Administrative Partner at FRP, has described what happened in the firm after receipt of the first plaintiff's letter of complaint of 18th June 1984:—

"After discussing with two of my partners they agreed with me that this matter should be referred to our Insurers via the ABS Insurance Agency Limited as a 'notification of claim made against the Partnership' pursuant to condition 4 of the said policy. Accordingly I wrote the letter of the 27th June 1984 to the ABS Insurance Agency Limited".

6

I need not quote the contents of this crucial letter, which I will call "the McLeish letter". It will suffice to say that it enclosed a copy of the first plaintiff's letter of 18th June, together with what were said to be "copies of other relevant memoranda", it expressed certain joint views of Mr. McGuinness and the writer as to the merits of the first plaintiff's contention that there had been a design error, and stated the approximate cost of replacing the glass as being in the region of £50,000.

7

On 30th October 1985 the plaintiffs issued a writ endorsed with a statement of claim against FRP. In addition to the claim notified on 18th June 1984, the second plaintiffs claimed loss of rent of about £1.3m. On 7th February 1986 FRP served a defence and counterclaim. On 17th March 1986 the plaintiffs served a reply and defence to counterclaim. On 6th August 1986 FRP served their first list of documents. This list made a claim for privilege in respect of the documents "enumerated in Part 2 of the said Schedule I". Part 2 read as follows:

"Correspondence and other document[s] passing between the Defendants and their Solicitors for the purpose of obtaining legal advice and in contemplation of proceedings; communications between the Defendants' Solicitors and third parties made in contemplation of litigation; correspondence, memoranda instructions and statements passing between the Defendants' Solicitors and Counsel; correspondence, memoranda, notes passing between the Defendants' Solicitors and Insurers; and all other documents brought into being and arising from and in connection with the proceedings".

8

At the end of October 1986 and afterwards the plaintiffs' solicitors sought further and better discovery from FRP. After certain intermediate correspondence, on 8th December 1986 FRP's solicitors wrote to the plaintiffs' solicitors giving notice of their intention to serve a supplementary list of documents and offering inspection of the documents prior to service of this list. On 9th December 1986 Mr. Hardy, a solicitor employed by the plaintiffs' solicitors, Mr. Crocker the plaintiffs' expert architect, and Mr.Armstrong the plaintiffs' expert on glazing attended the offices of FRP's solicitors. On that occasion Mr. Speed, a solicitor employed by those solicitors, handed to them four correspondence files. According to Mr. Speed's evidence contained in an affidavit sworn by him on 19th March 1987 (which there is no reason to doubt) he believed that these files contained nothing except correspondence passing between the first plaintiffs and FRP, which he was intending to disclose in the supplementary list, though he had not yet checked all the documents. The files had not yet been paginated. Unfortunately, from FRP's point of view, the file marked No. 3 contained a copy of the McLeish letter, which Mr. Speed says had been left there by mistake. Mr. Crocker, having seen this copy, took a photocopy of it. He flagged other documents of which he wished to obtain copies but not this one. He and the other persons who had attended at FRP's offices on behalf of the plaintiffs had been offered unrestricted facilities for inspection of the documents in the four files and for taking copies thereof. Mr. Crocker sent a copy of the letter to Mr. Hardy.

9

On 18th December 1986 an order was made providing for the exchange of experts' reports and giving the plaintiffs leave to amend their statement of claim, which was duly amended on 22nd December.

10

On 23rd December 1986 FRP's solicitors served a first supplementary list of documents. By that time a secretary in their office had paginated the documents in the correspondence file No. 3, to which I have referred and attributed the number "107" to the copy of the McLeish letter. In this first supplementary list FRP's solicitors disclosed the documents contained in file No. 3 in Schedule I, Part 1 of the list, without claiming privilege in respect of them. They were disclosed under the heading "Correspondence files between GPPSL and FRP" and under the sub-heading "Correspondence file No. 3 numbered 1–321". A claim for privilege was made in respect of documents referred to in Schedule I, Part 2 of the first supplementary list in the same form as that contained in Schedule I, Part 2 of the first list.

11

On 7th January 1987 Mr. Hardy attended FRP's solicitors' offices to inspect the documents which had been disclosed by bundles in the first supplementary list. On this occasion he inspected, inter alia, the copy of the McLeish letter which was included in file No. 3. On the same day, in a letter incorrectly dated 6th January, Mr. Hardy wrote to FRP's solicitors requesting a copy of, inter alia, document No. 107 in correspondence file No. 3. He had already received a copy of the letter from Mr. Crocker. However, his evidence was that his purpose was to obtain a copy with the page number and to "test the reaction" of FRP's solicitors. He received no response to this letter from those...

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