Heather French v Groupama Insurance Company Ltd
| Jurisdiction | England & Wales |
| Judge | HIS HONOUR JUDGE RICHARD SEYMOUR Q.C.,His Honour Judge Richard Seymour Q.C. |
| Judgment Date | 12 November 2010 |
| Neutral Citation | [2010] EWHC 2827 (QB) |
| Date | 12 November 2010 |
| Court | Queen's Bench Division |
| Docket Number | Case No: HQ09X00955 |
[2010] EWHC 2827 (QB)
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
Before : His Honour Judge Richard Seymour Q.C.
sitting as a Judge of the High Court)
Case No: HQ09X00955
Graeme Kirk (instructed by Blake-Turner & Co.) for the claimant
Geoffrey Brown (instructed by Ford & Warren) for the defendant
Hearing dates: 21, 22, 25, 26, 27 and 28 October 2010
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 Richard Seymour Q.C. :
Introduction
The property originally known as and situate at 149, Ardgowan Road, Catford, London SE6 (“the Building”) comprises a two-storey building forming part of a terrace of similar buildings. It appears that the Building was constructed in about 1910. In 1996 the ground floor of the building comprised shop premises (“the Shop”) which were vacant. At that stage the Shop was designated by the number originally ascribed to the Building, No. 149. The first floor of the building comprised a self-contained flat (“the Flat”). For postal purposes the Flat was designated No. 149A. At the rear of the Building was a courtyard (“the Yard”). The only access to the Flat was across the Yard and up a metal staircase affording access to the rear of the Flat, as viewed from Ardgowan Road. Access to the Yard from Ardgowan Road was obtained by turning right at the junction of Ardgowan Road and Dowanhill Road, as one proceeded from the front of the Building towards that junction, and then turning right again into a private road (“the Lane”) running across the rear of the back gardens of 145 to 157, Ardgowan Road. On the left-hand side of the Lane as one proceeded along it from the junction with Dowanhill Road, lay the rear gardens of properties in the next street, Minard Road, numbered 136 to 144 inclusive.
The Yard was surfaced with concrete paving. The level of that paving was some three feet above the level of the adjoining Lane. A retaining wall prevented the soil beneath the concrete paving from moving in the direction of the Lane.
By a lease (“the Lease”) dated 13 November 1978 and made between Lawrence Gilloway, as lessor, and Michael Hickford and Penelope Ann Badcoe, as lessees, the Flat was demised for a term of 999 years from 24 June 1978 at an annual rent of £25.
The rights granted by the Lease included:-
“(iv) The right to use the yard shown coloured blue on the Plan No. 1 [that is to say, the Yard] for purposes of gaining access to the staircase leading to the flat and also for recreational purposes and for hanging of washing PROVIDED THAT the Lessee must on no occasion obstruct the fire exit door marked “A” on Plan No. 1
(v) The right to keep and use in a tidy manner a refuse bin within the yard shown coloured blue on Plan No.1
(vi) The right (so far as the Lessor can grant the same) of way at all times and for all purposes along the passageway leading from the access yard to Ardgowan Road [despite the description, this seems in fact to have been a right of way along the Lane]”
Clause 3 of the Lease included the following provisions:-
“(a) THE LESSEE hereby further covenants with the Lessor to pay to the Lessor as a maintenance contribution one half of an annual sum specified by the Lessor (being the estimated annual cost of doing the things hereinafter comprehensively referred to as “maintenance” specified in the First Schedule hereto) such payment to be made in advance by two equal instalments on the 25 th day of December and the 24 th day of June in every year the first of such payments (being a proportionate payment from the date hereof) to be paid on the Twenty fifth day of December and in case in any year ending on the 25 th day of December such estimated sum shall with any balance carried forward from any previous year be insufficient to pay the cost incurred for maintenance in that year then likewise (subject to the proviso to sub-clause (d) hereof) to pay on demand to the Lessor an additional maintenance contribution of an amount equal to half of the deficiency
(b) THE LESSOR shall be responsible for maintenance and shall be obliged to pay all maintenance contributions received by him from the Lessee in the property into a separate banking account and to apply the same in discharge of the cost of maintenance and for no other purpose”
The definition of the expression “maintenance” for the purposes of the Lease contained in the First Schedule included:-
“3. Insuring the property in some insurance office of repute against destruction or damage by risks usually covered (including occupiers liability) under a standard comprehensive policy in the full value thereof with a further 15% of the sum so insured for the professional expenses of reinstatement and in case of such damage or destruction with all possible speed to spend and lay out the monies received from such insurance towards the rebuilding or reinstating in a good and substantial manner the premises destroyed or damaged”
It seems that in 1996 Woolwich Property Services (“Woolwich”) managed the Building and the adjacent building (“the Adjacent Building”), that known as and situate at 151, Ardgowan Road.
Woolwich, it appears, entered in its own name into a policy of insurance numbered PR907998U (“the Policy”) with Lombard General Insurance Co. Ltd. (“Lombard”). The Policy provided insurance against physical damage to the Building, including the Flat, and the Adjacent Building in respect of the period 29 September 1996 to 28 September 1997, both dates inclusive. By the date of the Policy, so the material adduced during the course of the trial suggested, the freehold owners of both the Building and the Adjacent Building were Mr. and Mrs. L.G. Gyarmati and their daughter, Dr. Judith Burstyner. The residue of the term created by the Lease was then vested in a Miss K. Conroy.
The Policy incorporated General Claims Conditions (“the Conditions”). By Condition 2 it was provided, so far as is presently material, that:-
“The Company [that is, Lombard]
(d) may elect to replace reinstate or repair any Damage to the Property Insured but only where circumstances permit and then in a reasonably sufficient manner but in no case will the Company pay more than the relevant Sum Insured”
The defendant in this action, Groupama Insurance Co. Ltd. (“Groupama”), is the successor to Lombard.
The Policy was arranged for Woolwich by brokers, Hanover Park Insurance Brokers Ltd. (“Hanover”).
At about the beginning of October 1996 Miss Conroy decided to seek to dispose of her interest in the Lease. She caused the Flat to be advertised for sale by a firm of estate agents, Mann & Co. (“Mann”). The claimant in this action, Miss Heather French, was interested in acquiring the residue of the term of the Lease. A copy of a Memorandum of Sale dated 2 October 1996 prepared by Mann put in evidence showed that it was agreed, subject to contract, between Miss Conroy and Miss French that Miss French would purchase the residue of the term created by the Lease for the sum of £31,000.
A friend of Miss French, an architect, Mr. Dennis Evans, looked at the Flat on her behalf on about 13 October 1996. Mr. Evans drew attention to some cracking to the floor and walls of the Yard and adjacent premises.
Miss French caused a survey of the Flat to be undertaken prior to deciding whether to enter into a binding contract to acquire the residue of the term created by the Lease. The surveyor who undertook an inspection was Mr. Richard van Maanen of RVM Partnership. In a report dated 9 October 1996 prepared following his inspection Mr. van Maanen noted structural damage to the Flat and its environs. In a section of his report entitled “Further Advice and Valuation” he included the following observations:-
“F1. Rear access road, in poor condition for which solicitors should confirm rights of way and any maintenance liability and/or liability for tree growth located within this area, possibly the Poplar causing the current structural damage. Subject to ownership liability, we recommend that a report be obtained from a qualified arboriculturist on the Poplar which should be kept under strict control and lowered.
F3.2 1. Reconstruct boundary walls and hardstandings. 2. Repair external staircase. 3. Carry out external decorations including extensive refurbishment of fenestration. 4. Obtain a report from engineer on electrical, plumbing and heating systems.
F4. We recommend that the following repairs and further investigations are carried out: 1. Obtain a report from damp and timber specialist. 2. Refurbish internal decorations and joinery. 3. Hack off and replace live plaster. 4. Renew defective ceilings. 5. Carry out closer inspection of sky light 6. Renew cast iron soil and surface water goods.”
The substance of what Mr. van Maanen had found on his inspection was communicated to Miss Conroy. What she did in consequence was revealed by a copy of a letter dated 16 December 1996 written by Woolwich to Hanover which was put in evidence:-
“We have been notified by the lessee of 149a that in the process of selling her property, the prospective purchaser's surveyor has noticed structural cracking to the property.
This may be due to root incursion from a neighbouring tree.
We have not at this time attended to inspect.
The purpose of this letter is to place the insurers on notice.
Could you please confirm if the lessee is required to obtain a survey on [sic] whether the insurers will appoint their own surveyor.
As this is holding up the sale I would be grateful if...
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