John Innes Foundation v Vertiv Infrastructure Ltd (Formerly Emerson Network Power Ltd)
| Jurisdiction | England & Wales |
| Judge | Mr Roger ter Haar |
| Judgment Date | 17 January 2020 |
| Neutral Citation | [2020] EWHC 19 (TCC) |
| Court | Queen's Bench Division (Technology and Construction Court) |
| Docket Number | Case No: HT-2019-000245 |
| Date | 17 January 2020 |
[2020] EWHC 19 (TCC)
IN THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
TECHNOLOGY AND CONSTRUCTION COURT (QBD)
Royal Courts of Justice
Strand, London, WC2A 2LL
Mr Roger Ter Haar QC
Sitting as a Deputy High Court Judge
Case No: HT-2019-000245
Rachel Ansell Q.C. and Athena Markides (instructed by Reynolds Porter Chamberlain LLP) for the Claimants
Gary Blaker Q.C. (instructed by W Legal Limited) for the Defendant
Hearing date: 4 th December 2019
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.
Mr Roger ter Haar QC:
This is the judgment on the Defendant's application under CPR 3.4(2)(a) to strike out the claim on the basis that the Particulars of Claim discloses no reasonable grounds for bringing the claim and/or for summary judgment pursuant to CPR 24.2 on the basis that the Claimants have no real prospect of succeeding in their claim.
The Facts
The claim is a claim for loss and damage arising out of a fire which occurred on the 7 th March 2015 (“the Fire”) at the Genome Centre at Norwich Research Park, Colney, Norwich, NR4 7UH (“the Property”).
Because it is central to the strike out application, it is necessary to set out at some length a number of contractual provisions.
At the time of the Fire, the First Claimant (“JIF”) owned the freehold in the Property and the Second, Third and Fourth Claimants (collectively referred to as the “Claimant Tenants”) occupied and had leasehold interests in different parts of the Property.
There is in evidence before me the lease from JIF to the Second Claimant, then known as The Genome Analysis Centre. 1 These were some of the provisions of that lease:
(1) Clause 1.1:
“ Insured Risks means fire, tempest, storm, flood, lightning, explosion, impact, aircraft (other than hostile aircraft) and other aerial devices and articles dropped from them, riot, civil commotion and malicious damage, bursting or overflowing of water tanks, apparatus or pipes and such other risks as the Tenant may from time to time insure against subject to such exclusions, excesses, conditions and limitations as may be imposed by the insurers and insurance being available on reasonable terms in the London insurance market.”
(2) Clause 3.5:
“ Repairs and Maintenance
“3.5.1 The Tenant shall put and keep the Premises at all times in good and substantial repair and condition (but the Tenant shall not be liable to repair or make good damage by the Insured Risks, except to the extent that payment of insurance monies is withheld because of any act, neglect or default of the Tenant or any undertenant or any person under its or their control)….
….
“3.5.3 The Tenant shall put and keep in good and substantial repair and condition and in good working order all plant machinery apparatus and equipment in the Premises in the nature of landlord's fixtures and fittings and shall keep in a safe condition all apparatus and equipment installed in the Premises by the Tenant or installed in the Premises on the Tenant's behalf and belonging to the Tenant for the Permitted Use and for that purpose:
“(a) shall enter into and thereafter maintain in force contracts with reputable contractors for the periodic and regular inspection servicing and maintenance of the said plant machinery apparatus and equipment; and
“(b) shall produce to the Landlord on demand from time to time sufficient details of such contracts as are then current to satisfy the Landlord that Clause 3.5.3(a) is being complied with; and
“(c) shall renew or replace from time to time such of the plant machinery apparatus and equipment in the Premises which in the reasonable opinion of the Landlord's Surveyor becomes during or at the expiry of the Term in need of such renewal or replacement with plant machinery apparatus and equipment (as the case may be) of a substantially similar kind and quality and reasonably fit for purpose having regard to the age of the items to be replaced; and
“(d) at all times shall ensure that such plant machinery apparatus and equipment is properly operated maintained and serviced.
…”
(3) Clause 3.16.6:
“ Fire precautions and equipment
“(a) The Tenant shall comply with the requirements and recommendations of the fire authority, the insurers of the Building and the Landlord in relation to fire precautions affecting the Premises or the Building.
“(b) The Tenant shall keep the Premises equipped with such fire fighting and extinguishing appliances as are provided by the Landlord and required by any statute, the fire authority or the insurers of the Building or reasonably required by the Landlord and shall keep such appliances open to inspections and maintained to the reasonable satisfaction of the Landlord…”
There is in evidence before me the lease from JIF to the Third Claimant (“JIC”) 2. These were some of the provisions of the Lease:
(1) Clause 1.1:
“ Insured Risks means such risks as the Superior Landlord may from time to time insure against pursuant to the Superior Lease subject to such exclusions, excesses and limitations as may be imposed by the insurers.”
(2) Clause 3.5 and 3.16.6 were in substantially the same terms so far as relevant as those clauses in the lease between JIF and the Second Claimant.
(3) The principal difference between the lease to the Second Claimant and that to the Third Claimant is that under the former lease the tenant had the obligation to effect insurance whilst in the latter it was the responsibility of JIF.
There is also before me a copy of a lease from JIF to The Sainsbury Laboratory. 3 As this is dated after the Fire and is not to any of the parties to these proceedings, I am
unsure of the relevance of that lease. However, for the purpose of his submissions Mr. Blaker Q.C. relied mainly upon the lease from JIF to JIC, which appeared to me sufficient for the points he wished to make based upon the lease arrangements, to which I refer belowThe Property had an emergency lighting system which was powered by an uninterruptible power supply (“the UPS”). The UPS incorporated an Emergency Lighting Unit (the “ELU”) and comprised a central control cabinet which was flanked on either side by a large battery cabinet containing four batteries (“the Batteries”). The Batteries were arranged in 4 strings of 30 12v blocs (or monoblocs) with 2 strings in each cabinet. It is the Claimants' case that the Fire was caused by a thermal runaway in one or more of the monoblocs in the Batteries which were well beyond their service life at the time of the Fire.
The Defendant, Vertiv, is a specialist in the maintenance and repair of standby power equipment, including uninterruptible power supplies. Vertiv is the current incarnation of the company formerly known as Harath Engineering Services Ltd, Chloride Electronics Ltd T/A Chloride Harath and Emerson Network Power Ltd.
In 2006, the Defendant was asked by the Third Claimant (“JIC”) to design a proposal for the maintenance of the Property's standby and emergency power equipment, including the UPS.
By letter dated the 1 st March 2006, the Defendant provided JIC with “our proposal for the maintenance of your standby and emergency power equipment”. This proposal was stated to include “2 service visits per year” and to provide “for the maintenance and emergency cover aspects of the services we offer”. 4
The maintenance proposal was accepted by JIC in 2006, and the Defendant's contract was renewed on an annual basis up to 2012.
In 2012, NBI Partnership Ltd (“NBI”) was engaged pursuant to a Members Agreement dated the 27 th February 2012 to act, in effect, as the managing agent of the Property (“the NBI Agreement”). 5 The parties to that Agreement were two of the Claimants (JIC and the Second Claimant) and two non-parties to these proceedings (The Institute of Food Research and The Sainsbury Laboratory).
The following were terms of the NBI Agreement:
(1) The Recital:
“(A) NBI Partnership was incorporated under the Companies Act 2006 on 9 January 2012 and is a private company limited by guarantee.
“(B) NBI has been established for the purpose of rendering its members those services directly necessary for the exercise of their activities and upon the basis that NBI Partnership shall merely claim from its members exact reimbursement of their respective shares of the joint expenses.
“(C) JIC, IFR, TGAC and TSL wish to participate as members in NBI Partnership for the purposes and on the terms set out in this Agreement”.
(2) Clause 6:
“ Provision of the Services
“6.1 With effect from the date of this Agreement, the NBI Partnership shall supply and make available to the Members and their Relevant Group Entities:
“6.1.1 the Administration and Support Services; and
“6.1.2 the Property Related Services.
“6.2 The NBI Partnership shall supply the Administration and Support Services and Property-related Services with reasonable skill and care and in doing so the NBI Partnership shall comply at all times with:
“6.2.1 all applicable laws;
“6.2.2 all applicable policies and regulations of the Members which are notified to it in writing; and
“6.2.3 all service level agreements, specifications, policies and procedures as may from time to time be agreed between the Members (or any of them) and the NBI Partnership.
“6.3 If the Administration and Support Services and/or Property-related Services do not conform with the warranty in clause 6.2, the NBI Partnership will use all reasonable endeavours to correct any such...
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...respect of physical damage caused by fire. In John Innes Foundation v Vertiv Infrastructure Ltd (Formerly Emerson Network Power Ltd) [2020] EWHC 19 (TCC), Roger Ter Haar QC sitting as a Deputy High Court Judge held at [53] that “where a negligent act of a person causes physical damage, tha......