Manolete Partners Plc v Hastings Borough Council
| Jurisdiction | England & Wales |
| Judge | Mr Justice Ramsey |
| Judgment Date | 12 April 2013 |
| Neutral Citation | [2013] EWHC 842 (TCC) |
| Court | Queen's Bench Division (Technology and Construction Court) |
| Date | 12 April 2013 |
| Docket Number | Case No: HT 12 123 |
[2013] EWHC 842 (TCC)
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
TECHNOLOGY AND CONSTRUCTION COURT
Royal Courts of Justice
Strand, London, WC2A 21,1.
The Hon Mr Justice Ramsey
Case No: HT 12 123
Samuel Townend (instructed by Gaby Hardwicke Solicitors) for the Claimant
Steven Gasztowicz QC and Clare Parry (instructed by Chris Barkshire-Jones, Chief Legal Officer of Hastings Borough Council) for the Defendant
Introduction
These Part 8 Proceedings concern the entitlement of the Claimant to make a claim against the Defendant ("the Council") under s.106 of the Building Act 1984 ("the 1984 Act") for compensation as a result of the Council exercising its powers to prevent access to Hastings Pier ("the Pier") under s.78 of the 1984 Act.
The Claimant brings these proceedings as the beneficiary of a legal assignment of a claim under s. 106 of the 1984 Act by Stylus Sports Limited (in liquidation) ("Stylus") against the Council.
Stylus was the tenant and operator of a bingo hall and amusement arcade on part of the Pier. Originally Stylus was the tenant of Hastings Pier Company Limited until that company entered into creditors' voluntary liquidation in 1999. Ravenclaw Investments Incorporated ("Ravenclaw") then became the freeholder of the Pier.
By two leases dated 14 August 2001 and 10 October 2001 made between Stylus and Ravenclaw, Stylus took leases of parts of the pier on which it earned out its business as the operator of a bingo hall and an amusement arcade, respectively. The relevant parts were described as Units C2 and C15. By Schedule 1 to both leases, the premises included the ceilings and floors and floor finishes but not the structural members in the roof or supporting the floors of the Units. Under the Schedules to the Leases, Stylus had rights to pass over the common parts of the Pier.
Ravenclaw had repairing obligations in terms of "repairing maintaining and when requisite modifying or renewing and rebuilding the structure (including the support structure roof structural and load bearing walls structural columns beams slabs and floors and the exterior" of the Pier in respect of which any such matters did not fall to be performed by Stylus or any other tenants. It was common ground that neither Stylus nor any other tenants had relevant repairing obligations.
In about 2004 Stylus became concerned about the structural integrity of the Pier and commissioned a full structural engineering survey of the Pier by Hamill Davies Limited who produced a report in September 2004. That report was provided to Ravenclaw by Stylus in an attempt to make Ravenclaw carry out the repairing obligations under the Leases. In January 2005 that report was provided to the Council in an effort to persuade the Council to act to require Ravenclaw to carry out the required repairs and maintenance.
Later, on 16 June 2006 the Council gave notice by letter to the Pier tenants that they were exercising their powers under Section 78 of the 1984 Act to close the Pier from the main entrance building onwards, including the Bingo Hall and Amusement Arcade, from 4:00pm on that date.
In a statement attached to their letter the Council stated that they had had concerns about the Pier and had been talking to the owner of the Pier for some time. In May 2006 they said they had served notice on the owner of the Pier requiring them to undertake a survey of the Pier structure after pieces of metal were found to have fallen from the underside of the Pier. The Council noted that three major events were booked to take place in the Pier ballroom in July and August and said that they instructed consulting engineers, Giffords, to look at an area of concern under the main covered walkway around the main facade entrance.
They said that this inspection was carried out on 25 June 2006 and established that at least five trusses had failed and the Council had been advised that it was unsafe to allow large numbers of people onto the Pier. As the area provided the only method of access onto and off the Pier, they said that any emergency requiring evacuation would mean crowds of people walking over the unsafe area. The Council therefore said that they had no option but to close much of the Pier immediately.
Barriers were put up at the main entrance into the Pier building preventing public access to the parts of the Pier where Units C2 and C15 were located.
The Council applied to Hastings Magistrates' Court and on 12 September that court made an order under s.77 of the 1984 Act ordering Ravenclaw, with immediate effect, to prohibit public access to the relevant part of the Pier until the court was satisfied that any necessary works had been executed or withdrew or modified the restriction.
Stylus instructed solicitors, Gaby Hardwicke, who wrote to the Council on 8 November 2006 seeking compensation for loss of profit and diminution in the value of Stylus' business from 16 June to 12 September 2006 under s.106 of the 1984 Act. A Notice of Arbitration was given on 15 December 2006.
Stylus went into liquidation and by an agreement dated 3 January 2012 the Liquidator assigned all claims to the Claimant. These proceedings were commenced on 19 April 2012, supported by the witness statement of Paul Maynard, a partner in Gaby Hardwicke, dated 18 April 2012. The Council served an Amended Defence and Mr Maynard served a second witness statement on 22 May 2012. Directions were then given leading to the hearing of the Part 8 Claim.
The Council essentially raised the following defences to the claim under s. 106 of the 1984 Act. The Council refer, as I do below, to the Claimant as encompassing both Stylus and the Claimant itself:
(1) That the Council filed the complaint at the Magistrates' Court on 16 June 2006 and once the court was seized of the application any damages suffered by the Claimant were suffered by reason of the delay in hearing the case in the Magistrates' Court and not by the exercise of the Council's powers.
(2) That the Claimant must show that the claim arises from an action which, but for the statutory power, would be actionable in tort by the Claimant. The Council submits that the action of the Council to restrain access to the Claimant's dangerous premises by members of the public in the interests of safety did not constitute a tort actionable by the Claimant against the Council. Further or alternatively, the Council pleads that the Claimant owed a duty of care to visiting members of the public under s.2 of the Occupiers Liability Act 1957 and the Council's action was a lawful, necessary and proportionate response to the Claimant's breach of that s.2 duty.
(3) That the Council is not liable under s.106 of the 1984 Act because the Claimant was "in default" for the purposes of that section because of the breach of s.2 of the Occupiers Liability Act 1957 and/or because it took a lease of the Pier past the end of its design life from a company registered outside the jurisdiction and was aware by the very latest in 2004 that there were serious problems with the structure of the Pier but took no adequate steps to ensure the Pier was repaired or the public excluded.
In its submissions the Council extended the duties which it relied upon from the Occupiers Liability Act 1957 to include also the Health and Safety at Work etc Act 1974.
I shall now deal with each of these defences in turn.
The effect of applying to court under s.78 of the 1984 Act
This aspect, whilst not abandoned, did not form a main part of the Council's submissions. In cases where s.106 of the 1984 Act applies, I do not consider that the Council can avoid liability to pay compensation by relying on the fact that they have made an application to the Magistrates' Court under s.77 of the 1984 Act. Whilst the Council may have sought the court order to replace the Council's use of its statutory powers under s.78 of the 1984 Act, unless and until the Magistrates' Court makes an order under s.77, it is the exercise of the Council's powers under s.78 which are the reason for there being no public access to the Pier. The application to the court does not change the nature of the action taken by the Council and until that court makes an order, it is the Council's exercise of their powers under s.78 which has effect. At the point when the court makes an order it is then that order which is effective, not the action by the Council under s.78.
It would have been open for the statute to make some saving provision in s. 106 of the 1984 Act in relation to any order made subsequently by the Magistrates Court under s.77 of the 1984 Act. That was not done and cannot be done by means of construing the statute to include a provision which is not there. Instead, it is clear that, where appropriate, the statute does deal with the relationship between ss.77 and 78. In particular, it relates the Council's ability to recover expenses under s.78 in the context of an application under s.77: see ss.78(4)(b) and 78(5). That shows that the s.78 power is one to be used, as the title to the section states, where emergency measures are necessary and not where the Council "might reasonably have proceeded' under s.77.
The cause of action against the Council
It is common ground that the Council must do something which, absent the power given to it under s.78 of the 1984 Act, would amount to a good cause of action which would be actionable by the Claimant for the damage suffered. Mr Samuel Townend who appeared for the Claimant submitted, however, that it is not necessary for the Claimant to make out an independent cause of action in tort and that there was, in any event, a cause of action. Mr Steven Gasztowicz QC, who appeared for the Council with Miss Clare Parry, submitted...
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