Pantelli Associates Ltd v Corporate City Developments Number Two Ltd
| Jurisdiction | England & Wales |
| Judge | Mr Justice Coulson |
| Judgment Date | 02 December 2010 |
| Neutral Citation | [2010] EWHC 3189 (TCC) |
| Court | Queen's Bench Division (Technology and Construction Court) |
| Docket Number | Case No: HT-10-332 |
| Date | 02 December 2010 |
[2010] EWHC 3189 (TCC)
Before: The Honourable Mr Justice Coulson
Case No: HT-10-332
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
TECHNOLOGY AND CONSTRUCTION COURT
Mr Richard Coplin (instructed by CMS Cameron McKenna) for the Claimant
Mr Crispin Winser (instructed by GH Canfield LLP) for the Defendant
Hearing date: 26 November 2010
Mr Justice Coulson :
(1) Introduction
The Claimant (“Pantelli”), a firm of quantity surveyors, seeks some £98,000 by way of unpaid fees from the Defendant (“CCD”) arising out of two building projects in North London. The claim is made pursuant to and/or as damages for breach of a compromise agreement dated 25 February 2009. Following commencement of proceedings in April 2010, CCD served a Defence and Counterclaim which raised, for the first time, allegations of professional negligence and a counterclaim for £300,000. Pursuant to an unless order, made by consent on 6 October 2010, CCD agreed to provide proper particulars of the allegations of negligence, causation and loss, by way of an application to amend, to be made no later than 12 November 2010. If they failed to do so, that part of the Defence and Counterclaim alleging poor performance and resulting loss would be struck out.
At the hearing on 26 November 2010, CCD made their application to amend. In so far as those proposed amendments concerned the claim for professional negligence, Pantelli opposed them, saying that CCD had not provided proper particulars and had therefore failed to comply with the terms of the agreed unless order. The application raised a potentially important point as to the proper practice for the pleading of claims for professional negligence. As a result, although I gave a ruling with brief reasons at the hearing on 26 November, I said that I would provide more detailed reasons by way of this written judgment.
(2) Background
The original contracts between Pantelli and CCD were made in writing on 27 September 2007. The work was carried out over the next few months. Ultimately, neither project received planning permission. No fees were paid to Pantelli and a letter before action was sent on 21 July 2008. Subsequently, a statutory demand was served.
Following a meeting in February 2009, the fees claim was the subject of a written compromise agreement, set out in Pantelli's letter of 25 February 2009. The letter was countersigned by CCD.
Unhappily, the terms of the compromise agreement were not honoured at all by CCD, who now maintain that, for reasons which it is unnecessary for me to analyse, the compromise agreement was in some way not binding and/or superseded by a later agreement (although no fees were paid pursuant to that agreement either). In April 2010, Pantelli commenced these proceedings in the QBD. In June, CCD served a Defence and Counterclaim which raised, for the first time, vague allegations of poor performance and professional negligence. The counterclaim said to arise in consequence was put in the sum of £300,000. Following the transfer of the case to the TCC in September 2010, a Case Management Conference was fixed for 7th October. At that CMC, Pantelli had given notice that they were going to raise the wholly inadequate nature of CCD's pleading and seek an unless order in connection with it.
The issue as to the inadequacy of the original pleading was discussed by the solicitors in the run-up to the CMC, and two days before the hearing, on 5 th October, CCD agreed to provide proper particulars of the allegations. Thus, a proposed order was agreed by consent on 5th October, and formalised by Akenhead J on 6th October 2010. The order was in these terms:
“Unless by 4pm on 12 November 2010 the Defendant do make an application to amend its Defence and Counterclaim properly explaining the nature of its Defence and Counterclaim and providing proper particulars of any alleged defence or cause of action, paragraphs 6, 7, 9(e), 10(e), 14–17 and 20–22 (including the prayer) of the Defendant's Defence and Counterclaim shall be struck out.”
The paragraphs specifically identified in the order were those setting out the case, such as it was, as to professional negligence, causation and loss.
For the avoidance of doubt, I should say that, although the unless order in this case was made by consent, I am in no doubt that such an order was appropriate in all the circumstances. In Marcan Shipping (London) Ltd v Kefalas [2007] EWCA Civ 463, [2007] 1 WLR 1864, the Court of Appeal stressed that an unless order should only be made in circumstances where the court has carefully considered whether such a sanction was appropriate in all the circumstances of the case. Here, a large counterclaim had been raised by CCD very late in the day, on the back of inadequate allegations of professional negligence. In view of CCD's delays, both before and after the service of the claim form, an unless order was appropriate in all the circumstances.
(3) The Proposed Amendments
The proposed amendments have been put forward by way of a completely new document entitled 'Amended Defence and Counterclaim'. Quite properly, Mr Coplin does not object to that document as a matter of form; neither does he object to any of the amendments other than those which purport to set up the counterclaim for £300,000 based on allegations of professional negligence.
For the purposes of this Judgment, it is unnecessary to set out the controversial paragraphs in full. However, it is instructive to set out parts of paragraph 16, which comprise the allegations of negligence, and the whole of paragraph 36, which is the entirety of CCD's pleaded case as to causation and loss.
“Performance
16. Paragraph 10 is denied. It is averred that the Claimant failed to perform to the contractual standard and is in breach of the QS Contracts and the PM Contracts.
PARTICULARS OF BREACH OF THE QS CONTRACTS
16.1 Failing adequately or at all to identify or determine the Defendant's initial requirements and subsequently develop the full brief.
16.2 Failing adequately or at all to advise on feasibility and procurement.
16.3 Failing adequately or at all to establish the Defendant's order of priorities for quality, time and cost.
16.4 Failing to prepare adequate and/or accurate initial budget estimates.
16.5 Failing to prepare or develop a proper and/or accurate preliminary cost plan.
…
PARTICULARS OF BREACH OF THE PM CONTRACTS
16.13 Failing to select or appoint appropriate consultants.
16.14 Failing adequately or at all to co-ordinate and...
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