Royal Brompton Hospital NHS Trust v Hammond (No. 9)
| Jurisdiction | England & Wales |
| Judge | JUDGE LLOYD |
| Judgment Date | 11 October 2002 |
| Neutral Citation | [2002] EWHC 2037 (TCC) |
| Court | Queen's Bench Division (Technology and Construction Court) |
| Docket Number | 1993-ORB-No 46 |
| Date | 11 October 2002 |
[2002] EWHC 2037 (TCC)
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
TECHNOLOGY AND CONSTRUCTION COURT
His Honour Judge Humphrey LLoyd QC
1993-ORB-No 46
(No. 11)
Antony Edwards-Stuart QC, Mark Cannon and Seanin Gilmore appeared for the Claimant, RBH, instructed by Masons.
Adrian Williamson and Abdul Jinadu appeared for the 1st to 7th and 13th Defendants, PMI, instructed by Davies Arnold Cooper.
Marcus Taverner QC and Richard Edwards appeared for the 8th, 14th and 15th Defendants, WGI, instructed by Fishburn Morgan Cole.
Andrew Bartlett QC and Jane Davies appeared for the 9th and 16th Defendants, AA, instructed by Berrymans Lace Mawer.
Pursuant to the Practice Statement of 22 April 1998 this is the official judgment of the court and no note or further record is to be made.
This action concerns the development of Phase 1 of new buildings for the Royal Brompton and National Heart and Lung Hospitals in Chelsea, London, SW3. Planning began in the 1970s. The NHS entity responsible for the majority of the time was the Board of Governors of the Royal Brompton and National Heart and Lung Hospitals, a Special Health Authority (SHA). The present plaintiff or claimant is its successor. I shall refer to both as RBH. RBH retained a number of well-known and reputable consultants: its architect was Watkins Gray International (WGI); its quantity surveyor was Northcroft Neighbour and Nicholson (NNN) – mainly its Cambridge office; its structural engineer was Clarke Nichols and Marcell (CNM); its mechanical and electrical services engineer was Austen Associates (AA). Later it retained a project manager, Project Management International (PMI). Annex 1 to this Judgment contains extracts from the contracts of engagement between RBH and the various consultants who are the present defendants to this action and other relevant documents. The contract with WGI was dated 8 May 1975; that with AA was dated 18 August 1984; that with PMI was dated 21 January 1986.
The project was typical of many hospitals. As built, Phase 1 comprises five storeys of hospital accommodation (one storey is below street level) with a sixth floor and a seventh level for plant. The total internal floor area was approximately 21,500m 2, arranged around three internal courtyards. The scheme was first started in 1967. An initial submission was made to the DHSS in March 1978. In July 1984 an official announcement was finally made giving a go-ahead for the scheme. In 1986 tenders were received. There was then a hiatus whilst steps were taken to bring the designs within a budget acceptable to the DHSS. A contract was let to Taylor Woodrow Construction Ltd (TWC) but in a joint venture with a sister company (Taymech or TM). I shall call the consortium “TW”, unless there is a reason to differentiate between TWC and Taymech. Annex 1 of the judgment also contains extracts from the contract between RBH and TW. The original contract price was £19,967,623. Work began in March 1987. The contract incorporated the JCT conditions (1980 ed). Clause 23 of the main contract required TW to complete the works by the 23 July 1989 subject to any extension of time under clause 25. Failure to complete by the required date would lead to TW being liable under clause 24 to liquidated damages for non-completion of £47,000 per week. Practical completion was certified to have been achieved on 22 May 1990, some 43 weeks and 2 days later than the original contractual date. WGI granted extensions of time covering the entire period of overrun and instructed NN to ascertain loss and expense. By October 1992 a further £5,204,247 had been paid to TW on the advice of WGI and NNN, including amounts in respect of claims. The extensions of time awarded in connection with the project were as follows:
| Relevant Event | Period | New Date for Completion |
| Delayed handover of Chelsea Hospital for Women (CHW) | 10 weeks | 1 October 1989 |
| Delayed handover of CHW | 1 week | 8 October 1989 |
| Vaults and reinforcement (concurrent) | 4 weeks | 12 October 1989 |
| Instructions to lay Hydrotite | 5 weeks | 12 November 1989 |
| Late M&E information | 2 weeks | 26 November 1989 |
| Instructions to lay Hydrotite (plus 2 weeks for Christmas) | 7 weeks | 14 January 1990 |
| LEB substation (later revoked) | 2 weeks | 28 January 1990 |
| Late M&E information and safety cabinets | 2 weeks and 1 week | 18 February 1990 |
| Safety cabinets and reinforcements | 2 weeks and 2 days | 6 March 1990 |
| Late M&E information and commissioning | 5 weeks and 8 weeks | 22 May 1990. |
TW was not satisfied with the amounts certified. On 16 October 1992 it started an arbitration. This action was commenced by a writ issued on 21 January 1993 but, by agreement, it did not proceed pending the outcome of the arbitration. In the arbitration TW claimed over £17 million beyond that certified. RBH was dissatisfied with WGI's decisions on extensions of time and brought a counterclaim in order to set them aside so it could recover from TW both the amounts ascertained and certified for prolongation and also liquidated damages. In addition RBH claimed that it was not liable to TW in respect of an instruction from WGI to lay hydrotite (one of the issues with which I am concerned). However RBH did not question the amount of loss and expense certified by WGI and paid to TW in consequence of its opinions that AA had failed to provide TW with mechanical and electrical information and that as a result TW had suffered delay and disruption. (That failure is one of the present issues.) As set out above, WGI had decided that although TW had been delayed by 11 weeks by late M&E information, 7 weeks was concurrent with delays for which other extensions of time had already been granted. A further extension of time of 5 weeks for inadequate M&E information was granted on 6 April 1992 to make a total of 16 weeks on this ground.
The arbitration was settled on 19 December 1995. It was due to last 40 weeks. RBH agreed to pay TW a further £6,230,975 including TW's costs. RBH had itself incurred over £2 million in costs on the arbitration. RBH now seeks to recover from WGI (the eighth, fourteenth and fifteenth defendants), AA (the ninth and sixteenth defendants) and PMI (the first to seventh and thirteenth defendants) much of what it had paid to TW. RBH was not able to establish how much of the settlement relates to each head of claim. RBH's claims against the eleventh defendant, CNM, concerning the superstructure and substructure, and variations to reinforcement (sections D and H of the statement of claim) have now been settled and are thus no longer pursued. RBH's claims in section I of the statement of claim are also no longer maintained (they concerned the number of variations, instructions, revised drawings and queries.) For present purposes it is to be assumed that the claims against the defendants centre on WGI's decisions and instructions to NNN.
The statement of claim was served on 5 August 1997. Thereafter, so far as I can see, the action has been notable for steps which ensured that for some time little real progress was made. Preliminary issues or points were raised for decision but then agreed or resulted in trials of issues which appear to me (of course with the advantage of hindsight) to be of little practical import. His Honour Judge Hicks QC ordered that the action should be tried in four tranches. The first slice was to be 12 days devoted to preliminary issues. The second and third were to be 44 and 40 days long. The last was to be about quantum. As I have said, the preliminary issues were largely resolved by agreement. (The outcome may be seen from Annex 2 to this judgment.) They included what can only be described as non-issues. For example on the last issue which Judge Hicks was asked to decide RBH, PMI, and CNM argued that it should answered: Yes. WGI took “no position”. Judge Hicks therefore decided the issue on written submissions from RBH, PMI and CNM (but not WGI) and without oral argument. Not surprisingly in such circumstances, he decided that it should answered in the affirmative.
The issues which were ordered to be tried in October 2000 were defined by Judge Hicks with some precision by reference to the pleadings as they then stood. In the event His Honour Judge Seymour QC did not deal with all the issues at the same time and some of his decisions were the subject of appeals. In the spring of 2001 the Court of Appeal decided that there should be a new trial of the bulk of the main issues which were or were to have been tried in October 2000 although some of the judgments of Judge Seymour were not affected. The trial before me covered a great deal of ground. Despite the time that has passed since the project was carried out I was able to obtain a clear picture of some of the difficulties that faced those involved in it, largely as a result of adroit questioning of witnesses of both fact and opinion by leading and junior counsel. In addition counsel made detailed references to the mass of documentation, and presented meticulously prepared and extensive submissions and argument, for which I was grateful. Unravelling them was a daunting task, (at times disheartening and reminiscent of the second labour of Hercules).
RBH's current claims are therefore as follows:
1. The “Blue...
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