Stanton and Another v Callaghan and Others
| Jurisdiction | England & Wales |
| Judge | LORD JUSTICE CHADWICK,LORD JUSTICE OTTON,LORD JUSTICE NOURSE |
| Judgment Date | 08 July 1998 |
| Judgment citation (vLex) | [1998] EWCA Civ J0708-6 |
| Docket Number | QBENI 97/1397/1 |
| Court | Court of Appeal (Civil Division) |
| Date | 08 July 1998 |
[1998] EWCA Civ J0708-6
Lord Justice Nourse
Lord Justice Otton and
Lord Justice Chadwick
QBENI 97/1397/1
IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
(Mr Ronald Walker QC)
Royal Courts of Justice
Strand, London WC2
MR R JACKSON QC and MR D SEARS (instructed by Messrs Veale Wasbrough, Bristo1) appeared on behalf of the Appellant Defendants.
MR J COGGINS (instructed by Messrs Norman Saville & Co, London N10) appeared on behalf of the Respondent Plaintiffs.
This is an appeal, with the leave of the Judge, against the order made on 10 September 1997 by Mr Ronald Walker QC sitting as a Judge of the Queens Bench Division whereby he dismissed the defendants' appeal against the refusal of the Master to strike out the plaintiffs' claim pursuant to Order 18 rule 19 of the Rules of the Supreme Court 1965 on the grounds that it disclosed no cause of action, alternatively was an abuse of the process of the Court.
The appeal raises a question on which, as we were told, there has been no previous decision in this Court: namely, whether claims for negligence and breach of retainer can be brought by a party to pending proceedings against an expert whose evidence he proposes to call in those proceedings where the claims are said to arise out of the expert's conduct in preparing, in conjunction with the expert instructed by the other party to those proceedings, a joint statement indicating what parts of the evidence which, respectively, they were proposing to give at trial were or were not in issue. The preparation of such a joint statement is, of course, recognised in Order 38 rule 38 RSC.
The facts, as alleged in the statement of claim or as they appear from contemporary documents which are not in dispute, may be stated shortly. The plaintiffs, Mr Philip Stanton and his wife, were the owners of a dwelling house known as Espica Villa, Marsh Road, Shabbington, Aylesbury. In October 1981 the plaintiffs were concerned that their property had suffered subsidence damage. With the agreement of their insurers partial underpinning at the property was carried out in 1982. That work failed to stabilise the property. Further subsidence occurred. In November 1983 Mr Callaghan or his firm, Brian Callaghan & Associates, were engaged by the plaintiffs to make a report. In that report, which was dated 5 March 1984, Mr Callaghan advised that partial underpinning had been an inappropriate solution; but that, that work having been carried out, what was now required was total underpinning of the building.
On the basis of that report Mr Stanton made a claim against his insurers for the cost of total underpinning of the building. That claim was rejected. On 26 August 1986 Mr Stanton commenced proceedings against the insurers in the Oxford District Registry of the Queens' Bench Division under reference 1986 S 447. Mr Callaghan was retained to provide expert advice in support of that claim.
On 9 March 1997 the District Registrar gave directions in the proceedings 1986 S 447. Those included a direction that expert evidence be agreed if possible and failing agreement be limited to three expert witnesses on each side. There does not appear to have been an express direction, under Order 38 rule 37 RSC, for the reciprocal disclosure of written reports within any specified time; or any direction, under Order 38 rule 38 RSC for a meeting of experts "without prejudice". Nevertheless, it is clear from contemporary correspondence and from the pleadings, (i) that Mr Callaghan's report of 5 May 1984 had been provided to the insurers' solicitors, (ii) that the insurers' solicitors had themselves instructed an expert, Mr Russell, whose report, prepared in or about January 1987, had been provided to Mr Callaghan and (iii) that Mr Callaghan had set out his comments on Mr Russell's report in a letter dated 6 May 1987. In December 1987 Mr Callaghan prepared a contract specification in respect of the remedial works—that is to say, total underpinning of the building—which he then considered necessary. On the basis of that contract specification a quotation for the works was obtained in the sum of £64,812.
The trial of action 1986 S 447 was fixed to commence on 11 January 1990. On 17 July 1989 Mr Callaghan attended a conference with solicitors and counsel then acting for Mr Stanton. In the course of that conference he was asked to revisit the property and report on certain specific matters. He did so on or about 26 July 1989. He was subsequently asked to provide a full report.
Mr Callaghan prepared a draft report, dated 11 December 1989, under his new firm name of Brian Callaghan & Partners. The draft was described as "a full report on the structural stability of Espica Villa". It contained advice as to the original cause of the subsidence to the property and the suitability of the partial underpinning scheme that had been carried out; and set out the firm's recommendations as to the works needed to achieve future stability of the property and an estimate of the cost of those works. In summary, the conclusions, as they appeared in the draft, were (i) that the original problem had been caused by dehydration of the clay sub-soil attributable to the proximity of willow trees, (ii) that the correct remedial works to solve that problem would have been to remove the trees and repair the property following rehydration of the ground over time, (iii) that the course actually adopted in 1982—partial underpinning—was "totally the wrong procedure", because it gave rise to differential movement on rehydration due to the stiffness created by underpinning at only one section of the building and (iv) that, in order to overcome that problem, the underpinning should now be continued over the full length and area of the property so as to place the property on similar foundations throughout.
On 14 December 1989, before a report in the form of the draft had been sent to Mr Stanton or his solicitors, Mr Callaghan attended a meeting at the property with Mr Kelsey, the expert then instructed on behalf of the insurers. He did so on instructions contained in a letter dated 7 December 1989 from Mr Stanton's solicitors:
The Insurance Company's Solicitors are pressing for us to exchange reports with them and have suggested that a meeting of experts take place before the Christmas break at Shabbington with a view to agreeing as much as possible and making a list of those areas where a dispute really does exist.
Following that meeting on 14 December 1989 Mr Kelsey prepared a joint statement which he and Mr Callaghan each signed. That joint statement recorded that the solution adopted before 1982—partial underpinning—did entail a considerable risk of future damage; and that some further damage had indeed occurred, probably due to slight foundation movement. The joint statement contained the following paragraphs which are material:
3. Risk of differential settlement
The experts agreed that there is a risk of differential foundation movement however slight with the present system which incorporates foundations with considerable difference in formation levels.
4. Agreed Remedy
The experts agreed that a solution to the problem stated in item 3 above would be to disconnect the piers from the underpinning beams and form a gap between the underside of the beam and the top of the pier. This gap to be 150 mm deep and to be infilled with low density polystyrene.
Mr Callaghan has deposed, in an affidavit sworn on 16 February 1998 which was admitted on this appeal without objection, that that joint statement was sent to Mr Stanton's solicitors by fax on 15 December 1989. In the light of the matters which he had agreed with Mr Kelsey, Mr Callaghan revised his draft report. He included under section 7 (recommendations) a further paragraph;
7.03. An alternative to this procedure [total underpinning] would be to remove the influence of the partially underpinned section of the property by cutting a gap between the beam and the piers. The beam would appear to have been constructed directly onto the ground and therefore the beam will act similarly to a strip footing which is similar to the original design of the foundations. This would alleviate the hard spot of the underpinning and remove the differential settlement aspect of the property and would alleviate the cracking to other parts of the property where the stiff section has undoubtedly caused cracking through the roof.
In paragraph 7.07 of the draft report Mr Callaghan had estimated the cost of works for the full underpinning of the property at £77,339—that reflecting an indexed uplift from the quotation obtained following the December 1987 specification. On revision he added the following sentence :
7.07.… Should the alternative [mentioned in 7.03] be accepted, thereby removing the influence of the underpinning carried out in 1982 and returning the foundations of the property to that that existed in 1981, the effective repairs would remove clauses 2.04 to 2.11 and 2.15 from our specification [of December 1987] which would effectively reduce the cost of the works to approximately £21,130 excluding VAT.
He concluded with the following recommendation:
...7.08. It is our recommendation that either of the above schemes would return the property to stability and full market value. The former being the only recommendation if the original underpinning was stated to be remaining.
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Litigation
...they had been unable to agree about anything including, as it emerged, what it was that they disagreed about”. 558 Stanton v Callaghan [2000] 1 QB 75 at 101, per Chadwick LJ. See also hree Valleys Water Committee v Binnie & Partners (1990) 52 BLR 42 at 52–53, per Steyn J; Mirant Asia-Paciic......
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Contract formation
...Transport Authority (1988) 4 BCL 338 [Sup Ct SA, Full Ct]; Lim Hsi-Wei Marc v Orix Capital Ltd [2010] SGCA 24. 347 Stanton v Callaghan [2000] 1 QB 75 at 105, per Otton LJ. 348 he relevant legislation in the UK is the Limited Partnerships Act 1907 and the Limited Liability Partnerships Act 2......
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Subject Index
.... . . . . . . . . . . . . . . . . . . . . . . . . . 99Stakić(Case No.IT-97-24) . . . . . . . . . . . . . . . . . . . 20Stanton v Callaghan [2000] QB 75, [1999] 2 WLR745, CA. . . . . . . . . . . . . . . . . . . . . . . 97,101, 103State (Healy)v Donoghue [1976]IR 325. . . . . . 228State (McCo......