The Sky's the Limit Transformations Ltd v Dr Mohamed Mirza
| Jurisdiction | England & Wales |
| Judge | Stephen Davies |
| Judgment Date | 10 January 2022 |
| Neutral Citation | [2022] EWHC 29 (TCC) |
| Docket Number | Case No: G50MA008 |
| Court | Queen's Bench Division (Technology and Construction Court) |
[2022] EWHC 29 (TCC)
IN THE COUNTY COURT AT MANCHESTER
BUSINESS AND PROPERTY WORK
TECHNOLOGY AND CONSTRUCTION COURT
Manchester Civil Justice Centre
His Honour Judge Stephen Davies
Case No: G50MA008
Philip Byrne (instructed by Berry Smith LLP, Cardiff) for the Claimant
Joe-Han Ho (instructed direct) for the Defendant
Hearing dates: 29 November – 3 December 2021
Date draft judgment handed down: 20 December 2021
APPROVED JUDGMENT
This judgment was handed down remotely by circulation to the parties' representatives by email. It will also be released for publication on BAILII. The date and time for hand-down is deemed to be … am on 10 January 2022.
I direct that pursuant to CPR PD 39A paragraph 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.
His Honour Judge Stephen Davies
| Section | Paragraphs | |
| A. | Introduction and summary of decision | 01 – 09 |
| B. | The evidence | 10 – 19 |
| C. | Contract formation and terms | 20 – 48 |
| D. | Termination | 49 – 73 |
| E. | Final account valuation | 74 – 77 |
| F | Damages for loss of profit | 78 |
| G | Conclusion | 79 |
| H | Windows | 80 – 92 |
| I | Appendix | 93 |
A. Introduction and summary of decision
This is a claim arising out of a building contract for alterations to a residential property known as Redthorne, Princess Road, Lostock, Bolton entered into between the claimant building contractor and the defendant houseowner. The building contract came to an end in April 2017 in acrimonious circumstances before the works had been completed. In December 2019 the claimant issued proceedings claiming payment for outstanding invoices and damages for loss of profit on the remaining works. The defendant defended on the basis that nothing was due, taking into account such matters as the true entitlement to payment in respect of the work done, the cost of completing the works and the cost of remedying alleged defects.
The case was transferred into the Manchester TCC where in September 2020 the then TCC District Judge gave directions down to a trial in July 2021. He was persuaded, because the parties had already instructed experts in these disciplines, to grant permission to each party to rely on expert evidence from a building surveyor, a mechanical engineer, an electrical engineer and a quantity surveyor. At the pre-trial review held in June 2021 I was forced to adjourn the trial to November 2021, due to witness ill-health and difficulties with expert evidence. I directed the parties to engage in a mediation which, regrettably, did not result in a settlement.
Thus, the trial proceeded and took place over 5 days. The first day was given to the claimant's factual evidence, the second to the defendant's factual evidence, the third to the evidence, given concurrently, of the mechanical engineers, electrical engineers and building surveyors, the fourth to the evidence, also given concurrently, of the quantity surveyors, and the fifth to oral closing submissions.
It was a fairly challenging timetable to run on a traditional basis, given the volume of evidence and disputed issues. Leaving aside contract formation and terms and termination there were a large number of disputes regarding variations, unfinished and defective works (the Scott Schedule runs to 160 items). I am extremely grateful to counsel for their hard work and discipline in ensuring that the case ran to time, leaving me to produce this judgment subsequently. I suggested that the parties might consider further settlement discussions after the evidence and submissions had closed. Again, that resulted in no settlement.
It is a great shame that the parties have been unable to resolve their dispute out of court, given the amount of time, effort, stress and cost the whole process has taken for the individuals concerned. It is of course the function of the court to resolve disputes where the parties are unable to do so. However, I am acutely aware that, as so often occurs in this type of case, the outcome will likely be a financial disaster for one of the parties and, even if not, likely an expensive and ultimately unrewarding result for both.
In my view concrete steps to address the challenge of finding a time and cost effective means of fairly resolving domestic property renovation building contract disputes are required. Based on what is now my relatively longstanding experience, both as advocate and as a TCC Circuit Judge, in case managing and trying such cases, I would suggest that one option well worth considering in such cases would be for directions to be given at the first CCMC 1 along the following lines: (a) disclosure limited to documents relied upon and to known adverse documents; (b) a single joint expert building surveyor to be instructed in all cases 2 to address all items in issue, both liability and valuation, with questions to the expert strictly for the purposes of clarification only; (c) a stay for mediation on receipt of the report and questions. If the parties are not willing to mediate and the judge does not consider it appropriate to order mediation, then there should be an order for compulsory early neutral evaluation before another TCC Judge.
If no settlement is achieved then there should be further directions as follows: (d) witness statements, limited to matters remaining in dispute, strictly complying with PD57AC and limited in length and/or number; (e) a trial, which should not normally exceed 1 day in length, at which: (i) each party would have produced in advance detailed written opening submissions; (ii) no oral openings would be permitted; (iii) no more than 1 hour each for cross examination of each party's witnesses on their key evidence would be permitted; (iv) the single joint expert would attend remotely to answer questions from the judge and parties for no more than 1 hour in total; (v) there should be 1 hour each for oral closing submissions, followed by: (f) a judgment, orally or in writing at the judge's discretion, which would be as summary as the trial process. To make the trial workable and fair the judge would probably require a half day pre-reading time and up to a full day judgment time, ideally the day before and the day after the trial respectively, with the latter being used either to produce a
In terms of costs budgeting, the approved costs going forwards should not normally exceed £25,000 per party, broken down as to £2,500 for disclosure; £5,000 for expert evidence (which would include the party's half share of the expert's fee); £5,000 for mediation (including a half share of the mediator's fee); £2,500 for witness statements; and £10,000 for trial preparation, trial and post judgment matters.
Whilst this process would not enable a judge to produce anything like the sort of judgment I have produced in this case in terms of length and detail, it would enable the judge to produce a judgment after a fair and open, but summary, trial process in which the key issues were ventilated and which, importantly, was reasonably speedy and reasonably inexpensive. I am not suggesting that an order for directions along the above lines would be appropriate in every case 3 or that it would be a panacea in every case. In particular, it would not address the problem of disproportionate costs being incurred pre-action (although if the judge considered that such costs were disproportionate and was prepared to record as much in the costs management order that might also assist in concentrating minds). However, it would at least allow the parties a better chance to settle with the benefit of independent expert opinion before being plunged into trial. It would also provide a better chance to avoid financial disaster if the case had to go to trial. Most importantly, it would be fair since, based again on my experience of such cases, it is unlikely that a more intensive — and thus more lengthy and expensive — trial process would produce a result significantly different to the result produced through this procedure. In particular, if a party or a witness is thoroughly unreliable or dishonest, that will usually become apparent within a fairly short time, measured in minutes rather than hours, of focussed cross-examination and, more often than not, such findings are unlikely and cases more often turn on the contemporaneous documents, which are usually not seriously in dispute, and the expert evidence which, if given by an independent single joint expert, ought not to be capable of significant challenge.
Returning however to the present case, in short, my decision is that there is nothing further due to the claimant under the final account and, in the absence of a counterclaim, nothing due to the defendant either. My reasons follow. I have kept my reasons as brief as is consistent with enabling the parties to understand the findings I have made. To produce a full mini-judgment on each disputed item would have involved unacceptable delay in the production of this judgment, especially given the relatively modest values involved.
B. The evidence
This is a reasonably well-documented case. The principal elements of the contract were reduced to writing, although there are disputes about some of the terms. There are voluminous emails as well as some text messages passing between the claimant and the defendant although, as Mr Byrne observed, in some ways they make my task more difficult because those contemporaneous emails show that the parties were not agreed even at the time about what had been said, done or agreed.
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