Vinci Construction UK Ltd v Eastwood and Partners (consulting Engineers) Ltd
| Jurisdiction | England & Wales |
| Judge | Mrs Justice O'Farrell DBE,Mrs Justice O'Farrell |
| Judgment Date | 24 July 2023 |
| Neutral Citation | [2023] EWHC 1899 (TCC) |
| Court | King's Bench Division (Technology and Construction Court) |
| Docket Number | Case No: HT-2022-000035 |
and
[2023] EWHC 1899 (TCC)
Mrs Justice O'Farrell DBE
Case No: HT-2022-000035
IN THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
TECHNOLOGY AND CONSTRUCTION COURT (KBD)
Royal Courts of Justice
Rolls Building
London, EC4A 1NL
Katie Lee (instructed by Kennedy's Law LLP) for the Second Defendant
Simon Hale (instructed by Reynolds Porter Chamberlain LLP) for the Third Party
Hearing date: 14 th June 2023
Approved Judgment
This judgment was handed down remotely at 10.30am on Monday 24 th July 2023 by circulation to the parties or their representatives by e-mail and by release to the National Archives (see eg https://www.bailii.org/ew/cases/EWCA/Civ/2022/1169.html).
The following applications are before the Court:
i) an application by the third party (“GHW”) for reverse summary judgment against the second defendant (“Snowden”) in respect of the Additional Claim on the ground that Snowden has no real prospect of succeeding on the claim because it is statute-barred; and
ii) an application by GHW to strike out Snowden's claim for contribution pursuant to the Civil Liability (Contribution) Act 1978 on the ground that the Additional Particulars of Claim disclose no valid cause of action against GHW.
The applications are opposed by Snowden on the grounds that:
i) although its claim in contract is time-barred, Snowden has a real prospect of succeeding on the claim in negligence at trial because the claim is not time barred either under section 2 or section 14A of the Limitation Act 1980; and
ii) the contribution claim is arguable and no limitation issue arises in respect of such claim.
Background facts
By a contract dated 26 April 2012, based on the NEC3 Engineering and Construction Contract 2005 (with amendments 2006) Option A and executed as a deed, the claimant (“Vinci”) was appointed by Princes Ltd (“Princes”), a manufacturer of bottled drinks, as design and build contractor to carry out work at its warehouse and distribution facility at Weaverthorpe Road, Bradford.
By an appointment dated 18 April 2012 and executed as a deed, Vinci engaged the first defendant (“Eastwood”) to provide civil and structural engineering services in respect of the works.
By a subcontract dated 12 April 2013, executed as a deed and based on the NEC3 Engineering and Construction Subcontract Option A with amendments, Vinci engaged the second defendant, Snowden, to carry out the design, supply and installation of the structural reinforced concrete slabs as part of the works.
On 12 April 2013 Snowden engaged GHW to carry out the design, complete with all calculations and drawings, for the in situ reinforced concrete internal floor slabs.
The original design intent for the floor in an area of the works referred to as ‘the Low Bay Warehouse’ was to break out and replace the existing concrete slab. However, during 2012 and 2013, the design was changed to comprise limited replacement of areas of the existing slab and the installation of an unbonded overlay slab on the retained slab.
In around May 2013 Vinci issued a ‘Compensation Event’ notice to Snowden in respect of the design, supply and installation of the Low Bay Warehouse concrete slab works.
During May and June 2013 the design for the overlay slab was developed. Installation of the overlay slab commenced on around 2 July 2013 and was completed by 9 July 2013. The works at the Low Bay Warehouse were completed on about 2 August 2013.
Vinci's case is that by September 2013 the floor had developed damage and/or defects, including cracks, damage to sawn edges, curling and local crushing of the concrete, leaving holes in the overslab. Various remedial schemes were carried out but ultimately, Princes removed and replaced in its entirety the Low Bay Warehouse floor.
In 2019 Princes commenced an adjudication against Vinci, alleging that an overlay slab was not suitable for the Low Bay Warehouse; the existing slab should have been broken out and a new slab constructed. By an adjudication decision dated 2 April 2020, the adjudicator found in favour of Princes that Vinci was liable for breach of contract in respect of defects caused by inadequate design of the Low Bay Warehouse floor.
On 10 September 2020 Vinci served a pre-action protocol letter of claim on Snowden, indicating that, to the extent that Prince's adjudication claim against Vinci succeeded, Vinci intended to make a claim under Snowden's contractual indemnity and/or a claim in general damages and/or tort against Snowden by way of compensation for the losses sustained by Princes and/or Vinci.
By letter dated 18 January 2021, Snowden issued a preliminary notice of claim against GHW, indicating a potential claim arising out of GHW's appointment as a specialist floor designer in connection with the design of the overlay slab.
By a further adjudication decision dated 1 April 2021 (corrected 8 April 2021), the adjudicator awarded Princes damages, including a decision that Vinci was liable to pay Princes for the costs of removing the overlay slab, and for the construction of the new flooring to the Low Bay Warehouse.
On 7 May 2021, Snowden and GHW entered into a standstill agreement, suspending time running for the purpose of any limitation defence for a period of six months from the date of the agreement.
On 21 October 2021, a further standstill agreement was entered into by Snowden and GHW, extending the suspension of time running for the purpose of any limitation defence for six months, until 21 April 2022.
Proceedings
On 9 February 2022 Vinci commenced proceedings against Eastwood and Snowden, seeking damages of £2.5 million approximately in respect of the sums paid pursuant to the adjudication decisions and costs of the adjudications. The basis of the claim against the defendants is that the design concept of an unbonded non-structural overlay slab, at a thickness of 100mm and without mirroring the joints in the overlay slab to the joints in the existing slab, was inadequate to support the loading requirements of the Low Bay Warehouse and the heavy trafficking to which it would be subject. It is pleaded that the defective design placed Vinci in breach of its contract with Princes and it became liable for the adjudication awards, fees and costs.
On 8 April 2022 Snowden served its defence, denying liability to Vinci.
On the same date, Snowden served its Additional Claim on GHW, seeking an indemnity and/or contribution from GHW in respect of the claim by Vinci and/or Eastwood. The allegations set out in the Part 20 Particulars of Claim are that GHW was in breach of contract and/or duty in that it:
i) adopted the design concept of an unbonded non-structural overlay slab which: (a) did not provide adequate support for loads; (b) was not thick enough; (c) was unsuitable for heavy warehouse traffic; and (d) was not in accordance with industry guidance;
ii) failed to consider the loading requirements or the performance of the overlay slab, and the preparatory work to the existing slab;
iii) adopted and constructed a design in which the joints of the existing slab were not mirrored in the overlay slab;
iv) failed to warn of the ‘inherent weaknesses in the design’; and
v) failed to warn of the potential effects of omitting the 25mm sand layer.
On 20 June 2022 GHW served its defence, denying any liability and raising a limitation defence:
“3. The claims advanced against GHW are time-barred under the Limitation Act 1980 (“the LA”) or analogy with the LA and/or are otherwise precluded by the equitable doctrine of laches and/or acquiescence.
4. GHW was engaged to develop the design of the Overlay Slab in May 2013. GHW carried out its design development in May to July 2013. The Overlay Slab was constructed by Snowden in July 2013. Pursuant to Section 2 and/or section 5 of the LA, the claims against GHW are time-barred because the Claim Form was issued on 8 April [2022] which is more than six years from the date on which the cause of action accrued.
5. Further and alternatively, in relation to the tortious claims against GHW, Vinci alleges in its Particulars of Claim that it was apparent that the industrial floor in the Low Bay Warehouse had developed damage and/or defects by September 2013. Pending the provision of full and proper disclosure and witness statements, GHW understands that by the aforesaid date or, alternatively by April 2014 at the latest (at the time when GHW and Snowden were asked to comment on appropriate remedial works), Snowden had both the knowledge required for bringing an action for damages and the right to bring such action. In the premises, the starting point referable to section 14A of the LA was September 2013 or alternatively by 1 April 2014, with the three-year period for bringing a claim expiring in September 2016 or alternatively March 2017. The claims against GHW are thus time-barred under section 14A of the LA.
6. GHW and Snowden entered into a standstill agreement dated 7 May 2021 and a subsequent standstill agreement dated 21 October 2021. The relevant cumulative effect of the said standstill agreements was to suspend time for a “Limitation Defence” from 7 May 2021 to 6 months after the date of the second standstill agreement, namely 21 March 2022. For the avoidance of doubt, the standstill agreements do not affect the fact that the claims against GHW are time-barred because the claims were already time-barred by the time the first standstill agreement was entered into.
7. The remainder of this Defence is provided without prejudice to GHW's right to apply to strike out Snowden's...
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