BNP Paribas Depository Services Ltd & Anor v Briggs & Forrester Engineering Services Ltd

[2024] EWHC 2903 (TCC)

In February 2021, BNP entered into a design and build contract with B&F for the design and construction of stair pressurisation works in risers A and B of a 30-storey 1960s office skyscraper.

It was always known that there was at least some asbestos containing material ("ACM") in the existing risers, and it was common ground that the contract allowed for at least some works to remove ACM within the risers. However, as HHJ Stephen Davis explained, the fundamental issue between the parties was the extent of those works and whether B&F owed any obligation to undertake further refurbishment asbestos surveys (“RASs”) to identify the presence of further ACM in all areas where it was required to undertake works and, if found, to undertake all such asbestos removal works (“ARWs”) as were necessary. There was a further issue in relation to certain additional structural strengthening works that had not initially been foreseen as part of the original scope of work.

B&F said that its obligations were limited to the ARWs identified in a quotation dated 17 April 2020 from its specialist licensed asbestos removal and disposal subcontractor, Woods. Problems arose when further asbestos was encountered in areas outside the scope of the Woods quotation. B&F said that this was not part of its scope of work and that it would not undertake such works without an instruction. Eventually, B&F issued a suspension notice, followed by a termination notice in February 2023, on the basis that BNP was preventing it from completing the works by not providing further RASs or an instruction. BNP said that this amounted to a repudiatory breach of the contract.

In the judge’s opinion, as a general statement, the design and build contract made it “plain beyond serious argument” that the design and build obligation and the risk in relation to the scope of the works necessary to provide the complete stair pressurisation installation, including the need to survey for ACM to the extent necessary and to undertake any ARWs to the extent necessary, laid “firmly” on B&F. Under the JCT design and build contract, B&F took full responsibility for the Employer's Requirements and the Contractor's Proposals as regards the design of the works, the execution of the works, compliance with the performance specification and with the Statutory Requirements.

In particular, the judge referred to clause 2.40  which was a  bespoke clause introduced by the schedule of amendments. If anything, this served to extend B&F’s design responsibility:

“1. The Contractor has had an opportunity to inspect the physical conditions (including the sub-surface conditions) and all other conditions of or affecting the site and shall be deemed to have fully acquainted himself with the same and to have obtained all necessary information as to risks, contingencies and all other circumstances which may influence or affect the execution of the Works.

2. Any information prepared by or on behalf of the Employer … is provided for information only. The Employer … make[s] no representation or warranty as to accuracy or completeness of any such information or for any representation or statement contained therein whether made by the Employer or the Employer's Persons for misrepresentation or misstatement whether made negligently or otherwise in respect of such information.

3. No failure on the part of the Contractor to discover or foresee any physical conditions and/or other conditions affecting the site and/or any risks, contingencies or other circumstances whatsoever referred to in Clause 2.40.1 (whether the same ought reasonably to have been discovered or foreseen or not) shall entitle the Contractor to an adjustment of the Contract Sum or an adjustment of the Date for Completion of the Works or any Section thereof.”

The Woods quotation did not assist B&F. It was not a method statement, or a scope of works, but had been provided in response to a request to demonstrate that the subcontractor element of the price had been subject to market testing. The Employer's Requirements made it clear that the scope of the ARWs included, but was not limited to, the removal of all ACM identified. The relevant material had identified ACMs in the majority of places surveyed but did not suggest that this was an exhaustive list of every place where ACM might be found. In fact, it qualified the report and advised much more extensive ARWs than just those to remove the ACM found in the survey.  

Nor did the Woods quotation expressly limit the scope of the works by reference to the specific areas of asbestos. It did not simply refer to removing “all ACM identified”. Since the Employer’s Requirements required all works to be subject to the provision of clean air certificates on completion, and since B&F would be undertaking the new installation, B&F’s scope of works was not limited only to those works specifically included in the Woods quotation.   

When it came to the structural strengthening works, the judge considered it sufficient to explain that the existing ductwork passed through floors within the risers which were made up of concrete with reinforcing bars underneath to provide structural support. During the course of the works, it became known for the first time that, in certain floors on riser B, the reinforcing bars were not present throughout, leading to an obvious and acknowledged risk to the safety of anyone working in this area, and the need for remedial works. The simple issue was whether that was BNP's or B&F's contractual responsibility. 

As a starting point, B&F accepted full design responsibility for the whole of the design, including that contained in the Employer's Requirements, and that required to comply with the Statutory Requirements. That said, B&F's case was that repairs to the structural defects with the riser floors were not expressly identified in the contract documents and there was no term expressly requiring it to carry out these works.

The judge agreed that repairs to the structural defects within the riser floors were not expressly identified in the contract documents. But that was not surprising since the defects were not known about at the time the contract was entered into. This explained the absence of any term expressly requiring it to carry out those particular works. However, this real question was: what did the contract provide in terms of allocation of risk for such a problem? In the view of the judge, the answer was that the contract provided for the risk to lie with B&F:

“The impact of bespoke clause 2.40.1 was that it was not open to B&F to argue that it was reasonably unaware of existing site conditions and the associated risks associated with them.  The impact of clause 2.40.2 was that B&F was not contractually entitled to rely on the accuracy of information, including that contained in surveys and reports, provided by BNP.  The impact of clause 2.40.3 is that all these matters were at B&F's risk in terms of the impact of subsequently discovered matters on the time and cost of the works.”

These were special conditions not included in the JCT standard form, and thus represented the parties' specific agreed intentions. 

So, was B&F entitled to terminate the contract for the reasons given? Constable J in Tata Consultancy Services Ltd v Disclosure and Barring Service [2024] EWHC 1185 (TCC) stated that:

"An act of prevention may be (a) a breach of an express or implied contractual obligation; and also (b) the exercise of an entitlement (such as the giving of an instruction).  It will not be the happening of an event for which the parties have otherwise agreed the allocation of risk within the contract. The concept of 'prevention' is, therefore, itself rooted in consideration of the parties' express or implied obligations ...".

It was common ground that if a contractor wrongly purports to terminate pursuant to an alleged contractual right, and leaves site undertaking no further work, then that purported termination will normally be a repudiatory breach of contract. Given the judge’s conclusions, it was an inevitable result that the cause of the suspension was B&F's default, in that it had to carry out works which it was required to do under the contract. In the circumstances, B&F was not entitled to issue the suspension or the termination notice.

Back to the previous page

Click to download PDF