Fenwick Elliott’s Top 15 cases of 1996
In the first Fenwick Elliott Summer Review, we identified the 15 most important cases from 1995 to 1996. We thought it might be interesting to summarise them here. You will see that, strictly, there are 14, although number 15 is perhaps the most important development: the Housing Grants Construction & Regeneration Bill.
1. Abbey National Mortgages v Key Surveyors [1996] 1 WLR 1534 concerned an application to appoint 29 expert witnesses for 29 separate properties allegedly negligently valued in various parts of the country, on the basis that local experience was necessary. The Court of Appeal upheld the trial judge’s appointment of a single Court Expert and the limitation of one expert for each party.
2. AEG v Translift Monorail [1996] CLC 265 concerned the fitness for purpose of amplifiers for a thrill ride, in which warning lights came on during testing on the steepest uphill section of the ride. The Court held the amplifier was not fit for purpose, even though it was capable of performing the required purpose by swapping a fuse.
3. Alfred McAlpine Homes v Property and Land [1996] 47 ConLR 74 concerned a contractor’s claim under JCT80 for loss and expense arising from employer’s instruction to postpone the works. The Court held the contractor is entitled to overheads and profits, but the loss cannot be quantified on notional hire rates since it must be actual loss.
4. B Mullan v Ross [1996] N.I. 618 concerns a claim by a contractor’s liquidator that Employer’s payments to an unpaid subcontractor violated pari passu under Insolvency (Northern Ireland) Order 1987. The Court held the employer was not entitled to make direct payments to the subcontractor.
5. Birse Construction Limited v Haiste Ltd and Others [1996] 76 BLR 26 concerned an engineer’s liability for “the same damage” as the subcontractor under the Civil Liability (Contribution)Act 1978 for the contractor’s loss rebuilding a leaking reservoir constructed under a Design and Build Contract. The Court found the employer’s loss (disruption during reservoir reconstruction) was not the same as the contractor’s (cost of rebuilding new reservoir), and the contribution claim must be to the same party.
6. Balfour Beatty v Docklands Light Railway [1996] 78 BLR 42 concerned a contractor’s claim for prolongation costs beyond those certified by the employer under ICE (5th Edition) where the Standard Conditions omitted the disputes clause and replaced the engineer with an employer’s representative. The Court held that, where the employer’s representative is the same legal person as the employer, it is under an implied duty to act honestly, fairly and reasonably.
7. Bristol & West Building Society v Christie and Others [1996] EGCS 53 concerned a solicitor’s claim against valuers under Civil Liability (Contribution) Act 1978, from their loss settling the Building Society’s claim in full for a negligent valuation in respect of a loan. The Court determined a 50/50 split of the Building Society’s recoverable amount (not the agreed settlement figure), excluding sums recoverable under the borrower’s insurance policy.
8. Bowmer and Kirkland v Wilson Bowden [1996] CILL 1157 concerned an application for interim payment into Court. The Court held a party is entitled to refer to a payment into Court for an interim payment application. A payment may reflect the odds of success or failure (not an expected outcome), but a “nuisance value” carries minimal weight.
9. Clarksteel v Birse Construction [1996] CILL 1136 concerned the contractor’s supply of free issue materials for pipe laying works under the standard FCEC Blue form of subcontract, which included a Schedule for “extra-over” rates where external pipe welds exceeded the relevant British Standard. The Court held the subcontractor was not entitled to damages or a quantum meruit, as the “extra-over” rate is to be treated like a liquidated damages clause.
10. Colt International v Tarmac Construction [1996] CILL 1145 concerned the application for removal of a Chartered Surveyor as Arbitrator for misconduct for not appointing Queen’s Counsel for a discovery application involving a waiver of privilege, unless the costs were borne by the Applicant. The Court held the application was groundless, but an arbitrator is entitled to assistance form solicitors, and counsel for questions to be put to a legal advisor.
11. John Barker v London Portland Hotel [1996] 83 BLR 31 concerned an arbitrator’s decision regarding an acceleration agreement after delay to refurbishment works under JCT80. The Court held that the arbitrator was under an implied obligation to act lawfully and fairly. Where the arbitration machinery broke down to such an extent (i.e. the arbitrator made an impressionistic assessment instead of a logical analysis of delay), the Court would substitute its own assessment.
12. Havant BC v South Coast Shipping [1996] CILL 1146 concerned a variation to an ICE Contract to perform potentially noisy work from 6:00am to 11:00pm, after a local resident obtained an injunction restraining the subcontractors making noise outside of 9:00am-5:00pm. The Court held that the contractor was entitled to a variation, as it was required to identify the method pre-contract, so the employer bears the additional costs if the method become unworkable.
13. Hoppe v Titman [1996] 1 W.L.R. 841 concerns claim of professional negligence against an architect following the settlement of an earlier claim where a set off arising from negligence was raised as a defence (i.e. not a counterclaim) to the payment of architectural fees. The Court held the negligence claim was not res judicata, so could be pursued.
14. Vascroft v Seeboard [1996] 78 BLR 132 concerned the subcontractor’s failure to give notice of Practical Completion in accordance with an amended DOM/2. The Court held Practical Completion is deemed from the date of completion of the main contract works (not treated as a matter of fact), on the basis that the subcontractor’s failure to give notice of Practical Completion should not place him in a better position than the main contractor dissenting from the notice of Practical Completion.
15. Housing Grants Construction and Regeneration Bill, which did not become law until after publication. The Act gave any party to a construction contract a right to refer disputes to a quick, impartial and investigative adjudication procedure. A payer would have to give the contractor notice, with reasons, if they wished to set off against the payments due and pay when paid clauses became unenforceable, save in the case of actual ultimate payer insolvency.