EWJ June 2024 web - Journal - Page 102
Fluid submitted the Costs Claim were losses that did
not fall within the scope of the duty agreed or assumed
by Fluid in respect of the services carried out pursuant
to their Appointment. Fluid’s position was based on
the scope of duty principle explained in the UK
Supreme Court case of Manchester Building Society v
Grant Thornton UK LLP [2021],[6] and the role of a
structural engineer in BDW Trading Limited v (1) URS
Corporation Limited (2) Cameron Taylor One Limited
[2021].[7] As for the Repayment Claim, Fluid’s position was these could only be recovered where it can
be said that the professional services were either not
provided at all or were worthless, either as to the
whole or as to some specific part of the services.[8]
defendant has substantially (albeit negligently) performed the work, and the defendant is entitled to be
paid the normal remuneration and the client must
rely upon a remedy in damages. For Glover’s Repayment Claim to succeed it must show that the services
were not performed at all, or were performed so
poorly that they were worthless. Notably, a single joint
expert report was undoubtedly highly critical of Fluid
as to their failure to undertake fortnightly site visits
and maintain site inspection records. Having reviewed
the evidence, HHJ Stephen Davies held that it was at
least possible that by the end of the trial, Glover may
be able to establish that the services provided by Fluid
would be so deficient that they were for all practical
purposes worthless and be entitled to the Repayment
Claim. For these reasons, the Repayment Claim was
also not struck out as it was a question for trial.
Glover contended the Costs Claim was in accordance
with the scope of duty principle in Manchester Building Society or, at the very least, should not be summarily determined as being bad in law, because the
application of the purpose and scope of duty principle
is fact-specific and should only be determined at trial.
Key takeaways
The dismissal of the application reinforces the courts
approach to striking out of claims – namely that where
there are valid arguments as to liability that it is inappropriate. It is also a reminder that in the context of
the scope of a professional’s duty, the extent is determined by the purpose of the duty, with reference to
why the advice is being given. In each case this is a
question of fact and analysis, and in this particular instance is still to be determined in the final hearing.
Glover reiterated this last point for the Repayment
Claim (fact specific and should only be determined at
trial).[9] Glover also submitted that just because Fluid
is a structural engineer, it could not argue its only liability was for losses directly flowing from physical damage due to structural defects. This was on the basis that
Fluid had specifically undertaken to investigate and
or provide advice in relation to anticipated litigation.
A practical lesson is the importance for professionals to
have a clearly defined scope of work and obligations in
a written appointment and where appropriate to consider limiting liability for certain categories of loss.
The decision
At the hearing, the Judge HHJ Stephen Davies,
focused on whether the proper grounds for strike out,
or summary judgment had been met.
References
[1] Glover and another v Fluid Structural Engineers & Tech-
nical Designers Ltd [2023] EWHC 3219 (TCC):
https://www.bailii.org/ew/cases/EWHC/TCC/2023/3219.html
[2] Hamida Begum v Maran (UK) Limited [2021] EWCA Civ
326, per Coulson LJ at paragraphs 20-21
[3] ICI Chemicals & Polymers Ltd v TTE Training Ltd
[2007][3] EWCA Civ 725
[4] Paragraph 19.
[5] For specific breakdown of the heads of loss, see paragraph
20.
[6] Manchester Building Society v Grant Thornton UK LLP
[2021] UKSC 20, see paragraph 4: “the scope of the duty of
care assumed by a professional adviser is governed by the purpose of the duty, judged on an objective basis by reference to
the purpose for which the advice is being given”. Note the
checklist provided at paragraph 6 (1) – (6).
[7] BDW Trading Limited v (1) URS Corporation Limited (2)
Cameron Taylor One Limited [2021] EWHC 2796 (TCC).
Dealing with the Costs Claim first, he held that it was
at least arguable that Fluid was or should have been
aware that the purposes of its performance of its duties in the construction phase extended to protecting
Glover’s interests as a whole which included the potential consequences of damage to adjoining properties Their obligations included site visits, monitoring
compliance and movement, which was to serve the additional purpose of allowing the Works to be properly
investigated and resolved when faced with any claim.
Ultimately, the Cost Claim would be a question for
trial, as to whether or not Glover could make out their
case on the basis that initial pre-action costs were
wasted due to an incorrect understanding of the true
position, as a result of Fluid’s alleged breaches. HHJ
Stephen Davies went on to say that Manchester Building
Society v Grant Thornton UK LLP [2021] provided a perfectly satisfactory limit to the nature and extent of the
losses for which structural engineers may be liable
which, in appropriate cases, may extend to a liability
for legal and other dispute-related costs incurred by
their client or for which their client is liable.[10] For
these reasons, the Cost Claim was not struck out as it
was a question for trial.
[8] Jackson J in Multiplex Constructions (UK) Ltd v Cleveland
Bridge UK Ltd [2006] EWHC 1341 (TCC); and HHJ Stephen
Davies in William Clark Partnership Ltd v Dock St Pct Ltd
[2015] EWHC 2923 (TCC).
[9] Paragraph 27 and 28.
[10] Paragraph 52.
[11] Multiplex Constructions (UK) Ltd v Cleveland Bridge
UK Ltd [2006] EWHC 1341 (TCC)
[12] William Clark Partnership Ltd v Dock St Pct Ltd [2015]
EWHC 2923 (TCC)
As for the Repayment Claim, the judge focused on the
authorities Multiplex Constructions (UK) Ltd v Cleveland
Bridge UK Ltd [2006][11] and his own judgment in
William Clark Partnership Ltd v Dock St Pct Ltd
[2015][12]. Both cases focus on situations where the
EXPERT WITNESS JOURNAL
Author
Jake Wright, Associate
Stevens & Bolton LLP
Jake.Wright@stevens-bolton.com
100
JUNE 2024