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You are here: BAILII >> Databases >> England and Wales High Court (Technology and Construction Court) Decisions >> New Islington and Hackney Housing Association Ltd v. Pollard Thomas and Edwards Ltd [2000] EWHC Technology 43 (8th December, 2000)
URL: http://www.bailii.org/ew/cases/EWHC/TCC/2000/43.html
Cite as: 2001 PNLR 515, [2001] PNLR 515, [2001] BLR 74, [2001] BLR 74(2000) 85 ConLR 194, 85 ConLR 194, [2000] EWHC Technology 43

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New Islington and Hackney Housing Association Ltd v. Pollard Thomas and Edwards Ltd [2000] EWHC Technology 43 (8th December, 2000)

Case No: 1998/ORB/200

IN THE HIGH COURT OF JUSTICE
QUEEN’S BENCH DIVISION
TECHNOLOGY and CONSTRUCTION COURT
Royal Courts of Justice Strand, London, WC2A 2LL

Date: 8 December 2000

B e f o r e : THE HON MR JUSTICE DYSON


NEW ISLINGTON and hackney housing association limited
Claimant
- v - POLLARD THOMAS AND EDWARDS LIMITED
Defendant

Alan Tunkel (instructed by Messrs Devonshires for the Claimant)

Juliet May ( instructed by Messrs Fishburn Morgan Cole for the Defendant)

JUDGMENT

I direct pursuant to CPR Part 39 PD 6.1 that no official shorthand note shall be taken of this judgment and that copies of this version as handed down may be treated as authentic.

The Hon. Mr. Justice Dyson

Introduction

1. In these proceedings, New Islington and Hackney Housing Association ("the Association") claim damages for breach of contract and/or negligence against Pollard Thomas & Edwards ("PTE") arising out PTE’s appointment as architects in 1990. PTE were appointed as architects in 1990 to design and supervise the construction of 6 properties at 2-4 Stradbrooke Road (6 flats), 1-3 Tilney Gardens (8 flats), 132 Rotherfield Street (4 flats), 43 Arvon Road (4 flats), 40 Grenville Road (3 flats) and 57 Avenell Road (3 flats). I have indicated in brackets the number of flats that were created at each property. The Association acquired these sites in 1989/90 with the intention of building new residential units.

2. The construction work was let under two building contracts. Both contracts were on the JCT IFC 84 Standard Form. The contract for the construction of flats at Arvon Road, Grenville Road, Rotherfield Road and Tilney Gardens was let to Botes Building Limited. On 27 January 1992, PTE certified that practical completion was achieved on 23 January 1992. The certificate of making good defects was issued on 24 January 1994. The final certificate was issued on 25 January 1994.

3. The contract for the construction of flats at Avenall Road and Stradbrooke Road was let to GND Construction Limited. On 23 March 1992, PTE certified that practical completion had been achieved on 20 March 1992. The certificate of making good defects was issued on 22 October 1992. The final certificate was issued on 19 February 1993.

4. This litigation is concerned with the sound proofing of all 6 buildings. The Association contends that the sound proofing was inadequate in that it fails to meet the standards prescribed by the Building Regulations for sound insulation between flats. It is the Association’s case that this defect was the result of a shortcoming in PTE’s design. PTE denies liability, but in any event contends that the claim is time-barred. This judgment is concerned only with the limitation issues that arise. Before I set out the relevant history in more detail, it will be convenient to summarise the specific issues that have been raised before me.

5. The proceedings were issued on 1 May 1998. The Association claims damages for breach of contract and/or negligence.

The issues

6.

  1. Did the cause of action in contract accrue before 1 May 1992?

  1. Did the cause of action in negligence accrue before 1 May 1992?

  1. Did the Association acquire knowledge of the relevant damage within the meaning of section 14A of the Limitation Act 1980 before 1 May 1995?

Breach of contract

7. PTE were engaged by the Association under the RIBA standard conditions of engagement. They undertook to provide the "Normal Services", which were described as the various Work Stages identified in Part 2 of the Conditions. These included the following:

"E F G L detailed design, production drawings, specifications and

bills of quantities.

Completing a detailed design, incorporating any design work done

by consultants, nominated sub-contractors and suppliers. Carrying

out cost checks as necessary. Obtaining quotations and other infor-

mation from nominated sub-contractors and suppliers. Preparing

production drawings and specification of materials and workmanship

required. Supplying information necessary for the preparation of

bills of quantities, if any.

H. Tender action to completion

Obtaining and advising on tenders and preparing and advising on the

contract and the appointment of the contractor. Supplying information

to the contractor, arranging for him to take possession of the site and

examining his programme. Making periodic visits to the site as described

in Clause 1.33; issuing certificates and other administrative duties under

the contract. Accepting the building on behalf of the client, providing

scale drawings showing the main lines of drainage and obtaining drawings

of other services as executed, and giving initial guidance on maintenance."

8. As I have already said, PTE certified practical completion as having been achieved on 23 January and 20 March 1992 under the 2 contracts. The Association started to let the flats to tenants in about February 1992. The evidence does not disclose precisely when each flat was first occupied, but it is clear that several, at least, were in occupation from February and March of that year. That is not surprising, since by issuing a certificate of practical completion, PTE were certifying that the Works had been completed: at that stage, in the opinion of PTE the flats were fit for occupation.

9. On 15 September 1992, the Housing Support Manager of the Association wrote an internal memorandum headed "six small sites". At paragraph 2 she wrote:

"2. Flats in the above scheme are now tenanted and noise disturbance

is proving to be a real problem. Although all units are carpeted it is

possible to hear normally-conducted conversations in the next flat.

Were normal standards on sound insulation applied? I am not sure

with whom this should be raised, but I am anxious to avoid similar

problems on future schemes.

Please advise."

 

10. On 30 September, the Association wrote a standard letter to many, if not all of the tenants, reminding them of the obligations in their tenancy agreements not to make noise. But it was clear that the problem was so widespread that the Association thought that it might be caused by inadequate sound insulation in the buildings. Accordingly, on 1 December 1992, they wrote to PTE:

"RE: 40 Grenville Road

I have recently taken over the above scheme from Philip Browne.

I have had a request, from our Housing Support - Project Manager, to

enquire about the sound insulation used at the above scheme. There has

been a complaint from the tenants about the noise disturbance (i.e. conducted conversations in one flat being heard in next flat.)

Could you clarify the following points:-

1) Which sound insulation product was used?

2) Was the sound insulation laid in accordance to Building Regulations?

I look forward to hearing from you."

11. PTE responded on 3 December:

"40 GRENVILLE ROAD, N19

With regard to your query concerning the sound insulation used on the

above project, I confirm the following:-

1) Sound insulation to compartment floor: 48mm Alpha DBK Ltd

‘Sound Floor Plus’ bonded insulation quilt to t & g chipboard laid on

floor boards. 100mm Rockwool insulation quilt laid between joists:

30mm plasterboard and set to ceiling.

2) The insulation specified, as above, was part of the Full Plan Building

Regulations approval received and was subject to the normal site

inspections carried out by the District Surveyor.

I trust the above information is satisfactory but if you require anything

further, please contact me."

12. On behalf of the Association, Mr Tunkel submits that PTE were under a continuing duty to check and review their design until their retainer was terminated. The retainer continued until the final certificates were issued under the two contracts. In particular, he submits that, following receipt of the Association’s letter dated 1 December 1992, PTE were under a contractual duty (a) to investigate the complaint made in the letter, and (b) if they found the complaint to be justified, to have any defect remedied. The failure of PTE to investigate the complaint or to take any steps to have the defect remedied, was a breach of the continuing duty arising under the original retainer. The cause of action in respect of this alleged breach of contract arose when, within a reasonable time of receiving the letter of 1 December 1992, PTE failed to investigate the complaint and remedy the defect that would have been disclosed by an investigation.

13. There has been a number of cases in which the court has had to consider whether, and in what circumstances, an architect is under a continuing obligation to review his design. In my view, the starting point must always be the terms of the contract of engagement between client and architect. As we have seen, the express terms of the contract between the Association and PTE defined the duties to be undertaken by PTE with some precision. They comprised "completing a detailed design", and the various elements specified as "Stage H" which are collectively described as "Tender action to completion". These included preparing the contract, issuing certificates and performing other administrative duties under the contract, and accepting the building on behalf of the client. The express terms do not include the duty of keeping the design under review, still less do they include the duty of reviewing the design after practical completion and the handing over of the building. The administrative duties do, however, include the issue of a certificate of Practical Completion when in the opinion of the architect Practical Completion has been achieved (clause 2.9 of both building contracts). Clause 2.10 of the building contracts provides that "any defects, shrinkages or other faults which appear and are notified" by the architect to the Contractor not later than 14 days after the expiry of the Defects Liability Period from the date of Practical Completion, and "which are due to materials or workmanship not in accordance with the Contract" should be made good by the Contractor. When the Contractor has discharged this obligation, the architect is required to issue a Certificate of Making Good Defects. Accordingly, the scheme of the building contracts which PTE were engaged to administer left no room for PTE to change the design after Practical Completion had been achieved. Prior to that date, it was always open to PTE to issue instructions for a variation of the specification.

14. I accept the proposition that, although it is necessary to look at the circumstances of each engagement, a designer who also supervises or inspects work will generally be obliged to review that design up until that design has been included in the work: see Jackson and Powell on Professional Negligence 4th Edition para 2-17. In a number of cases, it has been held that this duty continues until practical completion: see Chelmsford DC v T J Evers [1983] 25 BLR 99,106, Equitable Debenture Assets Corporation Ltd v William Moss Group Ltd [1984] 2 Con L R 1, 24 and Victoria University of Manchester v Hugh Wilson [1984] 2 Con L R 43, 73.

15. But it is necessary to consider the scope of that duty in a little more detail. What does the duty to review the design entail? In what circumstances will an architect be in breach of that duty? I find it convenient to consider an example. Let us suppose that an architect is engaged on the standard RIBA Conditions of Engagement to provide the full service (as PTE were in the present case), including administering a building contract in a standard JCT form of contract. Suppose that he designs the foundations of a building (a large office block), the foundations are constructed in accordance with his design, and several years later, practical completion is achieved. Let us further suppose that the design of the foundations is defective and one which no reasonably competent architect would have produced: in other words, the architect was negligent. There can be no doubt that the architect commits a breach of contract when he completes the design and gives instructions to the contractor to construct the foundations in accordance with it. But in what sense and to what extent is the architect under a duty to review his negligent design once the foundations have been designed and constructed?

16. In my view, in the absence of an express term or express instructions, he is not under a duty specifically to review the design of the foundations, unless something occurs to make it necessary, or at least prudent, for a reasonably competent architect to do so. For example, a specific duty might arise if, before completion, the inadequacy of the foundations causes the building to show signs of distress; or if the architect reads an article which shows that the materials that he has specified for the foundations are not fit for their purpose; or if he learns from some other source that the design is dangerous. In such circumstances, I am in no doubt that the architect would be under a duty to review the design, and, if necessary, issue variation instructions to the contractor to remedy the problem. But in the absence of some reason such as this, I do not think that an architect who has designed and supervised the construction of foundations is thereafter under an obligation to review his design.

17. I do not accept that in every case where an architect has negligently introduced a defective design into a building, he is also by the same token in breach of a continuing breach of a contractual obligation to review his design. In Midland Bank v Hett, Stubbs & Kemp [1979] Ch 384, 403C, Oliver J said:

"It is not seriously arguable that a solicitor who or whose firm

has acted negligently comes under a continuing duty to take

care to remind himself of the negligence of which, ex hypothesi,

he is unaware".

18. In my view, that observation is as apt to apply to an architect as it is to a solicitor. The position is quite different where the architect (or solicitor) knows, or ought to know, of his earlier negligence. When that occurs, then he may well be under a contractual obligation to review his earlier performance, and advise his client honestly and competently of his opinion. Whether he is in fact under such a duty when he has actual or constructive knowledge of his earlier breach of contract will depend on whether the contract is still being performed. If the contract has been discharged (for whatever reason), then the professional person may be under a duty in tort to advise his client of his earlier breach of contract, but it is difficult to see how he can be under any contractual duty to do so.

19. The foundation for the statement in the cases that an architect is under a continuing duty to review his design is the dictum of Sachs LJ in Brickfield Properties v Newton [1971] 1 WLR 862, 973F:

"The architect is under a continuing duty to check that his design

will work in practice and to correct any errors which may emerge.

It savours of the ridiculous for the architect to be able to say, as it

was here suggested that he could say: "true, my design was faulty,

but, of course, I saw to it that the contractors followed it faithfully"

and be enabled on that ground to succeed in the action."

20. But Sachs LJ was not concerned to explore the scope of an architect’s continuing duty to review his design. In my judgment, the duty does not require the architect to review any particular aspect of the design that he has already completed unless he has good reason for so doing. What is a good reason must be determined objectively, and the standard is set by reference to what a reasonably competent architect would do in the circumstances.

21. In the present case, however, it is not sufficient for Mr Tunkel to contend that PTE were in breach of a continuing duty to review their design before practical completion. He has to argue for a breach of such a duty after 30 April 1992. In University of Glasgow v Whitfield John Laing Construction Ltd [1988] 42 BLR 66, Judge Bowsher QC held that the architect’s duty to design "is a continuing duty which extends until the building is complete" (p 77). At page 78, he said that he saw no reason in principle why the continuing duty should be limited to the period until practical completion "despite the fact that the architect’s right to require work to be done alters at that point". In that case, practical completion of an art gallery was achieved in 1978. The gallery was formally opened in 1980 and 1981. From about 1978, there was water ingress into the building as a result of leaks and condensation. It was only in 1981 that the extent of the problem became apparent. The judge found that the defendant architects undertook a fresh duty in 1982 to reconsider the design. They agreed to give advice and charged a fee for that advice. Judge Bowsher held that this further advice was given "either pursuant to an existing duty or pursuant to an undertaking of a fresh duty". On the facts of that case, therefore, the architects agreed for an additional fee to review their design after practical completion. Inevitably, their breach of duty in the performance of that review arose after practical completion. I do not believe that Judge Bowsher was stating a general principle that an architect is usually under a duty to review his design even after practical completion. I think that his decision was heavily coloured by the special facts of the case. In my view, that case should be regarded as an example of an architect agreeing to investigate the cause of defects in a building outside the terms of his original retainer, and not as an example of the performance of a continuing duty to review his design under the original contract of engagement.

22. In my view, there are two distinct reasons why PTE were not under a contractual duty to review their design of the sound insulation of the flats of these 6 properties in the present case. First, their conditions of engagement, when read in conjunction with the building contracts that they were employed to administer, did not require them to review their design after practical completion had been achieved. On the true construction of the building contracts, PTE were authorised to issue variation instructions at any time up to practical completion of the works. But once practical completion had been achieved, the power to issue variation instructions was spent, and the only remaining functions for PTE to perform under the contracts were to issue the certificates of making good defects and the final certificates. It is not possible to spell out of the RIBA Conditions of Engagement an obligation in PTE to review their design, or to do anything after practical completion except for the matters mentioned in Stage H to which I have earlier referred. It is not surprising that practical completion is treated as the watershed for the purposes of the architect’s duty to review his design. Once practical completion has been achieved, the building is complete, and is handed over to the employer. It is fit for occupation, and will often be physically occupied before the architect issues his certificate of making good defects and his final certificate. In my view, it follows that, if the employer asks his architect to investigate a potential design defect after practical completion, the architect is entitled to refuse, or to say that he will only do so if he is paid a fee. That is because the work of investigating the effectiveness of his original design is not part of the original contract of engagement. The architect may be willing to carry out investigations without a separate fee, but in my view, he cannot be required to do so as part of the services for which he was originally engaged.

23. Secondly, even if (contrary to my view) the contractual duty to review the design can survive practical completion, it would only arise (as before practical completion) where something occurs to put the architect on notice that, as a reasonably competent architect, he ought to review the design. That is where the letter of 1 December 1992 assumes importance.

24. This letter lies at the heart of Mr Tunkel’s argument. He submits that, upon receipt of this letter, PTE were under a duty to investigate whether there was a problem with the sound insulation of all six properties, and to advise the Association of their views. If the investigation had revealed that there was a noise problem, then PTE would, inter alia, have had to review their design.

25. But it is clear that the letter of 1 December 1992 did not ask PTE to investigate whether there was a problem with the sound insulation. It merely asked two precise questions. It is noteworthy that the letter of response answered the questions and concluded with the words: "I trust the above information is satisfactory, but if you require anything further, please contact me". The Association never asked PTE to investigate whether there was a problem, and if so what was its cause. In this respect, the case is strikingly different from the University of Glasgow case. I cannot accept the submission of Mr Tunkel that the letter of 1 December was a "trigger" which activated the obligation in PTE to review their design. They were not asked to do anything other than answer the two questions.

26. I conclude, therefore, that, after practical completion at the latest, PTE were under no contractual duty to review their design of the sound insulation of the six properties.

Negligence

27. On behalf of PTE, Miss May submits that the cause of action in negligence accrued no later than the dates of practical completion, i.e. when the Association took possession of the buildings with their defective sound insulation. Mr Tunkel contends that the cause of action arose when "after a period of occupation by the tenants, the tenants found the buildings to be unfit for their purpose because of "noise nuisance" and the Association became liable to the tenants and/or the Local Authority to remedy this": I quote from his skeleton argument. This is the date when Mr Tunkel submits the Association first suffered damage. His fall-back position is the date when the Association first ought reasonably have discovered the defects in the buildings.

28. It is trite law that the cause of action accrued when the Association suffered damage caused by the negligence of which complaint is made. The problem which has troubled courts time and again in a variety of different situations in recent years has been to determine when a claimant first suffers damage. At the heart of any consideration of the issue lies the House of Lords decision in Pirelli General Cable Works Ltd v Oscar Faber & Partners [1983] 2 AC 1. In that case, the defendant engineers were engaged to advise on and design a building which included a chimney. The chimney was built in June and July 1969. The defendant was found to have been negligent in requiring the use of a material that was unsuitable for its construction. Not later than in April 1970, cracks developed in the chimney. These were discovered in 1977, and it was found by the judge that they could not with reasonable diligence have been discovered before October 1972. The House of Lords held that the cause of action accrued not later than in April 1970 when the damage came into existence. It did not accrue at the later date when, exercising reasonable diligence, the plaintiffs could first have discovered the damage. Lord Fraser gave the main speech. At page 16F, he said:

"…there is an element of confusion between damage to the plaintiff’s

body and latent defect in the foundations of a building. Unless the defect

is very gross, it may never lead to any damage at all to the building. It

would be analogous to a predisposition or natural weakness in the human

body which may never develop into disease or injury. The plaintiff’s cause

of action will not accrue until damage occurs, which will commonly consist

of cracks coming into existence as a result of the defect even though the

cracks or the defect may be undiscovered or undiscoverable."

29. At page 18G, he dealt with the submission advanced on behalf of the defendants that their fault in advising on the design of the chimney was analogous to that of a solicitor who gives negligent advice on the law, which results in the client suffering damage and a right of action accruing when the client acts on the advice: Forster v Outred [1982] 1 WLR 86 is a good example. Lord Fraser said that it was not necessary to decide whether that submission was well-founded , but "as presently advised" he did not think that it was. He continued:

"It seems to me that, except perhaps where the advice of the

architect or consulting engineer leads to the erection of a building

which is so defective as to be doomed from the start, the cause

of action accrues only when physical damage occurs to the building".

30. The Pirelli decision gave rise to difficulties in a number of situations. For example, in Tozer Kemsley & Millbourn (Holdings) Ltd v J Jarvis & Sons Ltd [1983] 1 Const LJ 79, Judge Stabb QC had to decide when the cause of action accrued for the negligent design of a defective heating and air-conditioning plant. The defect did not cause any physical damage analogous to the cracking caused by the defectively designed chimney in Pirelli. Understandably believing that he was constrained to apply Pirelli, Judge Stabb said:

"…a building in that defective state is a damaged building. It is

a damaged article in the sense that it is not a sound one….a building

is a manufactured thing, and if it is unsuitable or defective when it

is handed over it seems to me that the cause of action arises when

the person acquires it in its defective state."

31. In Dove v Banhams Patent Locks Ltd [1983] 1 WLR 1436, the defendants, a firm of burglary prevention specialists, installed a security gate at the entrance to a house in 1967. The installation was done negligently. The plaintiff bought the house in 1976. A burglar broke down the gate in 1979, entered the house and stole some property. Hodgson J held that the cause of action accrued at the time of the burglary. He referred to Pirelli and said: "It seems to me that the analogy between the cracks in the chimney and the collapse of this gate is exact".

32. In London Congregational Union Inc v Harriss & Harriss [1988] 1 AER 15, the defendant architects were sued for negligently designing drains for a church hall. Practical completion of the building took place in 1970. In August 1971, the building was flooded (and damaged) as a result of the negligent design of the drains. The writ was issued in February 1977. The defendants contended that the cause of action accrued at the date of practical completion on the grounds inter alia that the defective drains constituted the physical damage to the building (applying Tozer Kemsley), or that the design defect had by the date of practical completion caused the plaintiffs economic loss, since they had incurred remedial costs by that date. Ralph Gibson LJ, with whom O’Connor LJ agreed, said that he was unable to distinguish Pirelli. At page 22E, he said that in both cases, there was a negligent design which was latent in the sense that "for a time the building and the various parts of it functioned as those parts were expected and required to function, and which was later the cause of physical damage to the building".

33. Ralph Gibson LJ later considered Tozer Kemsley, and at page 23G said:

"…I see no reason why on the facts of a particular case the defect

resulting from negligent design or supervision should not constitute

the physical damage to the building provided that the damaging

consequences of the defect are immediately effective. In such

circumstances there is no need for subsequent or later damage

in order to complete the cause of action. Accepting the principles

stated by Judge Stabb and applying them to the facts of this case,

I am unable to find that the defect in design can or should be treated

as physical damage to the building. The drains, in the physical

condition resulting from the defect in design, were not such as to

produce at once their damaging effects. They were capable of

functioning properly as drains and they did so for some twenty months."

34. The problem of latent damage caused by negligent advice in contexts other than that of buildings and chattels was treated differently. We have seen that Lord Fraser said that he did not think that the analogy between cases concerning the negligent design of buildings and negligent advice by solicitors was a good one. In D W Moore & Co v Ferrier [1988] 1 AER 400, Bingham LJ said at page 411H that cases such as Pirelli and Dove "turn on special principles related to their own subject matter".

35. There are many examples of these cases of negligent advice by professional persons, where it has been held that the claimant suffers damage when he or she acts in reliance on the advice, even if unaware of the defect until later. Examples are Forster v Outred, Moore v Ferrier, Knapp v Ecclesiastical Insurance Group Plc [1998] LLR (Insurance and Reinsurance) 390, and many others. Thus, in Forster, the defendant solicitors were instructed to advise the plaintiff about executing a mortgage which charged her freehold property as security for a loan made to her son. Her case was that the solicitors had been negligent in that she should have been advised not to execute the mortgage. A question arose as to whether her cause of action in tort accrued when she executed the mortgage, or only later when her son became bankrupt and she had to pay off the loan. The Court of Appeal held that it accrued at the earlier date. This was because she suffered a loss from the moment her property was reduced in value by the encumbrance, although it was not to be known at that time whether her son would default. As Hobhouse LJ said in Knapp (at page):

"From these authorities it can be seen that the cause of action can

accrue and the plaintiff have suffered damage once he has acted

upon the relevant advice "to his detriment" and failed to get that to

which he was entitled. He is less well off than he would have been

if the defendant had not been negligent".

36. In Murphy v Brentwood District Council [1991] 1 AC 398, the House of Lords departed from its earlier decision of Anns v Merton London Borough Council [1978] AC 728. Although Murphy is not a limitation case, as Lord Keith pointed out (page 466B), "consideration of the nature of the loss suffered in this category of cases is closely tied up with the question of when the cause of action arises". He then went on to discuss that question in relation to defective buildings, and at page 466F said:

" It would seem that in a case such as Pirelli, where the tortious liability

arose out of a contractual relationship with professional people, the duty

extended to take reasonable care not to cause economic loss to the client

by the advice given. The plaintiffs built the chimney as they did in reliance

on that advice. The case would accordingly fall within the principle of

Hedley Byrne & Co Ltd. V Heller & Partners Ltd. [1964] AC 465. I regard

Junior Books Ltd. v Veitchi Co. Ltd.[1983] 1 AC 520 as being an application

of that principle.

In my opinion it must now be recognised that, although the damage in Anns

was characterised as physical damage by Lord Wilberforce, it was purely

economic loss. In Council of the Shire of Sutherland v Heyman, 157 CLR 424

where, as observed above, the High Court of Australia declined to follow

Anns when dealing with a claim against a local authority in respect of a

defectively constructed house, Deane J. said, at pp. 503-505:

"Nor is the respondents’ claim in the present case for ordinary physical

damage to themselves or their property. Their claim, as now crystallized,

is not in respect of damage to the fabric of the house or to other property

caused by collapse or subsidence of the house as a result of the inadequate

foundations. It is for the loss or damage represented by the actual inadequacy

of the foundations, that is to say, it is for the cost of remedying a structural

defect in their property which already existed at the time when they acquired

it. In Anns v Merton London Borough Council [1978] AC 728, it was held

by the House of Lords that a local government authority owed a relevant

duty of care, in respect of inspection of the foundations of a building, to

persons who subsequently became long term lessees (either as original

lessees or as assignees) of parts of the building. Lord Wilberforce, at

p.759, in a speech with which three of the other four members of the

House of Lords agreed, expressed the conclusion that the appropriate

classification of damage sustained by the lessees by reason of the

inadequacy of the foundations of the completed building was ‘material,

physical damage, and what is recoverable is the amount of expenditure

necessary to restore the dwelling to a condition in which it is no longer

a danger to the health or safety of persons occupying and possibly

(depending on the circumstances) expenses arising from necessary

displacement’. While, in a case where a subsequent purchaser or long

term tenant reasonably elects to retain the premises and to reinforce

the foundations, one possible measure of the damages involved in the

actual inadequacy would (if such damages were recoverable) be that

suggested by his Lordship, I respectfully disagree with the classification

of the loss sustained in such circumstances as ‘material, physical damage’.

Whatever may be the position with respect to consequential damage to

the fabric of the building or to other property caused by subsequent

collapse or subsidence, the loss or injury involved in the actual inadequacy

of the foundations cannot, in the case of a person who purchased or

leased the property after the inadequacy existed but before it was known

or manifest, properly be seen as ordinary physical or material damage.

The only property which could be said to have been damaged in such

a case is the building. The building itself could not be said to have been

subjected to ‘material, physical damage’ by reason merely of the

inadequacy of its foundations since the building never existed otherwise

than with its foundations in that state. Moreover, even if the inadequacy

of the foundations could be seen as material, physical damage to the

building, it would be damage to property in which a future purchaser

or tenant had no interest at all at the time when it occurred. Loss or

injury could only be sustained by such a purchaser or tenant on or

after the acquisition of the freehold or leasehold estate without knowledge

of the faulty foundations. It is arguable that any such loss or injury should

be seen as being sustained at the time of acquisition when, because of

ignorance of the inadequacy of the foundations, a higher price is paid

(or a higher rent is agreed to be paid) than is warranted by the intrinsic

worth of the freehold or leasehold estate that is being acquired. Militating

against that approach is the consideration that, for so long as the inadequacy

of the foundations is neither known nor manifest, no identifiable loss has

come home: if the purchaser or tenant sells the freehold or leasehold estate

within that time, he or she will sustain no loss by reason of the inadequacy

of the foundations. The alternative, and in my view preferable, approach

is that any loss or injury involved in the actual inadequacy of the foundations

is sustained only at the time when that inadequacy is first known or manifest.

It is only then that the actual diminution in the market value of the premises

occurs. On either approach, however, any loss involved in the actual

inadequacy of the foundations by a person who acquires an interest in the

premises after the building has been completed is merely economic in its

nature."

I find myself in respectful agreement with the reasoning contained in this

passage, which seems to me to be incontrovertible."

37. The other members of the House (some of whom gave substantive speeches) all agreed with the speech of Lord Keith. It is clear, therefore, that, as Professor McKendrick has said in his perceptive article "Pirelli re-examined" (1991) 11 Journal of Legal Studies 326, the House of Lords has "re-interpreted" its earlier decision of Pirelli. It did not, however, say that it had been wrongly decided. In my judgment, the present state of affairs is hardly satisfactory. If, as Lord Keith said, Pirelli falls within the principle of Hedley Byrne v Heller & Partners [1964] AC 465 and is an economic loss case, then it is difficult to see why the cause of action in Pirelli did not accrue when the plaintiffs relied on the advice of the engineers by instructing them to proceed with the construction of the chimney. But, as we have seen, the defendants sought to persuade the House in Pirelli to accept the analogy of the Forster line of cases, and Lord Fraser thought that it was not a good one. As Professor McKendrick says, this suggests that the reason for the rejection of the analogy was Lord Fraser’s perception of the loss in Pirelli as physical damage, and not economic loss. Now that the loss has been classified as economic loss, the reason for rejecting the analogy has disappeared.

38. The fact remains, however, that the House in Murphy did not say that Pirelli was wrongly decided. Accordingly, it remains an authority that is binding on me. In Knapp, the Court of Appeal stated that it was bound by Pirelli, although it appears that Murphy was not cited to it.

39. Since I am bound by Pirelli, it is clear that the Association’s cause of action in the present case did not accrue when they first knew or ought reasonably to have known of the defect. It is true that in the Sutherland case, Deane J said that the date of knowledge of the defect in the building was his "preferable" approach, and that Lord Keith found the reasoning of Deane J to be "incontrovertible". But the fact remains that the knowledge test has not been applied in English law as marking the date on which damage is first suffered for the purpose of completing a cause of action in negligence. This test was disavowed in Pirelli itself; and it has not been applied in the line of cases exemplified by Forster either. It is because a claimant can suffer loss without being aware of it that the Latent Damage Act 1986 was passed.

40. Nor can I accept the submission of Mr Tunkel that the Association did not suffer damage until they first became liable to their tenants and/or the local authority in nuisance. If, as appears from Murphy, the case is to be viewed as one of economic loss, then the Association suffered damage at the latest when the buildings were handed over with their defective sound insulation. This loss is completely independent of any potential liability to meet claims by tenants and/or the local authority. It would be nonsense to say that the accrual of the cause of action was dependent on the fortuitous timing of complaints made by third parties. The fact is that, regardless of any complaints by third parties, the Association have a defective building as a result of the alleged negligence of PTE.

41. In my judgment, the Association’s cause of action in negligence accrued at the latest at the date of practical completion. It seems to me that this follows from an application of Pirelli as it was interpreted in the Harriss case. In my view, the present case is analogous to Tozer Kemsley, which, it will be recalled, was approved by the Court of Appeal in Harriss. The defective heating and air-conditioning plant did not (and could not) cause physical damage to the building. The defective plant was the physical damage. The plant was never capable of functioning as it was expected and required to function. Since the defect was present when the building was handed over, the damage was suffered at the date of handover. In Harriss, Ralph Gibson LJ said that a defect could constitute physical damage to the building "provided that the damaging consequences of the defect are immediately effective". In Tozer Kemsley, the damaging consequences of the defect were immediately effective, since the plant was never capable of functioning properly. In Harriss, the damaging consequences of the defective drains were not immediately effective, since the drains were capable of functioning properly as drains, and did so function, for 20 months. Accordingly, the physical damage was not suffered until those damaging consequences first occurred. In the present case, the sound insulation was inadequate from the date of handover. It was never capable of being fit for the purpose. In the language of "damaging consequences", those consequences were immediately effective. From the outset, the building suffered from lack of adequate sound insulation, just as the building in Tozer Kemsley suffered from an inadequate heating and air-conditioning plant from the outset. In neither case is it necessary to identify a date when an occupant actually suffers from the defect. It is the building that suffers from the defect, and that is what is required to enable the owner to complete his cause of action in negligence.

42. Accordingly, by applying Pirelli, as it has been interpreted by the Court of Appeal, I conclude that the Association’s cause of action accrued when the buildings were handed over.

43. If I had been free to do so, I would have reached the same conclusion by a different route, but that would have involved the proposition that Pirelli was wrongly decided. It seems to me that, if it is now to be understood as a case on economic loss, then Pirelli cannot stand. That is because it makes no sense to say that the plaintiffs in that case first suffered economic loss when, unknown to them, cracks first occurred in the chimney. There are arguments in favour of saying that the plaintiffs suffered economic loss when the chimney was constructed to the defective design, or alternatively (Deane J’s preferred approach) when the defect was first discovered or discoverable. On the facts of Pirelli, the first approach would have led to the cause of action accruing in June or July 1969; the second approach would have led to the cause of action accruing in 1977. One advantage of abandoning the Pirelli approach would be to bring the defective building cases into line with the other cases involving latent defects resulting from negligent advice. On the face of it, there is no good reason why building cases should be the subject of special rules. Another advantage would be to avoid the kind of contortions that are exemplified by decisions such as Dove and Harriss. I see the great force of the reasoning of Deane J. Similar reasoning was expressed by the Privy Council in the New Zealand case of Invercargill City Council v Hamlin [1996] AC 624, 646H- 649A. But, as Hobhouse LJ pointed out in Knapp (at page 397), New Zealand, and indeed Australia, have adopted different solutions to the potential injustices which arise from a strict application of the primary limitation period. In those countries judicial solutions have been found. In England the approach has been different:

"Additional statutory provisions have been introduced designed to

achieve similar results. These provisions are premised upon the

prima facie application of the primary limitation period and

introduce in a defined way certain relaxations of it to avoid injustice."

 

44. In particular, the Latent Damage Act was passed, inter alia, in order to deal with the injustice that can flow from Pirelli. One consequence of adopting the discoverability test would be to render redundant the discoverability test that was introduced by that Act (incorporated as section 14A of the Limitation Act 1980). Section 14A provides that the plaintiff in an action for negligence now has the benefit of an extended limitation period where he or she is unaware of facts relevant to his cause of action at the date when the cause of action accrued. The extended period is three years from the date when the plaintiff first had the knowledge required for bringing an action for damages in respect of the relevant damage, with a long-stop period of 15 years from the date of the act or omission which is alleged to constitute negligence. Accordingly, another consequence of adopting the discoverability test would be to undermine the 15 year long-stop period.

45. Largely for these reasons, if free to do so, I would have preferred to adopt the first of the two approaches adumbrated by Deane J. I have touched on this point, because it was the subject of argument by Miss May.

Section 14A of the Limitation Act 1980

46. Section 14A(4) of the Limitation Act 1980 provides that an action to which the section applies (which includes one such as the present action) shall not be brought after the expiration of "(a) six years from the date on which the cause of action accrued, or (b) three years from the starting date as defined by subsection (5) below, if that period expires later than the period mentioned in paragraph (a)". Subsection (5) provides that "the starting date for reckoning the period of limitation under subsection (4)(b) above is the earliest date on which the plaintiff…first had both the knowledge required for bringing an action for damages in respect of the relevant damage and a right to bring such an action". Subsection (6) provides that "knowledge required for bringing an action for damages in respect of the relevant damage" means knowledge "both---(a) of the material facts about the damage in respect of which damages are claimed, and (b) of the other facts relevant to the current action mentioned in subsection (8) below". Subsection (8) provides that:

"The other facts referred to in subsection (6)(b) above are—

(a) that the damage was attributable in whole or in part to the

act or omission which is alleged to constitute negligence; and

(b) the identity of the defendant; and

(c) ……."

 

Subsection (10) provides that knowledge includes knowledge which a person might reasonably be expected to acquire "(a) from facts observable or ascertainable by him; or (b) from facts ascertainable by him with the help of appropriate expert advice which it is reasonable for him to seek."

47. It has been held that for the purposes of section 14A of the Limitation Act 1980, a claimant need not "know for certain and beyond the possibility of contradiction": per Lord Donaldson MR in Halford v Brookes [1991]1 WLR 428, 443E. He continued:

"It does, however, mean "know with sufficient confidence to justify

embarking on the preliminaries to the issue of a writ, such as submitting

a claim to the proposed defendant, taking legal and other advice and

collecting evidence. Suspicion, particularly if it is vague and unsupported,

will indeed not be enough, but reasonable belief will normally suffice".

 

48. The burden of proof is on the Association to prove that the claim is not statute-barred: see per Purchas LJ in Nash v Eli Lilly [1993] 1 WLR 782, 796. On the facts of this case, this means that the burden is on the Association to prove that it did not have the requisite knowledge until a date after 30 April 1995.

 

The Facts

49. It is now necessary to recite some of the relevant facts. I have already recounted the relevant events up to and including the Association’s letter to PTE of 1 December 1992, and PTE’s response of 3 December 1992.

50. The evidence discloses almost nothing about the noise problem during 1993. On 18 March 1994, Islington Council served notice of failure to comply with the Building Regulations in relation to airborne sound in two flats at 43 Arvon Road, requiring remedial work to be done in the two flats, and suggesting that work be done to improve the sound insulation in all the flats, because "from what the tenants have told me, the insulation is poor throughout". On 23 March, the Association sent a copy of the notice and report on sound insulation in respect of 43 Arvon Road to Bickerdike Allen & Partners ("BAP"), and asked for advice on the best course of action. On 28 March 1994, BAP replied advising that the Association appeal, saying that it was unclear what was the nature and extent of the complaints that had been received by the local authority.

51. On 4 May, Mr Courtnell of the Association wrote to BAP asking them to carry out tests at Arvon Road. This BAP did and on 30 June they reported to the Association that they were not confident that they had sufficient evidence to challenge the notice. They referred to the sound insulation of the separating floor, and said:

"...If it is new build, and arguably even if it is a conversion given its

recent time of construction, it brings into question the role of the Architect

who should have been aware at the design stage of the need to provide

adequate sound insulation in accordance with current (or impending)

Building Regulations. Clearly, if it is new build, the airborne performance

of the floor is not achieving the performance standard given in the

Approved Document E of the Building Regulations."

52. The Association decided not to contest the notice, and on 5 September 1994 instructed BAP to prepare the documents necessary for the remedial works to be carried out at 43 Arvon Road. On 20 October 1994, BAP wrote to the Association again after having considered the constructional details that had been used to do the work at 43 Arvon Road in the first place. They advised that "the main cause of the shortfall in sound insulation performance with respect to Building Regulations is, in our opinion, due to the wall construction". They said that the Building Regulations required that if the mass of the inner leaf of blockwork was less than 360kg/mm2, then an independent lightweight wall should be provided adjacent to the masonry wall. BAP advised that the mass of the inner leaf was well below the required value, and probably less than 100kg/mm2: there was no independent lightweight wall.

53. On receipt of this report, Mr Courtnell decided that the Association needed legal advice. On 7 November 1994, they consulted Messrs Devonshires. On 7 December, Devonshires wrote to PTE. They referred to the tests carried out by BAP in June, and said that it " is obviously of great concern to our client if the same sound insulation specification has been used in new build constructions at [all the other properties] in which you were involved around the same time". They asked for confirmation of the sound insulation specification that was used at the other sites, and that these met the standards required by the 1985 Building Regulations. They also enclosed a copy of the BAP letter of 20 October "for your information".

54. The response was delayed because Mr Christophides, the architect responsible for this project no longer worked for PTE. On 31 January 1995, PTE did respond but apparently without the assistance of Mr Christophides. They said that they were trying to obtain more details from Mr Christophides, now that they had retrieved their files and drawings. They said that it was "possible" that the contractor had not built in accordance with their specifications. They added:

"...We shall need to discuss further with Mr Christophides whether

the same specification was used in the other properties to which you

refer in your letter under reply although, if such does prove to be the

case, no automatic conclusions can be drawn.

Might we suggest a site inspection to be attended by the contractor,

ourselves and we shall endeavour to obtain the attendance of Mr

Christophides. It is, I suggest, for you or your client to approach

the contractor. Such an inspection should not be construed as any

admission of liability."

55. On 2 February 1995, Devonshires replied saying that, as PTE was "responsible for the specification of the sound insulations" at each of the sites, it was not proposed to contact the contractor. They asked PTE to make available all their files, so that they could inspect the specifications and plans etc. They said that if there were similar problems with other sites, "then with every day that passes our clients are at risk of having further Noise Nuisance Notices served on them, which may require remedial work to be carried out at our clients’ cost". They then asked PTE to provide information about the specifications and to say whether they were complied with in relation to each of the 6 properties. They gave PTE until 20 February to supply the information.

56. PTE replied on 15 February giving some of the information that had been requested. They confirmed that the contract files for 43 Arvon Road were available for inspection. They hoped to provide the remaining information that had been requested within the next few days. Meanwhile, PTE had instructed Messrs Fishburn Boxer to act as their solicitors. On 1 March 1995, Devonshires wrote to Fishburn Boxer asking for all the documents previously requested as well as the outstanding information. They continued:

"Whilst our client has so far refrained from issuing proceedings in the

hope that the matter can be resolved without proceedings, after over

3 months of correspondence our client feels that we are no further

forward. With this in mind, we would be grateful if the two matters

referred to in the paragraph above could be dealt with within the next

14 days".

57. The two matters referred to were the requests for the documents and for the outstanding information. On 13 March, Fishburn Boxer asked for the documents to be identified more precisely, and said that they could not provide the balance of the information that had been sought until they had completed their own investigations. On 14 March, Devonshires identified the documents that they wished to inspect as all the Association’s files in relation to the 6 sites, and said that they were taking their client’s instructions on the issue of proceedings. Correspondence continued between the solicitors. On 20 March, Fishburn Boxer said that proceedings would be premature, since PTE were doing "everything possible to investigate the alleged problems at the various sites". In response to yet another request for the documents, Fishburn Boxer wrote on 30 March saying that the documents relating to 43 Arvon Road had been available for inspection since mid-February as stated in PTE’s letter of 15 February. Fishburn Boxer reiterated on 19 April and again on 13 June that the documents were available at PTE’s offices.

58. Mr Furley of PTE says that the Association did not in fact inspect these documents until 16 May 2000. The Association did not call any witness before me to say that he or she did inspect the documents before May 2000. But I think that Mr Furley is probably wrong. An examination of the documents at pages 179, 179a and 179c of bundle B suggests to me that the files and other documents listed in PTE’s letter of 13 June 1995 as being available for collection were the ones that were referred to in the Association’s memo at page 179a as the "documents" that had been "got". That would tie in with the note on Devonshire’s file at page 179c that "file confirmed all hses built to same specification". I did not find Mr Furley a particularly convincing witness, and, despite the absence of oral evidence that there was an inspection of the documents in June 1995, I find that such an inspection probably did take place.

59. This review has taken me beyond 1 May 1995, which is the critical date for the purposes of the section 14A point. I can complete the narrative of relevant events briefly. On 7 December 1995, BAP made their proposals for assessing the sound insulation of flats at the remaining 5 properties (i.e. all except 43 Arvon Road) by selective testing. In their letter to Mr Courtnell of that date, they referred to the other groups of flats as being "recently built and similar in construction to 43 Arvon Road". During February and March 1996, they produced their reports on the tests that they were able to carry out at the other properties. On 7 June 1996, BAP reported on the remedial works that they considered to be necessary for 43 Arvon Road. They wrote that they had been advised that all of the properties had been built to the same specification. They said that, if the same specification had indeed been used in all the properties, and if airborne sound insulation measurements suggested a comparable performance in all the flats, then the proposed remedial measures would be equally applicable to all the properties. They suggested that a detailed survey be carried out at each site.

60. BAP duly carried out testing and reported on 30 July 1996. The testing showed a significant deficit in sound insulation at each of the properties. The main cause of the problem in each case was the same as that which had been identified by BAP at 43 Arvon Road and referred to in their letter of 20 October 1994.

The submissions of Mr Tunkel

61. It is the Association’s pleaded case that they had the requisite knowledge at about the end of June 1995 (as regards 43 Arvon Road), and at the end of February 1996 (as regards the remaining properties).

62. As regards 43 Arvon Road, Mr Tunkel accepts that the Association knew (a) that they had suffered some damage by the time they received the statutory notice on 18 March 1994, and (b) that the damage was caused by defects in the property (as opposed to unreasonable behaviour by the tenants). But he submits that they did not know that the defects were ones of design until they inspected the documents in June 1995.

63. As for the remaining properties, Mr Tunkel contends for the end of February 1996 on the grounds that this is when BAP reported that the tests showed that the sound insulation problems were substantially the same in those properties as they were at 43 Arvon Road. Since by that time the Association knew that there was no material difference between the design in any of the properties, they had the relevant knowledge on receipt of the test results from BAP.

Conclusion on the section 14A issue

64. I cannot accept these submissions and substantially for the reasons advanced by Miss May.

43 Arvon Road

65. I shall start with 43 Arvon Road. The Association knew as early as 1992 that there was a problem of sound insulation at this property. By October 1994, they knew that the main cause of the problem was the fact that the walls did not comply with the Building Regulations. The Association may not have known for certain that the problem was one of design, rather than a failure by the contractor to comply with the specification. But it is instructive to see how Devonshires dealt with the suggestion made by PTE in the letter of 31 January 1995 that it was possible that the contractor had not built in accordance with the specification. They said that, as PTE was responsible for the specification of the sound insulation, they did not propose to contact the contractor. That is a very strong indication that the solicitors believed that this was a design problem. As Miss May points out, the tone of the correspondence in early 1995 indicates that the Association and their solicitors took the view that this was a design problem for which PTE was responsible. They were looking to PTE to come up with a solution.

66. I conclude, therefore, that so far as 43 Arvon Road is concerned, the Association had all the relevant knowledge at the latest on receipt of the BAP reports of 30 June and 20 October 1994. If it were necessary to do so, I would find that the Association actually knew that the sound insulation problems at 43 Arvon Road were caused by the defective design of the walls, and that PTE were responsible for that design. But, as Lord Donaldson MR said in Halford v Brookes, it is not necessary to go that far. The Association certainly had a reasonable belief that the problems were caused by the defective design of the walls for which PTE were responsible. They had taken legal advice. Indeed, by the Spring of 1995, Devonshires were threatening to start proceedings.

The other properties

67. I turn next to consider the position with regard to the other properties. Mr Tunkel submits that by 30 April 1995, the Association did not know whether the sound insulation of any of the other properties complied with the Building Regulations. They acted reasonably in not instructing BAP to inspect and test these buildings until December 1995: it was reasonable first to seek to obtain the relevant documents and information from PTE, thereby avoiding the expense of further testing etc. Mr Tunkel says that it would have been mere speculation to infer from the October 1994 report on 43 Arvon Road that the other properties suffered from the same sound insulation problems, and that they were attributable to the same cause. He points out that no statutory notices had been received in respect of any of those properties, and that Mr Henson of BAP was not willing to extrapolate the results of the tests and inspections at 43 Arvon Road, and apply them without more to the remaining properties.

68. I cannot accept these submissions for the following reasons. First, the Association knew by 30 April 1995 that the problem of sound insulation was not confined to 43 Arvon Road. As early as September 1992, concerns had been expressed in relation to all sites, and there were documented noise complaints from Stradbrooke Road and Grenville Road.

69. Secondly, if they had applied their minds to the point, the Association would have known that it was extremely likely that the design and construction methods adopted at each of the 6 properties was the same. In particular, they would have known that it was extremely likely that the same lightweight blockwork walls had been installed throughout. All of the sites were developed as part of one scheme carried out at the same time, under two contracts (separate only because of funding differences), using identical contract documentation. In any event, even if they did not actually know that the same lightweight blockwork walls had been specified throughout, they could have found this out with little difficulty. The Association were provided with a complete set of the contract documentation at the outset of the development. It is said on their behalf that they had mislaid these documents by 1992. I am bound to say that the evidence in support of this is far from satisfactory. I have not been persuaded (the burden being on the Association) that they did not have the documents at all material times. Mr Courtnell never looked for the contract documentation, but relied on PTE to produce it in 1995. He could have contacted Mr Keat, the Quantity Surveyor, who had a set of the documentation. Mr Keat’s unchallenged evidence is that he knew that the original specification for sound insulation was the same at all 6 properties. It is common ground that this is so, although there was an amendment to the specification of the floor in the two properties that were the subject of the GND contract. Mr Courtnell could also have contacted any of the Association’s staff who were present at the design stages of the contracts. By one or other of these routes, the Association could have obtained details of the specification, and discovered that the lightweight walls that were found at 43 Arvon Road had been specified at all 6 sites.

70. Thirdly, the Association did in fact believe that the problem was one of design and not of failure by the contractor to build in accordance with the specification. The clearest evidence of that is the way in which their solicitors dealt in their letter of 2 February 1995 with the suggestion that it was "possible" that the contractor had not built in accordance with the specification.

71. Fourthly, the unwillingness of Mr Henson to extrapolate from the results of his tests at 43 Arvon Road does not avail the Association. Mr Henson explained that he had been told by Mr Courtnell by December 1995 that all 6 properties had been built in the same way. The reason why he wanted to conduct sound tests at the other properties was to confirm that what he had been told was correct, and also to help determine the remedial works. If the sound test results at the other properties were in line with those at 43 Arvon Road, that would achieve both objects. It was understandable that Mr Henson should wish to make sure that all the properties had indeed been built in the same way, and that he should obtain all the information that he thought was necessary in order to produce a suitable remedial scheme. But the question for me is whether the Association have proved that they did not have the requisite knowledge until after 30 April 1995. They may not have had knowledge "for certain and beyond the possibility of contradiction" by that date. But I am in no doubt that they had knowledge "with sufficient confidence to justify embarking on the preliminaries to the issue of a writ", and not only in relation to 43 Arvon Road.

72. Fifthly, even if the Association did not have actual knowledge until BAP reported by the end of February 1996, in my view, they should have instructed BAP to carry out the tests on the other properties much earlier than December 1995. Mr Courtnell was asked more than once during his evidence why the Association had delayed until December 1995 before instructing BAP to carry out the further testing. He said that he did not know. Mr Tunkel submits that the Association acted reasonably in first seeking the relevant information from PTE in correspondence. But even when the Association were able to inform BAP that all 6 properties were constructed in the same way, BAP advised further testing to make sure. If Mr Tunkel’s argument is right, the Association could never have had the requisite knowledge until the testing had been carried out. On that basis, there never was a justification for postponing the carrying out of the tests. The fact is that by early 1995, the Association had (at the very lowest) a strong suspicion that there were sound insulation problems at all the properties, and that these were caused by inadequacies in PTE’s design. If (contrary to my opinion) it was necessary to carry out tests at the other properties in order that the Association should have knowledge with "sufficient confidence to embark on the preliminaries to the issue of a writ", then I consider that it was incumbent on them to instruct BAP to carry out those tests promptly in early 1995 at the latest. I am not persuaded that, if this had been done, the Association would not have received the results before 1 May 1995. The reality, however, is that the Association had passed the stage of the preliminaries to the issue of a writ: note, for example, Devonshires’ letter of 1 March 1995 "our client has so far refrained from issuing proceedings".

73. For all these reasons, I am satisfied that the Association had acquired the requisite knowledge before 1 May 1995

Conclusion

74. In the result, I decide all the limitation issues in favour of PTE. Accordingly, these proceedings must be dismissed.


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