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You are here: BAILII >> Databases >> England and Wales Court of Appeal (Civil Division) Decisions >> CA Blackwell (Contractors) Ltd. v Gerling Allegemeine Verischerungs Ag [2007] EWCA Civ 1450 (16 November 2007) URL: http://www.bailii.org/ew/cases/EWCA/Civ/2007/1450.html Cite as: [2007] EWCA Civ 1450 |
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COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT, CHANCERY DIVISION
(HIS HONOUR JUDGE MACKIE QC)
Strand, London, WC2A 2LL |
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B e f o r e :
LORD JUSTICE MAURICE KAY
and
LORD JUSTICE HOOPER
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CA BLACKWELL (CONTRACTORS) LTD |
Claimant/ Respondent |
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- and - |
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GERLING ALLEGEMEINE VERISCHERUNGS - AG |
Defendant/ Appellant |
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WordWave International Limited
A Merrill Communications Company
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Mr Ronald Walker QC and Mr William Evans (instructed by Fisher Scoggins LLP) appeared on behalf of the Respondent.
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Crown Copyright ©
Lord Justice Tuckey:
"This policy excludes loss of or damage to and the costs necessary to replace repair or rectify
a) Property insured which is in a defective condition due to a defect in design plan specification materials or workmanship of such Property insured or any part thereof.
b) Property insured lost or damaged to enable the replacement repair or rectification of property insured excluded by a) above.
Exclusion a) above shall not apply to other Property insured which is free of the defective condition that is damaged in consequence thereof.
For the purpose of the Policy and not merely this Exclusion the Property insured shall not be regarded as lost or damaged solely by virtue of the existence of any defect in design plan specification materials or workmanship in the Property insured or any part thereof."
"23. …Temporary drainage involved more than the use of pumps and tankers. The strategy during bulk works consisted first of shaping earthworks laterally and longitudinally day to day so as to shed water to collection points prior to its discharge into adjacent streams. Where this was not possible sacrificial "grips" (shallow temporary excavated channels which lead water to collection points) and trenches would be excavated to drain water. He said that once the final profile of the earthworks was reached there was a risk of rainwater collecting in the low points of the incomplete works and from that point the installation of temporary trenches would not be possible without causing damage to the permanent works. Water was shed laterally and longitudinally to the collection points in the vertical alignment. Grips were cut where necessary to assist the flow. At the collection points sumps were excavated where there was space. Pumps and tankers were in use only where direct discharge to collection points or silt traps was not possible because of the remoteness of the outfalls…
24. The rainfall which occurred at the time of the incident was of a level that had occurred during the previous year's construction period but the consequences were then much less because of the earlier stage of the earthworks."
"38. …Mr Edwards's appraisal of the factors that led to the incidents is one I accept both because of the weight of his evidence and because of its consistency with common sense. I accept Mr Edwards's evidence that an adequate temporary drainage system needs to have more to it than bringing in tankers and pumps after the event. But properly considered the evidence of Blackwell, which I accept, is that it did have a more 'proactive' system, which altered day by day as described by Mr Kettyle. Further whilst recognising the force of what Mr Edwards had to say about the use of shale his conclusion that disaster was inevitable with work continuing through October to December was based on the assumption, which he had been entitled to make from his instructions at the outset, that there was no proactive temporary drainage, nothing additional to the pumps and the bowsers."
"…all Damage (meaning Physical Loss, Physical Destruction or Physical Damage) of whatsoever nature sustained during the period of insurance to: a) the Works whether permanent or temporary, materials incorporated or for incorporation therein…and any other property of whatsoever nature…the property of the insured."
The policy defines the words "the Works" to mean:
"the undertaking described in and which forms the subject matter of any contract executed or in the course of execution by the Insured."
and "property" to mean "material property". I have already quoted the exclusion clause which was the fourth of a series of unrelated exclusions to section 1 of this policy.
"61. …What is the 'property insured' for this purpose, defined as it is as 'material property' in the definitions? It is, as both parties in a sense recognise, the capping and damaged sub-formation. The temporary drainage is not of itself property. It is a series of measures combining items like tankers with methods of doing things which include changes, such as cutting and channelling, to the capping which is part of the Insured Property. Some of these measures are protection for the capping and distinct from it. To this extent Mr Walker is right to separate drainage from capping so that if the exclusion is triggered that property falls within the limitation. So presumably would the sub-formation which is also part of the claim. However a failure to cut and channel the capping so as to make it reasonably proof against incidents such as those in this case, if demonstrated and material (which is not the case here), might well mean that the property is in a defective condition due to a defect in design or, say, materials. The difficulties identified in argument spring, as I see it, not from inadequacies in the wording but from the continuous, extensive, protean and eventually hidden nature of the insured property in this case.
62. On the facts I do not consider that Gerling has been able to establish that property was in a defective condition due to a relevant defect. It does not follow from the fact that the incidents occurred as a result of the coincidence of factors identified by Mr Edwards that there was, even if some negligence on the part of Blackwell were established, a defect in design, materials or workmanship. I have no reason, as I have said, to doubt that Blackwell were operating an essentially sound system of drainage to prevent incidents of the kind which did in fact occur. I return to the difficulties and obstacles which it seems to me lay in the way of Gerling in establishing their case on wilful misconduct. There is insufficient evidence available to warrant a conclusion that the property insured for which claims are made was in a defective condition within exclusion 4."
a) the property insured which has been damaged is the capping and the sub-formation;
b) the temporary drainage is not property insured, but if it is and it was defective it is distinct and separate from the capping and sub-formation so the limitation to the exception applies and damage to the latter, is not excluded;
c) in any event, the property insured was not defective.
Lord Justice Maurice Kay:
Lord Justice Hooper:
Order: Appeal dismissed