Part 5 of the Building Law Reports covers the following key judgments:
- PBS Energo AS v Bester Generacion UK Ltd [2019] EWHC 996 (TCC)
- C Spencer Ltd v MW High Tech Projects UK Ltd [2020] EWCA Civ 331
- Endurance Corporate Capital Ltd v Sartex Quilts & Textiles Ltd [2020] EWCA Civ 308
- Hudson Contract Services Ltd v The Construction Industry Training Board [2020] EWCA Civ 328
- Lungowe v Vedanta Resources plc and Others [2020] EWHC 749 (TCC)
Introduction to the Building Law Reports Part 5 [2020]
This issue is being prepared in the midst of the Coronavirus lockdown. This has affected the everyday business of the courts, in the same way that it has affected so many societies across the world. The Technology and Construction Court has continued to hear cases and applications, for the most part remotely and in accordance with the new guidelines issued by the Lord Chief Justice. The crisis also hit very shortly after O’Farrell J became the new judge in Charge of the TCC, taking over from Fraser J. She is the first female Judge ever to hold this post, and indeed the first female judge to hold a leadership post in the Business and Property Courts. All those associated with the Building Law Reports send her the very best wishes for her term in office. It is also fervently to be hoped that the remainder of her term will be far less dramatic than the first two months.
In this issue we report four Court of Appeal decisions and one first instance decision. The latter is a decision of Fraser J and concerns representation in group litigation, which forms an increasing amount of the work in the Technology and Construction Court.
We reported the decision of Pepperall J in PBS Energo AS v Bester Generacion UK Ltd [2019] EWHC 996 (TCC) in Part 6 of 2019 [2019] BLR 350 . In that case, Pepperall J considered one of those rare cases where summary judgment to enforce an adjudication decision was not granted. This was on the grounds of fraud which the judge held was properly arguable based on the subject matter of the adjudication and the submissions that the claimant PBS had made to the adjudicator, which were false. In this issue we report the appeal in that case, PBS Energo AS v Bester Generacion UK Ltd [2020] EWCA Civ 404. Coulson LJ, sitting with Rose LJ and Sir Timothy Lloyd, gave the judgment, and identifi ed at paragraph 23 the relevant principles concerning enforcement where there are allegations of fraud. He held that such allegations can be a proper ground for resisting enforcement, but only where the adjudicator’s decision itself had been procured by fraud, or where the evidence upon which the adjudicator had relied was shown to be materially and arguably fraudulent. That latter condition applied in this case and so the appeal was dismissed.
Another appeal concerning adjudication is that of C Spencer Ltd v MW High Tech Projects UK Ltd [2020] EWCA Civ 331. This was an appeal against a decision of O’Farrell J, where she had herself granted leave to appeal on a point in respect of which there was no authority. The issue was whether, where there was a hybrid contract (one that included both construction activities and non-construction activities) a valid payment notice was required to identify separately the sums in respect of each type of activity. She had held that it did not. The Court of Appeal agreed and dismissed the appeal.
In Endurance Corporate Capital Ltd v Sartex Quilts & Textiles Ltd [2020] EWCA Civ 308, the Court of Appeal considered an appeal in an insurance case heard by David Railton QC sitting as a Deputy High Court Judge in the Commercial Court. The respondent’s premises and plants were completely destroyed by fi re, an insured peril under an insurance policy written by the appellant. The issue upon the appeal was whether the respondent was entitled, as found by the judge, to the reinstatement cost of the premises and plant, and whether a genuine intention to reinstate was a necessary ingredient in order to recover that measure of loss. The alternative, for which the insurer contended, was the diminution in value, a far lower amount. Leggatt LJ, soon to become a Justice of the Supreme Court, gave the judgment with which McCombe and Dingemans LJJ agreed, and in dismissing the appeal gave clear and helpful guidance concerning the correct approach to quantification of loss in insurance policies in such circumstances. The case is likely to be widely relied upon in the future over many years.
The final appellate authority is Hudson Contract Services Ltd v The Construction Industry Training Board [2020] EWCA Civ 328. This was an appeal from the Administrative Court, and concerned whether the construction industry levy was applicable to self-employed people. Simler LJ, with whom Sir Jack Beatson and Underhill LJ agreed, gave the judgment in which she dismissed the appeal and upheld the decision of Lambert J below. That hearing was itself an appeal from the Employment Appeal Tribunal at first instance, which had held that Hudson was an employer for the purposes of the levy and dismissed its appeal from an assessment that had been performed.
Finally, we report a first instance decision, this being Lungowe v Vedanta Resources plc and Others [2020] EWHC 749 (TCC), a decision of Fraser J. This is widespread litigation concerning alleged contamination of wide areas in Zambia from the world’s second biggest open cast mine, and claims in personal injury. The litigation already has something of a history. In Issue 6 of 2019 we reported the Supreme Court judgment which dismissed the appeals of the defendants on jurisdiction grounds. That judgment is Vedanta Resources plc v Lungowe [2019] UKSC 90. The Court of Appeal decision at [2017] EWCA Civ 1528 was therefore upheld. The Court of Appeal had dismissed the appeal by the parent company and owner of the Nchanga Copper Mine in Zambia from a decision of Coulson J (as he then was). He had held that the English court did have jurisdiction over a group tort claim in relation to the rural farming communities whose activities and health were said to be damaged by the environmental pollution from the mine. The instant decision concerns the next steps in that case, complicated by the involvement of another fi rm of solicitors (the well-known solicitors Leigh Day acting for the original claimants) and a whole new action with thousands of new claimants.
Fraser J was faced with conflicting positions by the different litigants, in particular whether a Group Litigation Order should be made, and competing arguments by the different sets of claimants’ legal teams about the way in which the court could or should order the case to proceed in terms of legal representation. He dealt at paragraphs 38 to 41 with the different principles that apply in group litigation in terms of whether different groups of litigants were entitled to be represented by separate counsel in group litigation. Having analysed both CPR Part 19, the relevant Practice Direction 19B and also the other cases where such situations had arisen, he held that they were not. This decision is also potentially notable as it was handed down on 27 March 2019 under what is called the Covid-19 Protocol, whereby rather than being handed down physically in open court, it was handed down by being sent to the parties by email and posted on bailii.
About the Building Law Reports
Edited by members and former members of Atkin Chambers, the Building Law Reports are essential reading for legal professionals, construction industry professionals, law libraries and universities. Each report provides expert commentary on key judgments from the editors, including the substance of a case and its implications on past and future decisions.
Described as “the most established and authoritative construction law reports available”, they provide comprehensive coverage from the Technology and Construction Court, Court of Appeal, Supreme Court and other relevant jurisdictions worldwide, including Hong Kong, Australia and Singapore.
Consulting Editor: The Honourable Mr Justice Fraser
General Editors: Sir Robert Akenhead, Chantal-Aimée Doerries QC, Dominique Rawley QC, Marc Lixenberg, Omar Eljadi and Felicity Dynes.
The Building Law Reports are published by Informa.
