Laing O’Rourke Delivery Ltd v Sweett (UK) Ltd
Citation: [2024] EWHC 1088 (TCC)
Court refused to strike out parts of a claim by the main contractor for alleged breaches of its design and site inspection obligations, and granted permission to amend particulars of claim as the amendments and underlying case had real prospects of success.
Background
- In 2007, a Project Agreement was entered into by an NHS Trust (‘the Trust’) and Three Valleys Healthcare Limited (‘TVH’) for the development of a site at Roseberry Park Hospital (‘the Hospital’). TVH subsequently entered into a building contract with Laing O’Rourke Delivery Ltd (the Claimant in these proceedings, ‘LOR’) in respect of the Hospital, under which LOR was the design and build contractor.
- The Trust, TVH, LOR and funders appointed Nisbet as the Independent Tester for the project. Nisbet warranted to LOR the performance of its obligations via a Collateral Warranty. Nisbet was subsequently acquired by the Defendant (‘Sweett’), taking the liabilities in respect of Nisbet’s appointment and the collateral warranty.
- Following handover, the Trust identified serious fire safety concerns with the Hospital. It carried out extensive investigations and issued a letter of claim in 2020 against TVH relating to those and other defects. TVH passed the claim on to LOR, who agreed to pay TVH over £18m in a formal settlement. In July 2022, LOR issued a claim for £20.4m against Sweett for breach of its obligations under the Appointment and negligence in relation to various defects at the Hospital. LOR applied to amend their POC and response to a RFI. Sweett applied to strike out various parts of LOR’s POC.
Decision
- Freedman J allowed the amendments as they had real prospects of success.
- He applied Easy Air Ltd v Opal Telecom Ltd on the basis that the approach to summary judgment applications also applied to strike out applications. He turned to each of the defects and reviewed them in light of the steps for summary judgment, confirming that the arguments in the POC as they now stood did have a realistic prospect of success and did not require further improvement.
- The Judge stressed that, as one could argue that there is always room for improvement, “pleadings are not marked out of ten with a basic pass mark”. The points either have a realistic prospect or are struck out. In general, amendments will be permitted provided care is taken not to waste the court’s time with fanciful arguments. The court will review these points at a depth which is more than face value but less than at a trial. In this matter a schedule was provided which recorded numerous objections to the amendments, but the court decided instead to review the objections thematically, focussing on the bigger picture to save on time and costs.
Decision
- Full case: https://www.bailii.org/ew/cases/EWHC/TCC/2024/1088.html
- Ronan Hanna (Atkin Chambers) for the Claimant, instructed by Pinsent Masons LLP. Lucy Garrett KC (Keating Chambers) and Benjamin Fowler (4 New Square) for the Defendant, instructed by Clyde & Co LLP.
