Pantelli Associates Ltd v Corporate City Developments Number Two Ltd

A pleading alleging breach of contract or professional negligence must state the material facts. It must identify the alleged acts or omissions, explain the counterfactual position and connect each breach to the loss claimed. Generic restatements of contractual duties do not satisfy that requirement.

Where an unless order requires proper particulars, a party cannot cure non-compliance by offering to provide them later under Part 18. In the absence of relief, defective allegations must be struck out. Save for recognised exceptions, an allegation of professional negligence should have written support from a suitably qualified expert before it is pleaded.

Pantelli Associates Ltd, quantity surveyors, claimed unpaid fees under, or damages for breach of, a written compromise agreement concerning two North London building projects. Corporate City Developments Number Two Ltd denied liability and counterclaimed £300,000 for alleged poor performance and professional negligence.

At a case-management conference, a consent unless order required the defendant to apply to amend by a specified date and to provide proper particulars of its defence and counterclaim. The defendant's proposed amended pleading set out generic alleged breaches of its quantity-surveying and project-management contracts, and asserted wasted costs and increased loan-servicing costs without explaining causation. The issue was whether those allegations complied with the unless order and could remain in the case.

1. The defendant's application to amend was effective only to the extent of unopposed amendments. The allegations of professional negligence and the £300,000 counterclaim were struck out under the consent unless order.

2. CPR 16.4(1)(a) required a concise statement of the material facts. For a breach of contract or negligence claim, the pleading had to identify what the professional did or failed to do, what would have occurred but for that conduct, and the loss said to result. The proposed allegations merely converted contractual obligations into assertions of failure. They did not identify any concrete act or omission capable of admission or denial. The loss pleading also failed to connect any alleged breach with a particular loss.

3. Part 18 did not assist the defendant. A court might ordinarily direct further particulars rather than strike out a deficient first pleading. Here, however, the defendant had already received that opportunity through the unless order. It failed to comply and did not seek relief under CPR Part 3.

4. There was an independent reason for striking out the negligence case. Apart from the recognised exceptions, a professional-negligence allegation should be supported in writing by a relevant expert before pleading. No expert had suggested that the services fell below the standard of an ordinarily competent quantity surveyor. The court treated this as consistent with paragraph 704 of the Code of Conduct.

5. The defendant could still put the fees claim to proof on disputed facts, such as whether work was done or how long it took. It could not use that process to advance unpleaded criticisms of the claimant's professional performance. The remaining issues concerned the compromise agreement and any factual overstatement of the fees claim.

This was a first-instance decision. Proceedings began in the Queen's Bench Division in April 2010 and were transferred to the Technology and Construction Court in September 2010. At a case-management conference, Akenhead J made a consent unless order on 6 October 2010 requiring a properly particularised amendment application.