Mueller Europe Ltd v Central Roofing (South Wales) Ltd

A construction contract may allocate primary responsibility for safe working to the contractor while requiring the employer physically to isolate its own plant when it knows, or ought to know, that isolation is needed. The contractor’s responsibility is not displaced by the employer’s concurrent obligation. A health and safety plan or method statement may be an important standard against which performance is assessed without being a contractual document or creating an implied term of compliance. Contributory negligence cannot reduce liability for breaches of strict contractual obligations. A claimant’s concurrent breach breaks causation only where it obliterates the defendant’s breach as an effective cause. Damages for destroyed machinery ordinarily reflect the reasonable cost of reinstating the claimant’s pre-loss capacity, even where replacement has not yet occurred.

The claimant operated a copper-tube factory while the defendant refurbished its roof. The defendant erected a sheeted birdcage scaffold close to gas-fired radiant heaters. A heater operated during the works and caused a major fire. The claimant alleged that the defendant was solely responsible under the contract. The defendant alleged that the claimant was solely responsible for failing to isolate its plant, and relied on waiver, estoppel by convention, contributory negligence and causation arguments. The court also determined the disputed machinery and equipment claim after the parties agreed the other heads of loss.

1. Contractual allocation of responsibility. The contract, read as a whole, placed continuing responsibility on Central for carrying out the works safely, identifying hazards, taking precautions against fire, continuously inspecting the work and reporting incidents. Mueller remained responsible for physically isolating its own plant and machinery when it was, or should have been, aware from the information available that isolation was required. Clause 8.9 did not transfer to Mueller the responsibility for identifying the need for isolation.
2. The health and safety plan and method statement were not Contract Documents and did not themselves impose primary contractual obligations. No implied term requiring compliance was necessary to give the contract business efficacy. Nevertheless, they were important evidence against which Central’s compliance with its express safety obligations could be assessed. Central breached those obligations by failing to ensure that the heaters were isolated, failing to take adequate precautions, failing continuously to inspect and failing to report earlier incidents.
3. Mueller also breached clause 8.9. The method statement, together with the surrounding information and the obvious presence of the heaters, gave Mueller sufficient information to identify when isolation was required. The parties’ failures did not establish waiver or estoppel by convention. There had been no clear and unequivocal election or shared assumption.
4. Central’s relevant obligations were strict or absolute for contributory-negligence purposes. Accordingly, section 1 of the Law Reform (Contributory Negligence) Act 1945 did not permit an apportionment of liability for those breaches. If apportionment had been available for a reasonable-care breach, the court would have reduced liability by 40%, but that reduction did not apply.
5. Mueller’s failure to isolate the heaters was a concurrent cause, but it did not obliterate Central’s breaches. Central knew that isolation was not occurring routinely, and its own precautions were intended to prevent precisely that failure and the resulting inadvertent operation of the heaters. Central’s breaches were therefore an effective or dominant cause of the fire.
6. The appropriate machinery measure was the reasonable cost of restoring Mueller’s pre-fire production capacity, namely £8,036,150. The total damages were £21,357,889.

First-instance judgment in the High Court (Technology and Construction Court). No earlier appellate decision is stated in the judgment.