Iliffe & Anor v Feltham Construction Ltd & Ors

Summary judgment under rule 24.2 requires both that the defendant has no real prospect of successfully defending the claim and that no compelling reason exists for a trial. In multi-party construction litigation, uncertain causation and the prospect that substantially the same issues will be tried between other parties may constitute a compelling reason to refuse summary judgment.

The court must seek justice between all parties. Summary judgment is inappropriate where it creates a risk of inconsistent liability findings and achieves little saving because a trial involving extensive factual and expert evidence will occur in any event.

The owners of a timber house claimed damages from the main contractor after a fire caused extensive damage. Their pleaded claim alleged that defective installation of a chimney had caused the fire. The main contractor disputed the contractual allocation of design responsibility and sought to pass any liability down a chain of subcontractors.

The Technology and Construction Court entered summary judgment against the main contractor on liability, directed an assessment of damages and ordered an interim payment of £3 million. The contractor appealed. The central issues were whether its responsibility for designing the flues and the cause of the fire were sufficiently clear for summary judgment, and whether the continuing multi-party proceedings provided a compelling reason for a trial under rule 24.2 of the Civil Procedure Rules 1998.

1. Appeal allowed unanimously. The summary judgment and consequential order made on 3 July 2014 were set aside. Although the owners appeared likely to establish liability at trial, the requirements of rule 24.2 of the Civil Procedure Rules 1998 were not satisfied.

2. The judge had been right to conclude that the parties formed a contract for the Phase 3 works. Their agreement and subsequent conduct showed that the main contractor was to perform those works under the JCT conditions. However, the documents did not establish for summary judgment purposes that the contractor had assumed responsibility for designing the flues. The contract was partly made by conduct, and the evidence concerning that conduct had not been heard.

3. Causation was insufficiently clear. The fire was likely to have resulted from defective installation, but its actual cause remained unknown. The owners’ expert had identified several possibilities and relied heavily upon interviews with factual witnesses. Findings about those witnesses were for the trial judge. Other expert material also suggested possible causes unrelated to installation, while reports for several parties were not yet available.

4. The developing third-, fourth- and fifth-party proceedings meant that the main contractor could legitimately seek to adopt allegations advanced by parties further down the contractual chain. It was inappropriate to determine liability summarily while substantially similar questions of causation and responsibility remained for decision at a full trial between the other parties. In those particular circumstances, the need to do justice between all parties constituted a compelling reason for a trial within rule 24.2(b).

5. Summary judgment would produce little of its usual saving in time and costs. A trial involving extensive factual and expert evidence was already necessary, and the owners would participate to prove quantum. The decision did not discourage robust case management or the proper use of summary judgment in suitable cases.

1. Court of Appeal (Civil Division): In [2015] EWCA Civ 715, unanimously allowed the main contractor’s appeal and set aside the order made on 3 July 2014.
2. High Court, Queen’s Bench Division, Technology and Construction Court: Stuart-Smith J entered summary judgment for the claimants on liability, directed an assessment of damages and ordered the contractor to pay £3 million on account. No citation is stated in the judgment.