Thomas & Anor v Taylor Wimpey Developments Ltd & Ors

A builder ordinarily owes no tortious duty to a purchaser in respect of the cost of repairing defective work where the loss is pure economic loss. The proposed qualification allowing recovery of costs incurred to protect neighbouring land from danger is not part of the law. A claim under section 1 of the Defective Premises Act 1972 accrues on completion and is subject to a six-year limitation period. Statutory misrepresentation under section 2(1) of the Misrepresentation Act 1967 is not negligence for the purposes of section 14A of the Limitation Act 1980. Under a building warranty, retaining walls may contribute indirectly to structural stability, but the claimant must prove that they are necessary for that purpose. A claim under warranty provisions requiring non-compliance with the Building Regulations must plead the relevant non-compliance and its causal connection with the danger.

The claimants owned two new-build properties constructed by the first defendant. They alleged that timber retaining walls in the rear gardens were defective and claimed against the builder in negligence, misrepresentation and under the Defective Premises Act 1972. They also claimed against the National House Building Council under a ten-year Buildmark Warranty.

The court tried five preliminary issues. They concerned the existence of a tortious duty in respect of the pleaded losses, limitation of the statutory and misrepresentation claims, whether the walls were necessary for structural stability, whether non-compliance with the Building Regulations had been pleaded, and whether the Building Regulations applied to the walls.

1. Negligence and pure economic loss. The pleaded loss was the cost of full remediation or diminution in value. It was pure economic loss. The general rule in Murphy v Brentwood District Council and related authorities excludes recovery in tort for such loss absent a relevant contractual duty, assumption of responsibility, or liability for personal injury or damage to other property.
2. The qualification suggested by Lord Bridge in Murphy v Brentwood District Council, concerning the cost of protecting neighbouring land from a potential danger, was a single obiter dictum and did not represent the law. It was not supported by the ratio or reasoning of the other speeches and was inconsistent with the analysis in Robinson v P. E. Jones (Contractors) Ltd. The court declined to follow Morse v Barratt (Leeds) Ltd. In any event, the claimants had not pleaded losses corresponding to the cost of obviating a risk to neighbouring land. Issue 1 was answered “No”.
3. Limitation. The claim under section 1 of the Defective Premises Act 1972 accrued on completion under section 1(5) and was statute-barred. The pleaded misrepresentation claim alleged representations, falsity, reliance and loss, but no duty of care or negligent making of the representations. It was therefore a claim under section 2(1) of the Misrepresentation Act 1967, not negligent misrepresentation. Section 14A of the Limitation Act 1980 did not apply. Issue 2 was answered “Yes”.
4. Buildmark Warranty. The words “necessary for the structural stability” could include a retaining wall that indirectly protected a building from collapsing soil. The issue therefore depended on both construction of the warranty and expert evidence. On the evidence, the claimants failed to prove a significant likelihood of catastrophic slippage or that the walls were necessary for the stability of the houses or garages. Issue 3 was answered “No”.
5. Building Regulations pleading. A claim under section 4 of the warranty required pleading of a present or imminent danger, non-compliance with the applicable Building Regulations, and causation. The statements of case referred to NHBC standards and British Standards but identified no Building Regulations requirement or breach. Issue 4 was answered “No”.
6. Application of the Building Regulations. Under regulations 2(1) and 3(1) of the Building Regulations 2000, “building work” concerned the erection or extension of a building. The retaining walls were separate structures, not buildings or parts of the houses or garages. Their construction was therefore outside the Regulations. Section 121(2) of the Building Act 1984 did not alter that conclusion. Issue 5 was answered “No”. The parties subsequently agreed the terms of the order.