Blackpool Borough Council v Volkerfitz Patrick Ltd & Ors

Design life, suitability and maintenance provisions in a design-and-build contract may impose strict contractual obligations, rather than duties of reasonable care, where that is their proper construction. A design life obligation concerns performance over the specified period with anticipated, standard maintenance, but without major repair. Maintenance requirements which are non-standard or unusually onerous must be identified and expressly accepted.

For a modern steel-framed building, the meaning of “building structure” depends on the contract read as a whole. Contractual design documents may clarify an otherwise uncertain design life allocation. A claimant must prove the nature, extent and prognosis of corrosion by reliable evidence. Remedial damages are limited to works reasonably necessary to cure the breach, with appropriate regard to mitigation, betterment and the cost-effectiveness of repair rather than replacement.

The claimant, the owner of a coastal tram depot, sued the design-and-build contractor for defects affecting galvanised steel components, roof components, wall cladding, soffit panels, wave-form cladding, tram doors and other items. The depot had been completed in 2011 and was exposed to a severe marine environment.

The principal disputes concerned the contractual design life of the various components, the construction and suitability obligations, the effect of maintenance requirements, the extent and significance of corrosion, and the appropriate remedial works. Claims involving Range Roofing and Cladding Ltd and RPS Planning & Development Ltd had been compromised. The defendant’s claim against Caunton Engineering Ltd and Caunton’s contribution claim against RPS remained for determination, subject to the outcome of the main claim.

1. Disposition. Judgment was entered for the claimant in the sum of £1,110,782.10. The claim concerning the cold formed components failed. Awards were made for the roof components, wall cladding panels, soffit panels, wave-form cladding panels, tram doors and other defects. The defendant recovered nothing from Caunton.
2. Contractual obligations. Clauses 20.1 and 20.5 imposed strict obligations to provide the works in accordance with the Works Information and to satisfy specified performance requirements. The suitability and design life obligations were not merely reasonable-care obligations. The reasoning in MT Hojgaard v E.ON [2017] UKSC 59 was applied by analogy, subject to the wording of this contract.
3. Design life. The 50-year requirement for the “building structure” applied to the primary structural frame. The contractual RPS design log validly clarified the uncertainty by allocating a 25-year life to the external shell. The cold formed components formed part of the external shell and therefore had a 25-year design life. The roof and soffit components and wave-form panels also had a 25-year life. Tram doors and discrete ancillary components were subject to the default 20-year obligation.
4. Maintenance. The maintenance comparator was a similar building generally, not a similar building in the same coastal location. Maintenance which was non-standard or unusually onerous had to be identified and expressly accepted. Annual inspection and limited localised treatment of the cold formed components were reasonable maintenance. More frequent and intensive cleaning was required for sheltered wall cladding areas, but the contract had not secured informed acceptance of that obligation.
5. Corrosion and proof. The claimant failed to prove that widespread pitting corrosion would prevent the cold formed components meeting their 25-year life. The court preferred the evidence of Dr Callow and Mr Deacon to the theoretical analysis of Dr Clarke, which did not reliably establish the extent or progression of localised corrosion. By contrast, defects in the roof perimeter, wall cladding, tram doors and other external items were proved and required remedial works beyond reasonable maintenance.
6. Remedies and mitigation. Replacement was not allowed where proportionate repair or recoating was sufficient. The claimant’s refusal of reasonable roof-perimeter proposals limited recovery to the cost the defendant would have incurred. The claimant was entitled to recover reasonable remedial costs for the wall cladding and tram doors, but not unparticularised or unsupported management and procurement costs. A 10.5 per cent allowance was added for permitted additional costs.