Beattie Passive Norse Ltd & Anor v Canham Consulting Ltd

A professional designer is liable only for loss effectively caused by the breach of duty or contract. Where construction defects, later decisions, or failures by others independently produce the claimed loss, the designer is not liable for that loss. The cost of demolition and rebuilding may in principle be recoverable as the cost of cure, but only where the breach caused the need for that work and the decision was reasonable. A contractor may rely on issued construction drawings, while a designer remains responsible for providing clear and complete design information. A shareholder does not ordinarily acquire a separate duty of care from a professional engaged by the company, where the contractual structure already identifies the party to whom responsibility is owed.

Beattie Passive Norse Ltd (BPN) and NPS Property Consultants Ltd claimed in contract and negligence against Canham Consulting Ltd, consulting engineers responsible for foundation design for two residential blocks. Canham accepted, through its expert evidence, that aspects of the design were negligent, including omitted dowel connections and failures to provide complete dimensions and information.

The foundations were constructed using earlier Revision A drawings rather than Canham’s later Revision B drawings. Both blocks also suffered extensive construction and structural defects unrelated to Canham’s design. BPN demolished and rebuilt both blocks, while remedial works to Block B had begun. The issues included duty, factual causation, the reasonableness of demolition, and recoverable loss.

1. Claims and duty. NPS had no contractual claim and Canham owed it no direct duty of care. The contractual engagement was with BPN. The payment of invoices by NPS and use of NPS email accounts did not justify extending responsibility to a shareholder. Canham owed BPN contractual obligations and a co-existent duty to exercise reasonable skill and care.
2. Negligence. Canham’s design was negligent in limited respects, principally the omission of connections between pads and beams. The drawings also failed to identify required foundation depths and contained inaccurate or incomplete notes. Foxdown was entitled to receive the required dimensions on the paper drawings and was not expected to interrogate the digital CAD files, although it should have asked for missing information.
3. Causation. The applicable question was whether Canham’s breach was an effective cause of BPN’s loss. The answer was fact-sensitive and could differ between the two blocks. Foxdown constructed to Revision A, which had been issued for construction. That was not Canham’s fault. The defective construction of both blocks, including defects unrelated to the foundations, caused the decisions to demolish. Canham’s breaches were not an effective cause of either demolition.
4. Remedial loss. The omitted dowels caused the need for localised remedial works to Block B. Those works had begun when demolition was decided upon. BPN therefore suffered real loss notwithstanding that the works were later overtaken by demolition. The recoverable sum was assessed broadly at £2,000, being half the agreed £4,000 cost of completing the works.
5. The claim by NPS was dismissed. BPN succeeded only to the extent of judgment for £2,000. The claims for demolition, rebuilding and consequential losses failed.