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An employer's liability for an independent contractor's tort

30 May 11 Tinseltime's machinery was damages by dust caused by the contractor working for Denbighshire County Council and the Welsh Assembly Government cut concrete blocks. Tinseltime brought an action for damages, loss of profit and loss of management time against all three.

The first defendant, Roberts, was the contractor for part of the A5 Pont Melin Rhug Bridge project in Clwyd, which had been commissioned by the fourth defendant, the Welsh Assembly. The third defendant, Denbighshire County Council, DCC, had arranged the project on behalf of the Welsh Assembly, and had subcontracted the works to the second defendant, Davies. Davies had instructed, the first defendant, Roberts to carry out part of the works. The works involved the demolition of part of a building known as “The Old Creamery”. The other part of the building had been occupied by a company called Fountain of Youth Ltd. (FOY), which had since been dissolved. FOY used the building for its tinsel making business. It was alleged that when Roberts was cutting concrete blocks on the adjacent land for use in filling in existing openings in the dividing wall between the two parts of the building, the dust produced by the cutting operation settled on machinery on FOY’s premises which FOY used for making the tinsel. The dust was said to have caused significant damage and the machinery had to be repaired. Whilst the repairs were being undertaken, FOY had lost production and sales.

In the present action, Tinseltime sought to maintain a claim for damages under an assignment made on 1 December 2007. In order to determine whether Tinseltime was entitled to maintain such a claim, the court had to consider whether FOY had had sufficient interest in the premises in order to be able to maintain a claim in nuisance, whether FOY had owned the machinery at the relevant time in order to maintain a claim in negligence, and whether any of FOY’s claims had been effectively assigned to Tinseltime, whether on the case advanced by Tinseltime DCC or the Welsh Assembly could as a matter of law have been liable to FOY for the acts and/or omissions of Roberts, and lastly, whether or not the claims for loss of profits, for machinery repairs and for loss of management time had a sufficient prospect of success to proceed to trial, and if so on what basis. The court concluded that FOY had had the required interest in the premises, and the claim had been validly assigned to Tinseltime.

However, the judge the turned his attention to whether it was open to FOY to argue that the Welsh Assembly and/or DCC had undertaken a non-delegable duty to them , in negligence and/or in nuisance, or whether DCC and the Welsh Assembly could rely on the general principle that an employer is not liable for the torts of his independent contractor.

In Biffa Waste Services Ltd. v. Outokumpu Wenmac AB, [2008] EWCA Civ 1238, the Court of Appeal had subjected to serious scrutiny the rule that a defendant is liable for the negligence of his independent contractor where the activities of the independent contractor are ‘ultra hazardous’. In that judgment, the Court concluded that the rule was “so unsatisfactory that its application should be kept as narrow as possible. It should be applied only to activities that are exceptionally dangerous whatever precautions are taken”.

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It was clear on a proper analysis of the authorities that both the general principle and the “special risks” exception applied both to negligence and to nuisance, and that there was no justification for holding that the scope of the exception was different in nuisance than in negligence. It was necessary to keep clearly in mind the fact that the special risks exception was separate from the dividing structures exception as recognised and clarified in Alcock v Wraith, (1991) 59 BLR 16. Tinseltime could not rely upon the special risks exception in this case in nuisance or in negligence.

There was no justification for taking into account the extent of the works as a whole, rather than the works which are said to amount to or to cause the nuisance i.e. the cutting of the blocks. Otherwise it would follow that where a completely new building is erected next to an existing building, the mere fact that the works forming part of the erection of the new building involve some shoring up of the foundations of the old building means that the employer is under a non-delegable duty for all of the works, even those undertaken on the other side of the site from the existing building. Therefore, both the Welsh Assembly and DCC were entitled to rely upon the independent contractor defence both in negligence and in nuisance, so that they have an insurmountable defence to the claims made against them by the claimant.

Tinseltime v Roberts, Davies, Denbighshire County Council and the Welsh Assembly Government, [2011] EWHC 1199 (TCC)

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