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Thu November 15 2018

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We appointed you to do that… didn’t we?

6 Nov Never make assumptions about contractual obligations. Case study by Mike Plews of Irwin Mitchell LLP.

The Technology & Construction Court in London
The Technology & Construction Court in London

A dispute around whom had actually been appointed and the precise scope of the appointment of a chartered civil engineer came before The Technology & Construction Court in Williams Tarr Construction Limited v Anthony Roylance Limited and Anthony Roylance [2018] EWHC 23.

Williams Tarr Construction Limited (WTC) was the main contractor on a housing development in Congleton, Cheshire. The slope of the site necessitated the construction of a retaining wall, which WTC sub-contracted to Construction Site Services Limited (CSS). The originally envisaged blockwork retaining wall was changed to stone filled gabion baskets.

In the course of installing the gabion baskets, a band of running sand was encountered and WTC contacted Anthony Roylance. Following an exchange of emails, an appointment was agreed, but a formal written contract was not put into place.

WTC claimed that Anthony Roylance proposed a drain be installed behind the wall, which he then went on to design. Additionally, WTC claimed the appointment was to provide a solution to the overall problem so as to provide a design that was fit for purpose.

The retaining wall was defective and WTC commenced an adjudication against CSS contending the deficiencies in the wall were the results of failures on the part of CSS in the course of construction and installation. The adjudicator found in WTC’s favour. However this was of no benefit to WTC, because CSS was insolvent. So WTC commenced an action against Anthony Roylance and his company, Anthony Roylance Limited.

It was agreed that the design of the drain was within the appointment (and that there was no problem with that design) but a dispute arose as to whether the appointment extended to warranting the fitness for purpose of the retaining wall itself.

Anthony Roylance claimed that during the pre-contract exchanges (and at all times thereafter) he was working through Anthony Roylance Limited. The alternative, that he was acting in his personal capacity, could potentially put him at risk of a serious personal loss if his professional indemnity insurance did not respond to a claim in full.  

WTC claimed that his acting through his limited company was not made apparent, as the emails were sent from Anthony Roylance’s personal account. In addition, the professional indemnity insurance was also in the name of Anthony Roylance and the invoices submitted requested cheques be made payable to ‘Anthony Roylance’. 

The court decided that Anthony Roylance had contracted in his personal capacity, rather than through his company, which seemed like very bad news for him. However, the court then turned its attention to whether or not the appointment did in fact require Anthony Roylance to warrant that the wall was fit for purpose. It examined the exchanges of correspondence and listened to witnesses before deciding that Anthony Roylance had not been engaged to amend the design of the wall and consequently the fitness for purpose warranty was not a requirement of his appointment.

This case reinforces the importance of accurately recording the agreements arrived at during negotiations so that each party is clear as to the contracting parties are, their obligations and the means by which they can be effectively enforced.

MPU

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