In a judgment handed down today, the Technology and Construction Court has (a) rejected an attempt to extend the law in respect of an engineer's duty to warn and (b) clarified an engineer's responsibilities in relation to permanent and temporary works design.
Mr E Goldswain and Miss J Hale v (1) Beltec Limited (trading as BCS Consulting) (2) AIMS Plumbing and Building Services Limited  EWHC 556 (TCC).
The key facts are as follows:
- In February 2012, Beltec Limited (Beltec), a firm of structural engineers, was retained by Mr Goldswain and Ms Hale (the Claimants) to prepare designs for the excavation and underpinning of a new basement at the Claimants' ground floor North London flat (the Property).
- In March 2012, Beltec issued its design drawings and calculations to the Claimants. Subsequently, in September 2012, AIMS Plumbing and Building Services Limited (the Contractor) was retained by the Claimants to carry out the works.
- Also in September 2012, one of Beltec's engineers (Mr Pistilli) visited the Property to check the first pin being cast in the basement (at the Contractor's request and for a fee).
- At the end of October 2012, the Claimants began to notice cracks at the Property. By late November 2012, the first floor tenants also raised concerns about further cracks that were appearing.
- Soon afterwards, following a period of heavy rain, the Claimants saw the cracks widening, other tenants reported serious cracking and the building was evacuated.
- The flank wall collapsed onto an adjoining property and the Property was subsequently demolished by Barnet Council.
- The Claimants issued proceedings against Beltec and the Contractor claiming the costs of reinstating the Property, consequential losses, and an indemnity against third party claims from other tenants and neighbours.
- The Contractor did not file a Defence and judgment in default was entered against it with damages to be assessed.
- The trial took place in the TCC before Mr Justice Akenhead in February 2015.
The Claimants' main allegation against Beltec was that they had failed to exercise the appropriate level of skill and care when they designed the basement.
One of the important matters for the Court to clarify was the scope of Beltec's retainer. They were employed by the Claimants to "provide the permanent works design for the excavation of the basement, the underpinning of the perimeter walls and the provision of support to the internal walls and structure as necessary".
That retainer was limited and the Judge was "wholly satisfied" that Beltec had no on-going supervision obligation and therefore no requirement to visit the Property once works had started.
Permanent works vs temporary works design responsibility
It was common ground between the parties that, in principle, an engineer has responsibility for the permanent works and it is for the contractor to decide what temporary works (such as propping) are necessary to achieve the permanent works design.
One of the Claimants' primary arguments was that in the circumstances here (where a basement was being excavated with the risks that this posed) Beltec should have provided more information in its drawings about temporary works such as propping, in particular in areas of the site which were perceived to be particularly risky (light wells for example).
The Claimants' engineering expert accepted that there was nothing in Beltec's permanent works design which would have prevented the Contractor from doing its work in a reasonably safe way. Further, Beltec's drawings made it clear that "all propping and temporary works" were to be "to the contractor’s design and method statement" (which Beltec's engineering expert confirmed was standard industry practice).
In summary, Mr Justice Akenhead considered that:
"..in general terms it cannot be said that Beltec was negligent in that it did what many other engineers would do; the permanent works design was one which was capable and indeed readily capable of being implemented safely by the contractor because, if what was specified was provided with care, following the sequence and using appropriate propping, there is little doubt that this basement could have been created without any significant damage to the structure above."
Duty to warn
It was also alleged that Beltec was negligent in failing to warn both the Contractor and the Claimants about the shortcomings in the Contractor's activities following Mr Pistilli's site visit in September 2012 (the Site Visit).
Akenhead J reviewed the authorities on duty to warn and reached the following conclusions:
"(a)Where the professional (engineers in this case) are contractually retained, the Court must initially determine what the scope of the contractual duties and services were. It is in the context of what the professional person is contractually engaged to do that the scope of the duty to warn and the circumstances in which it may in practice arise should be determined.
(b)It will, almost invariably, be incumbent upon the professional to exercise reasonable care and skill. That duty must be looked at in the context of what the professional person is engaged to do. The duty to warn is no more than an aspect of the duty of a professional to act with the skill and care of a reasonably competent person in that profession.
(c)Whether, when and to what extent the duty will arise will depend on all the circumstances.
(d)The duty to warn will often arise when there is an obvious and significant danger either to life and limb or to property. It can arise however when a careful professional ought to have known of such danger, having regard to all the facts and circumstances.
(e)In considering a case where it is alleged that the careful professional ought to have known of danger, the Court will be unlikely to find liability merely because at the time that the professional sees what is happening there was only a possibility in future of some danger (see Aurum); any duty to warn may well not be engaged if all there is is a possibility that the contractor in question may in future not do the works properly."
The Site Visit arose as a result of a separate retainer between Beltec and the Contractor to view the first pin being constructed. Mr Pistilli saw that the first pin had already been cast but as the Judge said "there was clearly little to inspect, only a hole in the ground which was not very large." It was accepted that there could be no criticism in relation to a lack of propping at that stage because it would have been too early to install it.
As the relevant Beltec drawings were not on site, Mr Pistilli handed over his drawings to the Contractor on site. He also emphasised the importance of following the sequence on the Beltec drawings. Akenhead J considered that "there is no evidence that at that stage there was any actual danger, which is unsurprising given that only one small hole had been excavated." The day after the site visit, Mr Pistilli emailed the Contractor a full package of drawings and invited the Contractor to contact him as necessary.
Akenhead J commented:
"I find it very difficult to see how Mr Pistilli’s or Beltec’s conduct at or following this visit can be considered to be negligent. The 26 September 2012 visit was simply arranged to enable him to see what AIMS had done in relation to the first pin. He looked at it and formed the view that it should be re-done because it appeared to have been constructed in a way which was obviously non-compliant with Drawing S002A. There was no danger at that stage and it has not been established on any balance of probabilities that Mr Pistilli should have realised that AIMS were completely out of its depth or not competent to do the job which it had been employed to do…
…I have formed the view that professional negligence simply has not been established here on the facts having regard to the warning which it is said that Beltec should have given either to AIMS or the Claimants. I consider that a sizeable number of engineers in the position of Beltec or Mr Pistilli would have done no more and no less than he did which was, in essence, advising his client (AIMS at that stage) to follow the requirements set out on the Drawings..."
The Contractor's liability
Although Akenhead J did not have the benefit of evidence from the Contractor (as it played no part in these proceedings), the evidence he did hear established the "overwhelming probability" that the Contractor failed to carry out its work with reasonable care and skill or in compliance with Beltec's drawings. In particular, it was clear that, from the start of the work up to the collapse, no effective propping was provided.
It was the breaches of contract on the part of the Contractor which "undoubtedly" caused the collapse.
Although Akenhead J expressed sympathy for the Claimants, the case against Beltec was dismissed.
In an era where property prices are so high (especially in London), property owners are seeking alternatives to moving house to increase their living space and, as a result, basement conversions are in vogue. Beltec themselves gave evidence that they had been involved in well over 100 such conversions in a relatively short space of time in a small part of London.
Homeowners need to ensure that the builders they retain have the relevant experience to carry out this type of work, in particular experience to carry out the appropriate temporary works. If they do not have that experience, the builders should appoint a temporary works engineer. The permanent works designer will not be responsible for the temporary works design unless that is specifically agreed.
What will be welcomed by engineers is that this case does not extend an engineer's duty to warn.
What seems clear is that it is only in circumstances where there is a real danger to life or property that a duty to warn will arise. Akenhead J made it clear that the "duty to warn is no more than an aspect of the duty of a professional to act with the skill and care of a reasonably competent person in that profession" and that "whether, when and to what extent the duty will arise" will turn on the facts of each case.
In this case (probably to the comfort of engineers and their professional indemnity insurers) it was said that a "sizeable number of engineers" in the position of Beltec would have done exactly what they did.