England and Wales Court of Appeal (Civil Division) Decisions

IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
BIRMINGHAM DISTRICT REGISTRY
His Honour Judge David Grant
0BM90105 & 2BM50044

		Royal Courts of Justice Strand, London, WC2A 2LL
		4 December 2013

Lord Justice Moore-Bick :

1. On 23^rd June 2007 the fascia of a shop in Putney became detached from the building and fell onto the pavement causing serious injuries to the claimants who happened to be passing by. As a result they brought proceedings against the proprietor of the shop, Maison Blanc Ltd (the second defendant), and various other persons who were alleged to owe them a duty of care. They included Technical Sign Company Limited (the first defendant), which had supplied and fitted the shop sign, Active Commercial Interiors Ltd ("Active", the third defendant), which had carried out a remodelling of the shop front, including the fascia, in 2005 and the well-known firm of surveyors, Cluttons (the fourth defendants), who inspected the awning over the shop window at the request of Maison Blanc in March 2007 in circumstances which I shall describe later.
2. The defendants made Part 20 claims among themselves seeking indemnities or contributions in respect of any liability they might have to the claimants. In the event Maison Blanc submitted to judgment in favour of the claimants and Active also conceded that it was liable to them, although their claims against all the defendants other than Maison Blanc were stayed generally. The Part 20 claims were all compromised apart from the claims by Maison Blanc and Active against Cluttons, which went to trial. On 25^th September 2012 His Honour Judge David Grant held that Active and Cluttons were both liable to the claimants for the injuries they had suffered and were also both liable to indemnify Maison Blanc in respect of the financial loss it had suffered in compensating the claimants. On that basis he held that Active was entitled to obtain a contribution from Cluttons under section 1(1) of the Civil Liability (Contribution) Act 1978 on the grounds that they were both liable to the claimants and Maison Blanc in respect of the same damage. He apportioned liability between them 89% to Active and 11% to Cluttons. Maison Blanc was subsequently able to agree terms with both Active and Cluttons which enabled it to take no further part in the proceedings.
3. This is Cluttons' appeal against the judge's order that Active is entitled to obtain a contribution from them towards its liability to Maison Blanc. For that purpose they deny (contrary to the judge's findings) that they owed a duty of care either to the claimants or to Maison Blanc. Active resists that and by a cross-appeal challenges the judge's apportionment of liability, which it says was too favourable to Cluttons.

The remodelling of the shop front

4. The masonry forming the solid part of the shop front above the display window projected forwards from the wall to a distance of about 75 cm. Its face sloped forward slightly towards the road forming what has been referred to as an inclined facade. Soffit timbers of sturdy dimensions (to which the horizontal soffit board was attached) were fixed to the underside of the facade and formed a lattice which projected forwards beyond its line far enough to provide additional support to the fascia. Before the shop front was remodelled in 2005 a vertical fascia, to which the shop sign was attached, was fixed to the masonry of the building by plugs and screws along its top edge with the bottom edge resting on the projecting soffit timbers. The fascia itself was made of render-coated expanded metal mesh attached to a heavy timber frame.
5. As part of the remodelling Maison Blanc had wished to install a retractable awning below the fascia and above the shop window and for that purpose a box was constructed using medium-density fibreboard to house the awning and its mechanism. In the course of carrying out the work Active found that there was not enough room to accommodate the box between the soffit board and the underside of the facade and it therefore removed the soffit timbers and part of the fascia to make additional space. A ladder frame was attached to the rear wall below the projecting facade to carry the rear edge of the soffit board, which at the front formed the underside of the awning box. The awning box occupied the vertical space between the soffit board and the bottom of the modified fascia. The top board of the box was attached to the underside of the fascia. One effect of this new arrangement was to leave the lower edge of the fascia with little, if any, support: virtually the whole of its weight as well as that of the awning was carried on the fixings along the top edge. In addition, the horizontal restraint that had been previously been provided by the soffit timbers was removed. The weight of the awning and the horizontal forces generated by it when in use imposed an additional strain on the fixings along the top edge of the fascia.

Problems in 2007

6. Maison Blanc was the lessee of the shop premises comprising the ground floor and basement of the building. In the latter part of 2006 the owners of the building decided to carry out some work to the upper floors and for that purpose scaffolding was erected at the front of the shop. It was removed on 16^th December 2006. In March 2007 Maison Blanc's employees began to encounter difficulty using the awning, which tended to catch on the left hand side (viewed facing the shop window) as it was being retracted. It was thought that the awning box might have taken a knock when the scaffolding was dismantled. Cluttons had been engaged by the owners as contract administrators to supervise the building work and so on 27^th March 2007 Jeremy Brecknock, one of Maison Blanc's managers, sent Mr. Roberts of Cluttons an email asking him to look into it. Mr. Brecknock said he thought that the awning unit had slipped forward. As a result of that request an employee of Cluttons, Mr. Thomas Hunt, visited the shop on 30^th March 2007 and looked at the awning. On 2^nd April 2007 he sent an email to Mr. Brecknock in which he said that he thought the problem with the awning was that the retracting mechanism had moved slightly.
7. A number of photographs of the shop were taken between May 2006 and June 2007. Among a series of photographs taken by Cluttons are some which show the front of the shop in September 2006 before the scaffolding was erected. If viewed closely they show a slight gap between the top of the awning box and the fascia at the right hand end, suggesting that the end of the awning box had dropped slightly. Also of interest are two close-up photographs of the right hand end of the awning box, which the judge found had been taken by an employee of Maison Blanc, Florent Arcin, in early June 2007. One of these appears to show splits in the right hand end of the top board of the awning box, which has dropped an inch or two from the fascia. Although the judge accepted the opinion of one of the expert witnesses, Mr. Tutt, that when Mr. Hunt inspected the shop on 30^th March 2007 "he should have observed the disturbance to the ends of the awning housing and the apparent dropping of the fascia and cover above", I find that evidence somewhat puzzling, because although the separation of the awning box from the fascia appears clearly, the photographs do not show that the fascia itself had dropped and the cover to which Mr. Tutt referred can only be the top of the awning box. At all events, the judge did not find that there was any obvious indication that the fixings securing the fascia to the masonry were under stress.

Did Cluttons owe a duty of care to the claimants?

8. In deciding whether Cluttons owed a duty of care to members of the public who might walk past the shop the judge applied the threefold test approved in Caparo Industries Plc v Dickman [1990] 2 AC 605. He found that a reasonably competent surveyor would have foreseen that a failure on his part to inspect the premises with reasonable skill and care might cause physical injury to persons walking past the shop and that the requirement of foreseeability was therefore satisfied. He also found that Cluttons had a detailed knowledge of the premises and knew of their close physical proximity to the highway. It followed, in his view, that the ordinary reasonably competent surveyor would have known or appreciated that any failure to inspect and advise in connection with a defect in part of the frontage of the premises could result in personal injury being caused to a passing member of the public. Accordingly, he held that the requirement of proximity was satisfied. Finally, he held that it would be fair, just and reasonable to impose on Cluttons a duty of care to members of the public.
9. Mr. Michael Pooles Q.C. for Cluttons submitted that in this case there did not exist the degree of proximity between Cluttons and members of the public that is required to justify imposing a duty of care on his clients. Having regard to the circumstances in which they had been asked by Maison Blanc to look at the awning, they owed no greater duty to members of the public than if Mr. Hunt had happened to glance up at the shop front while walking along the street, which is to say, none at all.
10. In support of the judge's conclusion Mr. Jonathan Waite Q.C. for Active relied on certain passages in the judgment of Hobhouse L.J. in Perrett v Collins [1999] PNLR 77 in which a good deal of emphasis was placed on the importance of the distinction between physical injury and economic loss when considering whether to recognise the existence of a duty of care. Mr. Waite drew our attention in particular to a passage at page 87C-D in which Hobhouse L.J. said:

"In cases of personal injury, it suffices that the activity of the defendant has given rise to the situation which has caused the injury to the plaintiff. Where the defendant is involved in an activity which, if he is not careful, will create a foreseeable risk of personal injury to others, the defendant owes a duty of care to those others to act reasonably having regard to the existence of that risk. The limiting factors are the concepts of foreseeability and reasonableness."

Later he said at page 88D-E:

"Where the plaintiff belongs to a class which either is or ought to be within the contemplation of the defendant and the defendant by reason of his involvement in an activity which gives him a measure of control over and responsibility for a situation which, if dangerous, will be liable to injure the plaintiff, the defendant is liable if as a result of his unreasonable lack of care he causes a situation to exist which does in fact cause the plaintiff injury."

11. These statements of principle must, of course, be read in the context of the case before the court, which concerned the liability of an aircraft inspector and the organisation by whom he was employed to a passenger in a light aeroplane who was injured when it crashed because of a defect in its construction. The inspector's task was to check the construction of the aircraft and issue a certificate of airworthiness. Given the purpose of the inspection and the obvious likelihood that passengers in the aircraft might be injured if it turned out to be defective, it is not surprising that the court held that the inspector and the organisation for whom he worked owed a duty of care to any members of the public who might fly in it. The necessary degree of proximity was established by the fact that the inspector was actively involved in certifying the aircraft's fitness to fly and the obvious risk to the public if he were to carry out his task negligently.
12. In my view Mr. Pooles was right in submitting that the question whether Cluttons owed a duty of care to members of the public cannot be answered without taking into account the circumstances in which Cluttons came to be involved and I think the judge's findings betray two errors in his reasoning. The first relates to the role in which Cluttons were acting. They were not asked to advise Maison Blanc or to inspect the shop front on its behalf. Mr. Brecknock's message to Mr. Roberts was one of complaint. The judge appears to have approached the matter on the assumption that Cluttons had been instructed to inspect the shop front as surveyors on behalf of Maison Blanc. In fact, however, that was not the case. Mr. Brecknock was well aware that Cluttons had acted as the landlord's agents in connection with the refurbishment of the upper floors and the tone of the message he sent them on 27^th March was essentially one of complaint. He thought that the awning had been damaged by the landlord's workmen and wanted Cluttons to look into it in the expectation that the landlord would pay for any repairs. It was for that limited purpose that Mr. Hunt visited Maison Blanc on 30^th March and it is in that context that the relationship between Cluttons and members of the public falls to be determined.
13. The judge also erred, in my view, in placing too much emphasis on forseeability of harm, almost to the point of treating it as sufficient to create a relationship of proximity between Cluttons and passers-by. On its own, however, foreseeability of harm is not enough. In Caparo v Dickman their Lordships rejected the submission that the auditors of a company owed a duty to members of the public who might rely on the accuracy of the company's accounts when deciding whether to buy shares or to trade with it, even though it was foreseeable that some might do so. The reason was that the auditors are appointed by the members to report to them on the accuracy of the company's accounts. They did not undertake any responsibility to others who might choose to rely on the accounts for their own purposes. In the language of the law, the necessary degree of proximity did not exist between the auditors and persons other than the members of the company.
14. In that case, of course, the loss which the auditors were said to have a duty to prevent was purely economic and it may be said that greater caution is to be exercised before imposing a duty in such cases than where physical injury is concerned. It was for that reason that Mr. Waite drew our attention to the passages in Perrett v Collins to which I have referred. However, even where physical injury is concerned, the existence of a duty of care requires a relationship of proximity or "neighbourhood". If Mr. Hunt had happened to notice a defect in the shop front as he passed by but had said nothing about it to Maison Blanc, he would not have been in breach of duty to any member of the public who was subsequently injured by it. In those circumstances no neighbour relationship would have existed between them. If, however, Cluttons had been asked by Maison Blanc to inspect the awning on its behalf to ensure that it did not pose a danger to passers-by, a sufficient degree of proximity would probably have existed, because the very purpose of the inspection would have been to ensure the safety of the public. In those circumstances it could be said that by accepting the instructions Cluttons had assumed some responsibility for the safety of those using the highway (or, to paraphrase Hobhouse L.J., that he had become involved in an activity which gave him a measure of control over, and responsibility for, the safety of passers-by). As it was, however, Cluttons' involvement had nothing to do with the safety of passers-by; their role was simply to see whether the shop front had sustained damage for which their clients might be liable. In those circumstances I do not think that there was a sufficient degree of proximity between them and the claimants to give rise to a duty of care on their part.

Did Cluttons owe a duty of care to Maison Blanc?

15. The judge dealt with this question in paragraphs 71-84 of his judgment. He accepted that he should apply a synthesis of the three-fold test, the assumption of responsibility test and the incremental test, as proposed by Sir Brian Neill in Bank of Credit and Commerce International (Overseas) Ltd v Price Waterhouse (No. 2) [1988]P.N.L.R.564. He found that a reasonable surveyor would have appreciated that, if he failed to carry out a competent inspection of the shop front, Maison Blanc might suffer economic loss in the form of liability to any members of the public injured by its collapse. He then held that there was sufficient proximity between Cluttons and Maison Blanc to give rise to a duty of care, because Cluttons knew the premises well, because Maison Blanc had been in touch with them during the progress of the works to the upper floors and because Maison Blanc had asked them to investigate a problem and they agreed to do so. He also relied on the fact that Maison Blanc would rely on what Cluttons told it and that it was reasonable for it to do so; and on the fact that in his view Cluttons had assumed a responsibility to Maison Blanc to carry out an inspection with reasonable skill and care.
16. At the heart of the judge's analysis lies the finding that Cluttons undertook a responsibility to Maison Blanc to inspect the shop front and report their findings and in doing so to act with reasonable skill and care – in other words, that Maison Blanc became in effect a client of Cluttons, at least for that limited purpose. However, as Mr. Pooles submitted, the relationship between them was essentially adversarial in nature. As I have already observed, Mr. Brecknock approached Cluttons in their capacity as agents of the landlord, rather than as surveyors, and did so in order to make a claim in respect of damage that he thought had been caused by the landlord's workmen. Mr. Brecknock's concern was with the awning and it was that which Cluttons were asked to examine. There is nothing in the evidence to suggest that by the time Mr. Hunt visited the premises on 30^th March 2007 Cluttons had been asked to advise Maison Blanc in relation to the condition of the shop front in general or that a relationship of professional adviser and client had come into existence for any purposes. Accordingly, if following his inspection Mr. Hunt had kept his own counsel and had simply declined to accept responsibility on behalf of the landlord for any damage there might have been, I do not think that Maison Blanc could have complained. In those circumstances I do not think it makes any difference that he expressed a view about the cause of the problem; anything he said was said as the agent of the landlord in response to a complaint by the tenant and had to be viewed in that light.
17. The judge found that Cluttons knew that Maison Blanc would rely on what they reported following Mr. Hunt's inspection and that it was reasonable for it to do so, but in my view the evidence does not support either of those conclusions. The subsequent exchange of emails between Maison Blanc and Cluttons shows that the relationship continued to be adversarial in nature, with Maison Blanc pressing Cluttons as the landlord's agent to ensure that the problem with the awning was resolved. The nature of their relationship was quite inconsistent with an assumption of responsibility by Cluttons towards Maison Blanc for inspecting the front of the premises and advising it about the nature of any damage and the measures needed to put it right. For these reasons the judge was wrong, in my view, to hold that Cluttons owed a duty of care to Maison Blanc.

Were Cluttons negligent?

18. Since Cluttons did not, in my view, owe a duty of care either to the claimants or to Maison Blanc, it is unnecessary to decide this question, but since it was the subject of full argument I shall briefly state my views on it.
19. The judge found that the damage shown in the Arcin photographs taken in June 2007 had been present to substantially the same extent when Mr. Hunt visited the shop on 30^th March 2007. That finding was challenged as being inconsistent with his acceptance of the evidence of the expert engineers that the damage was progressive and on the grounds that it does not follow, as the judge appears to have thought, from the description given by Mr. Brecknock in his email to Cluttons. There is a certain amount of force in these points, but in any event I do not think that that finding is critical. There was evidence in the form of the photographs taken before work began on the upper floors that by the autumn of 2006 the right hand end of the awning box had begun to drop and I think the judge was entitled to find that it had dropped to a noticeable extent by the end of March 2007. When he asked Cluttons to look at the premises Mr. Brecknock directed their attention to the awning box, saying that it appeared that "the unit" had slipped forward during the works. (I agree with the judge that by "the unit" Mr. Brecknock meant the awning box; there is nothing to suggest that at that stage there were any signs that the fixings holding the fascia itself to the masonry were beginning to fail.) The judge found that Mr. Hunt did not carry out an inspection of the general frontage of the premises and that he concentrated on the operation of the awning rather than the structural integrity of the awning box. It is also said that when Mr. Hunt reported back to Mr. Brecknock following his inspection he failed to mention the droop and concentrated entirely on the operation of the awning.
20. It is not possible to say that Mr. Hunt was negligent without being clear about his role and the scope of his instructions. The view expressed by the expert surveyors appears to have been based on an assumption that Cluttons had been asked by Maison Blanc as their client to inspect the shop front as a whole. Thus Mr. Tutt said (judgment, paragraph 54) that Mr. Hunt

" . . . should have observed the disturbance to the ends of the awning housing and the apparent dropping of the fascia and cover above . . . I would have expected the Cluttons surveyor to have then advised that further investigation of the fascia be undertaken."

However, Cluttons had not been asked to carry out an inspection generally on behalf of Maison Blanc; they had been asked to inspect the awning on behalf of the landlord. As I have already mentioned, when Mr. Tutt spoke of "the fascia and cover above", I think he must have been referring to the front and top of the awning box rather than what I have described as the fascia, since the judge made no finding that the fascia itself had begun to slip by the end of March 2007 and no sign of its slipping can be seen in any of the photographs taken before that date. I have already given my reasons for concluding that Cluttons did not owe a duty of care either to Maison Blanc or to members of the public, so Mr. Hunt's failure to observe the damage to the right hand end of the awning box was not negligent in any relevant sense as far as they were concerned. It can, of course be said, as indeed the judge found, that a competent surveyor in Mr. Hunt's position would have noticed the damage and to that extent it may be said that he was negligent, but that is something of which only his client, the landlord, could complain and as far as I know it has not done so.

Causation

21. Finally, Cluttons argued that even if they owed a duty of care to Maison Blanc or the claimants, the injury and loss which they suffered was not caused by any negligence on the part of Mr. Hunt. Again, in view of the conclusions which I have already reached it is unnecessary to decide this point. It is sufficient, therefore, to say that in my view there is much to be said for it. Active's case was that if Mr. Hunt had examined the awning box carefully he would have realised that a more detailed examination of its structure was called for and would have advised Maison Blanc accordingly; and that if such an examination had been carried out it would have become apparent that the fascia as a whole was inadequately supported. That would have led in turn to remedial measures being taken before the fascia collapsed.
22. The difficulty with this argument is that in June 2007 when he was shown the Arcin photographs Mr. Hunt did tell Maison Blanc that it should arrange for the awning box to be inspected by its own contractors and as a result Maison Blanc instructed its own builders to examine it. They found nothing of any significance. The judge criticised Mr. Hunt for failing to tell Mr. Brecknock clearly that the damage had got worse, but given his finding that the damage shown in the Arcin photographs was substantially present in March, that particular criticism does not seem to be well-founded. At any rate, Maison Blanc took the very steps which it is now said Cluttons should have advised it to take. It seems to me, therefore, that there are strong arguments for holding that such negligence as there may have been on Cluttons' part was not the cause of the unfortunate injuries to the claimants or of the loss suffered by Maison Blanc.
23. However, for the reasons I have given I do not think that Cluttons owed a duty of care either to the claimants or to Maison Blanc and as a result Active's claim for a contribution must fail. I would therefore allow the appeal. In those circumstances the issues raised by the respondent's notice do not arise.

Lord Justice Patten :

24. I agree.

Lord Justice McFarlane :

25. I also agree.