England and Wales High Court (Technology and Construction Court) Decisions

Carillion Construction Ltd. v Farebrother and Partners (a firm) & Ors [2002] EWHC 216 (Technology) (21st February, 2002)

IN THE HIGH COURT OF JUSTICE
QUEENS BENCH DIVISION
TECHNOLOGY AND CONSTRUCTION COURT

		St. Dunstan’s House, 133-137, Fetter Lane, London, EC4A 1HD
		21 February 2002

HANDING DOWN (SUBJECT TO EDITORIAL CORRECTIONS)

H.H. Judge Richard Seymour Q. C. :

Introduction

1. This action arises out of a project for the undertaking of demolition and construction works at the former Lewis’s department store at Temple Court in Birmingham. Richardson Barberry Properties Ltd. (“RBP”) acquired that property, to which I shall refer in this judgment as “the Property”, and entered into a contract with the Claimant, Carillion Construction Ltd., for the undertaking of the works which I have mentioned. In this judgment I shall refer to the works in question as “the Works”. Carillion Construction Ltd. was, at the time the contract was made, called Tarmac Construction Ltd. and it is convenient to refer to the Claimant in this judgment as “Tarmac” no matter what name it actually had at the time of which I am speaking. The contract between RBP and Tarmac was in the Standard Form of Building Contract with Contractor’s Design, 1981 edition, issued by the Joint Contracts Tribunal, and was dated 21 April 1993. I shall refer to that contract in this judgment as “the Main Contract”. The Works included the removal of all asbestos from the Property, save asbestos insulated board.
2. Tarmac commenced the execution of the Works on 30 November 1992. The removal of asbestos was the subject of a sub-contract made between Tarmac and T.W. Ward (Industrial Dismantling) Ltd. (“Ward”). That sub-contract was contained in, or evidenced by, an order dated 14 December 1992, numbered 23/18856/2308580, placed by Tarmac with Ward. Ward is now in liquidation. A Certificate of Practical Completion was issued under the terms of the Main Contract on 16 November 1994. A Notice of Completion of Making Good Defects was issued under the terms of the Main Contract on 18 September 1997. In January 2000 it was discovered that substantial quantities of asbestos remained in the Block C of the Property (“Block C”).

Farebrother and Partners

3. The First Defendants, Farebrother and Partners (“Farebrother”), practise as consulting civil and structural engineers. Farebrother was appointed by RBP to provide professional services in connection with the Works by an agreement dated 21 April 1993 and described as a “Consultancy Agreement”. That agreement (“the Farebrother Agreement”) was novated as between Farebrother and Tarmac on the day it was made.
4. The Farebrother Agreement included the following express terms:-

“1. Definitions

Throughout this Agreement including the Schedules hereto the following words and expressions shall have the following meanings except where the context otherwise requires:

“Development” The Development of the Property in Sections comprising Block A Block B The Common Parts and the Section 106 Works as more particularly referred to in the Employer’s Requirements.

“Employer’s Requirements” The Requirements of the Employer [that is, RBP] in relation to the Works or the Development as more particularly referred to in the Building Contract [that is, the Main Contract].

“Property” The former Lewis’s department store at Bull Street Corporation Street and Priory Square Birmingham

“Services” The Services to be provided by the Engineer under the terms of this Agreement as more particularly set out in Schedule 1 hereto.

“Works” The construction of the Development and such other works operations services and the like to be carried out pursuant to the Building Contract.

2.1 The Employer hereby appoints the Engineer [that is, Farebrother] and the Engineer hereby agrees to perform the Services fully and faithfully in accordance with the instructions and directions of the Employer upon the terms and conditions set out in this Agreement. The Engineer shall strictly comply with all reasonable and proper instructions and directions given to it by the Employer on any matter connected with the Works.

2.2 The Employer and the Engineer hereby acknowledge that notwithstanding that the Engineer has undertaken a part or parts of the Services to be performed hereunder prior to the date of this Agreement the obligations and liabilities of the Engineer contained herein shall take effect in all respects as if this Agreement had been dated prior to the commencement of the Services by the Engineer.

5.1 The Engineer represents and warrants to the Employer that the Engineer has exercised and will continue to exercise all reasonable skill care and diligence in the performance of the Services under the Agreement in conformity with the normal standards of the Engineer’s profession.

Schedule 1 Part 1

SCOPE OF THE ENGINEERING WORKS (CIVIL/STRUCTURAL)

The Engineering Works

Sub-structure including: Foundations, earthworks, fill, retaining walls, water retaining structures, pits, ducts, slabs.

Super-structure including: Walls, columns, floors, slabs, staircases, frames, bracing, supporting members such as cladding rails, door posts, window fixings, wall stiffening and the like, roof, structural builders work in connection with services and other specialist sub-contractors works, and all other work necessary to ensure the continued stability of the Works in whole or part.

External works including: Foundations, earthworks, groundworks, fill, retaining walls, structures, pits, ducts, tanks, roads, crossover, paving, concrete and pre-cast concrete.

Drainage including: Foul effluent, surface water, rainwater, and land drainage systems, including pipes, manholes, chambers, outfalls, pumping equipment, gullies, culverts and the like.

Schedule 1 Part 2

The Engineer is to provide the following Services:

Prior to the placing of the Building Contract

5. Undertake a detailed inspection and investigation into the fabric of the Property and prepare such report or reports as are reasonably necessary or required by the Employer arising out of such inspections and investigations undertaken or recommended by the Engineer as may be necessary to enable the Engineer to advise the Employer on such works as may be necessary or recommended by the Engineer to enable the Employer to undertake the Development including advice on such measures as may be necessary to ameliorate the condition of the Property as reported on by the Engineer.

During the currency of the Building Contract

24. Liase with the Building Contractor the Contractor’s Consultants and others as required to prepare a design programme for the completion of the design of the Works compatible with the requirements of the Building Contractor’s overall programme.

27. Carry out site inspections as often as may be appropriate to inspect generally the progress and quality of the work and in any event at least once a week or as reasonably required by the Building Contractor and report thereon to the Building Contractor in writing.

31. Prior to practical completion of each Section of the Works the Engineer shall issue a letter to the Building Contractor stating that those works specified in the Building Contract relating to that Section have been carried out and concluded to such a standard that in the opinion of the Engineer a written statement of practical completion can be issued in respect of that Section. ”

5. It was an express term of the agreement by which the Farebrother Agreement was novated as between Tarmac and Farebrother, by clause 1, that:-

“The Engineer hereby undertakes to perform the obligations under the [Farebrother] Agreement for the Building Contractor with immediate effect and be bound by the terms and conditions of the same in every way as if the Building Contractor were a party thereto ab initio in lieu of the Developer.”

The Second Defendants

6. The Second Defendants, who formerly practised as architects, were appointed as architects in relation to the Works. The claim against them was compromised before the hearing of the preliminary issues with which this judgment is concerned. The Second Defendants thus took no part in that hearing.

Worcestershire County Council

7. The Third Defendant, Worcestershire County Council (“Worcester”), amongst its other activities, provides, through its County Laboratory, scientific services on a commercial basis. It is the successor to Hereford and Worcester County Council (“the Council”) which used to undertake similar activities. By an agreement made between Tarmac and the Council, the terms of which were, so it was contended on behalf of Tarmac, in part contained in, or evidenced by, Tarmac’s order dated 9 March 1993, numbered 23/19200/2308580 (“the Order”), the Council agreed to provide services described in the Order as “adequate asbestos monitoring programme as agreed with site as detailed below” for Tarmac at the Property. The details below in the Order were simply rates of charge for attendance at site and for air tests. It was common ground that the Council was not licensed by Health and Safety Executive under Regulation 3(1) of Asbestos (Licensing) Regulations 1983, SI 1983 No.1649, to undertake “any work with asbestos insulation or asbestos coating”, which would include the removal of asbestos.

The pleaded cases

8. Separate claim forms and Particulars of Claim were originally issued on behalf of Tarmac against each of the Defendants, although the actions have been ordered to be tried together. In the Particulars of Claim served on Farebrother the terms of the definition of the expression “Works” in clause 1 of the Farebrother Agreement and the terms of clause 2.2, Schedule 1 Part 1 and Schedule 1 Part 2 clauses 24, 27 and 31, all of which I have set out at paragraph 4 above, were pleaded, as was the express term of the novation agreement which I have set out at paragraph 5. Paragraph 8 of the Particulars of Claim was in the following terms:-

“8. Further it was an implied condition of the Appointment Agreement that the Defendants would exercise all due care and skill in performing its contractual obligations. Further or alternatively the Defendants owed Tarmac such a duty of care in tort.”

It is unclear why the implied condition alleged was pleaded. The obligations undertaken by Farebrother under clause 5.1 of the Farebrother Agreement seem to cover the same ground as the alleged implied term. On elementary principles a term is not to be implied unless it is, amongst other things, necessary to do so, and it cannot be necessary to imply a term which merely duplicates an express term.

9. The Particulars of Claim included the pleas in relation to the discovery of asbestos in Block C in January 2000 that:-

“16. In the premises the Defendants are in breach of contract and/or in breach of their duty of care in that they:

16.1 failed to exercise all due care and skill in drawing up a design programme for the removal of asbestos pursuant to clause 24 of Schedule 1 part 2.

16.2 failed to carry out inspections as often as was appropriate in order to detect whether asbestos was being removed in accordance with any design programme that they had drawn up or at all.

16.3 failed to exercise due care and skill in carrying out inspections which they did undertake in that they failed to notice that asbestos was not being removed in accordance with any design programme that they had drawn up or at all.

16.4 failed to report to Tarmac pursuant to clause 27 as to the removal of the asbestos; and/or

16.5 incorrectly reported to Tarmac pursuant to clause 27 that the asbestos was being removed as required under the Main Contract.

16.6 incorrectly issued letters to Tarmac pleaded at paragraphs 10.4-5 above when it knew or ought to have known that the works had not been completed as described therein.

17. Had the Defendants not been in breach of contract and/or their duty of care they would have advised upon and supervised the total removal of asbestos from Block C.”

10. The loss which it was alleged Tarmac had suffered as a result of the breaches of contract and negligence alleged was pleaded in this way:-

“19. To the extent that the Claimant is obliged to carry out the said works [of removal of the asbestos discovered in January 2000] without charge the cost of such works to the Claimant constitutes loss and damage resulting from the Defendants’ breaches of contract and/or negligence. Particulars of such cost will be provided hereafter following completion of the works and agreement of the Final Account in respect thereof between the Claimant and RBPL.”

The loss and damage claimed was thus simply the cost to Tarmac of removing the asbestos discovered in January 2000. No loss other than that financial loss was alleged.

11. The Defence served on behalf of Farebrother included the following:-

“9.1 The removal of asbestos (whether from Block C or otherwise) was not within the scope of the Engineering Works as defined in Schedule 1 Part 1 of the Appointment Agreement.

9.2 None of these activities were, therefore, required to be, nor were they in fact, performed by Farebrother in respect of the removal of asbestos from Block C…

12. It is denied that Farebrother were in breach of either contract or a duty of care as alleged in paragraph 16 or at all. The allegations at paragraph 16.1 to 16.6 are, currently, so vaguely pleaded as to preclude meaningful response. Pending clarification of Carillion’s case, Farebrother respond as follows:

i) Paragraph 9.1 above is repeated. The Scope of Works, in the context of which Farebrother were to perform their services, was circumscribed by Schedule 1 Part 1 of the Appointment Agreement.

ii) The removal of asbestos did not form part of the Engineering Works as defined in Schedule 1 Part 1.

iii) Farebrother were not, therefore, required by the terms of their appointment to perform the tasks, or functions, postulated in paragraphs 16.1 to 16.4.

iv) It is denied, if alleged in paragraph 16.3, that Farebrother undertook inspections in respect of the removal of asbestos in Block C.

v) It is further denied, as a fact, that Farebrother reported to Tarmac in the terms suggested in paragraph 16.5.

vi) It is specifically denied, if alleged in paragraph 16.6, that those letters purported to, or did, encompass the asbestos removal works.”

12. A Reply was served on behalf of Tarmac which included this in relation to the plea in paragraph 9.1 of the Defence of Worcester:-

“4. As to paragraph 9.1 the Claimant avers that properly construed the removal of asbestos was within the scope of the Engineering Works as defined in Schedule 1 Part 1 of the Appointment Agreement.”

13. The Particulars of Claim served on Worcester included the following pleas in relation to the obligations of the Council as a result of the making of the agreement between Tarmac and the Council:-

“7. By an agreement entered into between Tarmac and the Defendant on or around 9 March 1993 and in part contained in or evidenced by a Purchase Order of that date the Defendant agreed to advise in relation to and supervise the removal of the asbestos at that date remaining in Block C so as to ensure that no asbestos remained at the completion of the works to Block C.

8. It was an implied condition of the said agreement that the Defendant would carry out its obligations with all due skill and care. Further or alternatively the Defendant owed Tarmac such a duty of care in tort.”

14. A Request for Further Information was made on behalf of Worcester in relation to the pleas at paragraph 7 of the Particulars of Claim. In particular the Request included:-

“2. State whether it is alleged the agreement to provide the advice described in the Answer to Request 1 was made orally or in writing;

(a) If and insofar as it was agreed orally, state when, where and between whom it was so agreed giving the gist of all conversations relied upon.

(b) If and insofar as it was agreed in writing identify and provide copies of all documents relied upon as constituting the alleged agreement.”

The information provided in response to the Request quoted was:-

“Details of the agreement between the parties are fully pleaded.”

15. The Particulars of Claim served on Worcester also contained pleas that the Council had been in breach of its contract with Tarmac and in breach of an alleged duty of care. The material allegations were as follows:-

“14. In the premises the Defendant is in breach of contract and/or in breach of their duty of care in that it:

14.1 failed properly to advise Tarmac in relation to the removal of the asbestos in Block C.

14.2 failed to draw up a satisfactory method statement to result in the complete removal of the remaining asbestos.

14.3 failed properly to inspect Block C in that it did not notice the remaining asbestos. Had it properly inspected Block C the presence of asbestos would have been noted.

14.4 failed properly to carry out or have carried out analysis of air samples. Had they been properly carried out the presence of asbestos would have been noted.

14.5 issued clearance certificates (indicating that the Defendant was of the opinion that asbestos had been totally removed) as pleaded above when it was or ought reasonably to have been apparent to the Defendant that the asbestos had not been totally removed.

15. Had the Defendant not been in breach of contract and/or its duty of care it would have advised upon and supervised the total removal of asbestos from Block C.”

16. The loss allegedly suffered by Tarmac as a result of the alleged breach of contract or negligence of the Council was pleaded in the same way in the Particulars of Claim as against Worcester as it had been in the Particulars of Claim as against Farebrother.
17. In the Defence served on behalf of Worcester it was pleaded, so far as is presently material, as follows:-

“21. The services that Worcester performed pursuant to the said contract were as follows;

(1) Background monitoring by air tests prior to and during preparatory works inside and outside the enclosures.

(2) Checking that the legislative requirements concerning preparatory works had been complied with by Ward.

(3) Air tests within enclosures after removal of AIM from pipe work, soffits and steelwork by Ward. The said tests were by their nature concerned with the presence of asbestos fibres in the air and not the presence of concealed asbestos forming part of the building or undisturbed asbestos insulation board.

(4) Checking that areas were clear by means of air tests as in (3) above and visual inspection, checking that enclosures were bagged and removed (where applicable) and that all bagged materials were removed to the designated disposal plant.

22. Worcester’s services were concerned with environmental health control.

23. Worcester was not required to undertake a survey of block C for the presence of asbestos before, during or after removal works. In December 1992 Worcester was informed by Tarmac that a survey had been undertaken by others. Worcester was not concerned with the existence of asbestos insulation board (“AIB”) or cementitious asbestos. At a meeting in December 1992 Worcester’s staff were informed that AIB was to be removed by Ward following the removal of AIM by Ward and Worcester was not to be involved in that operation.”

18. In a Reply served on behalf of Tarmac the response to paragraphs 21 and 22 of the Defence of Worcester was this:-

“15. As to paragraph 21 it is admitted that the Defendant performed or purported to perform the services particularised at sub-paragraphs (1) to (4). It is denied that the Defendant’s obligations were so limited. For the avoidance of doubt the Claimant contends that the Defendant was obliged to:

15.1 carry out background monitoring prior to erection of enclosures

15.2 check the integrity of the enclosures

15.3 monitor all preparatory work within the enclosures such as removal of suspended ceilings and ducting

15.4 monitor for leaks outside the enclosure during the carrying out of the removal works

15.5 monitor the removal of asbestos waste

15.6 carry out a thorough visual inspection of each enclosed area before final cleaning

15.7 carry out air testing of a clean enclosed area

15.8 carry out a thorough visual inspection and air testing throughout all areas following removal of enclosures.

Further, the second sentence of sub-paragraph (3) is denied. The Defendant was retained in relation to all asbestos whether visible or invisible, and whether or not fibres in the air.

16. Save that it is denied if it be alleged that the Defendant’s services were solely concerned with environmental health control, paragraph 22 is admitted. The Defendant was obliged to carry out the services pleaded in paragraph 15 above even if they were not concerned with environmental health control.”

The pleas in paragraph 15 of the Reply do not seem to amount to any allegation that the Council was bound to investigate the Property to discover the location of all asbestos or to confirm that all asbestos had been removed.

The preliminary issues

19. It was plain from the respective statements of case of the parties that the basic position of both Farebrother and Worcester was that neither Farebrother nor the Council agreed with Tarmac to undertake any role in relation to the discovery of asbestos at the Property or in ensuring that all asbestos had been removed. In those circumstances it seemed to me appropriate to order the trial of preliminary issues as to the nature of the obligations undertaken by Farebrother and the Council respectively to Tarmac.
20. As between Tarmac and Farebrother the agreed preliminary issues were as follows:-

“1. Did Farebrother owe Tarmac a duty of care in tort to advise upon and/or supervise the total removal of asbestos from Block C as pleaded at paragraphs 8 and 17 of the Particulars of Claim?

2. Did Farebrother owe Tarmac a duty of care in tort to avoid causing Carillion to incur the economic loss that it claims?

3. Did the removal of asbestos from Block C fall within the scope of the engineering works for the purposes of Schedule 1 Part 1 of Farebrother’s deed of appointment?

4. Did the drafting of a design programme for the removal of asbestos from Block C fall within the scope of clause 24 (Schedule 1 Part 2) of Farebrother’s deed of appointment?

5. Did the inspection (or supervision) of the works undertaken to remove asbestos from Block C fall within the scope of clause 27 (Schedule 1 Part 2) of Farebrother’s deed of appointment?

6. Did the removal of asbestos from Block C fall within the scope of clause 31 (Schedule 1 Part 2) of Farebrother’s deed of appointment? ”

21. As between Tarmac and Worcester the agreed preliminary issues were these:-

“1. By an agreement made on or around 9^th March 1993 did the Third Defendant agree to advise in relation to and to supervise the removal of the asbestos in Block C at that date so as to ensure that no asbestos remained at the completion of the works to Block C, as alleged in paragraph 7 of the Particulars of Claim?

2. Did the Third Defendant owe a duty of care in tort to exercise reasonable skill and care to ensure that no asbestos remained at the completion of the works to Block C in order to ensure that the Claimant did not incur economic loss, as alleged in paragraph 8 of the Particulars of Claim?”

The case against Farebrother

22. After the first day of the trial of preliminary issues Tarmac and Farebrother came to terms of settlement which included that the action as between Tarmac and Farebrother should be stayed. In those circumstances it is not necessary or appropriate for me to express any views on the preliminary issues formulated as between Tarmac and Farebrother.

The case against Worcester in contract

23. Miss Hitching set out how Tarmac put its case against Worcester in contract in the following passages of her written opening:-

“21. The Claimant contends that the agreement with Worcester was only part contained in or evidenced by the purchase order of 9 March 1993. It will therefore be necessary to look at the oral discussions preceding the written order not just as background to aid construction of the purchase order but also as themselves partially containing or evidencing the agreement.

22. The Claimant contends however that the factual matrix can only include matters up to the date of entry into the contract and of which the parties were aware or which were reasonably available to them. Evidence contained in the Claimant’s witness statements which post-dates 9 March 1993 is not to be adduced in relation to the claim in contract but rather the claim in tort…

24. In support of its claim the Claimant will in particular rely upon the following matters:

24.1 the purchase order is expressed to be for “asbestos monitoring” not “air/environment monitoring”

24.2 As a result of the prohibition notice Tarmac wanted Ward’s work and not just the working conditions to be supervised. The Second Defendant [here meaning Worcester] was made aware of this. Further the precise scope of services that the Second Defendant was to provide were discussed on site (and agreed) immediately prior to the purchase order being raised.

25. The Defendant can adduce no evidence in relation to the contract claim. None of its witnesses can or purports to deal with the period up to 9 March 1993 (the only relevant period). It has failed to call Jackie Green who acted on its behalf in agreeing the scope of services with Tarmac. (It is understood that Jackie Green would have been available to be called as a witness). In contrast the Claimant will call evidence not just from those employed by Tarmac but from a third party (Richard Pearl) who was authorised fully to discuss the scope of services to be provided. There is no reason to doubt the evidence of the Claimant’s witnesses as to what discussions in fact took place.”

24. Mr. Steven Walker, who appeared on behalf of Worcester, submitted, as it seems to me correctly, that, in the light of the answer given to the second Request for Information in relation to paragraph 7 of the Particulars of Claim as against Worcester, it was not open to Tarmac to contend that anything had been agreed orally between representatives of the Council and representatives of Tarmac other than that the Council would “advise in relation to and supervise the removal of the asbestos at that date remaining in Block C so as to ensure that no asbestos remained at the completion of the works to Block C.”

The case against Worcester in tort

25. Miss Hitching elaborated the case of Tarmac against Worcester in tort in her written opening in this way:-

“28. The Claimant alleges that the Second Defendant assumed responsibility for the economic losses that might result from the failure fully to remove the asbestos. It contends that the acts constituting such an assumption both pre-date and post-date the order of 9 March 1993…

29. Therefore in respect of the claim in tort the Claimant will adduce evidence as to the period after 9 March 1993. It does not do so in order to advance an argument that performance could be considered in determining the scope of the duty being performed but rather that the acts themselves constituted the assuming of the duty…

31. The Claimant will in particular rely upon the fact that the Second Defendant did and purported to perform services more extensive than background air monitoring for health purposes in and immediately outside enclosures.

31.1 It advised on a revised method statement

31.2 It advised that works be carried out in accordance with the method statement and certified when remedial works were not necessary despite an apparent departure from it

31.3 It advised on the appropriateness of removing asbestos and the method to be adopted if not removed

31.4 It advised on the wording of the checklist which related to the construction of the enclosures, preparatory work for stripping asbestos and subsequent disposal

31.5 It purported by its signature on the checklist to supervise the carrying out of items listed, took samples of asbestos for analysis other than from enclosures. It is clear from Worcester’s second letter of 16 August 1993 that it considered this to be separate to questions of background monitoring

31.6 It monitored the actual removal process where the “cut and wrap” method was used

31.7 It checked and purported to control how asbestos was removed from site and ensured that asbestos impregnated clothing was dealt with so as not to spread asbestos

31.8 It raised queries with Tarmac in relation to the presence of asbestos other than in enclosures

31.9 Insofar as asbestos was detected after Ward’s works it specified the remedial works to be carried out, either compliance with the method statement or specfic operations

31.10 Its own internal notes state that it was involved in site supervision (entry under 15^th March 1993) and its second letter of 16 August 1993

31.11 Worcester’s first letter of 16 August 1993 make it clear that its obligations under the contract with Tarmac were wider than the obligations under the contract with Ward.”

26. The list of matters set out in paragraph 31 of Miss Hitching’s written opening is rather curious. The duty of care pleaded in paragraph 8 of the Particulars of Claim as against Worcester was a duty to “carry out its obligations with all due skill and care”, where the obligations in question were those alleged to have arisen under the agreement pleaded at paragraph 7 “to advise in relation to and supervise the removal of the asbestos at that date remaining in Block C so as to ensure that no asbestos remained at the completion of the works to Block C.” In other words, the duty of care alleged was a duty to perform with reasonable skill and care obligations allegedly assumed by contract. As I have already indicated, Tarmac was asked on behalf of Worcester to provide further information in respect of the allegations made in paragraph 7 of the Particulars of Claim. The information requested included, “5. Please explain the basis on which it is alleged that the Defendant owed the Claimant a duty of care in tort.” The answer given was:-

“5. It was foreseeable that the Claimant would suffer loss of the type actually suffered if the Defendant gave negligent advice. There was close proximity between the parties. The Defendant assumed responsibility for supervising the safe removal of asbestos. Furthermore the Claimant, Wakeman Management and Richardson Barberry all relied on the Claimant’s reports confirming asbestos had been removed. The Defendant was aware of this reliance and redrafted its report dated 16 August 1993 for this purpose.”

There was thus no pleaded case that any duty of care other than to perform its contract with reasonable skill and care was being contended for on behalf of Tarmac. The case set out by Miss Hitching at paragraphs 28, 29 and 31 of her written opening did not seem to me to be available to Miss Hitching on Tarmac’s statement of case as against Worcester. The duty of care contended for at paragraphs 28, 29 and 31 of Miss Hitching’s written opening seemed to be one alleged to have arisen not because the Council had entered into an agreement with Tarmac to provide a professional service, but because of activities in which it was alleged the Council had engaged outside of, and both before and after, the contract alleged. When this was pointed out to her Miss Hitching sought permission to amend Tarmac’s Particulars of Claim as against Worcester so as to allege, in paragraph 8:-

“It was an implied condition of the said agreement that the Defendant would carry out its obligations with all due skill and care. Further or alternatively the Defendant owed Tarmac such a duty of care in tort to advise in relation to and supervise the removal of the asbestos at that date remaining in Block C so as to ensure that no asbestos remained at the completion of the works to Block C. ”

She also sought permission to add a sentence in the further information which I have quoted earlier in this paragraph as a new third sentence, namely:-

“Particulars of the assumption of responsibility are set out below. ”,

and to set out as such particulars the matters listed in paragraph 31 of her written opening.

27. Mr. Walker objected to the granting of permission to amend in the manner sought by Miss Hitching on two principal grounds. The first was that the application was made late. That it undoubtedly was, but, in view of the fact that most of the matters upon which Miss Hitching sought to rely as particulars of the assumption of responsibility for which she wished to contend were not in dispute as facts, I should not have been inclined to refuse permission simply on the ground of lateness. Mr. Walker’s second principal ground of objection was that the particulars of the assumption of responsibility which Miss Hitching wished to add were not particulars of any assumption of responsibility of a duty such as that Miss Hitching wished to plead in paragraph 8 of the Particulars of Claim but particulars of an alleged assumption of responsibility of a duty put in the further information to which I have referred as one of “supervising the safe removal of asbestos”. As a matter of the language of the proposed amendments I think that Mr. Walker is correct. However, in my judgment the substance of the objection is more than just semantics. It seems to me to be plain that none of the matters listed in paragraph 31, if correct, would amount, individually or collectively, to an assumption of an obligation on the part of the Council positively to seek to ensure that no asbestos remained in Block C at the completion of the works of asbestos removal. For that reason I declined to grant permission to amend the Particulars of Claim and the further information.

The scope of any duty of care

28. It is, I think, plain that, in a case in which the parties are in a contractual relationship and the complaint is that one of them has failed to do with reasonable care and skill that which he contracted to do, the scope of any duty of care in tort which the alleged contract breaker owes to the other contracting party is prescribed by the terms of the contract between them. In South Australia Asset Management Corporation v. York Montague Ltd. [1997] AC 191 the appellants were all valuers of real property who had been instructed to value properties which were being offered as security for loans. In each case the relevant property was considerably over-valued. In each case the borrower defaulted. In each case the true value of the property had fallen since the date of valuation as a result of a general decline in the property market. The main point at issue was the extent of the liability of the valuers to the lenders. The leading speech was that of Lord Hoffman. At page 210 of the report he said:-

“….Before one can consider the principle on which one should calculate the damages to which a plaintiff is entitled as compensation for loss, it is necessary to decide for what kind of loss he is entitled to compensation. A correct description of the loss for which the valuer is liable must precede any consideration of the measure of damages. For this purpose it is better to begin at the beginning and consider the lender’s cause of action.

The lender sues on a contract under which the valuer, in return for a fee, undertakes to provide him with certain information. Precisely what information he has to provide depends of course upon the terms of the individual contract. There is some dispute on this point in respect of two of the appeals, to which I shall have to return. But there is one common element which everyone accepts. In each case the valuer was required to provide an estimate of the price which the property might reasonably be expected to fetch if sold in the open market at the date of the valuation.

There is again agreement on the purpose for which the information was provided. It was to form part of the material on which the lender was to decide whether, and if so how much, he would lend. The valuation tells the lender how much, at current values, he is likely to recover if he has to resort to his security. This enables him to decide what margin, if any, an advance of a given amount will allow for a fall in the market, reasonably foreseeable variance from the figure put forward by the valuer (a valuation is an estimate of the most probable figure which the property will fetch, not a prediction that it will fetch precisely that figure), accidental damage to the property and any other of the contingencies which may happen. The valuer will know that if he overestimates the value of the property, the lender’s margin for all these purposes will be correspondingly less.

On the other hand, the valuer will not ordinarily be privy to the other considerations which the lender may take into account, such as how much money he has available, how much the borrower needs to borrow, the strength of his covenant, the attraction of the rate of interest or the other personal or commercial considerations which may induce the lender to lend.

Because the valuer will appreciate that his valuation, though not the only consideration which would influence the lender, is likely to be a very important one, the law implies into the contract a term that the valuer will exercise reasonable care and skill. The relationship between the parties also gives rise to a concurrent duty in tort: see Henderson v. Merrett Syndicates Ltd. [1995] 2 AC 145. But the scope of the duty is the same as in contract.”

29. For practical purposes, in a case in which the parties are in a contractual relationship and the complaint is that one of them has failed to perform his contractual obligation to do something with reasonable care and skill, whether a claim is framed as one for damages for breach of contract or for damages for negligence only matters if a cause of action in contract would be barred by the operation of Limitation Act 1980, but a cause of action in tort would not be, or damage was suffered which was too remote to be recoverable as damages for breach of contract, but not too remote to be recoverable as damages for negligence, or if some question arose of leave to serve proceedings outside the jurisdiction – see per Lord Goff in Henderson v. Merrett Syndicates Ltd. [1995] 2 AC 145 at page 185E-H. The question of limitation is a live issue in the action as between Tarmac and Worcester. However, the main focus of attention in the preliminary issues is simply what was it that the Council agreed with Tarmac to do. Whether formulated as an issue as to the scope of a duty of care or as an issue as to the proper construction of the relevant contract, the answer depends upon the interpretation of the contract in question.

The proper approach to construction of a contract

30. It was common ground that the approach which I should adopt to construction of the contract made between Tarmac and the Council, insofar as in writing, was that indicated by Lord Hoffman in Investors Compensation Scheme Ltd. v. West Bromwich Building Society [1998] 1 WLR 896 at pages 912H to 913F:-

“The principles may be summarised as follows.

(1) Interpretation is the ascertainment of the meaning which the document would convey to a reasonable person having all the background knowledge which would reasonably have been available to the parties in the situation in which they were at the time of the contract.

(2) The background was famously referred to by Lord Wilberforce as the “matrix of fact”, but this phrase is, if anything, an understated description of what the background may include. Subject to the requirement that it should have been reasonably available to the parties and to the exception to be mentioned next, it includes absolutely anything which would have affected the way in which the language of the document would have been understood by a reasonable man.

(3) The law excludes from the admissible background the previous negotiations of the parties and their declarations of subjective intent. They are admissible only in an action for rectification. The law makes this distinction for reasons of practical policy and, in this respect only, legal interpretation differs from the way we would interpret utterances in ordinary life. The boundaries of this exception are in some respects unclear. But this is not the occasion on which to explore them.

(4) The meaning which a document (or any other utterance) would convey to a reasonable man is not the same thing as the meaning of its words. The meaning of words is a matter of dictionaries and grammars: the meaning of the document is what the parties using those words against the relevant background would reasonably have been understood to mean. The background may not merely enable the reasonable man to choose between the possible meanings of words which are ambiguous but even (as occasionally happens in ordinary life) to conclude that the parties must, for whatever reason, have used the wrong words or syntax: see Mannai Investments Co. Ltd. v. Eagle Star Life Assurance Co. Ltd. [1997] AC 749.

(5) The “rule” that words should be given their “natural and ordinary meaning” reflects the common sense proposition that we do not easily accept that people have made linguistic mistakes, particularly in formal documents. On the other hand, if one would nevertheless conclude from the background that something must have gone wrong with the language, the law does not require judges to attribute to the parties an intention which they plainly could not have had. Lord Diplock made this point more vigorously when he said in Antaios Compania Naviera SA v. Salen Rederierna AB [1985] AC 191,201:

“if detailed semantic and syntactical analysis of words in a commercial contract is going to lead to a conclusion that flouts business commonsense, it must be made to yield to business commonsense.”

The factual matrix

31. Miss Hitching did not really urge upon me any particular matters as being facts which shed light upon how the contract between Tarmac and the Council should be construed. Rather she sought to rely on the oral evidence of witnesses called on behalf of Tarmac as leading to the conclusion that the terms of the agreement actually made between Tarmac and the Council were those for which Tarmac contended. Mr. Walker did rely heavily upon the regulatory background governing working with asbestos in 1993 as relevant to the construction of the Order and upon the fact that what prompted Tarmac to engage the Council in the first place was the service by the Health and Safety Executive of a prohibition notice on Tarmac in relation to asbestos removal work at the Property. He also relied heavily upon the facts that Tarmac had commissioned a survey of the asbestos in the Property, including Block C, before the Council ever had any involvement with the Property, and had told the Council that such a survey had been undertaken, as representing the context in which the Order should be construed.
32. Oral evidence was called on behalf of both Tarmac and Worcester from people who had had some involvement with activities at the Property in relation to asbestos in 1992 or 1993. Some of those witnesses, in particular those called on behalf of Tarmac, sought to express some view as to their respective understandings of the obligations of the parties in respect of the removal of asbestos. Such evidence is not admissible and I have disregarded it. With only very limited exceptions, principally, but not entirely, in relation to the contention that the agreement made between Tarmac and the Council was made partly orally, the remaining evidence of the witnesses called was simply irrelevant to the issues which I have to decide. Much of it, particularly that called on behalf of Worcester, was focused on what was actually done after the relevant contract had been made. Rather strangely, although it was common ground as between Miss Hitching and Mr. Walker in their respective opening submissions that events after the making of the agreement between Tarmac and the Council were irrelevant to any background against which that agreement fell to be construed or to the interpretation of the agreement, Miss Hitching took some time in cross-examining the witnesses called on behalf of Worcester on matters occurring after the making of the agreement.
33. The documents copied before me for the purposes of the trial of preliminary issues included a copy of a letter dated 9 September 1991 written by Mr. Roger Wilson, at that time Tarmac’s Design-Build Manager for the Midlands area, to Mr. Michael Winters of RBP and the enclosure to that letter. The letter referred to the enclosure as “the action list agreed at the meeting of 30 August 1991.” The enclosure included in the action list as something for Tarmac to do:-

“Roger Wilson to write to Mike Winters of Barberry Properties requesting formal consent to carry out investigative work, this to include:

…

Asbestos check.”

34. Under cover of a letter dated 8 October 1991 Mr. Michael Edge, at that time Contracts Director of a company called Kerrmead Ltd., which traded under the name “Insulation Contracting Services”, sent to Tarmac, marked for the attention of Mr. Keenan, a report of “A survey of the location and extent of asbestos contaminated materials with recommendations for the safe removal of same with budget costings at the old Lewis’s store”. The letter dated 8 October 1991 began:-

“Further to your recent request for us to carry out a survey of asbestos materials in the above premises we are pleased to enclose herewith a report of our findings.”

The letter bore upon its face the manuscript note, “Action RWK. Copy for Roger W.”, that is, Mr. Wilson. Mr. Keenan told me in his evidence that the manuscript note was in his hand and that he was RWK. Mr. Keenan was employed by Tarmac as one of two site agents at the Property for the purposes of the Works. On the face of the report a thorough inspection of the Property had been undertaken in order to prepare it. Mr. Edge, who gave evidence before me, said that the survey recorded all the asbestos which he could find at the time of his inspection.

35. Mr. Wilson sought, in his oral evidence, to distance Tarmac from the survey and report. He said that, contrary to the impression which one might have from the terms of the Action List which he himself prepared, he had not agreed that Tarmac should undertake an asbestos check. He said that at the time he prepared the Action List Tarmac was not the chosen contractor for the Works, but was involved with opening up works to permit the various members of the professional team to inspect the existing structure of the Property. What he was indicating in the Action List he was going to do, therefore, was no more than seek permission from Mr. Winters to undertake an asbestos check in the context of the opening up works then under way or in contemplation. I accept Mr. Wilson’s evidence on this point. Further, Mr. Wilson said that, despite what Mr. Edge said in his letter dated 8 October 1991 and in the introductory part of his survey report, Insulation Contracting Services had not been requested to survey the Property to seek to locate any asbestos, but rather to submit a quotation for asbestos removal works. Mr. Keenan’s evidence was that he was in fact asked to arrange for an asbestos survey to be carried out by one of the consultants involved in the project, but he could not remember which. It was for that reason, he said, that the report of the survey carried out by Insulation Contracting Services was marked for his attention. I prefer the evidence of Mr. Keenan to that of Mr. Wilson on the question how the asbestos survey came to be undertaken. However, whichever of them is correct, the fact remains that, however it came about, Tarmac was in fact in possession of a report of a survey of the Property for asbestos as from the date of receipt of Mr. Edge’s letter and enclosure. From an endorsement on the letter that date seems to have been 17 October 1992.
36. Julie Goddard, who was called as a witness on behalf of Worcester, said in her witness statement dated 29 November 2001:-

“2. In December 1992 I attended a meeting with Jackie Green, my immediate supervisor, at Temple Court in Birmingham. Also at the meeting were representatives of Ward and Tarmac. We were given little information at the meeting, which mainly consisted of a walk round the site where some areas of asbestos materials were pointed out by Tarmac.

3. I asked if an asbestos survey of the building had been carried out. I asked this because it was a service we provided. The request was not pursued because we were informed that a survey had already been carried out by a representative of Tarmac. This representative did not have a copy of the survey at the meeting and was not able to tell us who had carried out the survey.

4. Following this meeting Hereford and Worcester County Council was employed by Wards to provide an air monitoring service when the project started in January 1993.”

I accept that evidence. The Council thus knew that someone else had undertaken an asbestos survey of the Property prior to the making of the contract with which I am concerned.

37. Ward seems to have engaged the Council to undertake background monitoring during asbestos removal works at the Property. What precisely the Council was engaged by Ward to do is a little unclear because no direct evidence as to the terms of any contract between Ward and the Council has been put before me. In cross-examination Mrs. Goddard raised the possibility that no contract had been made between the Council and Ward. However, Mr. Frank Crilly was called as a witness on behalf of Worcester and he said that he had worked at the Property from January 1993. He told me, and I accept, that what he in fact was instructed to do, and did, was background monitoring. That is the only evidence from which any conclusion can be drawn as to what the Council agreed with Ward to do. Background monitoring involves making tests of the air quality in the vicinity of enclosures set up to contain asbestos during the process of removal, and, if thought appropriate, elsewhere, so as to check that no asbestos has escaped from the relevant enclosure during the removal operation. Mrs. Goddard explained to me in cross-examination, and I accept, that such enclosures as I have mentioned are set up to screen the working area from areas not being worked in. Within the enclosure all areas other than those from which asbestos is to be removed are covered. Once the asbestos has been removed what is called a clearance test is undertaken. This involves first a visual inspection to make sure that no visible asbestos has been missed. There is then testing of the air quality within the enclosure to ensure that it is within acceptable limits in terms of numbers of fibres in the air. If the air testing produces satisfactory results, the enclosure is then dismantled. A further inspection is then made to ensure that no asbestos was stuck to the tape with which the sheeting forming the enclosure was joined or hidden elsewhere in folds in the sheeting or the like.
38. As a result of concerns on the part of Health and Safety Executive about how Ward was undertaking the removal of asbestos from the Property prohibition notices in relation to further work were served on both Ward and Tarmac on 25 February 1993. The prohibition notice served on Tarmac recited that the notice was being given because the Factory Inspector giving it, Mr. Alan Craddock, considered that:-

“the following activities namely:

Removal of Asbestos

under your control at Temple Court (Lewis’) Birmingham

involve, or will involve, a risk of serious personal injury, and that the matters which give rise to the said risk(s) are:

uncontrolled spread of Asbestos fibre

and that the said matters involve contravention of the following statutory provisions:

Health & Safety at Work etc Act 1974 s 3(1)

because The enclosure has not been suitably sealed and that the Asbestos Contractors are not being suitably controlled…”

The substance of the grounds for service of the prohibition notice on Tarmac was thus that Tarmac had failed to control Ward so as to ensure that Ward undertook asbestos removal in a manner which did not involve risks to the health and safety of individuals.

39. It was following service of the prohibition notices that the discussions to which I refer later in this judgment took place between Jackie Green of the Council and various persons interested on behalf of Tarmac. I say “various persons interested on behalf of Tarmac” notwithstanding Miss Hitching’s submission that one of those involved, Mr. Richard Pearl, was a third party, because Mr. Pearl at the material time actually worked for subsidiary of Tarmac called TBV Science. Mr. Pearl made the status of TBV Science plain at paragraph 3 of his witness statement dated 30 November 2001.
40. Draft Contractor’s Proposals prepared by Tarmac in relation to the Works included, in section 4.3.3,

“During asbestos removal operations, monitoring will be carried out to ensure that the environment outside the enclosed area does not become contaminated with asbestos fibre…

On completion of asbestos removal work, each area will be monitored and certified as clear of contamination and within the statutory limits of 0.01 fibres per ml for safe normal working conditions.”

The work there described is, of course, essentially that which Worcester contends that the Council was engaged to undertake.

41. The Employer’s Requirements for the purposes of the Main Contract included, at section A13 at 120:-

“The works to Block C shall be only those operations necessary to facilitate the construction of the other works, (Block A, Block B, Common Parts) the complete removal of all asbestos and asbestos based materials and the sealing off of main services installations.”

42. The Contractor’s Proposals for the purposes of the Main Contract included, at section 3.1.5:-

“a) Demolition/strip out of Block C Sub-basement up to ground floor will only be carried out up to the new separation wall position. All asbestos will be removed from all levels of all blocks.”

43. An important part of the background which I have so far set out which I consider is of relevance to construction of the Council’s obligations to Tarmac is that what led up to the making of the agreement between Tarmac and the Council was the service of the prohibition notices on the grounds that Ward was not carrying out asbestos removal work in such a manner as to avoid risks to the health and safety of individuals and that Tarmac had failed so to control Ward as to ensure that it did avoid those risks. The consequence was that asbestos removal work had had to stop. That inevitably delayed other work the undertaking of which was dependent upon the completion of the asbestos removal work. It was thus important to Tarmac to have the prohibition notices lifted. In order to achieve that it was necessary to satisfy the Health and Safety Executive that Ward would in future carry out asbestos removal work in a manner which did comply with regulatory provisions and relevant Codes of Practice, and that Ward would be properly supervised to ensure that it carried out asbestos removal work in such a way as to avoid risks to health and safety.
44. Another important part of the background, as it seems to me is that Julie Goddard was told, as was the fact, that an asbestos survey of the Property had been undertaken for Tarmac, and no copy of that survey was ever prior to the commencement of the current action provided to the Council. Those circumstances make it unlikely that Tarmac would wish to pay for work which had already been done, a survey, to be done again, or that Tarmac would wish the Council to check that the asbestos identified in the survey had been removed. The Council could hardly check to see that all the asbestos identified in the report of the survey undertaken by Insulation Contracting Services had been removed unless it was provided with a copy of that report. If Tarmac did not wish the Council to check that the asbestos identified in the survey had been removed, it is somewhat improbable that it would have wished the Council to check that asbestos not identified in the survey had been removed.

Relevant regulatory provisions

45. In March 1993 the removal of asbestos was the subject of The Control of Asbestos at Work Regulations 1987, SI 1987 No. 2115, as amended up to that date (to which, as so amended, I shall refer in this judgment as “the Regulations”). The focus of the Regulations was the health and safety of persons exposed to asbestos dust in the course of their work. The provisions of the Regulations and of the Approved Codes of Practice accompanying them are lengthy and detailed. Mr. Walker relied particularly on Regulations 8, 9, 10, 12, 13, 14 and 15 of the Regulations, paragraphs 35 to 37, 85 to 87 and 92 of the Approved Code of Practice “The control of asbestos at work”, and a large number of paragraphs in the Approved Code of Practice “Work with asbestos insulation, asbestos coating and asbestos insulating board”. For the purposes of this judgment I think that it is only necessary to set out the terms of Regulation 15(1) of the Regulations, which appears under the heading “Air monitoring”:-

“Every employer shall take adequate steps to monitor the exposure of his employees to asbestos where such monitoring is appropriate for the protection of the health of those employees.”

The other provisions of the Regulations upon which Mr. Walker relied are concerned with minimising the risks of exposure to asbestos. The provisions of the Approved Codes of Practice to which he drew my attention are concerned with how air monitoring should be carried out and what levels of exposure are acceptable.

The evidence in relation to the agreement between the Council and Tarmac

46. No evidence was led on behalf of Worcester as to any discussions with anyone on behalf of Tarmac prior to the sending by Tarmac of the Order. This was a circumstance upon which Miss Hitching relied heavily in support of her submission that I should accept the evidence called on behalf of Tarmac in relation to such discussions. She submitted that the words in the Order, “Provide adequate asbestos monitoring programme as agreed with site..” meant that it was necessary to consider what had, as a matter of fact, been agreed between Tarmac and the Council on site before the Order was sent. While the words “as agreed with site” might have meant, as a matter of English, “as is to be agreed with site” rather than “as has been agreed with site”, there was no plea that anything relevant had been agreed after the Order was sent and there was some evidence that there had been discussions at site before the Order was despatched. I shall come to that evidence in due course.
47. Mr. Walker submitted that in considering the evidence as to discussions on site preceding the despatch of the Order I should have very much in mind the terms of a letter dated 2 March 1993 written by Mr. Alec Watson of Tarmac to Ward. Mr. Watson was employed by Tarmac as Contracts Manager at the Property for the purposes of the Works. Mr. Watson did not give evidence before me. The letter dated 2 March 1993 was written following the service of the prohibition notices. It was in the following terms:-

“Further to our discussions on site with your Mr. Gillespie, we confirm that asbestos removal cannot recommence until agreed working procedures have been put in place.

With regard to the 6^th floor, the following procedures must be implemented:-

1. Extra air movers will be fitted to discharge into each staircase.

2. The air lock design will be improved to an acceptable standard.

3. The integrity of the whole enclosure will be checked and a certificate by an independent person issued.

4. Packed material will be removed via a new air lock adjacent to the lift and removed to a lockable skip in the disposal area.

5. Following the above a clearance test will be carried out.

6. If this fails the enclosure will be divided up into appropriate sections which will in turn be re-cleaned and tested section by section, until clearance is obtained.

7. The tumble drier will be vented into the dirty area of the decontamination unit.

New method statements must be provided for the removal of asbestos in all other areas of the Contract and it is anticipated that we will discuss this with you on site on Wednesday 3 March.

We also confirm that the environmental control being carried out at present by Hereford and Worcester, by yourselves, will continue on the 6^th floor. To comply with the requirements of the Health and Safety Executive, it is our intention to place an order direct for the environmental health control on all other areas of the Contract.

We look forward to your co-operation in putting these procedures into operation quickly to enable an early recommencement of asbestos clearance.”

Mr. Walker submitted that, whatever the witnesses called on behalf of Tarmac now say, and that is a matter to which I shall come, it is plain from the penultimate paragraph of Mr. Watson’s letter dated 2 March 1993 that what Tarmac at the time was looking to the Council to do was to provide that monitoring and supervision of the operations of Ward which was necessary to be provided if the Health and Safety Executive was to be persuaded to lift the prohibition notices, that is to say, that monitoring required by the Regulations and the Approved Codes of Practice accompanying them, and that supervision of how Ward undertook its asbestos removal operations necessary to ensure that the Regulations and the Approved Codes of Practice were complied with.

48. After the close of the case for Tarmac Mr. Walker produced a copy of what appeared to be the Tarmac copy of a letter dated 8 March 1993 written by Mr. Geoffrey Keen, Director of Scientific Services of the Council at that time, to Tarmac. Although the letter was referred to in the witness statement of Julie Goddard at paragraph 7 it had not previously been disclosed. The copy of the letter put before me had apparently been obtained from the files of the Health and Safety Executive. It seemed that the files which the Council had maintained in relation to work done at the Property had been destroyed before the action against Worcester had been commenced. The letter was entitled “Air Monitoring Agency – Scientific Services. Method Statement for Asbestos Removal at Temple Court.” At the top was a date stamp “10 MAR 1993”. The letter bore upon it in manuscript the initials ATW, JAT and IR and the words “Copies to all staff”. The printed letterhead of the letter gave a telephone number “Worcester 765453” and a fax number “Worcester 765454”. In manuscript above the word “Worcester” in the telephone number appeared the numerals 0905 in brackets. Those numerals seem to have been the telephone dialling code for Worcester in 1993. It was accepted by Miss Hitching on behalf of Tarmac that the initials ATW were those of Mr. Alec Watson. The initials JAT were those of Mr. John Tipton, who in March 1993 was the senior quantity surveyor employed by Tarmac at the Property. The initials IR were those of Mr. Ian Roberts, who in March 1993 was employed by Tarmac as a Section Engineer at the Property.
49. The letter dated 8 March 1993 written by Mr. Keen was in the following terms:-

“1. The size of each containment area should be kept to a manageable size.

Consultations with the Contractor [meaning Ward] and with Tarmac’s Supervising Officer should determine the size of each area.

All non-contaminated areas will be outside the enclosure, as far as possible.

Non-contaminated areas are to be determined by bulk analysis, or as directed by the Supervising Officer.

2. The enclosure to be checked by Scientific Services, prior to the smoke test, for it’s [sic] construction and durability. Where necessary, 2x1 planed timber will be used for supporting the polythene, and in all cases only 1000 gauge polythene will be used.

The 3-stage Air Lock will be of sufficient size as to accommodate men and equipment, without restricting movement. A separate 3-stage bagging area will be constructed for the removal of contaminated waste. This area will be of sufficient size to allow for the free movement of men and material. Each stage of the 3-stage air lock and bagging area will be sealed with single flaps, with each flap being weighted.

Negative Pressure Units will not be situated adjacent to the 3-stage air locks or to the bagging areas. The Negative Pressure Monitor will be situated so that it can be observed from inside and from outside the enclosure. The Monitor will have a visual and audible alarm to warn of any fall of negative pressure within the enclosure. If pressure falls below 0.05 inches water gauge, then work must cease until the fault is rectified.

3. All equipment for use within the enclosure will be checked by Scientific Services, prior to any witness of the smoke test, and before any removal begins. Checks shall be made on the condition and suitability of the Negative Pressure Units, the Type-H vacuum cleaners, and the RPE used on site. Any doubt as to the durability of any of the equipment then the Contractor will be asked to change it. Service records of all equipment should be available on site.

4. Scientific Services will check the Hygiene facility prior to any use. The unit should be clean and free from any equipment and should not be used as a store. The unit will be checked on a daily basis. A plentiful supply of soap, clean towels and nail brushes should be available. All non-compliances will be noted.

5. Scientific Services will witness the smoke test. The enclosure will be completely filled with smoke using a smoke generator supplied by the Contractor. No Smoke Test Certificate will be issued until Scientific Services have ascertained that the integrity of the enclosure has been thoroughly checked.

6. All air tests will be carried out by Scientific Services, and will include:

a) Background tests carried out outside the enclosure, prior to the asbestos removal commencement.

b) Leak tests will be taken daily within 1 hour of work commencing while removal is taking place. These sampling points will be determined by Scientific Services and potential break out points will be identified.

c) Clearance air tests will be taken within the enclosure following a satisfactory visual inspection.

d) Regular personal monitoring will take place on all operatives, at specified periods as required by the legislation.

7. A daily log will be kept on site and is available for inspection. This log will indicate the daily activities of the Contractor and of Scientific Services, and the following details will be included:-

a) The Analyst’s times on site.

b) Equipment check and condition.

c) Check filters on Negative Pressure Units, and note when these are changed.

d) Daily checks to be undertaken on Hygiene Unit, including regular air tests.

e) The enclosure will be inspected daily and any defects will be rectified and details will be recorded in the Site Log Book.

f) All air test results will be left on site and entered into the Site Log Book. All elevated readings obtained will be notified to Tarmac on site, as soon as these results are obtained. Remedial measures will be suggested to prevent any further contamination.

g) The laundry facilities will be inspected regularly, and a high standard of cleanliness is required. If standards are not maintained, then the use of this facility will be withdrawn, and off-site measures will have to be found.

All Site Officers of the Scientific Services Department are aware of their responsibilities to maintain high standards from the Contractor. The requirements of the current legislation must be met, and regular contact with Tarmac’s Supervising Officer is essential for the smooth running of this contract.”

50. Mr. Walker sought to rely on the terms of the letter as indicating the outcome of the discussions between, in particular, Mrs. Jackie Green on behalf of the Council and Mr. Richard Pearl. Subject, of course, to the question of what the significance of the letter truly was, all that was necessary for Mr. Walker to be able to rely on it was that I should be satisfied that the letter had been written on or about the date upon it, 8 March 1993. Subject again to the question of what was its true significance, the letter was evidence of how the discussions which I have mentioned were viewed at the time by the Council even if it had never been received by Tarmac.
51. The production of a copy of the letter dated 8 March 1993 prompted a flurry of activity on the part of the legal team acting on behalf of Tarmac. It was not accepted that it was a genuine letter, or at any rate not a letter which had really been received by Tarmac. This struck me as a little odd, because at paragraph 22.2 of his witness statement, which he had by this stage in the trial verified, Mr. Keenan referred to the Council redrafting Ward’s method statement as to how asbestos removal works to be performed and the letter dated 8 March 1993 did, on its face, set out a method statement. No document other than the letter dated 8 March 1993 was suggested as being the method statement to which Mr. Keenan was referring in his witness statement. Mr. Alan Cook, who was also employed by Tarmac at the Property for the purposes of the Works, in his witness statement dated 29 November 2001, which he had also verified by this stage in the trial also referred, at paragraph 11, to a method statement being produced with input from the Council.
52. Three witnesses were brought to court specifically to deal with the letter dated 8 March 1993. With my permission each of these witnesses gave evidence notwithstanding that no witness statement from any of them had been produced. The first of these witnesses was a Mr. Woolley, who had been employed by Tarmac as a quantity surveyor in connection with the Works with particular responsibility for dealing with the accounts of sub-contractors. Mr. Woolley dealt with the account of Ward. Mr. Woolley said that if it was intended that he should see a copy of a document sent to Tarmac in connection with the Works the letters “QS” would be written on the original. The letters “QS” do not appear on the copy of the letter dated 8 March 1993 put before me. He said that he would have expected to have seen the letter dated 8 March 1993 had it been received by Tarmac and to the best of his recollection he had not seen it.
53. The second of the three witnesses called specifically to deal with the letter dated 8 March 1993 was Mr. Peter Hart. In March 1993 he was employed by Tarmac as its Deputy Chief Buyer. He gave evidence that he was the author of the Order. He said that he in fact typed the Order himself. He also signed the Order on behalf of Tarmac. He said at first in his evidence that he had been prompted to type the Order because he had received an instruction to do so from either Mr. Watson or Mr. Tipton, but that he did not think that he had seen any document other than that instruction at the time he produced the Order. However, when his attention was drawn to a reference in the Order to a letter dated 4 March 1993 from Jackie Green, he said that he must have seen that letter in order to have made reference to it. Mr. Hart did say that, to the best of his recollection, he had never seen the letter dated 8 March 1993 written by Mr. Keen.
54. The third witness called on behalf of Tarmac as a result of the introduction of the letter dated 8 March 1993 was Mr. Ian Roberts. He said that he did not recall having seen the letter. However, he also said that he did think that he recognised the handwriting of the manuscript note on the letter including the initials as that of a Senior Engineer who had been employed by Tarmac at the Property and whom he knew as Peter. He said that it was not unknown for Peter’s handwriting to appear on documents received by Tarmac at the Property, although not common.
55. I was shown a date stamp on other documents received by Tarmac at the Property which appeared similar to the form of date stamp on the letter dated 8 March 1993.
56. I am satisfied that the letter dated 8 March 1993 was a letter in fact written by Mr. Keen, or at least signed by him, on or about 8 March 1993 and despatched to Tarmac. I am also satisfied that the copy put before me was the version of the letter received by Tarmac. The form of the date stamp is similar to the form of date stamp which had been applied to other documents received by Tarmac at the Property. The addition of the dialling code for Worcester in manuscript indicates that the person who did that both was unaware of the dialling code for Worcester and considered that he or she might have occasion to want to telephone Worcester in the future. The fact that the manuscript note on the letter was thought to be in the hand of a former Tarmac employee and the fact that the initials placed on the letter would have meant something only internally within the Tarmac organisation at the Property makes it overwhelmingly probable, in my judgment, that the letter was received by Tarmac. However, the date of the date stamp indicates that the letter probably was not received by Tarmac before the Order was despatched. If that were so, the Order could not have been sent in reaction to the receipt of the letter dated 8 March 1993, and so that letter could not be treated as an offer which was accepted by the despatch of the Order. Given the indication as to the date of the despatch of the letter, namely either the date upon it, 8 March 1993, or at any rate no later than the next day so as to allow for it to have been received on 10 March 1993 in the ordinary course of post, the letter could not be regarded as having been sent in reaction to the receipt of the Order, which was also sent through the post, on the evidence of Mr. Hart, which I accept. Thus on no view was the letter dated 8 March 1993 a contractual document, as Mr. Walker accepted. I therefore turn to the oral evidence as to discussions preceding the despatch of the letter dated 8 March 1993, upon her contentions as to the effect of which Miss Hitching relied in support of Tarmac’s case as to the obligations which the Council undertook under its agreement with Tarmac.
57. Mr. Pearl said in his witness statement that he was called in by Tarmac after service of the prohibition notices dated 25 February 1993 to which I have referred. At that time TBV Science seems to have provided a scientific support service to Tarmac. At paragraph 4 of his witness statement he said:-

“When we were part of the Tarmac Group our specialist services were available to the Group generally. We would get calls, in my case particularly from safety officers, and we would do what we could to help. If it was just one call we wouldn’t open a file. For anything more significant we would have to open a file.”

58. Mr. Pearl said in his evidence that he went to the Property the Monday after the prohibition notices were served, that is to say,1 March 1993. On that occasion he says he met Jackie Green. His account in his witness statement of what then happened was this:-

“9. Jackie and I toured the building together. I had brought my breathing apparatus. We were given unrestricted access to all areas of the site. Work was suspended (as required by the Prohibition Notice). I did not go in the enclosures as I did not consider them safe.

10. Jackie pointed to a number of things which she was not happy with. She gave me a lot of information about the job and events to date. For example she felt (and I agreed) that the grade of polythene being used was not good enough. I do not remember what it was but it was not 1,000 gage [sic –gauge is meant]. It was not cling film.

11. We were also concerned about the size of the enclosure on one floor. I think Ward were trying to clear the whole of a floor with one huge enclosure. Although this might be feasible it would not be good practice. The regulations require that fibre levels within an enclosure should be kept below certain safety levels. In a large area this is very difficult. You have to keep air moving within the enclosure and at all times you have to maintain negative air pressure. My view was that the area was too big, there were not enough negative air units (these are sophisticated air handling units which have special asbestos filters) and what units there were were incorrectly placed (too close to the air lock entrance).

12. Jackie and I observed asbestos debris outside an air lock enclosure. I think we both felt it had been “placed” there deliberately, probably by a disgruntled Ward employee.

13. We discussed all aspects of the job including transit routes, disposal methods etc. Jackie told me her “brief” from Ward had not been defined but in practice she felt that she had no authority on site and although she had had several sharp exchanges with Ward she couldn’t influence their working methods.

14. At the conclusion of about 4-5 hours together Jackie and I were in agreement that she should be appointed by Tarmac to act as an independent expert “policing” all aspects of the asbestos removal. We agreed on various measures which she would insist Ward adopt to improve their working methods on site.

15. We then met Tarmac (and possibly a Ward representative) to discuss what should be done. My primary recommendation was that Hereford and Worcester’s appointment by Ward should be terminated (immediately) and that they should be appointed directly by Tarmac. They were obviously very familiar with the project and therefore better placed than TBV Science to provide ongoing expert advice to Tarmac. I had been impressed by Jackie’s approach to the job and I knew that H&W [had] all the appropriate accreditation. If they were reporting direct to Tarmac this would allow them to be properly independent and to make sure that Ward complied with their requirements. I was asked if TBV Science could take the job on. I declined, I thought that H&W’s knowledge of the project meant they could do a better job. This recommendation was accepted by Tarmac without any reservations.

16. The other suggestion Jackie and I made was that H&W should draw up checklists which would set out the basic tests that they were going to perform throughout the job.

17. It is possible that I made recommendations about Ward’s method statement but, having seen that H&W were appointed by Tarmac I would have expected them to deal with the detail of what they required as well as the unacceptable working methods which were going to stop.

18. We did not sit down and discuss exactly what H&W would be doing. The basics would be covered by the checklists but really Tarmac were giving H&W an open brief. I had recommended that they be given the role of policing every aspect of asbestos removal. They were to do whatever they felt necessary or advisable to fulfil that function. There was no point in trying to formulate that into a number of tests or inspections. They were to do what they thought best as the circumstances required with the objective of ensuring the job was done properly and completely. I should add that this is the way Casella [the present owners of TBV Science] work and, like H&W we insist on being paid on a time charge basis so that we are not limited in our activities.”

59. Insofar as Mr. Pearl, in the passage from his witness statement quoted in the preceding paragraph, deals with his conversations with Jackie Green, I have no doubt, having seen him in the witness box, that his evidence is essentially correct. However, much of what he said in paragraph 18 of his witness statement was not evidence of fact but comment. That comment was, I think, as the reference to Casella shows, influenced by how Mr. Pearl likes to think he goes about an assignment. It does not represent, in my judgment, anything actually discussed with Jackie Green. In fairness to Mr. Pearl I do not think that he suggested otherwise. What is plain from the evidence of Mr. Pearl is that there was little or no discussion with Jackie Green about specifics, but that the overriding concern was with putting in place a system which would ensure that Ward adopted safe working practices and which would enable asbestos removal to recommence. Nothing which Mr. Pearl says in his evidence can sensibly be considered as the making of a contractual offer by one party to the other, or the acceptance by one party of an offer previously made by the other. In her closing submissions Miss Hitching sought to suggest that when Mr. Pearl referred to the Council “policing all aspects of asbestos removal” what he meant was that the Council was not merely to make sure that Ward in its asbestos removal operations complied with the Regulations and the Approved Codes of Practice, but that it was to make sure that all asbestos was removed from Block C. I do not accept that interpretation of Mr. Pearl’s evidence. Looking at the totality of his evidence I think that it is plain that he was only talking about the Council making sure that Ward complied with all relevant health and safety provisions in how it went about its work.
60. At paragraph 20 of his witness statement Mr. Pearl said:-

“I have also been asked what I understood the scope of Tarmac’s responsibilities to be with regard to asbestos. I was told that the building was to be cleared of all asbestos. I am quite confident that Jackie Green understood that was part of her job to ensure the building was asbestos free.”

I do not accept the last two sentences of that paragraph. The comment about the understanding of Jackie Green was not said to be based on anything Mr. Pearl himself said to her, or on something someone said to her in his presence, or on anything she is said to have said in his presence and hearing. These deficiencies were not remedied by anything Mr. Pearl said in his oral evidence.

61. Mr. Wilson made a witness statement dated 27 November 2001. For reasons which I can only speculate about he considered it appropriate at paragraph 12 of that witness statement to say:-

“I was not present at the various meetings with Ward, Health and Safety Executive and Worcester Scientific Services (“Worcester”) to agree a way forward. However I received reports from these meetings that Worcester would now be working directly for Tarmac. They would be monitoring the works to ensure that the highest possible standards applied and that all asbestos would be removed.”

On the face of his statement, and as he agreed in cross-examination, Mr. Wilson has no personal knowledge of any agreement made between Tarmac and the Council. The only report which he was able to identify in cross-examination he had received between the date of the prohibition notices and the date of the Order was a copy of Mr. Watson’s letter dated 2 March 1993 to Ward. His opinion of the effect of the agreement between Tarmac and the Council is of no value and I reject it.

62. Mr. Charles Yates was, in 1992-1993, employed by Tarmac as an off site Safety Adviser. In his witness statement dated 29 November 2001, Mr. Yates said, amongst other things:-

“15. Richard Pearl of TBV Science visited site and he and Jackie Green of H&W toured the project in order for Richard to gain an impression of the nature and scope of the asbestos work involved. I met with them later and made notes of their proposals as to what should be included in the checklist regime.

16. The format of the checklists was finally agreed at a meeting with Frank Crilly of H&W, Bob Keenan and myself. They abbreviated what was required by law. A procedure was implemented whereby the checklist forms were given to Tarmac during and at each critical stage of the removal operation. With a trained eye, H&W would be able to pick items up on visual inspections and hence complete categories (1) A-J and (2) A-C on the checklists, which H&W signed on our behalf. Wards accepted the checklists.

17. Bob Keenan wanted a method statement from H&W which was back to back with our contractual obligations, but I do not think that they ever produced this document.

18. Broadly I understood H&W’s duties to break down into:

18.1 background monitoring

18.2 inspection for asbestos debris and residue

18.3 further visual inspection followed by

18.4 further clearance test.

For example, they had to climb up and examine ledges and sometimes had to use brushes to disturb the air to see if anything had been left. Checklists would then be completed. Only H&W had the instruments to check for contamination. H&W were continually monitoring the office areas after the prohibition notice. Jackie Green of H&W was almost continuously on site checking what Wards were doing. For instance, she asked Wards to go back several times to deal with fibres stuck to beams, failing which she would not issue a clearance certificate. I recall her doing this on a number of occasions and she had no difficulty telling them to do this. If she had any problems, they could be recorded on the checklists but they were not.”

Miss Hitching relied upon this passage in support of Tarmac’s case as to the terms of the agreement made between Tarmac and the Council. I confess I find it difficult to understand why. Mr. Yates said nothing about anything which could sensibly be argued to amount to an offer made by one party to the other or to an acceptance by one party of an offer made by the other. He set out his understanding of what the Council was to do without giving any basis for such understanding. His understanding in any event seemed more consistent with Worcester’s case than with that of Tarmac. In cross-examination Mr. Yates said that his prime concern was not to put other people in the Property at risk from the asbestos removal works and that after the prohibition notice had been served on Tarmac what Tarmac was concerned about was the allegation that it had failed to control its sub-contractor, Ward.

63. Faced with the reliance which Mr. Walker sought to place upon the letter dated 2 March 1993 as evidence of the effect of the discussions involving Jackie Green on behalf of the Council and those on behalf of Tarmac, in particular Mr. Pearl, on 1 March 1993, Miss Hitching submitted that, however matters had been left on 1 March 1993, the scope of the obligations which the Council agreed to undertake had been broadened in the course of the agreement of the checklist between Mr. Yates and Mrs. Green and Mr. Crilly on behalf of the Council. I reject that submission. I accept the evidence of Mr. Crilly that he was not involved in the agreement of any checklist. Mr. Yates said in cross-examination that he looked to Mr. Pearl and Mrs. Green as the experts as to what the checklist should contain. I accept that evidence. From that evidence it must follow that nothing Mr. Yates sought to agree was intended in any way to go beyond whatever had been discussed between Mr. Pearl and Mrs. Green.
64. As I have already indicated, Mr. Cook was called as a witness on behalf of Tarmac and he verified his witness statement dated 29 November 2001. In that witness statement he said:-

“11. I was involved on the peripheries of several meetings to discuss our response to the Prohibition Notice. Alec Watson called in Andy McGowan and Stangers (at that time Stangers was owned by Tarmac) [this in fact seems to be a reference to TBV Science]. I remember people saying “if we have this expertise in house, why didn’t we have them on site all along?”. In the event it was decided not to use Stangers. H&W already knew the site and they had all the expertise needed so they were employed by Tarmac. Checklists and a revised Method Statement were produced with H&W input to ensure that nothing else could go wrong.

12. I have been asked about H&W’s specific duties. I don’t think I can go into any technical details. As I have indicated, they were to do everything on the checklists and generally make sure that asbestos removal from Temple Court was done 100% right.”

Miss Hitching relied on that passage from the evidence of Mr. Cook. Again it is a mystery to me why. Mr. Cook did not say that he had anything to do with any exchanges between Tarmac and the Council. He felt unable to say anything about the duties of the Council other than in the most general terms. His evidence like that of Mr. Yates seemed to be more consistent with Worcester’s case than with that of Tarmac. It was evident from his cross-examination that Mr. Cook had very little recollection of the matters about which he was being asked to give evidence.

65. The last witness upon whose evidence Miss Hitching sought to rely in support of Tarmac’s case as to the terms of the agreement with the Council was Mr. Keenan. In his witness statement dated 22 November 2001 he explained the serving of the prohibition notices and went on:-

“17. There followed a series of meetings involving various people and I am guessing that I was involved in most of them. I do not remember the precise sequence and who was present at all the meetings. However, I do remember the things that I thought were important at the time.

18. Stangers and Hereford and Worcester (H&W) were heavily involved and that we looked to them as the experts. Charles Yates was also involved and he liased with HSE too.

19. It should be understood that we were approaching this problem from the perspective that our information was that Ward had not seriously transgressed the rules. Alan Craddock [the factory inspector who served the prohibition notices] had told me the result of an air test reading he had taken which indicated very high levels of asbestos spores in the air outside a tent on the 6^th floor. When I reported this information to H&W and Stangers they were doubtful that such high levels were recorded. H&W did their checks and got a “safe” reading. They said if the HSE result was accurate the asbestos would have been so thick it would have looked like a fog. They thought the HSE test result was wrong.

20. Also we were convinced that the HSE had been “tipped” to attend site and that they knew exactly what to look for and where it was. It was just so odd that they should have rushed to the precise location of the tear in the polythene. Some people thought the tear was not an accident, they thought Wards had been “set up”. Wards were certainly dubious about the HSE evidence…

22. To return to February 1993, our actions responding to the Prohibition Notice, the conclusions were:

22.1 H&W were to work directly for Tarmac. Tarmac had been served with a Notice to say we were not managing Ward properly. H&W would be responsible for ensuring that from now on every aspect of asbestos removal would be properly managed.

22.2 H&W and Wards redrafted Wards Method Statement. I don’t remember the technical details but clearly it was important that this Statement reflected the working methods H&W wanted Wards to adopt.

22.3 H&W, Stangers and our safety experts agreed a checklist which would describe the basic checks which would be undertaken on site by H&W and Ward.

23. At these meetings H&W were represented by Jackie Green. I remember her very well and she was a very forceful woman. I can remember her saying things like “we will even check the soap dispensers” and “make sure the men shave every day”. I had every confidence that she would have not have any problem in telling Ward what to do….”

Yet once more a witness upon whose evidence Miss Hitching sought to rely in relation to Tarmac’s case as to the terms of its contract with the Council not only was not able to give any direct evidence about it, but such evidence as he was able to give seemed to support the case of Worcester rather better than that of Tarmac. In cross-examination he said that he could not recall being present at any meeting at which anyone on behalf of the Council agreed that the Council would ensure that all asbestos was removed from the Property.

66. I enquired of Miss Hitching during her closing submissions whether Tarmac’s case was that the Order was evidence of an agreement made orally between representatives of Tarmac and representatives of the Council or whether it was that the Order was either an offer which was accepted by conduct, for example by undertaking work to which the Order related, or an acceptance of some offer made orally on behalf of the Council. She was unable or unwilling to say. She submitted that it did not make any difference to the assessment I had to make of the evidence. It seems to me, on the other hand, that the point is important. If what was being contended for was an oral agreement, that would have to be proved, if at all, by the evidence of witnesses, and the precise terms of the Order might not be very significant. What would matter would be what, as a matter of fact, was the agreement between the parties. On the other hand, if the Order were a contractual document, it would be necessary to construe it.
67. In the course of her cross-examination of various of the witnesses called on behalf of Worcester, in particular Mrs. Bush and Mr. Crilly, Miss Hitching put that the witness would not have issued a clearance certificate unless satisfied that all asbestos had been removed from the area to which the certificate related. To that proposition each of Mrs. Bush and Mr. Crilly assented. Miss Hitching submitted that those answers showed that the Council had agreed to ensure that all asbestos was removed from the Property. That submission has a number of difficulties. First, the way in which the questions were put did not distinguish clearly between the issue whether an area was safe for people to work in and the issue whether the economic interests of Tarmac in having asbestos removal work comprehensively carried out were adequately protected. I am entirely confident from the totality of the evidence of the witnesses who assented to Miss Hitching’s proposition that their answers were directed to the question of the health and safety of individuals. Second, whatever the private thoughts of those charged with the function of issuing clearance certificates, the certificates put in evidence were all in a standard printed form. On its face each certificate was a certificate not by someone carrying out the sort of monitoring undertaken by Mrs. Bush or Mr. Crilly, but by a Public Analyst, that identified samples of air had been tested with the results set out in the certificate and:-

“1. The results are consistent with the satisfactory removal of asbestos. Insulation residues were not detected.

2a. Further remedial work is not necessary and the area(s) may be returned to normal use.”

The whole focus of the certificates was thus that no concentrations of asbestos harmful to the health and safety of individuals had been detected in the samples. Third, evidence of matters subsequent to the making of a contract are inadmissible as evidence of the proper construction of the contract – see James Miller & Partners Ltd. v. Whitworth Street Estates (Manchester) Ltd. [1970] AC 583. Thus how the Council or its employees in fact acted in performing the obligations of the Council under the agreement with Tarmac is not relevant to the proper construction of what the Council agreed to do. I reject Miss Hitching’s submission.

68. In the result I am not satisfied any agreement was made orally between any representative of Tarmac and any representative of the Council prior to the sending of the Order by Tarmac to the Council of which the Order could be said to be evidence. Further, I am not satisfied that there was any conversation between any representative of Tarmac and any representative of the Council prior to the sending of the Order by Tarmac to the Council which had any contractual effect or was relevant in a way supportive of Tarmac’s case to the proper construction of the Order. On the totality of the evidence it seems that the sending of the Order was an offer made by Tarmac to the Council, which the Council accepted by conduct in doing the work which it did at the Property after receipt of the Order. In my judgment it is plain from the evidence of the witnesses called on behalf of Tarmac which I have set out that the whole focus of concern after the serving of the prohibition notices was the safety of Ward’s operations. No attention at all, on the evidence, was given to ensuring that no asbestos would be overlooked. No suggestion was made that the Council should interest itself in performance by Tarmac of its obligations under the Main Contract.
69. Had I permitted Tarmac to seek to make out a case that by reason of what the Council in fact did after the sending of the order dated 9 March 1993 the Council assumed responsibility to Tarmac in such a way as to give rise to a duty of care not to cause Tarmac economic loss by failing to exercise reasonable skill and care to ensure that all asbestos was removed from Block C, I would have found that no duty of care was owed more extensive than to perform with reasonable skill and care the Council’s obligations under its contract with Tarmac. Where the parties are in a contractual relationship in respect of a particular subject-matter it is, in my judgment, to be presumed that they have, by their contract, made that provision for the allocation of responsibilities and risks in relation to that subject-matter which they consider appropriate. It is not for the Court to disrupt the balance as struck by the parties by their contract and substitute some different allocation of responsibilities or risk. To do so would not be fair, just or reasonable. In any event in this particular case the evidence does not justify any conclusion that the Council had assumed any obligation to do anything other than perform its contract.

Consideration and Conclusions concerning proper construction of the contract between Tarmac and the Council

70. It seems to me to be plain that all that the Council agreed to do, or was expected by anyone at the time to do, was to monitor how Ward undertook its work, not to ensure that Ward identified all asbestos which required to be removed from Block C, or actually removed all asbestos from Block C. In my judgment the limit of the Council’s obligations was to make sure that Ward carried out its work safely and that, when Ward contended that its work in some particular area was complete, the quality of the air in that area was within permitted standards. The words in the Order “Provide adequate asbestos monitoring programme” mimic the words in Regulation 15(1) of the Regulations “take adequate steps to monitor the exposure of his employees”. What the Council was to do was to undertake a programme, not to conduct a survey or to ensure the performance by Ward of its contractual obligations generally to Tarmac. The object of the “programme” was to be “asbestos monitoring”. Against the background in which the Order was placed “asbestos monitoring” meant monitoring for asbestos so as to ensure that the relevant regulatory provisions were complied with and the Health and Safety Executive was sufficiently reassured as to permit asbestos removal work at the Property to resume. “Monitoring” is not, in my judgment, a word apt to describe the sort of activities of hunting out asbestos and ensuring that it was all removed which Miss Hitching submitted the Council had agreed to undertake. Miss Hitching submitted that what was “adequate” depended upon what the parties wanted to be done. I disagree. “Adequate” is simply the standard of monitoring required by Regulation 15 of the Regulations.
71. I have the firm impression that the case which Tarmac has sought to advance against Worcester has been devised in an opportunistic fashion so as to try and recover from someone in respect of the cost to Tarmac of the failure of Ward to carry out properly its obligations under its sub-contract. It is therefore unsurprising that the nature of the case which it has been sought to advance should appear artificial and that such case should have failed. However, in my judgment it is appropriate in the modern age for the Court actively to seek to discourage speculative litigation such as the action commenced against Worcester on behalf of Tarmac by making suitable orders for costs when such litigation fails. That may particularly be so when a large, well-funded corporation selects an apparently soft target, such as a local authority. I will hear argument before deciding what order, if any, should be made in this case.
72. The answers to the preliminary issues as between Worcester and Tarmac are:-

1. No.

2. No.

73. In the light of the answers to the preliminary issues the claims of Tarmac against Worcester are bound to fail. Consequently the action in which Tarmac has sued Worcester is dismissed.