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

IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
TECHNOLOGY AND CONSTRUCTION COURT

 


INTRODUCTION

1. This action concerns the alleged responsibility of the First Defendant, Henry Boot Management Limited ("HBM"), for damages caused to the floor of a retail store ("Store C") at The Friars Square Shopping Centre ("Friars Square") in Aylesbury in late September 1992. At the time the floor was damaged the Claimant, Woolworth plc ("Woolworths"), was carrying out internal fitting out works ("the Tenant's Works") prior to its intended opening of Store C on or about 10th October 1992.
2. Friars Square was a 1960s shopping mall development. The main shopping area was built on a re-inforced concrete deck above a lower level service area. Three large retail stores and a number of small retail units faced onto a central open, sunken courtyard. In the late 1980s the Second Defendants, Friends Provident Life Office ("FP"), the underlessee-owners of Friars Square took steps to achieve a comprehensive re-development. So far as this action is concerned three aspects of the re-development scheme are material. First, the existing stores and retail units were to be extended inwards into the courtyard area; secondly, the finished pavement level of the courtyard area was to be raised so that the store/shop floors and the mall would all be at the same level; and thirdly, a barrel vaulted roof was to be erected to enclose the new reduced size mall area.
3. At the time the re-development was planned Woolworths had traded at one of the existing Friars Square stores ("Store A") for many years. Store A was situated at the opposite side of the courtyard from Store C. Woolworths was prepared to agree with FP commercial terms upon which it would surrender its existing lease and take a new lease of the smaller, re-furbished Store C. Understandably, Woolworths and FP wished Woolworths to maintain continuity of trading at Friars Square during the redevelopment. The construction works needed to be appropriately phased to allow this and complex commercial arrangements were agreed to accommodate the transfer of trading part way through the redevelopment scheme. The Agreement for the surrender of Store A and the lease of Store C ("the Agreement") was dated 5th April 1990. Clauses 6, 7, 10 and 16 contain the terms which are most material in the context of the present action (G/957 to 970, 975 and 986 to 990). Ignoring alternative possibilities, which did not in the event come to apply, in essence the Agreement provided as follows:–

(1) Once FP's re-development works in Store C had been Practically Completed and provided adequate service level access was available to Woolworths to allow it to proceed with the Tenant's Works, Store C would be handed over to Woolworths. Woolworths would then be entitled to occupy Store C to carry out the Tenant's Works on (broadly) the same terms as if the new lease had been granted. During this initial period of occupation, Woolworths would pay a licence fee equivalent to the "Insurance Rent" and the "Service Charge Rent" reserved in the new lease and reimburse FP for rates and other outgoings but, no "Yearly Rent" was to be payable.

(2) Sixteen weeks after Practical Completion of Store C, provided that FP had completed the works required to give adequate customer access to Store C (this involved, in particular, work to the new mall), Woolworths was to surrender the lease of Store A and commence payment of Yearly Rent on Store C.

(3) This same sixteen-week period was the period within which Woolworths was to carry out and use all reasonable endeavours to complete the Tenant's Works. The sixteen-week period within which those works were to be completed was extendable (for the usual sort of reasons). But, even if it was justifiable, delay to the completion of those works would not postpone the date upon which Woolworths was obliged to surrender the lease of Store A.

4. Store C had the following physical characteristics. These can conveniently be seen on either Mr Pinfold's drawing 2308/01, Mr Pinfold was Woolworth's expert, or Mr Shaw's drawing 15729/B, Mr Shaw was HBM's expert –

(1) Store C occupied a corner site; two runs of shop-frontage (which Woolworths was to supply and fix) were required;

(2) On the northern side of Store C there was a fire exit corridor. On the southern site of Store C there was a shop unit ("Unit 21"). The walls which separated the fire exit corridor and Unit 21 from Store C were internal type blockwork walls. The wall which features extensively in this case is the blockwork wall which separated Unit 21 from Store C ("the Internal Wall");

(3) Looking into Store C from the mall, at the back of the store opposite the corner where the two runs of shopfront met, there was a services/lobby area with a staircase leading down to the lower level services area. This lobby/staircase was at the end of a service corridor intended for use by the occupants of other premises (including the adjacent Unit 21) as well as Woolworths.

5. What FP was to hand over to Woolworths was the shell of Store C. The Tenant's Works to be carried out by Woolworths within that shell included the laying of a floor screed over the structural concrete deck and the placing of a suitable finished flooring on top of that screed. The concrete deck handed over to Woolworths had an unusual profile. Over the most of the floor area, which had been within the previously occupied retail area, the concrete deck was a 1960s concrete at a uniform level which required a 50mm thick screed. Over the part of Store C, immediately adjoining the new mall, a new composite deck had been constructed to the same level and this too required a 50mm thick screed as part of the Tenant's Works. This new composite deck was a 1992 construction. Assuming, as the experts who gave evidence assumed, that the construction drawings/specification had been followed, this part of the deck consisted of a cement/sand screed laid over a concrete which had itself been laid on a super-holorib steel decking. Between these two parts of the deck was an area of 1960s concrete which had a lower finished level. Here the level was 75mm lower than it was in the main part of the old floor area and in the new composite deck. This lower level showed up as a "channel". It was not confined to Store C. It was a feature of the deck which continued into the adjoining units to the north and south of Store C. In the channel area what was required as part of the Tenant's Works was a 125mm thick screed in order to bring the whole of the floor of the Store C up to the same level.
6. Approximately two months after the floor screed had been laid the required finished flooring was put in place. The screed was thought, by those who came to lay the flooring, to have dried out sufficiently to allow the finished flooring to be laid directly onto it, ie no waterproofing membrane was applied before the floor layers applied their latex (Arditex) smoothing layer. Amtico strip flooring was then fixed with adhesive. This flooring comprised strips which were 75mm wide and 915mm long. These, when laid, gave the appearance of a wooden plank floor. The adhesive used to fix the Amtico strip floor was (and was known to be) susceptible to failure in the presence of water. Approximately one week after the flooring had been laid, it was discovered that, over a significant part of the floor, the adhesive had failed. Water was found to be present beneath the flooring. Investigations were put in hand. In due course it was decided to take up all of the flooring in the main sales area. The flooring was re-laid after the screed had been allowed to dry, insofar as that was possible in the time available, and after a waterproofing membrane (Tretabond) had been applied.
7. So far as the facts are concerned, the dispute between Woolworths and HBM is simply this – what was the source of the moisture in the screed that caused the failure of the adhesive?

Woolworths' pleaded case is that the moisture was the result of water ingress from Unit 21 which HBM could and should have prevented. This case, which was supported by Mr Pinfold's evidence at the trial, reflects the views that were expressed by Mr R H Corson, a Technical Building Consultant and former Senior Scientific Officer DOE Building Research Advisory Service, in the report he submitted to Woolworths dated 8th December 1992 (J/71 to 78 – and see paragraph 41 below for further details). His conclusion was, "that enough of the flood water from Unit 21 and the adjacent corridors could have migrated into the screed to be considered the major cause, if not the only one, of the failure the Amtico tile flooring" (J/74). Mr Corson had noted in his report that water was "also observed to have ponded to a depth of about 50mm between [Woolworths] shopfront and the hoarding [which had been placed a little way in front of Store C to cut it off from most of the site which HBM still occupied, whilst allowing a little (necessary) working space]" with this ponding continuing out into the mall area beyond the hoarding (see J/72) but he did not identify that as water which could have migrated into the screed.

HBM's response is that Woolworths' water ingress case fails to tie in properly with the timing of certain exceptionally heavy rainfall and that the probable cause of the adhesive failure was moisture which was present in the screed (beneath the apparently dry surface) at the time when the flooring was laid. This moisture, which had been sealed in when the flooring was laid, would rise to the surface (as equilibrium conditions came to establish themselves within the screed) with the adhesive failing once the relative humidity ("RH") at the surface rose above 75%. This case, which was supported by Mr Shaw's evidence at the trial, reflects the views that were expressed by Mr G Barnbrook, an Advisory Engineer of the Concrete Advisory Service, in the report he submitted to HBM dated 2nd November 1992 (J/63 to 70 – and see paragraph 40 below for further details).

8. This action was begun by a Writ issued on 18th September 1998. The claim made against HBM was for damages caused by its alleged negligence. A claim was also made against FP for damages caused by negligence alternatively for breach of the terms of the Agreement. This claim was discontinued, on agreed terms as to costs, by an Order dated 27th February 2001 and I say nothing more about it.
9. The Statement of Claim served on 20th January 1999 claimed repairs costs of £93,348 plus business interruption losses of £83,013. In paragraph 6 it was alleged that by 21st September 1992 Unit 21 "was flooded to a depth of up to 180mm" and that it was the migration of this water that caused the failure of the adhesive. In paragraph 7 it was alleged that the failure of the Amtico flooring was caused by HBM's negligence. No details were given of the extent of the common law duty which HBM was alleged to have owed Woolworths but, inferentially, the duty would have been discharged if HBM had taken action of the sort which, in the particulars of negligence Woolworths complained that HBM had failed to take. The pleaded particulars of the alleged negligence being that HBM–

"(i) failed to pump out water from Unit 21 until on or about the 22nd September 1992;

(ii) failed to notify [Woolworths] that Unit 21 was not kept clear of water whether by pumping or otherwise and further failed to notify [Woolworths] that by reason of their failure to waterproof or 'tank' or apply a bitumastic finish to the lower part of the breeze block wall and concrete slab within Unit 21 they thereby were placing [Woolworths] Store at risk from water permeating into the screed of the Store from within Unit 21;

(iii) failed to apply tanking or a bitumastic finish to the lower part of the breeze block wall and concrete slab within Unit 21 until on or about the 22nd September when such a finish was applied to the bottom 250mm of the breeze block wall;

(iv) failed to undertake any or any reasonable checks of Unit 21 in the weeks preceding the 21st September to ensure that water was not lying within the Unit despite torrential rain during that period;

(v) caused or permitted the water from Unit 21 to track into Store along the line of the lower sub-floor and thus to be soaked up by the screed which was porous: [Woolworths] will rely upon the failure by [HBM] to apply tanking to Unit 21 or to ensure that water was not allowed to lie in Unit 21 and by reason of the lack of tanking to floors to track into or permeate the screed within the Store;

(vi) failed to stop or to take any steps to stop the migration of water from Unit 21 to the Store."

(The obvious typographical error in (v) has been corrected.)

10. HBM's Defence was served on 18th February 1999 together with a Request for Further and Better Particulars of the Statement of Claim. HBM denied owing Woolworths, "any duty to take the steps which in the Particulars of Negligence … [Woolworths had alleged HBM] failed to take". HBM admitted that it occupied Unit 21 and further admitted that "… some pooling of water occurred on 21st September 1992" but denied the existence of any flood or any flood to a depth of up to 180mm. HBM denied the alleged migration of water from Unit 21 into the floor screed of Store C and further denied that the failure of the adhesive was attributable to water migrating from Unit 21. HBM also responded to the Particulars of Negligence in the following way –

"(i) it is admitted that [HBM] did not on every occasion of water appearing in Unit 21 remove it on the same day, but it is denied that any such failure as is alleged against [HBM] (which it is denied constituted a failure to exercise reasonable care) was causative of the failure of the Amtico flooring, either as alleged or at all;

(ii) it is not admitted insofar as the same is therein intended to alleged, that [Woolworths] was unaware that Unit 21 was not kept clear of water; it is admitted that [HBM] did not tank the lower part of the breeze block wall but it is denied that the absence of such tanking or any of the other failures alleged against the [HBM] constituted the failure to exercise reasonable care, and it is denied that [HBM] either placed [Woolworths] Store at risk in the manner alleged or at all, or that any of the … failures of [HBM] alleged in Particular (ii) caused the failure of the Amtico flooring either as alleged or at all;

(iii) it is denied that the failure alleged in Particular (iii) constituted a failure to exercise reasonable care, and it is in any event denied that such failures caused the failure of the Amtico flooring, either as alleged or at all;

(iv) it is denied that [HBM] had any obligation to ensure that water was not lying within Unit 21, particularly during a period of torrential rain, and it is denied that [HBM] had any obligations to undertake any checks of Unit 21 so as to ensure that water was not lying therein, and it is in any event denied that any such failure as is alleged in Particular (iv) caused the failure of the Amtico flooring either as alleged or at all;

(v) if, which is denied, water from Unit 21 tracked into the Store along the line of a lower sub-floor, and was soaked up by the screed, it is denied that the [HBM] either caused or permitted the same, or that the same was attributable to the alleged or any failure of [HBM], and it is in any event denied that any alleged failure of [HBM] caused the failure of the Amtico flooring either as alleged or at all;

(vi) if, which is denied, there was any migration of water from Unit 21 to the Store, it is denied that the same was attributable to the failures alleged against [HBM] in Particular (vi) and it is in any event denied that any such failures caused the failure of the Amtico flooring either as alleged or at all."

HBM denied that the alleged losses were recoverable and it also raised the issue of contributory negligence on Woolworths' part alleging that its claimed losses had been caused or contributed to by its contractor's negligence in two respects –

(i) opening the roof of the Store so as to install plant at a time when the screed was still drying; and

(ii) laying the Amtico flooring before the screed had dried sufficiently for the Amtico flooring to be laid safely.

11. HBM's request for Further and Better Particulars of the Statement of Claim included a request for details of the alleged flooding of Unit 21 to a depth of up to 180mm by 21st September 1992 The response given on 29th April 1999 was –

"[Woolworths] is unaware of the precise levels of the floor of Unit 21. [Woolworths] will request at Trial that judicial notice be taken of the fact that water, in an enclosed space, will find its own natural level. {Woolworths] does not have precise details of the level of the floor of Unit 21.

But it is considered likely by [Woolworths] that the whole of Unit 21 was flooded including, in particular, and for the avoidance of doubt, that part adjoining Unit C."

Having considered the stated levels of the concrete deck shown on the face of the construction drawings, Mr Pinfold and Mr Shaw included in their CPR Part 35.12(3) statement, the following observation –

"We agree that, whilst the alleged depth of water in Unit 21 of 180mm can be tested through witness evidence, it is the level to which the water stood that is the important matter. We agree that the water level in Unit 21 or other adjoining areas could not have been above the top of the Woolworths screed to any significant extent."

12. By consent, the action was transferred to the Technology and Construction Court by an Order dated 17th April 2002. It was assigned to H H Judge Havery QC. A Case Management Conference was held on 24th October 2002 when, inter alia, the trial date was fixed for the week commencing 12th May 2003 and a Pre-Trial Review was fixed for 29th April 2003. At the Pre-Trial Review Woolworths applied to Re-Amend its Statement of Claim (A/209 to 220). The Amended Statement of Claim had made significant changes to the pleading against FP but it had left the case against HBM essentially unchanged. The proposed re-amendments to the liability case were triggered by the views expressed by Mr Pinfold. The way in which it was put, in the supporting witness statement (A1204 to 206), was this –

"… Due to a review of the expert evidence which has been finalised over the last couple of days we can be more specific as to the sources of water ingress. We had initially thought that the water ingress was from one source which was an adjacent unit, namely Unit 21. The evidence relied upon by the expert and the conclusions drawn by the expert show that indeed, there were other sources of water ingress, more particularly from the front entrance, ie the atrium entrance at the front of [Store C], and possibly water ingress from the rear service corridor and also Unit 17 which also adjoins [Store C]."

13. After hearing full argument, Judge Havery refused permission for these proposed amendments (A/221). I was informed by Counsel that Judge Havery had decided (inter alia) that the proposed amendments would involve new causes of action, that were "statute barred" and did not fall within CPR 17.4(2). His decision was not appealed and, before me, the case was opened on the basis of the original/amended pleading although, factually, Mr Pinfold's report dated 24th April 2003 supported the proposed/disallowed wider re-amended case.

THE CONTRACTUAL RELATIONSHIPS

14. Although Woolworths' claim against HBM is pleaded only in negligence, the contractual arrangements which were agreed for the re-development are (or, arguably they may be) of relevance. I have already mentioned that Agreement of 5th April 1990 which was made between FP and Woolworths (see paragraph 3 above). The draft lease which was annexed to the Agreement provided a careful and full definition of the premises which were to be let to Woolworths. The let Premises included "the inner half severed medially of those internal non load bearing walls ... that divide the Premises from the adjoining unit ..." - see Clauses 1.3 and 2.17(c). The draft lease provided for FP to insure Friars Square against damage by "the insured risks", which included ".... storm, tempest, flood …", to the extent that insurance might ordinarily be arranged for such properties (see Clauses 2.10, 6.1.1 and 6.2.1). The draft lease also provided for Woolworths to pay a fair and reasonable proportion of the premium payable by FP as "Insurance Rent" (see Clauses 2.9.1 and 6.3).
15. Subject to the giving of advance notice, the Agreement made provision (a) for Woolworths (and its advisers) to enter the site (at any time after the re-development had started) to inspect the works which FP was carrying out and (b) for FP (and its advisers and/or contractors) to enter Store C at any time after Woolworths had occupied Store C (whether or not the new lease had been granted) for any purpose in connection with the carrying out and completion of the re-development (see Clauses 10 and 16.2).
16. In order to carry out the intended re-development FP had appointed a team of professional advisers (who produced designs, specifications, planning and cost estimating documentation) and HBM as its Management Contractor.

HBM was to co-operate with the professional team during the preparatory stages and, provided the go-ahead was given, HBM was to manage, organise, supervise and secure the carrying out and completion of the (by then) defined Contract Works. The Contract which was dated 21st May 1991 was an amended 1987 edition of the JCT standard form of Management Contract ("the Contract") Article 1 of the Articles of Agreement which formed part of the Contract, was amended to include an additional sub-article which provided –

"in carrying out the functions and fulfilling the responsibilities of the Management Contractor mentioned in 1.1 and 1.2 hereof [HBM] will exercise all the skill, care, expedition, initiative and diligence to be expected of an experienced, qualified and competent manager acting at all times with due regard to [FP's] interests and experienced in carrying out work of a similar size and complexity to the Project. Any collaboration between the Professional Team and [HBM] shall not be held to diminish in any way or to any degree the foregoing covenant nor except as may be specifically agreed in writing by [FP] shall [FP] be responsible to [HBM] for collaboration by the Professional Team with [HBM]."

Condition 1.5 of and the Third Schedule to the JCT Conditions, which detail the specific obligations undertaken by HBM, were heavily amended (see E/16, 17, 66, 67, 68, 80, 81 and 111 to 119). When these amended specific obligations are read together with the additional sub-article cited above, it is apparent that HBM was intended to collaborate fully and intelligently with all members of FP's professional team throughout the project. HBM would have (phased) possession of Friars Square, hand over practically completed phases and co-ordinate with tenants carrying out their own works (see, e.g., Section 7.06.03 of the project specification at F/642 to 646, especially at 645). The fact that new or extended internal division walls between shop units, including in particular the Internal Wall, were to be single skin internal type blockwork walls (and not external type cavity walls) was obvious on the face of the drawings and from the pricing documents.

17. The Contract contained detailed provisions for phasing of the re-development works. So far as the present action is concerned it is material to note that the phasing provisions were such as to facilitate the terms of the Agreement providing for the early completion of FP's works to Store C and the later handing over of Store A to HBM. As well as providing for phased possession and phased completion, the standard JCT insurance provisions (Condition 6) were replaced. FP was to take out, and maintain up to the date of certified Practical Completion for each relevant phase of the works, a "joint names" policy of insurance for loss or damage to the work executed. The "joint names" to be protected by this insurance included FP, HBM and the various "Works Contractors" E/14 and 80).
18. Direct warranty agreements were made between Woolworths (1), FP (2) and various members of FP's professional team, including the Architect and the Consulting Engineer (3). Each of these warranties was dated 27th November 1991 and given under seal. The Architect and the Consulting Engineer each warranted to Woolworths that it had and/or would duly perform the services required by its contract with FP, using all the reasonable skill and care to be expected of an architect/consulting engineer with experience of carrying out projects of similar complexity to the re-development of Friars Square. Neither the Architect nor the Consulting Engineer was to have any greater liability to Woolworths as a result of these direct warranty agreements than it would have had if Woolworths had been named as the joint employer under its contract with FP.

In addition, there was a direct warranty agreement between Woolworths (1) and HBM (2) ("the Direct Warranty"). The Direct Warranty was also an agreement under seal dated 27th November 1991. After reciting the Contract and Woolworths' interest as a tenant or prospective tenant of a part of Friar's Square, HBM warranted –

"1(a) that in respect of all matters which lie within the scope of [HBM's] responsibilities under the Management Contract in relation to the Project [HBM] has exercised and will continue to exercise all reasonable skill care and diligence and

(b) that [HBM] has complied and will continue to comply promptly with the terms of and will regularly and diligently carry out and complete [HBM's] obligations under the Management Contract …"

and the Direct Warranty then further provided –

"2. [HBM] shall indemnify and save harmless [Woolworths] against the reasonable cost of repairing any defect or damage to the part of the Property it occupies or which it intends to occupy under a lease caused by any breach of its obligations hereunder save that it shall have no greater liability and for no longer period than that which would have been owed to [Woolworths] if [Woolworths] had been named as Employer under the Manager Contract.

3. Subject to Clause 1(a) and 1(b) above nothing in [HBM's] tender the Contract Documents (as defined in the Management Contract) or in any specification drawing programme or other document put forward by or on behalf of [HBM] and no approval consent or other communication at any time given by or on behalf of [FP] or [Woolworths] shall operate to exclude or limit [HBM's] liability for any breach of its obligations hereunder and no forbearance or forgiveness in or in respect of any matter or thing concerning this Agreement on the part of [Woolworths] shall in any way release [HBM] from any warranty covenant or obligation under this Agreement.

4. The liability of [HBM] under this Agreement shall not be released diminished or in any other way affected by an independent enquiry into any relevant matter which may be made or carried out by or on behalf of [Woolworths] nor by the appointment of [Woolworths] of any independent person firm or company to review and report to [Woolworths] in respect of the Project nor by any act or omission of any such person firm or company whether or not such act or omission might give rise to an independent liability of such person firm or company to [Woolworths] shall in any way release [HBM] from any warranty or obligation under this Agreement.

5. The provisions of this Agreement shall be without prejudice to any rights or remedies which [Woolworths] may have against [HBM] whether in tort or otherwise and shall not be deemed or construed so as to limit or exclude any such rights or remedies …

(my emphasis).

EVIDENCE/FINDINGS

19. Woolworths served witness statements made by, and called four factual witnesses to give evidence. They were –

(1) Mr I.J.T. Fisher, the project manager whose responsibilities included refurbishment and fit out of the company's stores within the area which included Aylesbury;

(2) Mr R.W. Northover, the store manager who had been assigned to Aylesbury in 1992 to oversee the closure of Store A and the opening of Store C;

(3) Mr K. Stirling, who in 1992 had been a director of Solum Ltd, the flooring contractors engaged by Woolworths to supply and fix the Amtico flooring; and

(4) Mr T. Morris, Solum's foreman at the time that the flooring works had been carried out.

HBM also served witness statements made by, and called four factual witnesses to give evidence. They were –

(1) Mr D.R. Moffett who, as HBM's project director, had been responsible for all aspects of its work on the Friars Square re-development scheme;

(2) Mr K.M.L. Dickson, HBM's senior construction manager for the re-development scheme, who had overall responsibility for the production section. He had responsibility for co-ordinating site activities, including temporary works. He was supported by construction managers who ran the site on a day-to-day basis;

(3) Mr K.J.E. Butler, HBM's managing surveyor whose responsibilities had included the commercial and contractual management of the re-development scheme; and

(4) Mr P.C. Hornigold, HBM's operations manager who had been assigned to the re-development scheme to provide assistance to Mr Moffett.

Whilst I was quite satisfied that all of the factual witnesses did their best to recollect what had happened in the Summer/early Autumn of 1992, it was apparent that the accuracy of recollection suffered from the lack of contemporaneous records and/or reference being made to only some of the records that were available and to the long period of time which elapsed between 1992 and the time when the witness statements came to be prepared.

20. By letter dated 13th March 19992, FP gave Woolworths formal notice that Practical Completion of and access for the fitting out works in Store C was expected by 5th June 1992 (C/43). In the event, Practical Completion of Store C was delayed until after the works to the roof had been satisfactorily completed (C/SO). It took place on 22nd June 1993 (C/54 to 59) at which time the permanent waterproofing was yet to be fully completed – see item 1 on the snagging list. In a letter to Woolworths dated 16th June 1992, FP had stated –

"…we confirm that Woolworths will apply the screeds to all three levels of Store C, and that Woolworths will provide the shop hoarding at Mall level…

…in addition to the permanent roofing works which will be complete on Monday, 22nd June, we will be providing additional temporary bituminous felt that weather proofing to the areas adjacent to your Store C demise to ensure that your shop front works can be completed satisfactorily.

With regard to this temporary water proofing [FP] would appreciate [being informed] ... when you envisage completion of the works associated with the shop front, so that [FP] can arrange for [HBM] to be mobilised for its removal."

The hoarding which was put in place to divide off Store C from the remainder of the Mall can be seen in photographs H/39 to 41 and Mr Corson's photograph 5. The gap/working space allowed to Woolworths between the rear of the hoarding and the line of its new shop front can be seen in photograph H154 – Mr Corson's photograph 3.

21. Although I heard little or no direct evidence on this point, it seems clear from the disclosed labour allocation sheets for 20th and 21st June 1992 (J/34 to 36) that significant quantities of water were present on the concrete decking within Store C on 20th June 1992 and that a triple headed burner was used to dry off this floor slab on the day before handover to Woolworths. Furthermore, water had been able to penetrate down to the basement level of Store C prior to its handover. This was dealt with on 24th June 1992 according to the allocation sheets (J/38).
22. Woolworths' contractors laid the floor screeds within Store C during July 1992. Different documents give different dates. The earliest start date stated was 6th July 1992 (C/138). This was the date assumed by both Mr Pinfold and Mr Shaw when they prepared their reports. If screeding did start then it was probably finished by about 20th July 1992. At latest, the screed was laid between (about) 17th and 28th July 1992 (see C/61 and 62). There was no evidence from the contractors who laid the screed to explain the timing of the works, their working method, what checks (if any) were made of the condition of the concrete decking before the screed was laid and/or whether after laying the screed had initially been covered by a polythene curing membrane. Someone from Woolworths later informed Mr Corson that " … the screed was not covered up after laying" (J/71 to 78 at page 72).

In my judgment the screeding works were probably begun on (or about) Monday 6th July 1992 (as Mr Fisher stated in his letter to Mr Barnbrook dated 13th October 1992) and they were carried out and largely completed by about the weekend of 18th/19th July 1992. A small area was probably delayed (for some unknown reason) until the start of the week commencing Monday 27th July 1992. That area was therefore "only 3 days old" when routine testing was carried out on 31st July 1992 (C/62).

The screed was taken through Store C and finished in line with the front of the blockwork walls which adjoined the Mall. Once the shop fronts were fitted, the finished screed edge was a few inches ahead of the shop fronts. The position can be seen most clearly in two of the photographs exhibited to Mr Corson's report - photographs 3 and P2.

Mr Fisher explained that Woolworths' own architects' department had decided to use an Isocrete K screed when fitting out this store. This screed had been used on a few previous occasions but, at the time, he was not personally very familiar with it.

23. When considering the general issue of moisture retention and drying out times, Mr Fisher said he was not aware of any thought being given to the possible delaying effect (so far as the drying of the Isocrete screed itself was concerned) of the ongoing drying out of the new screed/concrete laid over the super-holorib steel decking and/or of the moisture which had been taken up by both the old concrete and new screed/concrete whilst they had been exposed to the elements before the roof of Store C had been weatherproofed.

As to the drying time required for the Isocrete screed itself, in July 1992 this had been perceived on the simplistic basis that 1 week needed to be allowed for each 25mm of depth. Given the time available in the fitting out works programme, this was not something which was thought problematical. In evidence, Mr Fisher readily accepted that, in July 1992 he had had only a "rough and ready" understanding of the drying times required. As a result of the investigations that had been made after the discovery of the problems in late September 1992, he had come to have a much more comprehensive understanding – in particular, he now knew that an Isocrete screed of the depth required in the "channel area" of the floor should not be laid when rapid drying was required.

Mr Fisher was aware that no provision had been made for the application of a damp proof membrane ("dpm") over the screed before the flooring was laid. Also, and this was a linked matter, Mr Fisher was aware that the screed needed to be dried out properly before the flooring was laid. As to these two matters, Mr Fisher said that no-one on the Woolworths' side had thought that there might be any sort of dampness problem within Store C that might require a dpm. So far as the dryness of the screed at the time of floor laying, this was a matter left to the skill and judgment of the flooring contractors.

24. The Isocrete screed was tested for soundness and integrity on 31st July 1992 when, according to the report, it was between 3 and 14 days old (C/61 and 62). The results showed it to be "within the acceptance limits for Category 'A' screeds". When reporting later, on 20th January 1993 (C/186 and 187), on the quality of the screed, Isocrete said in relation to drying times, strength and its ability to absorb water –

"…Assuming no water is allowed to penetrate the screeds after they have been laid, we would anticipate a drying time of a 50mm screed to be in the order of two weeks after removal of the polythene curing membrane. It is, however, more difficult to assess the time for a screed as thick as 125mm. Such thickness should not be laid when rapid drying is required. However, we would make an assessment that such a screed would be dry in about 8-10 weeks.

A semi-dry modified cement:sand screed, such as K-Screed, is not a fully compacted material. It is designed to have adequate strength to sustain the anticipated traffic, but in being ruled to form accurate levels full compaction is not expected. Indeed if you compare the density of standard K screed at 1800/2000kg/cu.m. with a fully compacted material such as vibrated concrete, you will appreciate that there is a proportion of voids within the screed which would permit the passage of water.

Densities of one of the samples was checked and was found to be 1865kg/cu.m., which is within the normal range and it was found that this sample readily absorbed water up to 11% of its dry screed weight."

25. After the screed had been laid, and before the flooring was laid on it, it is apparent from contemporary documents that Store C suffered intermittent water penetration. A number of small openings, two medium sized openings and one large opening were cut through the roof to accommodate various services. The two medium sized openings were made to accommodate a supply duct and an extract duct. The large opening was cut to accommodate a smoke extract fan. In theory, each of the openings ought to be given effective temporary weatherproofing but, quite obviously Woolworths' fitting out contractors ("BSC") did not achieve that. Mr Fisher's Minutes of a site meeting held on 18th August 1992 open with the following observation –

"Concern was expressed at progress on the weathering to upstands around roof openings. A considerable amount of water had entered the building which had hindered progress on site.

BSC advised that all openings had been sealed and no further ingress should occur,"

whilst the Minutes of the following week's site meeting, held on 25th August 1992, include the following entry –

"Considerable ingress of water had occurred through 2 roof. BSC to ensure this is sealed without delay,"

and the Minutes of the last of the series of formal meetings held on 8th September 1992 include these entries –

"BSC advised that all ceiling works would be completed Thursday night.

[Mr Fisher] advised that the Amtico flooring was to be laid Thursday/Friday and all trades still working on sales floor must not halt flooring. The floor would be laid in two halves to allow work to continue …

All equipment was now on roof although one condenser unit may require replacing ...

Roof leaks were still being experienced. [Mr Fisher] to chase [HBM] as a matter of urgency as damage would now result if ingress continues."

Two inferences are to be drawn from the final paragraph of the Minutes of 8th September 1992. First, roof leaks remained a continuing problem up to that time. Secondly, that BSC were blaming HBM for the problem rather than accepting it as their responsibility. The second inference is supported by Mr Fisher's letter of 14th September 1992 to HBM. That letter written on the day after the flooring had been completed (see further below) stated:

"Further to our recent conversation in respect to water ingress within our unit, I have been advised today that further ingress occurred over the weekend, and I am extremely concerned that our finishes will be damaged.

I have spoken to BSC this morning who advised that all weathering works to structural openings and steels supports installed by ourselves have been completed, and must assume ingress is via defects elsewhere in the roof surface.

Could you please take urgent action to remedy this situation before any significant damage is caused.

HBM replied on 21st September 1992, refuting the allegation that it was responsible and inviting Woolworths to take up with BSC the matter of the completion of the weathering works (C/93). There the correspondence on that topic seems to end.

26. In their evidence, although the Woolworths' witnesses admitted water penetration had occurred (particularly through the large opening), they sought to downplay its extent/significance. Mr Northover acknowledged rainwater ingress through the large opening but said it was "cleared up immediately" and that, as far as he was concerned, the dampened area of screed had dried before the floor went down – albeit he could not remember when it went down (see paragraphs 10 and 11 of his witness statement). Mr Fisher acknowledged that there had been "some ponding beneath the [large] opening and a localised disbursement indicated by discolouration of the screed". He had, he said "immediately instructed [BSC] to clear the ponding and reinstate the temporary weathering to the opening" (see paragraph 20 of his first witness statement). When he was asked in cross-examination whether he had seen water on the screed on his visits to Store C, Mr Stirling said he had been aware of the rainwater problem and he had himself seen "small amounts on several occasions [he] was there." In my judgment, the contemporary documents are a safer guide than the witness evidence so far as this part of the case is concerned. As the documents indicate there was an ongoing problem and, in my view, taking account of the fact that K-Screed is not a fully compacted material and that it contains voids which permit the passage of water, the probability is that it was a matter of greater potential significance that the Woolworths' witnesses were prepared to acknowledge.
27. The flooring works were begun on (or about) Monday 7th September 1992 and they were completed by the following weekend – Sunday 13th September 1992. The minimum period which elapsed between screed laying and the commencement of the floor laying depends on the choice of start dates (see paragraph 22 above). Assuming a start on 6th July 1992 most of the screed would have been laid for 7 or 8 weeks by the time the flooring works began; assuming the latest possible start date the period would have been about 6 weeks.

Solum Ltd had submitted a quotation to carry out the flooring works early in August 1992. Woolworths had accepted it. Mr Stirling was actively involved in planning the works on Solum's behalf. He attended a preparatory meeting with Woolworths'. Mr Fisher at which various matters were discussed. He said that Mr Fisher told him of the screed type/depth. He said that he told Mr Fisher that Solum was not "Isocrete licensed", that Mr Fisher told him of its drying characteristics and that he contacted Isocrete. He discussed matters with an Isocrete representative (whose name he could not remember) and he obtained their published literature. Having noted what was said in the literature, he formed the opinion that there was more than enough time for the screed to dry before Solum's works were to start. He recollected the works being carried out between 7th and 12th September 1992, with Solum needing to work around the M&E contractor who was still working at the time. He said, about the start of work and the initial testing:

"…As would normally be the case, I attended site after the initial visit with Iain Fisher to check that the site was indeed ready and to then arrange for a Foreman to be available on site for deliveries of materials to be made. I can confirm when I attended site the screed was of a normal colour and did not look damp/wet. If running water was beneath the screed, it would look wet and be greenish in colour.

Prior to attending site to carry out the works, various readings were taken to confirm that the floor area was sufficiently dry. The particular piece of equipment used was a Protimeter Concrete Master II gel bridge test. This is a quick and easy test which was commonly used at that time by flooring contractors, adhesive and screed manufacturers, as a first check of the dryness of sub-floors. The practice would be that if the readings of the Protimeter gave cause for concern, we would then propose carrying out a hygrometer test…

The Concrete Master II function was for the gel bridge test. At the time this was the quickest test technique for determining the moisture level in sand/cement screeds of known ratios. It can be used to obtain relative values in screeds containing admixes and concretes to identify areas which may warrant a detailed investigation using hygrometry techniques. These tests showed no cause for concern. I was therefore satisfied that the screed was sufficiently dry to carry out our works.

Hygrometer tests are still in the British Standard requirement for assessing the kH content of screeds, however, these instruments, although easy to install, need to be sealed to the screed for in excess of 48 hours. They are extremely sensitive, if kicked or knocked in any way they can lose calibration and give false readings. The site in question was a typical site of its kind where various trades are competing against time for work space. In my experience, even where hygrometers have been set and clearly barricaded with signage, they are still moved and tampered with even if by error. This makes them impracticable and were not, and are still not the first test used to test the level of moisture in the floors. We like most adhesive, screed and flooring contractors would use protimeters or similar manufacturers with the sleeve method.

We commenced flooring works to staff areas on Monday 7th September and on that day Steve Watson, our Surveyor at the time, went to site. We had been advised that rainwater had entered through a hole in the roof in Unit C which had been temporarily opened to install plant. Steve therefore undertook further protimeter tests around this area where the water ingress had occurred and again no suspect readings were recorded…".

When cross-examined, he accepted that a hygrometer test (which was the test recommended in the relevant British Standard – BS 8203) was perhaps not as impractical as his witness statement had suggested; if the protimeter test results had given any cause for concern a hygrometer test would have been carried out. He accepted that when rapid set screeds were tested with a protimeter it was possible to get false readings and, if the first of the readings taken was falsified all others would be. He also accepted that the protimeter used had been calibrated for depths up to 75mm and, in consequence, the readings taken in the "channel area" where the screed depth was 125mm and/or over the new concrete/screed might not be reliable. Looking back at the testing carried out and the results obtained Mr Stirling agreed with Mr de Freitas' suggestion that there was "some cause for concern".

28. Mr T Morris, Solum's foreman, also gave evidence concerning the initial floor laying in September 1992. Mr Morris said that he had been involved in numerous jobs since 1992. He had first been asked to recollect what had happened here about eighteen months ago. He knew nothing of the depth or type of screed. The screed had been tested by others before he was sent to the site. He recollected sweeping the floor at the start of the work and finding "dust without signs of damp". He had said in his witness statement:

"I was Foreman at Solum at the time that these works were carried out and was involved in the works. I cannot recall exactly when we commenced the flooring works, but it was probably in or around 7th September. The first thing that we did was to latex the floor, I can recall that there were no problems with this. If there had been too much moisture in the screed, then the latex would not have laid normally. The latex as a product has an extra high rubber content which acts as a suppressant and also absorbs the moisture. When it was put down, it did dry very quickly, literally almost within half an hour and immediately the area was being trafficked with no adverse effects. I also can confirm that when the Amtico flooring was put down, the adhesive used which is an acrylic based adhesive trowelled normally and dried normally, within 15 to 20 minutes. The adhesive was laid without adhesive bleeding through the joints and the flooring was then rolled, again during and on completion there was no bleed through."

29. Before considering the discovery of the moisture problem and the events which happened thereafter, it is convenient to note the evidence given by HBM' s witnesses concerning its role as management contractor and the operation of the site. This evidence was given (mainly) by Mr Moffett. He explained that HBM's role as management contractor was "largely one of organisation". He said that it was no part of HBM's role to review and question design details (produced by FP's professional advisers) such as the specified construction of the Internal Wall. He said that prior to HBM's handover of Store C to FP, who would then allow Woolworths into occupation, it was inspected by FP's representative (Mr Dougan) and the project architect (Mr Boyd). No-one had commented on the qualities of the Internal Wall. He described Unit 21 as an uncompleted shop unit which had a storage floor above the mall level and was roofed. At the time Unit 21 opened into the mall was being used to store materials. Mr Moffett explained the functions earned out by the "multi service gang" He said –

"…On a project of this type and size, particularly one like this which had to remain open to the public throughout the contract period it is essential to have a substantial team of men who are permanently engaged on site to deal with all manner of tasks as and when they arise on site. It is inevitable that minor tasks arise constantly on a major redevelopment contract such as this and the management contractor needs a ready supply of labour to deal with them. This was a contractual requirement in any event – see 'Site facilities and services to be provided by the Management Contractor Second Recital and clause 1.5.4' and the amendments thereto in the Management Contract.

The function of the multi service gang is to deal with tasks such as delivery of materials to sub contractors (works contractors), removal of surplus materials, carrying out minor works which arise which are not specifically covered by a works contract and generally to do the miscellaneous jobs which arise all the time. These include keeping the site as clean and tidy free from dust, dirt and water as is reasonably possible in the middle of a major construction project. As this was a shopping area open to the public it was certainly part of the duties of the multi-service gang to keep a constant check on and remove standing water from the site when it was identified.

The multi-service gang is a very flexible facility available at all working times to carry out these tasks when asked to do so by any member of the team. Keith Dickson had' overall responsibility for these men within his production section, although they were directly controlled by Tom Stockley. There were two individual teams led by Adrian Gallen and Gerry Harraghy… The number of men in each gang and therefore the total compliment did, however, vary depending on the stage of the overall project. At the time in question for these proceedings and for which daily allocation sheets have been found, the gang was approximately 15 in total.

30. It is common ground that the moisture problem was observed approximately one week after completion of the floor laying. Given the factual issue which I have to decide (see paragraph 7 above) it is unfortunate that no diary entries and/or daily reports exist for the week commencing Monday 21st September 1992. Woolworths allege that the problem was first observed on 21st September 1992 and HBM admits that some pooling of water was then apparent (see paragraphs 9 and 10 above) but the extent of/significance of the observed water is in issue. Mr Shaw places considerable reliance on the Berryfields rainfall records – Berryfields being about 4 km north west of the Aylesbury town centre.

The daily rainfall amounts taken from "Met Office" records are admitted facts in this case (A/160 to 171), Mr Shaw has included them in his chronology (B/181 to 183) but, in my judgment, these rainfall records cannot be considered in isolation and they cannot be read as giving definitive rainfall figures (either as to amounts or timing) for Friars Square; localised heavy rain is not an unknown phenomenon. That said, the figures quoted are for 24 hour periods (9.00 am to 9.00 am) commencing at 0900 GMT on the date of entry. The rainfall at Berryfields between 0900 GMT on 22nd September 1992 and 0900 GMT on 23rd September 1992, at 45.6mm, was exceptionally heavy. The rest of the week was wet with rainfall of 7.9mm (23/24 September), 7.6mm (24th/25th September) and 5.6mm (25th/26th September). There had been some rainfall at Berryfields at about the time the flooring works were completed – 8.6mm in the 24 hours commencing at 0900 GMT on Sunday 13th September 1992 – but little rain during the following week. There was 2.5mm of rainfall at Berryfields in the 24 hours commencing at 0900 GMT on Sunday 20th September 1992 and 1.4mm in the 24 hours commencing on Monday 21st September 1992.

31. Neither Woolworths' first written notification to FP of its intention to make a claim for losses resulting from water penetration – sent on 25th September 1992 (C/94) – nor Mr Fisher's internal memorandum – sent on 28th September 1992 (C/97 to 98) – states when the problem was first observed.

Mr Butler's report to HBM's insurance department dated 1st October 1992 (C/103) states that the problem had first been reported to Mr Moffett on 24th September 1992. That reported date appears to have been carried through to later documents – e.g. Mr Horngold's programme (C/285 or B/124A), FP's loss adjuster's report dated 6th October 1992 (C/117 to 122) and the letter dated 23rd October 1992 to Mr Barnbrook (C/156 and 157) – but, as Mr Moffett confirmed in evidence, that was an incorrect date; he had been present on 22nd September 1992 and seen trial holes being "dug" into the screed in Store C.

The disclosed multi-service gang allocation sheets for 21st, 24th and 25th September provide limited assistance and, unfortunately, the sheets for Tuesday 22nd and Wednesday 23rd September 1992 have not been located.

The earliest document which sets out a chronology is Mr Fisher's letter dated 13th October 1992 prepared to brief Mr Barnbrook of the Concrete Advisory Service (C/144 to 146, for the copy forwarded to HBM). HBM had asked Mr Barnbrook to visit and reporting to HBM and it would be for HBM to forward a copy of his report to Woolworths. In my judgment having considered the letter of 13th October 1992 in the light of the comments HBM made on 23rd October 1992 (C/156 to 157) and the recollections of those who were involved at the time (and gave evidence), the first ten paragraphs accurately record what happened and/or what was found on site on 21st and 22nd September 1992.

32. The first person to notice problem with the floor of Store C was Mr Northover. After the flooring had been completed he was involved with the "fixturisation" of Store C i.e. the installation of the retail gondolas which take the stock. He recollected that the entertainments fixtures, which would display videos, cassettes and CDs, were late arriving. It was in the area that those fixtures were to be placed – which was about 3 or 4 feet away from the Internal Wall – that he first noticed a white substance coming up through the joints in the Amtico flooring. This was the same area as Mr Stirling identified by reference to a marked up copy of drawing ME/595/RO/01 and which Mr Shaw showed on his figure 15729/B(B/218).

Mr Northover reported what he had seen to Mr Fisher and then one or other of them contacted Mr Stirling. Mr Stirling arranged to send one of Solum's floor layers (Mr Balchin) to remove what was first thought to be nothing more than excessive adhesive residue. Mr Balchin went to site the same day. He reported back to Mr Stirling that there was a more serious problem. Mr Stirling contacted Mr Fisher and the two of them agreed to meet the following day at Store C to investigate and decide what should be done. In my judgment, Mr Northover was probably mistaken in his recollection that Mr Fisher came to site himself on the day that he (Mr Northover) first reported the problem; it was, I think, Solum's Mr Balchin who came and removed some of the Amtico flooring on that day.

33. Mr Fisher and Mr Stirling met at Store C on 22nd September 1992. They began to investigate the problem. Mr Fisher took photographs during the day – most of the undated photographs in bundle H were taken by him on 22nd September 1992; the photographs which show "28" on their face were, according to Mr Fisher, taken later by Mr Hughes (a representative of one of the loss adjusters). It quickly became apparent to Mr Fisher and Mr Stirling that there was indeed a serious problem. As Mr Fisher said in his witness statement –

"The failure was first noticed at the front of the store to the left hand side of the front entrance [as one looks in from the mall]. I began investigating in or around that area and it became clear that there was a big problem, and something had seriously failed. I was able to lift the Amtico flooring tiles up quite easily, and when they were uplifted, the adhesive on the back simply ran off them. It had become very milky in consistency and lost all of its adhesive quality. There are a number of pictures [in bundle H] that show what the tiles were like as they were being lifted.

I was able to track the failure, from the left hand flank wall of the store, right across the right hand side of the store entrance to a distance from the doors of about 30 to 40 feet. When it became apparent that the failure was quite significant, I ordered that merchandising cease so that we could investigate further."

34. Mr Stirling made arrangements to bring Mr Morris to the site that same day. He told Mr Morris to come with a kango hammer so that some test holes could be dug. Mr Fisher and Mr Stirling went around to Unit 21 where they saw water in the "channel area" of the concrete decking. They also saw some water in the fire exit corridor on the other side of the Store and water in the service corridor. Varying descriptions of the amount of water which was seen on 22nd September are contained in the witness statements. None of the witnesses suggests that the water was anything other than rainwater and no alternative source is suggested in any of the contemporary documents. There is no direct evidence of the period of time this water had been standing in the channel area prior to 22nd September but I think it must have been there the day before and I doubt if it would have been allowed to remain over the weekend if HBM had been aware of that amount of water being there on the previous Friday. Of one thing I am quite certain; whatever amount of water there was, from wherever it had come and for however long it had been there, it could not ever have been anything like 180mm deep. On this point, without hesitation, I adopt the levels analysis of Mr Shaw (B/196 and 197) and I agree with the observations made by Mr Moffett –

"…I do still recall, even though this claim relates to events which occurred more than a decade ago, being notified of what is now described by Woolworths as a 'flood' and going immediately to Unit 21 to investigate. What I saw was nothing like 180mm of water, nor was it anywhere near as widespread as is alleged. Unit 21 was a unit of something like 160 square feet and 180mm of water over the entire area would be an unbelievable amount of water. There is no way the unit could have contained that sort of amount of water as it would have come gushing out of the front of the unit… The existence of this volume of water does not make sense. If there had been this much water in Unit 21 there would have been the same sort of volume all over the site, including Store C. The whole site would effectively be under water. In addition, the mall level on which this water is alleged to have gathered is above a basement service area 6 metres high. This would have become inundated with water and this did not happen."

but, having rationally ridiculed that aspect of Woolworths' pleaded case, Mr Moffett seems to me to have gone on to under estimate the amount of water present in Unit 21. He said–

"In fact, what I saw was a puddle of water, approximately the length and width of a small to medium sized car, no more than 10mm (½ inch deep). Needless to say I immediately arranged for this to be cleared. From recollection I believe that I spoke to Tom Stockley and Keith Dickson about how best to deal with it and I think that it was swept into the nearest drain (which I think was at the front of the unit) by the multi-service gang."

In my judgment a more accurate impression of the extent of the water which was found to be standing in Unit 21 is obtained from the evidence given by Woolworths' Mr Northover and HBM's Mr Dickson. Mr Northover explained what he meant when he had described Unit 21 as "completely flooded" and when he had referred to "paddling in water in the service corridor" in this way – water was in the sunken channel area of Unit 21, he was unaware how deep it was but (a) he did not notice any water flowing out from Unit 21 into the mall and (b) he was wearing shoes and he had not attempted to walk through it. So far as the service corridor was concerned, there had been some water in it at the time which they had to walk through to get into the store Mr Dickson said that "the puddle" was "a little larger than described by Mr Moffett … at its deepest … about 25 to 50mm deep and approximately 8 metres by 4 metres in size." He told me that he recollected the depth because of the way it had come up on his site boots when he had gone to Unit 21 with Mr Moffett. In my judgment, the depth of the water was probably at the upper end of Mr Dickson's range, or perhaps deeper but it was less than 75mm deep. Once the water which was present in Unit 21 had been seen by Messrs Fisher, Northover, Stirling, Morris, Moffett, Dickson and (no doubt) others on 22nd September 1992 it was quickly removed. Mr Moffett thought it was "swept into the nearest drain" whereas Mr Northover's recollection was that it was "pumped out". Given the amount of water involved and the configuration of the decking I think Mr Northover's recollection is more probably accurate.

35. Returning to events which happened inside Store C during 22nd September 1992, once Mr Morris had arrived, together with the kango hammer, some test holes could be dug. Three test holes were dug by Mr Morris – Nos. 1, 4 and 5 on the plan. He described arriving at Store C and walking from the back of the store (where there was little or no evidence of any problem) towards the mall. Towards the front of the Store, when he stamped his foot or fist on the tiles he found that water would "shoot up". He described picking up Amtico tiles and seeing the emulsified adhesive running off them. So far as the trial holes were concerned he said that he was instructed to dig down until water was visible at the bottom of the hole when he was told to stop. When he stopped he said that there was two inches of water (or thereabouts) in the bottom of the trial holes. Mr Fisher and Mr Stirling gave similar descriptions of the trial holes – see paragraph 14 of Mr Fisher's first witness statement and paragraph 16 of Mr Stirling's first witness statement.
36. The moisture found in the screed on 22nd September 1992 was not the result of the exceptionally heavy rainfall which came at Berryfields, overnight on 22nd/23rd September. If Friars Square had rainfall of the same order of magnitude at that time and over the rest of the week that certainly cannot have assisted matters. Such an amount of rainfall would probably have exacerbated the existing problems but, in my judgment, as a result of the discoveries made on 22nd September 1992, HBM and its multi-service gang were probably in a heightened state of awareness over that period. I think it probable that any and all further water accumulating on site (in the vicinity of Store C, if not elsewhere) was very promptly removed. The labour allocation sheet for 24th September 1992 indicates that two men spent their whole day, with a third man spending three hours, "pumping water off the main slab area". Unfortunately, as I have already noted, the allocation sheets for 22nd and 23rd September 1992 are not available. In contrast, prior to 22nd September 1992, I think it probable that there was not the same perceived necessity or urgency to remove standing water from areas of the concrete decking where little or no construction activity was taking place.
37. On 25th September 1992 the Labour Allocation Sheets indicate that some members of HBM's multi-service gang were engaged in "waterproofing in unit next to Store C." In his witness statement Mr Butler stated that this appeared to refer to the application of a bitumen coating to the [bottom of the] Unit 21 side of the Internal Wall. That work was certainly carried out at about that time but it was not all that was done. FP's loss adjuster's preliminary report dated 6th October 1992 (C/116 to 122, at 120) includes the following passage which must have been based on information given by HBM (probably Mr Moffett) –

"Upon receipt of the original complaint, [HBM's] Project Director noted that water was indeed lying against the party wall between Unit 21 and Store C. This had become possible because the previously sunken floor to the central courtyard area had been raised, so as to become level with the flooring of the various retail units and the barrel vaulted roof, which will subsequently enclose this courtyard area, is still not completely in place (sic).

Accordingly immediate arrangements were made to remove the water lying against the party wall, a waterproof coating was applied to the base of the wall and a small temporary brick bund wall was constructed in that area to prevent a repetition."

(my emphasis)

Another thing that was done, shortly after 22nd September 1992, was the removal of the hoarding which had been erected over the mall to separate the Woolworths' shopfitting site from the remainder of HBM's site. This was followed up by the placing of a line of sandbags across the corner of the mall in front of the Woolworths store. These must have been put in place to stop/impede future rainwater flows from going towards the edge of the screed which protruded below/in front of the shopfronts.

38. In his internal report dated 28th September 1992 Mr Fisher stated that "approximately 25% of the floor area [had] failed due to water from the surrounding building site tracking under our screed resulting in absorption into the screed causing the Amtico adhesive to emulsify and fail". In the report dated 1st October 1992 which Mr Butler prepared for HBM's insurance department (C/103), he indicated two lines of thought which HBM were pursuing. One was the extent to which the rainwater penetration which had occurred through the holes which Woolworths had cut in the roof of Store C had been causative of the problem. Tests were being earned out to see if the central area of the floor was damper than the perimeter. If so the results would support HBM's theory that the rainwater penetration had been causative of the problem. It is convenient to note here that, when they came, the results were found to be inconclusive. The other line of thought was this – if Woolworths was right to complain of water ingress from the adjacent Unit 21, what contribution had been made to the water ingress problem by rainwater which had ponded in front of the shopfronts, behind the hoarding line. In HBM's view, this was something for which Woolworths was itself responsible.
39. Further trial holes and hygrometer tests (the results of which Mr Barnbrook considered unreliable – see paragraph 40 below) were carried out in late September/early October 1992 but, since there is no challenge to the reasonableness of Woolworths' decision to replace the whole floor, I do not think it necessary to consider/examine these in any detail or to make any findings in respect of them. The decision to take up the whole of the Amtico floor covering, to re-prepare the screed and re-lay Amtico flooring was confirmed at a site meeting on 5th October 1992 (C/112 to 113). The remedial works were planned to be carried out, and I think they were carried out, between 6th and 19th October 1992. The only specific point that needs to be noted is the inclusion of a three-coat Tretobond damp proof membrane in the remedial works specification. This part of the remedial works cost £23,895.00 (C/149 to 152 at 150).
40. Mr Barnbrook visited Store C on 2nd October 1992 and, accordingly, he had the advantage of seeing the state of affairs whilst investigation/testing was on going and before the remedial works were begun. He met representatives of HBM, Woolworths and Isocrete. His factual knowledge was enhanced by Woolworths' letter of 13th October 1992 (C/144 to 146) and HBM's responses of 23rd October 1992 (C/156 to 157). He reported on 2nd November 1992 (J/63 to 70). He said in his report –

"… It must be confirmed here that the findings of this report are based largely on limited information provided to me by [HBM] but also substantiated in part by information in a letter to me dated 13 October 1992 from Mr Iain Fisher of Woolworths plc. My own observations at the time of visit and my general experience of moisture in screeds and concrete floors also are taken into account …

Detailed guidance on how to check when screeds and concrete bases are ready to receive sheet and file (sic) flooring is given in BS 8203. Clause 11.3 of the Standard discusses in particular the problem of the delay involved in the moisture in screeds and concrete bases drying to a point where vapour pressure as measured by hygrometer does not exceed 75%. It is moisture rising out of a screed or base, as indicated by vapour pressure, which can cause the problem with flooring and its adhesive and not the moisture level as such! BS 8203 particularly warns that the use of the electrical resistivity test can indicate e.g. over a period of days, the progress of drying but only an R.H. level obtained in a very special and particular way by hygrometer can give a final assurance that moisture conditions are satisfactory for flooring laying. The taking of one set of approximate moisture contents e.g. by Protimeter instrument on one day is not sufficient proof of satisfactory laying conditions at that time.

Assessment of time of laying of flooring made by taking moisture content readings is particularly unreliable where screeds are quite thick e.g. over 75 mm thick, and certainly at 125 thickness as is the case the ['channel'] area of Store 'C' ...

Obviously where the proprietary 'K' screed by Isocrete is concerned, a faster drying time [than for a conventional screed mix] is guaranteed by the makers. Their literature states approximately 7 days per 25 mm thickness but this is probably for more normal screed thicknesses e.g. 25 to 75 mm. They warn that 'very thick screeds will take longer to dry out than the rate mentioned above'. And they stress that whatever the screed thickness and time period, testing must always finally prove satisfactory conditions for flooring laying. I am fairly certain that Messrs Isocrete would consider careful hygrometer testing to BS 8203 to be the necessary test procedure …

In the case of screed [laid over the new 1992 part of the deck], the fact that a metal decking existed under the slab would delay its drying out considerably. In particular, the absorbent Lytag aggregate would tend to considerably slow the slab's drying out. If this was the case, the 50 mm Isocrete screed applied would have to allow construction moisture from itself and the Lytag before the flooring could be laid with no risk of moisture disruption. Again, properly insulated hygrometers laid in contact with the screed for lengthy periods, e.g. 72 hours as BS 8203 Appendix A demands, would have been necessary to obtain proper confirmation of time to lay moisture sensitive flooring. It does not appear from information given to me that such R.H. checks were made.

Two other water sources have to be considered in assessing the moisture state in the screeds in Store 'C'. Firstly, rainwater was said by [HBM] to have fallen through the store roof at 4 holes cut by Woolworths' plant installers. The time period during which this occurred was said to be about 2 weeks in the middle of the screeds' drying out period. Certainly the 4 roof holes were probably open for about 6 weeks according to [HBM], and any rainwater falling into a screed area through them would delay the achievement of moisture equilibrium in that area and for some distance away from the water surface contact area. Moisture would tend to spread laterally through the screed depending on the quantity of water and the screed porosity. The better the screed quality, the smaller the lateral spread.

Secondly, rainwater was said to have collected excessively [in Unit 21] … Woolworths said water stood to 75–100 mm depth here. [HBM] said a 'tide mark measured 50mm near the front of the store only' on this side of the building.

Woolworths also stated that rainwater collected and stood 50 mm deep outside of their shop, front position.

The questions as to whether the external standing rainwater penetrated under the 140 mm thick blockworth wall and, if so, how much it penetrated laterally across the screed are virtually impossible to answer in any certainty. It would have helped greatly to determine this if valid R.H. tests and a greater number of accurate moisture content tests had been made over the whole screed area …

Considering the screed overall, I cannot envisage a flood water source [within Unit 21], even over a day to 7 days' period … affecting the screed moisture level for more than a 1 to 2 m section of screed inside the store. This assumes, of course, that water could in fact penetrate under the wall in any quantity in the first place.

When it comes to considering other water sources and testing, these aspects are more clear and certain. In the area where the flooring adhesive was said to have failed first, this location was over or near the 125 mm thickness of screed. Drying out of the base of such a thickness could have taken such a time that at the time of flooring laying 'satisfactory' surface dryness was apparent to the flooring layers as indicated by Protimeter tests, but on covering the surface with the flooring, the excess moisture in the screed base would rise to the screed surface and affect the adhesive. The application of the heat in the store could have accelerated moisture travel upwards through the screed and to some extent out through the flooring joints. Emulsified adhesive could particularly show here.

The rainwater falling through service holes in the roof whatever its quantity could only have added to screed moisture and delayed drying to equilibrium level. It would appear that such water fell unfortunately over the thicker 125 mm screed section adding to its already expected longer drying time.

With regard to later R H hygrometer tests these were made by others and readings given to me by yourself. Readings ranged from 85 to 100% … having seen the type of hygrometer insulation encasements used for the tests, with polystyrene lids lying loosely over the hygrometers, I would not have accepted the accuracy of any of the R.H. readings taken from them and given to me and, sadly, therefore they would be deemed, in my opinion, not acceptable in the explanation of the problem.

Looking at details of the test holes excavated in the screed it was interesting to note that those in the deep 125 mm screed showed wetter lower layers consistent with the very slow drying out of thick screeds. Test holes 1 and 2 in the 50 mm deep screed showed visually dry screed even though they were adjacent to the perimeter walls outside of which some standing rainwater was said to have existed. This could tend to refute the argument that standing water outside the perimeter walls affected without doubt the moisture levels in the screed inside the store …

… external rainwater at floor level, even if penetrating under the perimeter walls, would not be expected to travel far through or under well-made and well-bonded screeds and as such water was not thought to be responsible for much of the moisture in the screeds which was alleged to have affected the flooring adhesive. The problem moisture was likely in much of the screed to have been residual moisture in thick screeds or screeds over the still moist floor base which had not dried out sufficiently at the time of flooring application.

(my emphasis)

41. Mr Corson who had been instructed by Woolworths on 19th October 1992 (C/155) visited Store C on 24th November 1992, after all the remedial works had been completed. He does not appear to have met any HBM or Isocrete representatives. His factual knowledge appears to have come from a copy of Woolworths' letter to Mr Barnbrook of 13th October 1992 (C/144 to 146: see C/155). He reported on 8th December 1992 (J/71 to 78). He said in his report –

"…On Monday, 21st September, 1992, Unit 21 … was reported to be flooded with 75 to 100 mm of water, apparently, as a result of torrential rain experienced during the period the flooring was being laid …

Water was also observed to have ponded to a depth of 50 mm between the shopfront and hoarding to the right hand side as viewed from outside, (Photograph 3). The long passage to the right of the Woolworths unit had been flooded as had the rear passage between Woolworths Unit and Unit 21. (Photograph 4). Flooding outside the Woolworths hoarding is shown in Photograph 5.

It became apparent during the days following the first indication of failure, on Monday, 21st September that re-emulsification of the adhesive as shown by Photograph 6 had to a greater or lesser extent affected the bond of the Amtico plank flooring over practically the whole of the floor. As a result all the flooring was taken up ...

The massive failure of the Amtico flooring (Photographs 7 and 8) is typical of failures experienced in both tile and sheet PVC floorings caused by a very large excess of water in the sub floor ...

It is understood that the screed was laid over a period of 2 to 2½ weeks, so that the drying time before the flooring was laid would have been approximately two months.

Unfortunately, the recommended method for dampness testing by use of a floor hygrometer, given in Appendix A of BS 8203 1987, to determine whether the screed was dry enough for the Amtico flooring to be laid, was not followed. The only check made prior to the Amtico tiles being laid was with an electrical conductance type moisture meter with a probe applied to the surface of the screed. The results of such a test would have given little, if any, reliable indication as to whether or not the screed was dry enough for laying a moisture sensitive flooring.

Isocrete K screed literature amended April 1992 gives average drying times after curing for laying floor finishes as being 'approximately 7 days per 25 mm thickness of the screed'. Hence a 50 mm thick Isocrete K screed which contains a water reducing additive given average drying conditions could reasonably be expected to be dry enough for Amtico flooring to be laid after drying out for about a fortnight following the end of the curing period. In the event, the Woolworths screed was not covered after laying.

Isocrete also recognise that 'excessive moisture in the building structure or high air humidity may delay the drying', and that 'very thick screeds will take longer to dry out than the rates indicated'. It is therefore questionable whether the assumption of a drying time of 35 days (7x5) can apply where the thickness of the screed is nearer 125 mm.

The moisture condition of the structural concrete base at the time the screed was laid is not known. Since the screed was not isolated from the concrete by a sandwich DPM, the possibility of transmission of moisture into the screed from the concrete, if it happened to be wet when the screed was laid, cannot be entirely ruled out. However, unless the concrete, which is not in contact with the ground, had been exposed for some considerable length of time to rainfall, it is unlikely that it would have been wet enough to seriously influence the drying time. It is believed that there was, in fact, an insignificant amount of moisture in the slab when the screed was laid.

It is admitted that some three weeks prior to the flooring being laid, the screed was wetted over a relatively small area by a minor ingress of rain via an opening made in the roof for the installation of smoke extract ductwork. This in itself would be likely to have done little more than perhaps marginally extend the drying time in the area of screed wetted.

When account is taken of the possible effects of these factors, it is reasonable to consider that even if only some parts of the screed were dry enough to receive the Amtico flooring when it was laid, the thicker parts, after some two months of drying out, would still have been approaching a moisture condition where it would have been safe enough to lay the flooring. Hence, at worst, the adhesive in those areas may have softened slowly to the point where, perhaps after a further six weeks or so, some local loosening of the tiles may have manifested itself. On the other hand, there could well have been no manifestation of failure at all. Without the absorption by the screed of a large amount of additional water, there would not have been the catastrophic failure that became apparent only a week after the flooring was laid.

Effect of flooding

It is well known that water, from any source of flooding, which penetrates the edges of a cement/sand screed, can rapidly migrate across the screed via voids at the base of the screed, or by absorption into the coarse pores of the mortar. In this case, the concrete block partition walling would offer little resistance to water penetration via joints in the blockwork or through the blocks themselves. The presence of water staining in Unit 21 on the partition wall up; to about 180 mm above the concrete base, and on the surface of the concrete (Photographs 1 and 2), is a fair indication that a substantial amount of water was in contact with the blockwork well above the interface between the screed and the structural concrete slab on the other side of the wall.

It would seem that the flooding of Unit 21 provided the main source of water penetration into the screed. It was reported that the whole of the floor here was observed on 21st September, 1992, to be flooded. Whilst there may be some slight falls in the concrete slab towards the partition wall on Woolworths side, a spirit level placed at several locations on the floor indicates that for practical purposes the floor in this unit could be regarded as being sensibly level. Hence, if the head of water in the unit was between 75 and 100 mm there would be an ample supply of water available for penetration of the screed and subsequent migration over a large area on the Woolworths side of the wall. It would also appear likely, from reports and photographs taken, that some of the water that ponded in the corridors further round the perimeter of the floor on both side of Unit 21 entered the screed …

Only if a large amount of water from an external source was absorbed by the screed would re-emulsification of the adhesive to the extent shown by Photograph 6 have taken place in just a week or two.

It is therefore considered that the amount of excess construction water that may have been present when the flooring was laid, together with the residual water deposited by rain viz the opening in the roof three weeks prior to the screed being laid, would, by itself, be unlikely to do more than slightly soften the adhesive … It would not be expected to cause an early failure, if any at all, of the Amtico flooring.

CONCLUSIONS

It is concluded that enough of the flood water from Unit 21 and the adjacent corridors could have migrated into the screed to be considered the major cause, if not the only one, of the failure of the Amtico tile flooring.

(my emphasis)

I make three comments on the contents of Mr Corson's report. First, the reference to "180 mm" in the first paragraph under the sub-hearing "Effects of flooding" would seem to be a typographical error. The figures given in the first of the extracted paragraphs and in the second paragraph under the sub-heading indicate that Mr Corson meant to refer to "100 mm" rather than "180 mm". The unsustainable figure of "180 mm" which Woolworths pleaded (see paragraphs 9 and 11 above) seems to have been taken from this report. Secondly, when dealing with the moisture condition of the concrete decking at the time the screed was laid, Mr Corson noted that exposure to rainfall "for some considerable length of time might seriously influence the [screed's] drying time". He then proceeded to discount the possibility of this being a significant factor in this case. I have no doubt that he did so on the basis of information given to him by Woolworths but it does seem to me that the decking towards the front of the new Store C (if not all of the decking within the new Store C) had probably been exposed to rainfall for some months. Thirdly, although, as I have previously noted at paragraph 7 above, in the second of the extracted paragraphs Mr Corson recorded that water had been observed to be ponded to a depth of 50mm in front of the shopfront, he did not consider this water as one of the sources of the large amount of water from an external source which, he postulated, had been absorbed by the screed and been the cause of the rapid re-emulsification of the adhesive. If Mr Corson's analysis is correct, it seems to me to follow logically that this ponded water, if allowed to stand for any length of time, was at least as much of a contributory cause as the other sources which Mr Corson expressly identified.

42. As I have previously indicated in the Introductory section of this Judgment, at paragraph 7 above, the different views which were expressed in Mr Barnbrook's and Mr Corson's reports are essentially the same as the differences between Mr. Pinfold and Mr Shaw which were explored in evidence. All seem to agree that, given the limited knowledge of the construction which was in place and the limited testing that was carried out, it is not possible to state with certainty where the moisture (which was certainly the cause of the adhesive failure) came from. They differ as to the probable source or sources of the moisture.
43. In his report Mr Pinfold reviews recorded facts and concludes that there had been a continuing problem of "water build up" on the site over the period June to September 1992. In his view–

"In phased construction it is important that completed phases are protected from the effects of weather and site activities beyond their boundaries. In this case there were walls of an internal type and the edge of the screed at the Woolworths shop entrance was exposed to the Atrium. No such protection appears to have been put in place by HBM on this site …

…a competent contractor would have realised that there was a danger of water ingress if the boundaries were unprotected and would have, in a timely manner:–

a) installed drainage to ensure that no water would stand against the boundary and/or

b) protected the parts of the boundaries vulnerable to water ingress.

Instead, the evidence suggests that water removal and waterproofing, such as was carried out, was being carried out only as and after problems arose. In the case of the waterproofing protection to Woolworths it was too little, too late."

This approach seems to me to pre-suppose that HBM had a fairly wide-ranging duty to consider the potential vulnerability of parts of the exterior of Store C, particularly those parts which would be internal in the completed re-development but which temporarily had some exposure to the elements, and a duty to protect all such parts from exposure to rainwater,: I address the matter of the common law duty owed to Woolworths at paragraphs 64 to 67 below. However, at this point I think it convenient to deal with the facts. In my judgment, the fact that the Internal Wall was designed as an internal type rather than an external type of wall was (or ought to have been) obvious to Woolworths (and its professional advisers). Furthermore, it was (or ought to have been) obvious to Woolworths (and its professional advisers) that the edge of the screed laid by Woolworths would be exposed for some time until HBM was able to complete the mall flooring. If, as Mr Pinfold suggests, such a screed edge ought sensibly to have been given temporary protection from the effects of weather, Woolworths (or its contractor) would seem to be the obvious person to put that in place because it was Woolworths, and not HBM, who had possession of that part of the site.

44. Both Mr Pinfold and Mr Shaw correctly identify the questions which have to be considered, viz was the screed sufficiently dry at the time the flooring was laid? did the water which was in the screed (and which was the cause of the failure of the adhesive) come from some external source or sources?

Both of them referred to the current (2003) Isocrete trade literature and, I have assumed that each of them was satisfied that the statements made do not differ materially from the earlier version which existed in 1992 (to which Mr Barnbrook and Mr Corson appear to have made reference). The average drying time to be allowed before laying floor finishes on the Isocrete K-screed is said to be -

"…approx 7 days per 25mm thickness at 15°C in well ventilated conditions, after removal of the polythene curing membrane [under which the screed was to be cured for a minimum of 5 days]. Excessive moisture in the building structure … may delay the drying …"

The current literature also states –

"The flooring contractor must check the moisture content of the screed before commencing to lay the floor finish. Very thick screeds (over 75mm) will take longer to dry out than the rates indicated [for average drying times]. Wetting of completed screeds will considerable (sic) extend the drying times …

… in many fast track programmes a DPM may be needed (at the discretion of the designer or main contractor) to separate the K-screed from a concrete base still containing construction moisture ...

The moisture content should be measured in accordance with the recommendations of BS 8203 … using calibrated fully insulated and sealed hair hygrometers.

BS 8203 recommends a maximum moisture content of 95% RH prior to installation of sensitive finishes, In the event that the screed is not dry … {a} surface damp proof membrane may be used to allow immediate installation of the floor coverings.

Was the screed sufficiently dry at the time the flooring was laid?

45. Mr Pinfold noted that, in accordance with the BS 8203 recommendation, the moisture content of the screed should have been measured using a calibrated/sealed hair hygrometer. However, he said that "the absence of such tests does not imply that the screed was not sufficiently dry to lay the flooring". I find that approach, on the part of an expert, somewhat surprising. The wisdom of all those involved in sheet or tile floor laying over screeds, distilled as it has been into the British Standard recommendations, is that there is a need for such testing, as the final testing which can establish positively that the moisture level of the concrete has been reduced to a value where the flooring can safely be laid. Given the inherent nature of the materials, viz the moisture gradient, the absence of the recommended testing certainly means that a complainant may find it more difficult to prove his case to the requisite standard.
46. Mr Pinfold noted that Solum had tested the screed in Store C using a Protimeter Concretemaster gel-bridge Conductivity Test. He had not seen the results of these tests but, on the assumption that the results were satisfactory, Mr Pinfold believed that "a competent flooring contractor could be expected to know by experience whether the screed was sufficiently dry to lay the flooring". Mr Shaw criticised this approach (J/258) and I agree with him. With all due respect to Mr Pinfold, this approach is unscientific and unsatisfactory – it fails to acknowledge the reality, which is, I believe, that such a contractor is disregarding accumulated wisdom and taking a calculated risk.
47. Mr Pinfold addressed the issues of rainwater ingress during August and early September 1992 and the possible higher moisture content of the new 1992 decking in this way – he said that he would have expected only a "relatively slight" amount of water ingress affecting only a limited area of the floor; he said that he would not expect the new 1992 decking to have caused any moisture problem so far as the Isocrete screed was concerned. Overall, in his view, all of the 50mm thick screed "should certainly have been sufficiently dry" before the flooring came to be laid but, accepting what Isocrete had said about drying times for the thicker screed over the channel area (C/186), Mr Pinfold accepted that "there could be some doubt about the 125 mm thick part".
48. Mr Shaw noted the absence of the recommended hygrometer testing prior to the floor laying and stated that in his view the testing carried out by Solum using the gel-bridge method could not have been sufficient to establish the overall moisture condition of the screed at the start of the floor laying operations. Mr Shaw dealt with the possible significance of the moisture content of the concrete deck prior to the laying of the screed in July 1992 in this way –

(1) the areas of old concrete must have been exposed (to a greater or lesser extent) to ponded rainwater during the re-development. It was to be expected that water had accumulated particularly in the lower/channel area where the deeper screed was to be laid. In my judgment this is probably right; the fact that the new Store C was being brought forward into the old open courtyard area and the recorded use of the triple head burner to "dry out" the decking on the 21st June 1992 suggest to me that the channel area of the store (if not all of the old store) had been exposed to the weather for some time prior to handover; and

(2) the new composite decking was laid in the previously open area at the front of the new Store C and carrying on into the mall. This new concrete was exposed to the weather for some time and, as Mr Shaw noted, even if it had not been so exposed, it would not have dried out fully before July 1992;

and he dealt with the rainwater ingress during August and early September 1992 by noting that it had occurred (as the contemporary documents stated) but its extent was not clear.

49. Overall, Mr Shaw's conclusion was that the moisture condition of the Isocrete screed at the time the flooring came to be laid in September 1992 was not known. In his opinion, neither the reported observations of the apparent dryness of the screed surface nor the evidence concerning the ease with which Solum carried out the required works, constituted a reliable basis to conclude that excessive moisture was not present at some depth below the screed surface. As he said –

"Following screed laying and while the top surface is unsealed there will be a gradient of increasing relative humidity (RH) with depth in the screed. Whilst the top surface may appear dry, there may be an excessive amount of moisture within the screed and/or the slab below. When the surface is effectively sealed by laying the floor covering, moisture will rise to establish equilibrium throughout the enclosed screed, and damage to the adhesive may occur if the RH near the surface rises to a level exceeding 75%."

50. On this aspect of the case, I prefer Mr Shaw's approach to Mr Pinfold's. In my judgment it is a better/more scientific approach. I do not agree with Mr Pinfold that the technical conclusions which can and should be drawn are that "there is nothing to suggest that … there was any doubt about the adequate dryness of the screed" and/or that "bearing in mind the period that had elapsed and the testing that was carried out ... the screed would have been sufficiently dry to apply the Amtico flooring". I agree with Mr Shaw's view that the proper technical conclusion to be drawn from the available materials is that "the moisture condition within the screed at the time when the floor laying started is not known".

Did the water which was in the screed (and which was the cause of the failure of the adhesive) come from some external source or sources?

51. Having extracted various passages from the factual witness statements, noted the test results for strength/hardness of the screed on 31st July 1992 (C/61 and 62), the results of the tests carried out on the sample of screed taken in September 1992 (C/184 to 187) and the agreed rainfall records for Berryfields for September 1992, the essential point which Mr Pinfold makes is this –

"When placed, the screed mix, being semi-dry would have had no 'free' water. The various witness statements show that after the flooring adhesive had failed the screed was saturated in many places and with free standing water in some of the test excavation holes. This water must have entered the screed after the time it had been laid. Had the screed been in this state at the time the flooring was laid it would not have been possible to lay the flooring …

In my opinion there was substantial water ingress into the floor construction of Unit C from outside and this could only have come from the inundation that occurred in the adjacent units and the atrium area. The mechanism existed by which this water could spread across the floor and cause the failure of the adhesive and the lifting of the floor finish. I have seen no evidence of any other source of water, which could have caused the failure.

52. Mr Pinfold considered that the top part of the screed would have been more compacted, and accordingly it would have been denser, than the bottom part of the screed. He explained it in this way –

"The nature of a semi-dry screed such as this, placed on an existing concrete slab is that the top will be more dense than average because of having been trowelled off, but the base will be less dense than average and will have voids because it would have less compaction. This means that water can readily migrate through the lower part of such a screed through a combination of hydraulic pressure and capillary action..."

He also considered that the Internal Wall would have been "by no means impermeable". Water would have been able to penetrate into the screed through that wall as well as penetrating over the length of the Woolworths shop front. Mr Pinfold acknowledged the different views that had been expressed by Mr Barnbrook and Mr Corson. He aligned himself with Mr Corson –

There is a difference in view expressed between Mr Barnbrook and Mr Corson on the penetration of water through screeds. Mr Barnbrook says that 'it (water) would, in my opinion, have had great difficulty in travelling far through a well-made and well-bonded screed'. On the other hand Mr Corson says 'It is well known that water, from any source of flooding, which penetrates the edges of a cement/sand screed, can rapidly migrate across the screed via voids at the base of the screed, or by absorption into the coarse pores of the mortar'. At the time of Mr Barnbrook's report the absorption test on the sample of screed had not been carried out and Mr Barnbrook may well have reached a different conclusion in the light of that test result. Bearing in mind the measured porosity I believe that Mr Corson is correct in this case.

53. Mr Pinfold described "the mechanism" or "three manners" by which water could have migrated into the screed in the following way –

"In my opinion, the manners in which water could have migrated into Unit C from Unit 21, the edge of the screed at the shop front and from the fire escape corridor are as follows:–

1. through the blockwork and thence into the screed

2. through the Lytag concrete base

3. between the screed and the flooring"

[as to each of these]

1. The screed has been shown [by the results obtained on the sample] to be potentially porous, and once water enters it from the edge or the underside, it can migrate rapidly.

2. The Lytag concrete base maybe porous and may have been exposed in the vicinity of the Woolworths main entrance. If this were the case, the standing water in this area could pass through the Lytag concrete and up into the screed.

3. There appears to have been free water on the screed under the flooring. If the standing water outside were above floor level there would be a tendency for slight pressure to build up under the flooring. This would lift the flooring and by the mechanism of water also destroying the adhesive, allow moisture to travel along this interface.

All three manners of water migration could have been present."

54. Mr Shaw's analysis was a very different one. He stated that there were five potential sources of water that needed to be considered. They were –

• moisture remaining within the concrete structural slab from ponding of rainfall;

• moisture remaining within the concrete composite slab from mixing water;

• moisture remaining within the screed from mixing water;

• rainwater falling through roof openings onto the screed; and

• water finding its way into the screed from the perimeter of Store C.

The moisture in the screed could have come from any one or more of these sources. He discussed each, to a greater or lesser degree. He identified each of the first four as possibilities before positively eliminating the last of the potential sources. The conclusion at which he arrived was –

"… the most likely sources of water in the screed when the Amtico flooring was laid are mixing water in the 125 mm deep screed and mixing water in the Lytag concrete of the composite slab, which had not had sufficient time to dry. Drying may well have been delayed by wetting of the concrete slabs and/or screed by rainwater through openings in the roof."

The reasoning by which he eliminated the possibility of water finding its way into the screed from the perimeter of Store C had two main (interlinked) strands. One was an analysis of potential water levels taken from/derived from the architect's drawing 3396/2017. The other was his view of the porosity of the Internal Wall and of the insufficiency of the maximum head of water that could ever have built up in Unit 21 to drive water through the Internal Wall and onwards for some considerable distance across the screed in Store C.

55. So far as the levels were concerned, Mr Shaw noted that there was no floor screed in Unit 21 in September 1992. But, he assumed that the rear service corridor and the fire exit corridor had been screeded with the finished level being the same as that in Store C. If that was so, the levels in these corridors must have been approximately 50mm higher than the level of the concrete deck in the mall. Within Unit 21 the level of the lower channel area of the old concrete decking was approximately 75mm below the levels of the mall deck (which was in front of it) and the main part of the old concrete deck (which was behind it). Furthermore, its level was approximately 125 mm below the finished screed level in Store C. This channel area would fill with rainwater, flowing in from the mall area, to its maximum depth of approximately 75mm before the rear part of the unit would be affected.
56. Mr Shaw looked at the coursing of the blockwork of the Internal Wall. He noted that full height blocks had been laid within the channel area. The nominal height of a block course was 225mm. If, as Mr Northover had described at paragraph 16 of his witness statement, the depth of water had been "well over half the height of a breeze block [laid in the channel area]", the water would have had to have filled the 75mm deep channel area and been standing to a depth of about 38mm on the higher parts of the decking. Quite obviously Mr Shaw had not considered this part of Mr Northover's statement credible, and having heard Mr Northover explain in more detail what he saw when he went around to Unit 21, it is clear that Mr Shaw was rightly sceptical. However, even if this had happened, the water level in Unit 21 would have remained below the finished screed level in Store C. Looking at the "tide marks" on the blockwork that were visible in the photographs (see photograph 43 – photograph 2 in Mr Corson's report) he said:–

"The presence of a 'tide mark' in the blockwork confirms that water had been present, but the level of the staining after the event cannot be relied upon as an indicator of the water level because it will reflect the rise due to capillarity in the blockwork (i.e. the effect of 'rising damp')."

Mr Shaw was unable to explain the source (or sources) of the water which was reported to be standing in the rear service corridor and in the fire exit corridor.

57. Insofar as water had accumulated in the channel area, would it have soaked through the Internal Wall? In Mr Shaw's opinion -

"Both the concrete blocks and their mortar joints, and the sand/cement screed, would be porous, and thus able to take up water by absorption and capillarity. The permeability (ability to transmit water) of these materials is however limited, in the absence of defects or discontinuities, as the flow paths between the pores are largely blocked by the cement matrix and a head of water is required to drive water through the limited openings that remain. It appears likely that water was present, at least temporarily, in the 75mm deep 'channel' within Unit 21 on 21 September 1992 but I believe it is not credible that the water level elsewhere within Unit 21 could have exceeded the level of the top of the screed in Store C at any time.

It is my opinion therefore that there could at no time have been sufficient head of water in Unit 21 to drive water through the block wall and into the whole of the screed in Store C, up to 40m from Unit 21, and up to 20m from the 'channel' in Store C."

As Mr Shaw noted himself, this opinion was the same as the opinion which had been expressed by Mr Barnbrook in November 1992.

58. In his report dated April 2003 Mr Shaw carefully dealt only with the specified pleaded allegations that HBM had to meet. Although he mentioned the water seen standing outside the front of Store C (see e.g. paragraph 8.6 of his report – B/186) and noted that the floor was initially observed to have failed in the front part of Store C (paragraph 9.1.6 of his Report – B/190), he appears to have assumed that this standing water was the product of rainfall on the night of 22nd/23rd September 1992 (and later in the week) and that the relevant photographs were not taken until 28th September 1998. He maintained his position on the timing of the water build-up outside the front of Store C in his supplementary report dated 9th May 2003 when commenting on Mr Pinfold's views as to the significance of the "free water" that had been observed in trial holes. Mr Shaw said:

"… Mr Pinfold deals … with the evidence of 'free water' in the base of three (?) trial holes in the deep screed and one near the right hand flank wall. These holes are believed to be the holes shown on my Figure 15729/B at Appendix B to my report. He also refers to 'evidence of water directly around the edge of the screed over the length of Woolworths shop front' (see also his Drawing No. 2308/03). These occurrences took place after the torrential storm of 22/23 September and I agree that, if water was standing against the fully exposed edge of the screed (50mm depth) then it was certain to penetrate into it. This would be the most likely explanation for the presence of free water in the test holes nearby. However, on the basis of the evidence of the timing of the discovery of floor adhesive failure and the delay between exposure to water and adhesive failure revealed by my testing, this water could not have caused the adhesive failure. My reasoning as to the cause of the failure is therefore unaffected. It is apparent that Woolworth should have used the epoxy resin based Amtico adhesive (non-water susceptible) in conditions of obvious water risk on this generally exposed site or, indeed, have used initially the system which was adopted later for the remedial works, namely the incorporation of a damp proof membrane between screed and adhesive/Amtico floor covering."

(my emphasis)

As to the time at which the water was seen to be standing on the mall decking between the Woolworths shop front and the hoarding, I have already indicated that I accept Mr Fisher's evidence that he took photographs, including photograph 54 – photograph 3 to Mr Corson's report, on 22nd September 1992. And, again as I have already indicated, I find no difficult in accepting the evidence concerning the conditions on site on 21st and 22nd September 1992 without doubting the accuracy of the Berryfields rainfall data (see paragraphs 30 and 34 above).

59. On this aspect of the case, I think that there is force in the main point which Mr Pinfold makes, viz, there must have been substantial water ingress into the screed from outside after the flooring was laid. I accept the evidence given by Mr Stirling and Mr Morris concerning the apparent dryness of the surface of the screed at the time the floor laying works began on (or about) 7th September 1992. The testing carried out may not have been adequate to be sure that there was no potentially damaging residual moisture within the screed but, I agree with Mr Pinfold that the descriptions given by the witnesses of the failed adhesive and of the quantity of free water in some at least of the test holes are not consistent with failure resulting from residual construction moisture and/or from the un-evaporated residue of rainwater which had fallen onto the screed beneath the roof openings being drawn up to the now sealed surface of the screed area.
60. However, I am not persuaded that the source (or a significant source) of the water ingress into the screed was the "reservoir" which had formed in the channel area of Unit 21 prior to 21st/22nd September 1992. Whilst I agree with Mr Pinfold that the Internal Wall would have been "by no means impermeable", in my judgment there is force in Mr Shaw's opinions concerning (a) the limited permeability of the concrete blocks/mortar joints of that wall and (b) the insufficiency of the head of water in the channel area of Unit 21 to drive water through the Internal Wall and across the whole of the screed in Store C. Even if water of some depth had been standing in the channel area of Unit 21 for a number of days prior to 21st/22nd September 1992, in my judgment, over such a limited period only a comparatively small (and in the overall context, a comparatively insignificant) quantity of water would have passed through the Internal Wall and into the screed in Store C. Furthermore, the screed in Store C would have been affected by such water for only a limited distance immediately adjacent to the Internal Wall. Given the fact that the surface of the screed was now sealed, as time went on water from that external source would be expected to penetrate slowly further and further into the screed. However, as I have said, I do not think water from that external source made anything more than a minor/insignificant contribution to the total of the external water that had come to be in the deeper screed in the channel area adjacent to the Internal Wall and in the immediately adjoining areas of 50mm deep screed over the new composite deck (to the front) and the old concrete deck (to the rear) by 21st/22nd September 1992. Most of the hatched area shown on Mr Shaw's figure 15729/B(B/218) as the area where damage was first observed would, of course, fall within this area.
61. The other source of penetrating water, the source which had much easier/more immediate access and access along a longer front, was the water which had built up against the unprotected edge of the screed where that edge protruded beyond the new Woolworths' shop front. Water which built up against the edge of the screed would migrate fairly rapidly across the front area of 50mm screed laid over the new composite decking and into the deeper screed laid in the channel area. It would take longer to migrate into the 50mm screed in the rear part of Store C. In my judgment, over much the greater part of the floor where the adhesive was found to have failed on 21st/22nd September 1992, the water ingress had come only from this second source. It was the very considerable volume of water that had come from this source that saturated the screed to such an extent that the adhesive had become very milky in consistency, and such that it ran off the back of the easily uplifted Amtico flooring.
62. In my judgment, in the area adjacent to the Internal Wall where water coming through from Unit 21 contributed something to the totality of the water in the screed, it was water from this second source which contributed by far the greater part of the volume. In my judgment, if there had been no water build up in the channel area of Unit 21, the Amtico flooring adjacent to the Internal Wall would still have failed in the way that it did and at the time that it did, as a result of water penetrating from the edge of the screed. Conversely, in my judgment, if the edge of the screed had been effectively protected but water had been allowed to build up in the channel area of Unit 21, there would have been a much less extensive and less dramatic failure of the adhesive; and, probably, the failure would have taken longer to become manifest.
63. The evidence concerning the water which was seen in the service corridor and/or in the fire exit corridor on the 21st and/or 22nd September 1992 was not very extensive. No investigations (or at least none of any substance) appear to have been undertaken to establish the origin(s) of the water or the potential contribution which water from either of these locations might have made to the total external water content in the Store C screeds.

Looking at the photographs, I tend to agree with Mr Shaw that the fire exit corridor had been screeded. I have noted the "tide marks" on the blockwork on one side of the fire exit corridor, see photograph 6A – photograph P3 to Mr Corson's report which, I was told, was taken at a later date (after the door to the mall area had been hung – there was no door in position up to and on 21st/22nd September 1992). It is not possible to say when and/or for how long water had been in that corridor or how much water had been there on any occasion. In my judgment the water seen in the fire exit corridor must have been water which had flowed in from the mall area; probably it came from the same accumulation that had been standing at the screed edge and which Woolworths had described (to Mr Barnbrook and to Mr Corson) as being 50mm deep. In reality it must have been, for some of the time at least, more than 50mm deep in order to overflow the screed edge and flow into the corridor. If some of this water penetrated the blockwork wall dividing the fire exit corridor from Store C, it might have made a very limited contribution to the totality of the water in the screed in the immediate vicinity of that wall. Turning to consider the water which was seen in the service corridor, only part of this corridor had been included within Woolworths' site and, whilst noting Mr Shaw's view, I rather doubt if it was screeded. The "water staining" on the floor of the service corridor can be seen in one of the photographs which Mr Fisher took on 22nd September 1992, photograph 38 – photograph 4 to Mr Corson's report. Whilst not doubting Mr Northover's evidence (see paragraph 34 above) I do not feel able to make any specific findings as to the source(s) or potential significance of this water. Given the findings that I have made at paragraphs 59 to 62 above (and noting again that there is no challenge to the reasonableness of Woolworths' decision to replace the whole floor), I do not consider that my inability to make specific findings in this regard matters to the result of this case.

COMMON LAW DUTY, BREACH OF DUTY AND CAUSATION

64. I have summarised Woolworths' pleaded claim and HBM's pleaded response at paragraphs 9 and 10 above. At the relevant time, viz 22nd June 1992 up to the time when the Amtico flooring failed, HBM had possession of most of Friars Square but it had given back the practically completed Store C to FP (who had then allowed Woolworths to occupy it) and it had temporarily ceded to Woolworths possession of part of the uncompleted mall area immediately adjoining the frontages of Store C. This was needed by Woolworths as working space ("the Working Space"). I do not agree with what, so it seems to me, is rather too narrow a view of HBM's role as management contractors which was described by Mr Moffett in his evidence (see paragraph 29 above).

HBM's contractual duties to FP under the Contract – (see paragraphs 16 and 17 above) – which, by virtue of the Direct Warranty were equally intended to be performed for the benefit of Woolworths – (see paragraph 18 above) – gave Woolworths a right to expect that HBM would exercise all the reasonable skill, care, initiative and diligence to be expected of an experienced, qualified and competent person managing works of the sort that HBM were managing. Under the Contract, HBM was to fulfil such a duty with due regard to FP's interests; under the Direct Warranty, HBM was to indemnify Woolworths against the reasonable cost of repairing any damage to (inter alia) Store C which might be caused by any breach of its obligations thereunder. The Direct Warranty provided that its provisions were "... without prejudice to any rights or remedies which [Woolworths might] have against [HBM]... in tort ..."

Given the contractual duties which HBM owed to Woolworths, the physical proximity of the parts of Friars Square occupied by (1) HBM and (2) Woolworths and foreseeability that carelessness on HBM's part might cause damage to Store C, the existence of a duty of care on the basis of the hallowed statements of legal principle which are to be found in Lord Atkin's speech in Donoghue v Stevenson [1993] AC 562 at page 580, might be thought obvious. If a more sophisticated analysis is called for then, in my judgment, in the circumstances of this case, there was a sufficiently proximate relationship between HBM and Woolworths which would make it fair just and reasonable for the law to impose a duty of care in relation to HBM's activities at Friars Square. Alternatively, in the circumstances of this case, the nature of the relationship between HBM and Woolworths was such that the necessary elements of reliance on the part of Woolworths and assumption of responsibility for losses caused to Woolworths by carelessness on the part of HBM in carrying out its activities at Friars Square are readily discernable. Accordingly, in my judgment, in this case HBM owed common law duties to take reasonable care to prevent damage being caused to Store C after handover of the practically completed shell of Store C, which were concurrent and co-extensive with the contractual duties accepted by HBM under the Direct Warranty. Although it was not referred to in argument, I draw attention to the discussion of the applicable legal principles in Keating on Building Contracts (7th Edition) at paragraphs 7-32 to 7-35 (inclusive). This is, I think, a helpful and instructive discussion.

In summary, in my judgment, at all material times, after Store C had been handed over to Woolworths, HBM's common law duty to Woolworths was a duty to exercise all the skill care initiative and diligence to be expected of an experienced qualified and competent manager who knew it needed to act with due regard to Woolworths' interests, who occupied and controlled most of the Friars Square redevelopment and who was continuing to carry out the works it had agreed to carry out, to achieve overall practical completion. When considering how to go about its works after the handover of Store C, HBM had to consider and give due weight to the interests of Woolworths.

65. HBM had possession of Unit 21. HBM knew that Woolworths had taken possession of Store C in order to carry out internal fitting-out works. HBM knew that the Internal Wall was indeed an internal type blockwork wall. HBM knew that the front of Unit 21 remained open to the elements. In those circumstances, in my judgment, an experienced/qualified/competent management contractor acting with due regard to Woolworths' interests would take reasonable steps to protect the Internal Wall from possible exposure to driving rain and/or from a flow of rainwater from the mall into Unit 21 where, self-evidently, it might collect in the lower level channel area. In my judgment, there was no reason for HBM to expect Woolworths to proceed with its fitting-out works on the basis that they should be designed to accommodate intermittent water penetration from the uncompleted Unit 21 for some (unspecified) period of time, until the remainder of the re-development was completed.
66. HBM did not have possession of the Working Space from the time the hoarding was erected to delineate the boundary of the site given over to Woolworths until after the problem with the Amtico flooring was identified. Woolworths was in possession of Store C and the Working Space. There is no suggestion that HBM agreed to provide some sort of weatherproofed hoarding, (e.g. a roofed over hoarding which would divert rainwater away from the frontages of Store C and/or a hoarding with some sort of seal or channel at its bottom edge to prevent rainwater flowing over the mall towards these frontages) and, as I have already indicated at paragraph 43 above, I cannot see any possible basis upon which it could be suggested that a weatherproofed hoarding ought to have been provided by HBM. Furthermore, it must have been obvious to Woolworths that the Working Space and the frontages of Store C remained vulnerable to the weather. In my judgment, it was for Woolworths (not HBM) to provide the necessary temporary protection to its shop frontages (including the exposed screed edge once the screed had been laid) for so long as the hoardings remained in place. The allocation of ongoing responsibility for continued protection of the edge of Woolworths' screed after the hoardings were taken down may give rise to some debate but there is no need for me to go on and consider that in this case.
67. Given HBM's duty is as I have found it at paragraphs 64 and 66 above and the findings I have made at paragraphs 20 to 63 above, in my judgment HBM was in breach of its duty to Woolworths because it failed to take reasonable steps to protect the Internal Wall from exposure to the build-up of the rainwater which was found there and which must have found its way into Unit 21 from the mall area. Most of the particulars of negligence which Woolworths plead, and which I have set out at paragraph 9 above, identify very specific, alternative ways in which the duty which HBM owed might have been fulfilled. If, instead of providing protection against possible exposure of the Internal Wall to driving rain and/or to a flow of rainwater from the mall, HBM had elected to keep its multi-service gang on "continuous stand-by" it might have protected Woolworths' interests by prompt pumping out – see paragraphs 9(i) and (iv) above – but, protection of the sort envisaged at paragraph 9(iii) above would seem to me to have been the more logical approach to adopt if the flow of water from the mall was not simply to be kept out of Unit 21 altogether by, for example, constructing a bund of some sort. The existing/continuing breach of duty which is alleged at paragraph 9(ii) above seems to me to add nothing to the allegations at paragraphs 9(i), (iii) and (iv); the allegations at paragraphs 9(v) and (vi) concern the alleged consequence of these breaches of duty and do not constitute alleged further/separate breaches of duty.
68. Although I find that HBM was in breach of its duty to Woolworths, I am not persuaded that such breach or breaches of duty were causative of the failure of the adhesive which had occurred by 21st/22nd September 1992. In my judgment, for the reasons I have given at paragraphs 51 to 62 above, the amount of water which penetrated through the Internal Wall and into the floor screed was insignificant in comparison with the water which came directly from the mall via the unprotected screed edge beneath the shop frontages. To my mind, the fact that the adhesive was seen to have failed in the same way and to the same extent right across the front part of Store C demonstrates very clearly what was the real and effective cause of the problem. It follows that, in my judgment Woolworths' claim must fail.
69. If I am wrong in the conclusions I have reached in respect of the external source of water then, if Mr Shaw's analysis and conclusions were to be accepted, Woolworths' claim would still fail in its entirety. If, on the other hand, Mr. Pinfold's analysis and conclusions were to be accepted, Woolworths' claim would succeed to some extent because the satisfactory condition of the screed at the time the floor was laid would have been established and because water penetration from Unit 21 would have made a significant contribution to the damage. On that basis, HBM's pleaded contributory negligence defence would fail, but in his evidence Mr Pinfold did not state what contribution (in his view) water which came from "the Atrium Area" (which was what he called the mall area) made to the overall adhesive failure problem. In my judgment, for reasons already given, this water must have made much the greater contribution to the overall problem Accordingly, it would be necessary to make a broad assessment of the contribution which water penetrating the Internal Wall had made to the overall damage. Had I accepted Mr Pinfold's analysis (and therefore not assessed the overall contribution made by the water which penetrated from Unit 21 as negligible), I would have awarded Woolworths 15% of the totality of the potentially recoverable damages.

QUANTUM

70. The quantum of Woolworths' claim was agreed during the trial. Woolworths accepted that it could not support the loss of profits claim and reduced the total sum claimed to £123,119. Although this figure was agreed HBM made two submissions in relation to the quantum of Woolworths' claim –

(1) the claim to recover the remedial works costs failed, it was said, because Woolworths had not proved that it had paid for the original floor laying works. According to HBM the most that could be said was that payment could be assumed because there was no evidence of the contractor making complaint of non-payment. In my judgment, if that was indeed all that could be said, it would of itself suffice to establish, on the balance of probabilities, the fact that payment was made. But, that is not all that was said on this subject; there were other matters which provided support for the fact that payment was made.

At the beginning of his cross-examination Mr Stirling was asked whether Solum had been paid for the original works and he said he believed that it had been. He had no recollection of any outstanding monies. I accept his evidence. Furthermore, in his supplemental, witness statement, Mr Fisher gave evidence, which again I accept, concerning Woolworths' pursuit of its insurance claim. At a time that claim was being pursued full contemporary invoicing and payment documentation would have been readily available. If Woolworths had been withholding payment from the contractors (thereby reducing the losses it had suffered) that is a factor which I would have expected to see taken into account in the settlement of the claim. In my judgment, Mr Stirling's recollection taken together with the appropriate inferences that fall to be drawn from the absence of complaint of non-payment and from the terms of the insurance settlement provide ample evidence that the Contractor had been paid for the original work; and

(2) the total of £123,119 included £23,895 for the supply and application of the Tretabond waterproofing membrane. This had been applied to the screed as part of the scheme of remedial works. HBM contended that this sum should be disallowed on the basis of betterment. Woolworths did not agree. Miss Gough submitted that there was no reason for Woolworths to have applied a waterproof membrane as part of the original works. However, the need to execute the remedial works as quickly as was reasonably practicable after the screed had been saturated made this expenditure necessary to minimise the delay before the floor covering could be replaced and Store C made ready for trading. Assuming a breach or breaches of duty on HBM's part which were causative of the failure of the adhesive, it seems to me that Miss Gough's submission must be correct.

Accordingly, the total of the potentially recoverable losses sustained by Woolworths is £123,119.

THE PROPOSED RE-AMENDMENT

71. At the commencement of oral closing submissions, Miss Gough applied for permission to re-amend the Statement of Claim. The proposed re-amendments were a restricted version of the amendments which Judge Havery had refused to allow at the Pre-Trial Review 29th April 2003 – see paragraphs 12 and 13 above. At the conclusion of the argument I refused Woolworths permission to make any of the contested amendments. I said I would include my reasons in the Judgment when it was handed down. I do so – albeit briefly in view of the findings which I have now made.
72. I did not give permission for the reasons advanced by Mr De Freitas in Section 1 of his "Comments on [Woolworths'] Closing Submissions". In particular, I adopt as my principal reasons for the decision, the submissions made at sub-paragraphs (e) and (f) of those Closing Submissions. I prefer Mr de Freitas' submissions generally and those submissions in particular, to the submissions made by Miss Gough in support of the application which are at paragraphs 34 to 38 of "[Woolworths'] Closing Submissions". In addition, having now considered the evidence as a whole, I add an additional reason – the proposed re-amendments should not have been allowed because Woolworths could not possibly succeed in establishing liability on that basis – as to which, see paragraphs 43 and 66 above.

5th August 2003

(With typographical errors 6th August 2003)

COLIN REESE Q.C.