Farrell v Arborlane Ltd and Others

• Jurisdiction: Ireland
• Judge: Mr Justice Max Barrett
• Judgment Date: 09 July 2015
• Neutral Citation: [2015] IEHC 535
• Court: High Court
• Date: 09 July 2015

[2015] IEHC 535

THE HIGH COURT

Record No. 9550P/2007

Farrell v Arborlane Ltd & Ors

Between

SASHA FARRELL

Plaintiff

- AND -

ARBORLANE LIMITED, McGILL CONSTRUCTION LIMITED, THE NATIONAL HOUSE BUILDING GUARANTEE COMPANY LIMITED, ROWE McGILL ARCHITECTS, TIMOTHY ROWE, MICHAEL McGILL AND ANTHONY LAWTON OPERATING UNDER THE STYLE AND TITLE OF LAWTON AND ASSOCIATES

Defendants

Construction – Damages & Restitution – Delay in institution of proceedings – Balance of convenience – Conduct of defendant

Facts: Following the institution of proceedings for damages by the plaintiff against the defendants for alleged construction defects in the house, the seventh named defendant being the structural and civil engineer of the project now came to the Court seeking orders for dismissal of the proceedings against him on the ground of inordinate delay. The plaintiff alleged that delay occurred to find the relevant parties and the eventual liquidation of the first named defendant further complicated the situation.

Mr. Justice Max Barrett refused to grant an order for the dismissal of the proceedings against the seventh named defendant. The Court held that it had discretion to pass an order for dismissal of proceedings for want of prosecution provided it was likely to cause serious prejudice to the defendant amounting to a real risk of an unfair trial. The Court observed that any decision in that regard must be balanced against the interests of the plaintiff having regard to the delay prior to the issue of the proceedings and the conduct of the defendant. The Court found that the delay from issuance of notice to delivery of the Statement of Claim was explainable as it took time for the plaintiff to find the necessary parties and the matter was further deteriorated when the developer company went into liquidation. The Court found that the plaintiff in the meantime was searching for options to manage the defects of the house but in vain. The Court found that there was indeed an inordinate and inexcusable delay of more than five years in preparing the Statement of Claim; however, the balance of convenience lay in favour of the plaintiff. The Court held that it was within the knowledge of the seventh named defendant that complaints had started pouring in concerning the development and the possibility of him being drawn into litigation could have been contemplated easily.

1 JUDGMENT of Mr Justice Max Barrett delivered on 9th July, 2015.

PART I

KEY ISSUE ARISING

2 1. Where does the balance of justice lie between (a) a woman who paid for a new apartment and is having to endure cracked walls, ongoing water ingress and other continuing problems, and (b) a professional engineer who issued a document attesting to the compliance of the relevant apartment complex with the Buildings Regulations but who contends that to allow him to be sued over that document would be an affront to justice, given the elapse of time arising and the "greater than moderate" risk of prejudice to which he now purports to be exposed?

PART II

KEY FACTS ARISING

3 2. Mr Lawton is a chartered engineer and the seventh-named defendant in the within proceedings. The proceedings themselves concern a development known as "The Ramparts", at Loughlinstown, County Dublin. The developer of "The Ramparts" was Arborlane Limited. McGill Construction Limited appears to have been the builder. The other defendants acted as architects and lead consultants on the project. Mr Lawton was retained by Arborlane to act as a structural and civil engineer on the project. The development was designed in 1998-1999. Mr Lawton's involvement in the project concluded in November 2000, at which time he issued Arborlane with an attestation as to the compliance of the development with the Building Regulations. It is useful to quote from the text of this attestation, the relevant portion of which reads:

"This Opinion relates to a five-storey development at The Ramparts. Loughlinstown, Co. Dublin...."

4 I, Anthony Lawton…hereby certify that Lawton Associates carried out the structural design of the above mentioned development and that, subject to normal engineering theory and practice, the design is in substantial compliance with Part A of the Building Regulations 1997.

5 It is the responsibility of the Main Contractor to ensure that the construction of the works complies with the drawings and specifications and the standards of construction required by the Building Regulations.

6 The construction work was monitored by cm Engineer on site employed by the Client, and by site visits by Lawton Associates during construction. Any work inspected by Lawton Associates was in our opinion being constructed generally in compliance with our drawings and specifications. Lawton Associates were responsible for integrating within the overall design of the works the design of such parts as were designed by specialist suppliers and/or sub-contractors and the above opinions are subject to the design of such parts and of all proprietary products meeting the requirements of the performance specifications.

7 The above opinions are issued solely for the purposes of providing evidence of the substantial compliance of the works with the Building Regulations at the above date. Except in so far as it relates to compliance with the Building regulations it is not a report or survey on the physical condition or on the structure of the building of which the works form part."

8 3. Completion of "The Ramparts" happened sometime in late-2000 or early-2001. The present case concerns an apartment in the development, No. 99, which Ms Farrell appears to have purchased sometime in 2002. By the time Ms Farrell came to purchase the apartment, Arborlane had already started receiving complaints from various residents of "The Ramparts" about various deficiencies in their apartments; these included water ingress and cracking. Consequent upon these complaints, and subsequent complaints from Ms Farrell, Arborlane carried out a number of remediation works over the years 2001-2009. It appears that the third-named defendant (which operates the 'HomeBond' scheme) inspected the development at some point during this period and decided that the defects arising were non-structural and thus did not come within the scope of the cover it provides.

9 4. All of the remedial works done by Arborlane were carried out at its own expense, and it appears that there was no suggestion by Arborlane that Mr Lawton was responsible for any of the cost arising. Mr Lawton was aware that residents in the development had complaints about the development from a point in time after completion. However, by his own account, he understood that Arborlane was accepting responsibility to accept the defects and did not understand that his own work was being called into question. Be this as it may, as an experienced professional gentleman and as the author of the above-quoted attestation as to compliance of the apartment complex with the Building Regulations, Mr Lawton must have contemplated the possibility that he could be drawn into any legal battle that might yet ensue; and he might, perhaps not unreasonably, be accused of a certain misplaced optimism if he did not.

10 5. In September 2007, the Ramparts Residents' Association commissioned a structural engineer's report from Horgan Lynch Engineers. Horgan Lynch concluded that such water penetration and cracking as had occurred were largely the result of inadequate detailing and poor construction. In July 2009, Arborlane went into liquidation.

11 6. When it comes to the within proceedings, the summons issued in December 2007 and was served in October 2008. Although other residents in "The Ramparts" have issued like proceedings, in none of these has a Statement of Claim yet been delivered. The present case thus represents the most advanced of all of these cases. An appearance was entered for Mr Lawton in November 2008 and a Statement of Claim requested. Thereafter, no steps were taken by Ms Farrell until May 2010 when a notice of intention to proceed was filed. This notice was served on Mr Lawton in August 2011.

12 7. By letter of February 2012, Ms Farrell's solicitors stated that they were in the process of finalising a Statement of Claim and would be delivering it shortly. They also gave some indication of Ms Farrell's continuing woes, stating:

"We enclose as promised copy photographs showing the damage to 99 The Ramparts as it stands at the moment....[T]his is a two bedroomed apartment. One of the rooms is uninhabitable. It is let. One of the tenants ? has left because of the condition of the bedroom which is virtually uninhabitable thanks to the water penetration and dampness....These problems must be addressed."

13 8. What is perhaps most notable about this letter is that while it waves the 'big stick' of litigation, it seems quite clear that even at this stage Ms Farrell is really seeking that someone remedy the deficiencies affecting Apartment No. 99. It would not be the first letter written by a solicitor in which rumblings about continuing litigation are made but the implicit thrust of the letter is to seek some sort of practical resolution to matters, notwithstanding the mention of litigation.

14 9. By letters of May 2012 and June 2013, Mr Lawton's solicitors called on Ms Farrell to discontinue the proceedings. By letter of July 2013, Ms Farrell's solicitors stated that they were preparing a Statement of Claim. Of passing interest in this regard is the observation of Ms Farrell's solicitors that:

"[T]he problems that gave rise to the proceedings in the first place are continuing and if anything have deteriorated to the point that some of the units owned by our clients are uninhabitable and currently remain unoccupied."

15 10. The...