McGee and Another v Alcorn and Another

• Jurisdiction: Ireland
• Judge: Ms. Justice Iseult O'Malley
• Judgment Date: 05 February 2016
• Neutral Citation: [2016] IEHC 59
• Court: High Court
• Docket Number: [2012 No. 11486 P]
• Date: 05 February 2016

BETWEEN

KEVIN McGEE and GRIT McGEE

PLAINTIFFS

AND

MARK ALCORN and MICHAEL FRIEL TRADING AS MICHAEL FRIEL ARCHITECTURAL DESIGN AND SURVEYING

DEFENDANTS

[2016] IEHC 59

[2012 No. 11486 P]

THE HIGH COURT

Tort – Damages & Restitution – Negligence – Quantum of damages – Duty of care – Defective construction of house – Damages against third party

Facts: The plaintiffs sought an order for damages against the second named defendant for economic loss arising out of a negligently constructed dwelling home built by the first named defendant for which the technician's certificates were issued by the second named defendant. The second named defendant while admitting negligence on his part alleged that he was not liable for the loss as he was not a party to the contract of sale entered into between the first named defendant and the plaintiffs. The second named defendant asserted that the damages for pure economic loss could not be recovered from him as the plaintiffs had pleaded negligence and not the negligence misrepresentation.

Ms. Justice Iseult O'Malley awarded pecuniary damages to the plaintiffs for the distress and inconvenience caused to the plaintiffs in carrying out the necessary repairs and expenses incurred for the repairs made. The Court also awarded damages reflecting 25% diminution in the value of the house. The Court, however, refused to award the damages to cover the extensive works carried out in the house as those were excessive and unreasonable. The Court found that the statement of claim and replies were sufficient in the present case to make a case for negligent misrepresentation and thus, pure economic loss was recoverable. The Court observed that the Court while awarding damages based upon the costs of reinstatement or the diminution in value of the house must have regards to the reasonableness of the plaintiff's desire to reinstate the property. The Court held that the second named defendant while supplying compliance certificates to the builder was aware that the same would be utilized by the prospective buyer to form an opinion to purchase the house and thus, there existed a duty of extreme care on the part of the second named defendant towards the purchasers as he held himself out as a professionally qualified person to issue certificates in relation to the quality and construction of the house.

JUDGMENT of Ms. Justice Iseult O'Malley delivered the 5th day of February 2016.

Introduction

1 The issue in this case is whether or not the plaintiffs are entitled to recover damages from the second named defendant for economic loss in relation to a negligently constructed dwelling-house. The claim is in respect of the cost of works done to date and further works proposed to be carried out, including the cost of alternative accommodation during the proposed works. There is also a claim for damages for emotional suffering and distress.

2 The primary basis for the claim against this defendant, who is an architectural technician, is that he issued certificates stating that he had inspected the construction, that the foundations of the house were satisfactory, and that the ground conditions for the foundations were suitable. It is common case that the foundations were in fact unusually defective and that they were laid in unsuitable ground.

3 The defendant has admitted negligence on his part. However, he says that he has no liability for any loss suffered by the plaintiffs. This is based, firstly, on the argument that the cause of action pleaded against him is negligence, and that damages for pure economic loss cannot be recovered in a negligence action.

4 Secondly, he contends that in any event his relationship was with the first named defendant (the builder) and that he had no duty of care to the purchasers of the house.

5 Thirdly, issue is taken with the extent of the damages claimed, on the basis that the proposed works (as opposed to works already carried out) are necessary only from an aesthetic point of view and will entail a cost that is disproportionate to the value of the house.

Background facts

6 The plaintiffs are a married couple with three young children. They lived abroad for some years and moved to County Donegal in 2008. The first named plaintiff is a self-employed mechanical engineer. His family are from the area and his parents owned a company which had initially engaged in construction but had come to specialise in monumental headstones. The plaintiffs took over as directors of this company at some stage after coming to live in the county. The second named plaintiff is a teacher.

7 The first named defendant is a builder. By contract dated the 8th July, 2008, the plaintiffs purchased a new house that he had built. (This defendant has left the jurisdiction and judgment in default has been marked against him.) The purchase price was €430,000.

8 The house is sizable, being some 16.3 metres in length. A conservatory on the western end brings the total length to 21 metres. It is clear that the plaintiffs have taken great care in its upkeep, and that both the house and garden are extremely well maintained.

9 Although impressive in appearance, the house was built upon a bizarrely defective foundation. For some reason, the first named defendant constructed the foundation in the shape of a rough V, tapering to a point at the bottom. Two bow windows at the front of the house were not supported at all and simply rested on the ground.

10 To compound the problem, the soil in which the foundations were laid was not suitable, being in part ‘made up’ or ‘filled’ ground.

11 The second named defendant is the holder of a technician's certificate in architecture. On the 9th April, 2008, he issued two certificates. One is headed ‘Certificate of Supervision’. In this document he confirmed that he had been employed in the erection of the house during the various stages of construction, and that he had inspected the progress of the work at various stages including the opening and pouring of foundations. He certified that:

‘… the foundations were satisfactory at the time of pouring and that the ground conditions were suitable for the laying of such foundations in respect of the property.’

12 He also certified that good building materials and workmanship had been used throughout and that the property was structurally sound and in accordance with good practice. He attached a copy of his professional insurance indemnity.

13 The second certificate is headed ‘Certificate of Compliance’. In this document the second named defendant confirmed that he had been retained by the first named defendant to inspect the house. He stated that in his opinion the construction of the house complied substantially with all of the applicable Building Regulations.

14 Over the course of 2009 cracks began to appear in the house. These became more serious, and ultimately substantial works were carried out in 2012 (for a cost that is agreed at €129,000) to underpin the foundations. The house is now completely structurally sound and safe. However, it has been left with a permanent tilt. The plaintiffs wish to remedy this by further extensive works which will cost in the region of €277,000. They say that this is required to make the house ‘ right’, in terms of what they bought.

15 The case as pleaded against this defendant claims damages for negligence, breach of duty and breach of statutory duty. The statement of claim alleges in paragraph 2 that he was at all times the supervising architect in relation to the property, and that he provided both a certificate that the relevant works were carried out in accordance with the Building Regulations made pursuant to statute and a certificate that the foundations were satisfactory.

16 The particulars pleaded are as follows:

‘(a) Failing to superintend the construction of the said works properly or at all.

(b) Failing to take any or any adequate steps to ensure that the said building work would comply with Building Regulations and ensuring that the building was in compliance with the said regulations.

(c) Failing to adequately and/or appropriately inspect the building and the works as carried out.

(d) Failing to provide adequate and appropriate plans specific to the requirements of the construction of the said dwelling house.

(e) Failing to ascertain the remedy to the problems that had arisen in the said dwelling house.

(f) Failing to heed or observe the defects or faults hereinbefore referred to.

(g) Failing to instruct the first named defendant to remove or remedy the said defects or faults.

(h) Failing to give any or any adequate instruction for opening up for inspection any of the said works.

(i) Approving the said works, including the said defects and faults.

(j) Acting or omitting as aforesaid, issued the final certificate and when they knew or ought to have known of the said defects or faults.

(k) Failing adequately to detail or design the said works.

(l) Certifying the said works when not correct and in particular certifying that the foundations were satisfactory at the time of pouring and that the ground conditions were suitable for the laying of such foundations in respect of the property.’

17 A notice for particulars from the solicitors for the second named defendant requested, inter alia, clarification as to whether the plaintiffs were claiming that they were owed a duty of care by that defendant with regard to the construction of the property; particularisation of the matters relied upon in support of the pleading that he owed them a duty of care; and clarification as to the basis upon which the plaintiffs were relying on the two certificates issued by him. The response to these queries was that, as this was a new build, the plaintiffs had relied upon the certificates as provided by the second named defendant.

18 In his...