DEPUTY DISTRICT JUDGE DEAN:
- This claim has been brought by the Claimant, British Telecommunications plc, under section 82(1) of the New Roads and Street Works Act 1991. That section is headed "Liability for Damage or Loss Caused", and subsection (1) says, as far as relevant:
"An undertaker shall compensate— ... (b) any other person having apparatus in the street in respect of any expenses reasonably incurred in making good damage to that apparatus, as a result of the execution by the undertaker of street works".
It also refers to certain events, listed in subsection (2), that are not relevant in this case.
- Definitions relevant to section 82 are found in section 48(1), which provides that a "street" includes a "footway", and also in section 96(1), which provides:
"Any provision of this part enabling an authority, body or person to recover the costs or expenses of taking any action shall be taken to include the relevant administrative expenses of that authority, body or person including an appropriate sum in respect of general staff costs and overheads."
- It seems to me that the terms of section 96(1) go beyond the ordinary pounds-and-pence measure of loss on which courts often embark, and that any such losses should be calculated in line with the guidance in the case of British Communications plc v Bell Cable Media (Leeds) Ltd [2001] B.L.R. 343, to which I have been referred. That is the case relied on in the relevant witness statement adduced by the Claimant to set out the basis of the calculation of its losses.
- This is a small claim and the parties by agreement have called no live evidence at this trial. I bear in mind the terms of Part 27 of the Civil Procedure Rules. In particular, rule 27.8(3) provides that the strict rules of evidence do not apply to the hearing of a small claim, although of course the ordinary rules on the burden and standard of proof do apply. Any party making an assertion or allegation must prove it, and the Claimant has the overall burden to prove all necessary elements of its claim. The standard of proof is the balance of probabilities: in other words, whether on the evidence an assertion is more likely than not to be true.
- I have a bundle running to 255 pages, and two very helpful skeleton arguments (and I record my thanks to both counsel, Mr De Silva K.C. and Mr Myers, for their written and oral arguments). In advance of the trial I read the pleadings, the four witness statements and the two skeleton arguments. Through the course of the trial, I was taken in submissions to other documents which were considered to be relevant. I had looked through them prior to the trial but, owing to limited preparation time, I had not read them in detail and the advocates were made aware of that. I take into account all that I have read, been taken to, and heard. I cannot in this judgment, delivered orally at the end of a relatively short hearing listed for three hours on some quite complicated matters, refer to all of it in detail.
- The Claimant's case is that on some date the Defendant, Anglian Water Services Ltd installed water apparatus in the street outside 13 Green End Road, Sawtry, in Cambridgeshire.
- Underneath Green End Road lies the Claimant's earthenware duct, which is a hollow cylindrical tube containing communication cables. There is an image in the bundle at page 232. That image, which I originally saw in black and white, but in the course of the trial saw in colour (which is far more helpful), shows the duct with a break in it. The duct is red or orange in colour. I am told it is ceramic, and the image is consistent with it being ceramic. Between the two parts of the broken duct are a number of cables. I can count three or four, but there is earth between them and there may be more.
- Next to the duct is an object. At the street level there is a cap on that object, which is a grey colour and is circular. The object appears from the photograph to protrude into the ground. There is, underneath some of the earth, what was described in oral argument as a "white bit". In black and white it was not clear to me what it was, but in the colour image I can see, and I find, that it is part of the apparatus of which the grey circular part is the cap. I make that finding given what I will come onto in a moment about the evidence of what it is and how it was put there, but also because it seems to me that there would be little point in there being a piece of apparatus that is simply a grey cap at street level with nothing underneath it (in which case there would be no need to have a cap there at all).
- The Defendant says that it is not sure what this piece of apparatus is. To resolve that I must consider the evidence. Amongst other documents is the Claimant's internal damage report at pages 234 and 235. At the top of page 235 the apparatus is described as a "water pillar".
- Helen Hunt, the operations manager at OpenReach, says in written evidence adduced by the Claimant that blockages were found when new cable was being laid between the duct and that, after investigation, damage was found at the site of this object. I can see in the images that the damage to the duct abuts the object. Taken together, it seems to me on the balance of probabilities that this was indeed water apparatus.
- The Defendant relies on a witness statement made by Julie Hyne, the insurance claims manager for the Defendant. At paragraph 6, Ms Hyne says:
"The Claimant has alleged that the damage to their apparatus was caused by AWS [the Defendant] during their works at the property prior to 15 July 2020. [It is said in the damage report the date that the damage was discovered.] They have stated a water pillar was found through their underground ducting. The photographs are not clear, so it is impossible to discern what has gone through the cable. If, which is denied, it is any apparatus belonging to us, it would be a water meter boundary box, which we often refer to as a 'BB Box'".
- Notwithstanding the equivocal language, and I make no finding about what might stand behind that equivocal language, that is evidence from the Defendant's witness that, in light of the object's appearance and location, it could be water apparatus. When I couple that with what was reported originally, and bear in mind that there is nothing to suggest through other evidence that during repair or any other stage of the matter something else was installed, that this was in fact a boundary box.
- There is reference in the papers and in the Defendant's records to an event in 2013 when work was done by the Defendant removing the contents of the boundary box and replacing them. I agree, I think with both parties but certainly with the Claimant, that that is a red herring because replacement of the contents of the apparatus would not have involved any change to the arrangement of its installation within the street.
- The Defendant says that all of this is speculation, but in fact, in my judgment, it is the result of taking together all of the evidence and drawing inferences from it, and determining from that evidence what is more likely than not to be true. If my finding is wrong then that would require the original damage report to have been factually incorrect. When the repair was undertaken there was no evidence to suggest that the repairer discovered this was not a piece of water apparatus. In other words, there was nothing that required the correction of an earlier false impression.
- The Defendant points to documents which it says cause a break in the link between the report of the damage and the repair undertaken but, in my judgment, they do not have that effect. Some of those documents refer to house or address numbers on Green End Road. One states that the repair, or the duct, was "from number 11". Other annotations start with "O/S" or "015", depending on how one reads the handwriting. In my judgment, the correct interpretation is "O/S", meaning "outside", given the context and also the way it is written on page 27 where the middle line is far more diagonal. "O/S The Bell" therefore indicates outside "The Bell" (presumably the name of a building); there is no reason to add a leading zero to a street number and the road in question is Green End Road, not a road called The Bell. (I add incidentally that if I am wrong about my interpretation of "O/S" and in fact it is "015" then the effect would be that the documents refer to a repair "from number 11" to "outside number 15". In my judgment, it does not take an enormous leap of logic to identify that that would place number 13 right at the site of the repair.)
- The lack of labelling of some of the diagrams that have been supplied from the Claimant's internal documentation, or alternatively the contractor's documentation, does not assist one way or the other in my judgment.
- Turning to the timing, we know from the Defendant's records that this water box was not installed after March 2005 because there are installation records April 2005 onwards and it does not appear in those. I accept that the Defendant has undertaken a complete and full search of its records; and that point obviously was not challenged given that no oral evidence was required.
- In argument, there was some discussion about evidence, or lack of it, about what the Defendant's obligations were in this area, and what its functions were as a water authority. I note in paragraph 14 of Ms Hyne's statement that she refers to computerised maps of assets which confirm that "… our water main was installed prior to our assets being digitised in April 1995". I note the word "our" and I take from that that the Defendant has a water main in that area and has had since a date before 1995.
- There were also questions raised about the owner of the box and who installed it. The Defendant suggests that it could have been a developer. In my judgment, that is speculation. The Defendant, of course, will answer, "Well, it is all speculation"; but it is in the street, and I can see it is in the street, if only from the images showing the damage to the duct.
- I also take into account the other images in the file. The Defendant asks, rhetorically, when and where they were taken and how the court can know whether they are relevant or show the right area. They are exhibited to the witness statement of Ms Hunt, who is the operations manager in the network repair team for the Claimant. There is no reason of which I am aware why she would be exhibiting, in a signed witness statement that she places before the court, images that are entirely irrelevant to the disputed matters in this claim. I do not think the Defendant is suggesting Ms Hunt has deliberately put irrelevant material before the court or alternatively that she provided those documents without having any regard to their provenance. That would have been a reason to have Ms Hunt attend to be cross-examined, but she was not required.
- What we know is that the Defendant had a water main in the area, and I have found that this object was water apparatus. There is no evidence of another water operator in the area.
- The burden is not on the Defendant to disprove the claim against it, but on this point it would have been easy for the Defendant to have put forward information about another water operator in the area, either now or at some earlier date, and it has not done so. For the avoidance of doubt, it is not my decision that simply because the Defendant has not put that evidence forward that therefore it is its apparatus, but it is a factor that I bear in mind when I look at all the evidence as a whole. Taking that evidence as a whole, on the balance of probabilities, in my judgment, it is more likely than not that this was the Defendant's water apparatus, installed by the Defendant.
- Similarly, on the balance of probabilities, I find that it is more likely than not that the duct was disturbed and damaged by the box. That was the clear impression of the first reporter when the damage report on page 235 was completed.
- The Defendant argues that the phrase under "Evidence of Responsibility" is ambiguous. That phrase reads as follows:
"Photos.
Water Pillar has been installed in route of BT earthenware."
- I accept that on one reading, which in my judgment is less likely to be the correct reading, that could suggest that there is already a water pillar in the route of the earthenware that was later laid or being laid. I also accept that on the previous page (page 234) the phrase "Cause of damage is excavating" is also ambiguous. It could mean, as the Defendant contends, that it was the Claimant's own excavation, undertaken as part of the operation to replace what was inside the duct, that caused the damage; but it could also mean that the excavation to place the boundary box is what caused it.
- I have to look at all of the evidence, and not simply rely on one or two ambiguous points. I take into account what I see in the photographs. I take into account the original impression of the reporter, set out above, which the Claimant did not later have cause further to investigate or correct.
- If the Claimant itself had done the damage then, first, it would be a remarkable coincidence that it happened to be digging exactly in the area of the water box; and, secondly, it would mean that the Claimant is effectively presenting a false or fraudulent claim against the Defendant, because the Claimant itself did the damage. Such damage is excluded from the section 82 recovery provision by subsection (4):
"... liability under this section does not extend to damage or loss which is attributable to misconduct or negligence on the part of ... the person suffering the damage or loss, or any person for whom he is responsible ..."
It would also mean that the witness evidence, which after all was unchallenged, about the circumstances of the discovery of the damage (that new cable was being fed through the duct, a blockage was found and, on investigation of the blockage, damage was found next to the water box) is false.
- The duct was alongside the box. It runs along the length of the street, and there is damage at the point that it met the boundary box. In my judgment that would be an incredible coincidence if there were no correlation. As I say, I am trying not to take any individual indicator alone, but to take account of the evidence overall.
- I find on the evidence overall that the damage did occur to the duct in execution of street works concerned with the installation of the Defendant's apparatus, by the Defendant. That is, in my judgment, the more likely reality. That is notwithstanding the fact that the Claimant could have helped itself a bit more by adducing some further evidence that put that question beyond doubt, such as a photograph of the top of the cap with the earth brushed off it to demonstrate whose cap and apparatus it was; but that was an opportunity for further evidence – I have made my decision on the evidence before the court.
- As I turn to the question of quantum, I am wary of the time. (This judgment, delivered orally, has already taken the court past 1 p.m.)
- The calculations undertaken by the finance manager of the Claimant, Frances Fraser-Reed, mirror the approach endorsed by the High Court in BT v. Bell Cable, to which I referred earlier. I accept that on an initial reading there was some opacity about the calculations, but I do accept what is said in Ms Fraser-Reed's statement. Having reviewed it further in the time I have had to consider my judgment, and also having been taken through it by Mr De Silva, I accept that it does adhere to the High Court's guidance.
- Further, I accept that section 82, when read with section 96, permits recovery of overhead costs. I am not going to overburden this already relatively long judgment with a recitation of the calculations in Ms Fraser-Reed's statement, but I accept what she set out there.
- On the question of contractors, I do not accept the contention that there is no overhead cost associated with that form of work. On this point I have taken into account, in particular, paragraphs 12 onwards of Ms Fraser-Reed's statement, as well as the other bases of the calculation. So, subject to the limitation point which I will deal with at the end of this judgment now, I would award the Claimant the sum claimed.
- On limitation, the Defendant advances a limitation defence and argues that the claim is time-barred by statute. It is agreed by both parties that section 9 of the Limitation Act 1980 applies. Subsection (1) provides:
"An action to recover any sum recoverable by virtue of any enactment shall not be brought after the expiration of six years from the date on which the cause of action accrued.
- I was taken on behalf of the Claimant to Yorkshire Electricity Board v. British Telecommunications plc [1986] 1 WLR 1029, in which the leading opinion was given by Lord Bridge of Harwich. That case related to the Public Utilities Street Works Act 1950, but that legislation included, at section 26(6), a strikingly similar provision to the one in section 82(1) of the 1991 Act:
"Operating undertakers shall pay to owning undertakers compensation equal to the expense reasonably incurred by the owning undertakers of making good damage to apparatus of theirs to which this section applies which is caused by the execution lawfully of works to which this section applies of the operating undertakers ..."
It is so similar that the most recent edition of Clerk & Lindsell on Torts refers to the case, by clear implication, as still being good law as against the provisions of the later 1991 Act.
- The key section of Lord Bridge's opinion in Yorkshire Electricity is at page 1032F:
"Confining attention to the enacting words, it seems to me that a statutory cause of action created by a requirement that A 'shall pay' a sum of money to B accrues when and not before the obligation to pay arises. If the words 'compensation equal to the expense reasonably incurred ... of making good damage' refer to a sum of money and indicate how it is to be calculated, then, on the face of it, I find it difficult to understand how the obligation to pay that sum of money can arise until the event has occurred which enables the amount payable to be calculated. ... At the moment I say no more than the enacting words appear to me, in their ordinary meaning, to create a cause of action which first accrues when owning undertakers reasonably incur the expense of making good damage to their apparatus."
Later, at page 1040G-H, the learned judge said:
"The only possible effect, in my opinion, is to create a statutory cause of action accruing when the expense is incurred."
- The Defendant argues that this is not applicable to the situation before the court today, because it is a different statute – although I do not consider that in itself to be dispositive – and Parliament changed the language from "equal to" to "in respect of".
- In my judgment, that is a distinction without a difference as a matter of construction. Both refer to a compensatory measure.
- The Defendant argues that the phrase "in respect of" is different to the phrase "equal to" and it is somewhat broader, at least in one direction, because it could, for example, refer to future loss. It is only possible, argues the Defendant, to work out the measure of compensation "equal to" what is expended once it has already been expended; but "in respect of" can refer to future loss. Further or alternatively, the Defendant argues that "in respect of" could indicate a total less than the sum equal to the expense, or the reasonable expense.
- On the future loss point, at page 1032F of Yorkshire Electricity (quoted above) Lord Bridge identified that it is the phrase "shall pay" which causes the obligation to pay to arise at the point at which the expense is incurred, rather than the phrase "equal to". In any event, the court is hardly likely to award a sum different to the expense reasonably incurred. In my judgment, in this context, the measure under "equal to" and the measure under "in respect of" are the same.
- That conclusion is also consistent with the consideration in the case of Yorkshire Electricity of different formulations of wording, including at page 1033B, where Lord Bridge referred to:
"numerous provisions in the Act of 1950 which require undertakers to pay to other undertakers or a public authority 'an amount equal to the cost reasonably incurred' ... There are some minor variations of terminology but common to all these provisions is the use of the phrases 'amount of' or 'amount equal to' and 'cost reasonably incurred'."
The learned judge noted differences in the wording of sections 18 and 19 of the 1950 Act, with slightly broader language in the latter, "explained by the additional liability imposed" explicitly by its terms (page 1034D-E); but he found that the words of both were such "to create a liability which can only arise when the relevant expense has been incurred" (page 1034F-G). He rejected the Court of Appeal's interpretation of the word "compensation" as creating an "absolute" measure of liability, in contrast to provisions which used the words "amount of" or "amount equal to" (page 1035A-C).
- In rejecting the Court of Appeal's interpretation of section 26(6) of the 1950 Act that "the cause of action accrues when the damage occurs", Lord Bridge said this at page 1038F-H:
"A judgment for damages to be assessed is, of course, a commonplace of litigation, especially in actions for damages for negligence in respect of damage to persons or property. But in any such case the plaintiff who obtains such a judgment is already entitled to recover damages and if the court were asked to quantify those damages it could always do so immediately even though this would involve looking at the future as well as the past and estimating the effect of future contingencies. But owning undertakers who obtained judgment after damage was caused to their apparatus but before it was made good would be in no position to quantify their entitlement by the only measure the enactment provides, i.e. the expense reasonably incurred of making good the damage. It is not suggested that owning undertakers would be entitled to have that claim quantified by reference to an estimate of expenditure to be incurred in future and it is, as stated earlier, accepted that, if the damage is never made good, nothing will ever be payable by the operating undertakers who caused the damage. ... the concept of a judgment finally determining liability in favour of a plaintiff who may in the event be entitled to recover nothing from the defendant is surely unacceptable."
- For those reasons, it appears to me that the decision of the House of Lords in Yorkshire Electricity supports the Claimant's argument in this case and the rationale applies to section 82(1) of the 1991 Act as much as it did to section 26(6) of the 1950 Act. In my judgment, that decision binds me in this case.
- The Defendant argues that the interpretation that I have found to be accurate – or, rather, that the House of Lords in Yorkshire Electricity found to be accurate – means that it could be a very long time between damage being done and the Claimant discovering it such that it then undertakes the repair and incurs the expense of that. That might be so, but I have to give effect to the statute, and Parliament's choice about that. Parliament in section 82 of the 1991 Act, and in the precursor provisions including section 26 of the 1950 Act, chose to provide a cause of action that arises at the point identified in Yorkshire Electricity. Presumably Parliament is, and was when enacting the 1991 Act, constructively aware of the interpretation given by the House of Lords to the relevant wording, and Parliament has not amended it in the years since. In any event, it is not an absurd result, given the long-lasting nature of utility companies and their apparatus. The Act creates a clear structure of obligations and rights against each other of which they are all aware.
- I am further fortified my conclusion on this point by considering the case of Southern Gas Networks v. Thames Water Utilities [2018] EWCA Civ 33, where at paragraphs 45 and 50 the Court of Appeal described section 82 of the 1991 Act as having been "introduced to replace section[s] 18, 19 and 26 [of the 1950 Act]; and, to that extent, was a consolidation provision". Accordingly, regarding the language of "equal to" and variations of it, in that case the Court of Appeal held that section 82 replaced all three of those sections, which, as considered in the Yorkshire Electricity case, contained varying phrases but referred to the same measure of loss.
- The Defendant has put forward cases including Pirelli General Cable Works Ltd v. Oscar Faber & Partners [1983] 2 AC 1, but they relate to the limitation period for claims in negligence arising out of building construction and not under the 1991 Act. Indeed, on my reading of the case of Yorkshire Electricity, the Pirelli case was considered but distinguished: potentially, two causes of action had been available, but it was admitted that the one in tort was out of time, so the only one falling for consideration by the House of Lords (and the lower courts) was that offered by the 1950 Act. That indicates that the former, about which Pirelli is authority, is not the same as the latter. I quote from Lord Bridge's summary of the background at pages 1031H and 1032A of Yorkshire Electricity:
"A preliminary issue was ordered to be tried as to whether the board's claim was statute barred. The board had to concede that their claim in tort was statute barred, since their cause of action accrued when the physical damage to the cables was done: Pirelli General Cable Works Ltd v. Oscar Faber & Partners [1983] 2 AC 1. The question in this appeal is whether a cause of action under section 26(6) of the Act of 1950 accrues as soon as damage is done to statutory undertakers' apparatus or only when the undertakers incur the expense of making it good."
- For all those reasons, it is my conclusion that Yorkshire Electricity continues to be binding on me in interpreting section 82 of the 1991 Act, and I follow it.
- So, in my judgment, the cause of action arose when the Claimant incurred the expense of making good the damage. The claim is therefore in time.
- Given my findings, there will be judgment for the Claimant in the sum sought.
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