Scottish Court of Session Decisions

 

OUTER HOUSE, COURT OF SESSION   [2007] CSOH 20
A5093/01	OPINION OF LORD WHEATLEY   in the cause   K2 RESTAURANTS LIMITED   Pursuers;   against   GLASGOW CITY COUNCIL AND OTHERS   Defenders:     ­­­­­­­­­­­­­­­­­________________

 

Pursuers: McGregor; Dundas & Wilson, C.S., LLP

First Defenders: Dunlop; Balfour & Manson, W.S. (For Hennessy Bowie & Co, Glasgow)

 

2 February 2007

 

[1] The pursuers are a company incorporated under the Companies Acts and have a place of business at 235 North Street, Glasgow. The first defenders are Glasgow City Council, a local authority constituted under and in terms of the Local Government Etc (Scotland) Act 1994 and having its headquarters at the City Chambers, George Square, Glasgow. Originally a company called CMI Demolition Ltd, which was incorporated under the Companies Acts and had its registered office at Paxton House, 11 Woodside Crescent, Charing Cross, Glasgow were brought into the action as second defenders. However, I was advised that these defenders were no longer part of this process. On 21 December 2005 the Court interponed authority to a Joint Minute and assoilzied the second defenders from the conclusions of the summons.

[2] The circumstances leading to the pursuers' claim were as follows. In August 1994 the pursuers were the owners of restaurant premises at 225/235 North Street, Glasgow. These premises formed the ground floor of a four storey tenement block. The first, second and third floors of the tenement were in a state of disrepair. As a result, on 17 August 1994 the first defenders served a notice under and in terms of section 13 of the Building (Scotland) Act 1959, as amended, requiring that the owners of 229 and 235 North Street carry out reinstatement works, failing which the defenders would execute the demolition of the tenement building down to the first floor level. Apparently further notices were served (presumably in similar terms) on the pursuers in September 1994 and June 1995. No reinstatement works were carried out by the owners of the tenement (which included the pursuers) and as a result the first defenders obtained an order under section 13(4) of the 1959 Act as amended to carry out the demolition of the tenement with the exception of the pursuers' ground floor premises.

[3] In June 1996 the first defenders contracted with the second defenders to carry out the demolition work at 229/235 North Street. It took about ten weeks to complete the demolition of the three levels above the pursuers' premises. The demolition exposed the former mutual gable at the first to third levels which had previously separated numbers 235 and 237 North Street and which thus became an external gable wall. Following completion of the demolition works, the first defenders carried out an inspection of the gable wall. On 1 October 1996, the proprietor of the ground floor premises at 239 North Street wrote to the first defenders expressing his concern at the state of the repair of the upper floors at 237/239 North Street, and requested that a notice under section 13 of the 1959 Act be served by the first defenders upon the heritable proprietors of those upper floors. Thereafter, on 6 November 1996 in adverse weather conditions, a portion of the brickwork forming the gable wall and chimney flues was blown down. The brickwork collapsed through the roof of the pursuers' premises, and the pursuers aver that they suffered loss and damage. The pursuers aver further that the exposed gable wall prior to the collapse was clearly in an unsafe state and was manifestly liable to collapse. This it is said was plainly evident upon a visual inspection.

[4] In essence the pursuers divide their case of negligence against the first defenders into two parts. First of all they aver that the first defenders had duties of reasonable care to ensure that the demolition works were executed and completed in a reasonable and safe manner, and to leave the remaining gable wall in a safe state, having regard to the protection of property adjacent, including that belonging to the pursuers. They were also under a duty of reasonable care to inspect the condition of the buildings adjacent to the building which had been demolished.

[5] The second set of duties averred by the pursuers against the first defenders relate to the period after the demolition had been complete. The pursuers aver that the first defenders knew or ought to have known that the former mutual gable wall was exposed and unstable. They knew or ought to have known that there was a material risk of the gable wall or part of it collapsing or otherwise becoming detached from the main wall. Accordingly, the pursuers aver that the first defenders were under a duty of reasonable care to instruct that immediate steps be taken to protect the structural integrity of the exposed gable wall, either by tying back the brickwork of the exposed gable wall to the joists in the roof void of the adjoining property and erecting weather protection, or by removing the brickwork of the wall from the roof level to the third floor ceiling level and either rebuilding it or covering it to protect it from the weather, or alternatively to erect retaining scaffolding with a fan guard. The first defenders undertook none of these works. As indicated earlier, the case against the second defenders has been departed from.

[6] In these circumstances Mr Dunlop, counsel for the first defenders, argued for his first plea-in-law to the relevancy of the pursuers' averments. He submitted that the pursuers' complaints concerned the way in which the works were carried out, but these works were carried out by the second defenders and the first defenders only instructed the second defenders to do the work. He submitted that it was settled law that instructing employers in these circumstances are not liable for incompetent building works by independent companies. It is not suggested in the present case that the second defenders were not competent. If the first defenders had engaged competent independent contractors, they were entitled to rely on them (Ferguson v Welsh 1987 1 WLR 1553 per Lord Keith of Kinkel at p.1560G-H). In the present case there were no special circumstances averred why the council should be liable for the acts of the second defenders. Counsel also submitted that it should be noted that the first defenders only instructed the second defenders because of the failure of the proprietors (including the pursuers) to comply with the section 13 notice which they had served. Had the proprietors complied with the section 13 notice, the first defenders would not have instructed the second defenders to do the work. The pursuers had now abandoned their case against the second defenders and could not give themselves a better case against the council than they might have had against the demolition contractors.

[7] Counsel for the first defenders then turned his attention to the second tranche of duties averred by the pursuers, which were concerned with the duty to inspect the wall once it was exposed. In essence, duties under two headings were pled. First of all there was said to be a general duty to instruct immediate steps to protect the integrity of the building. Secondly there were particular duties of care which were described as tying back the brickwork of the exposed gable wall to the joists in the roof void of the adjoining property; removing the brickwork of the exposed gable wall from the roof level to the third floor ceiling level and either rebuilding it or covering it to protect it from the weather; or erecting scaffolding with a fan guard. However, counsel for the first defenders maintained that the first defenders had no power to do anything of this sort, and there were no relevant averments which suggested they had. They were not the owners of the property, and as non-owners the only powers available to them were under section 13 of the Building (Scotland) Act 1959. It was not however part of the present pursuers' claim that the first defenders should have served a further section 13 notice. Further, the works that the pursuers wanted to be carried out would have to be done on the property not covered by the original section 13 notice. That notice referred to the property at 229/235 North Street, and the first duty which the pursuers averred as being incumbent upon the first defenders was to tie in the brickwork of the exposed gable wall to the joists in the roof void at 241 North Street. In these circumstances a further section 13 notice would have been required, but there is no duty averred by the pursuers to that effect. Further, it is clear that the power given to the local authority to carry out such work by virtue of section 13(4) of the Act is discretionary and not a prescribed duty, and the exercise of that discretionary power only arises on the expiry of a number of time limits set out in other parts of the section. Because there is no case that there is a duty on the first defenders to serve an additional section 13 notice, there is nothing in the pursuers' pleadings to indicate what time limits should operate or how the first defenders were to obtain the necessary authority.

[8] At this point it was clear from an intervention on the part of counsel for the pursuers that it was not part of his case, either expressly or implicitly, that there was a duty on the first defenders to serve a further section 13 notice. In these circumstances, counsel for the first defenders maintained that any duty that is incumbent on the first defenders can only therefore arise out of the existing section 13 notice. His response to that was, as already indicated, that that work was done by the second defenders and the first defenders were not responsible for it. Were the pursuers to rely on duties persisting after the demolition work had been completed, these could not have been carried out without a fresh notice being served, before the first defenders had any power to do anything. Further, the first defenders are said to have certified the demolition work as complete. It is not said that they were negligent so to certify that work. Nothing further could thereafter be done in terms of the original section 13 notice because it was complete and spent. That a fresh section 13 notice would be required is beyond doubt, because of the duty which the pursuers aver concerning the need to tie in the existing brickwork with the adjoining property at number 241 North Street. The question which immediately arises then is what power the first defenders have to enter the roof void at number 241. If the pursuers say that that power lies in the existing section 13 notice, that notice relates only to numbers 229/235 North Street. Accordingly there was a gap in the pursuers' pleadings which could not be filled. As a matter of relevancy there was nothing said to fix liability on the first defenders for anything that was done during the course of the work, and after the work was completed there was no ability on the part of the first defenders to do what the pursuers say should have been done in order to satisfy their responsibilities and duties of care. Counsel for the first defenders therefore submitted that his first preliminary plea directed at the relevancy of the pursuers' averments should be sustained.

[9] Counsel for the first defenders also argued for his second preliminary plea, which is based on prescription. There were three relevant dates for the purpose of this argument. The first was the completion of the demolition works for which a precise date was not available. However it was clear from an examination of the pleadings that the work started in July 1996 and was expected to take about ten weeks. This would suggest that the work would be completed in about September 1996. This is confirmed by the averments on condescendence 4 which suggest that following completion of the works, the proprietor of adjoining premises wrote to the first defenders on 1 October 1996. Accordingly, counsel submitted that it would be reasonable to take the date at which the works were completed as being 1 October 1996. The second material date was when the brickwork collapsed on 6 November 1996. The third date was when proceedings commenced, and the best indication of that was that the present action passed the signet on 26 October 2001. Accordingly it was clear that if the quinquennial prescription started to run from the date of the collapse of the brickwork on 6 November 1996, then the present action is raised in time. If, however, the concurrence of injuria and damnum occurred before 26 October 1996, then the present action has prescribed. Counsel pointed out that the first defenders' position in this matter is contained in answer 8, but these averments are not specifically denied in response by the pursuers. However on the assumption that this is a live issue, the first defenders submitted that the pursuers' averments of the concurrence of injuria and damnum indicated that the right of action started at the time the demolition works were completed, because the pursuers aver that at that time the building was left in an obviously dangerous condition and the gable wall was liable to collapse. That date, therefore (1 October 1996), was when the prescriptive clock started ticking. The collapse of the brickwork subsequently was just a continuation of the damage which had been caused. Reference was made to the case of Dunlop v McGowans 1979 SC 22 (per Lord Justice Clerk Wheatley at pp.31-32) where it was made clear that the terminus a quo was fixed as soon as any loss had been incurred. This decision was affirmed on appeal (1980 S.C.(H.L.)73). In effect, as soon as a party is able to sue, his cause of action exists, and that is when the prescriptive period begins to run. The fact that subsequent loss cannot at that time be precisely calculated is not significant. The fact that estimation is possible allows the action to proceed (see Lord Keith of Kinkel at pp.79-80); Cartledge v Jopling 1963 A.C.758. In the present case, therefore, the pursuers would have been entitled to raise an action for damages as soon as the demolition works were complete. On their own averments, any course of action in this case had been extinguished by the quinquennial prescription and the first defenders' second plea-in-law should be sustained.

[10] In response, Mr McGregor, counsel for the pursuers, indicated that having listened to Mr Dunlop's submissions, he would be asking leave to amend part of his pleadings. Three issues had been raised by the first defenders, namely the relationship between the first defenders and the second defenders, the question of a second section 13 notice in respect of works that might be done involving 241 North Street, and the question of prescription. It was in respect of the first two matters that the pursuers would seek leave to amend. However, the pursuers did not consider it necessary to amend on the matter of prescription. Mr McGregor maintained that the first defenders' submissions on the question of prescription were misconceived. The fundamental basis underpinning the whole of the first defenders' argument on prescription was that the pursuers had ownership of the gable wall in question. Mr McGregor therefore appeared to accept, by implication, that the loss in respect of the building works occurred when the demolition was complete, and the gable wall was left in a dangerous condition, on 1 October 1996. But the pursuers' position on record is that they did not own the gable wall at the first, second and third floor levels. That being so, the pursuers would have no grounds for raising an action against the first defenders based on the condition of the wall which they did not own. If the pursuers had owned that part of the wall, that would have provided them with a claim for damages. However, their premises were on the ground floor and the damage which had been done to the gable wall was on the upper floors. Accordingly, because the pursuers had no ownership of the exposed gable wall which had been damaged as a result of the first defenders' activities, therefore there was no right of action by the pursuers at the point where demolition was completed. In that case, the quinquennium only started to run when damage was done to the pursuers' property, and that occurred on 6 November 1996 when the gable collapsed on top of the pursuers' roof.

[11] Dealing briefly with the first two points raised by the defenders, Mr McGregor noted that the first defenders has submitted that they had no responsibility for the work done by the second defenders and there were no averments of special circumstances which would make the first defenders so responsible. Mr McGregor accepted the force of this submission and sought leave to amend on that matter. He argued that the note of arguments which had been lodged in this case makes no reference to this point and that it had not been raised previously.

[12] In respect of the second issue which concerns the possibility of a fresh section 13 notice being served, Mr McGregor made it clear that he did not seek to rely for his remedy on a claim that fresh section 13 notices should have been issued, or that the discretionary power available to the first defenders could form the basis of a common law duty of care against those defenders. The pursuers' case was that having issued the first section 13 notice, the first defenders then came under a duty of reasonable care to see that the demolition was executed in a safe manner. This, he maintained, was clear from the averments on condescendence 5 where it is said that the first defenders were under a duty of reasonable care to ensure that the demolition works were executed and completed in a reasonable and safe manner, and further that, as part of the existing demolition works, the first defenders were under a duty of reasonable care to instruct that immediate steps be taken to protect the structure and integrity of the exposed gable wall. Against that background, the first defenders' counsel had argued that the pursuers could not claim that the first defenders should have tied the brickwork of the exposed gable wall back to the joists in the roof void of the adjoining property at 241 North Street; that would involve the service of a fresh section 13 notice because the work to be done in that circumstance on the adjoining property would not be covered by the existing notice. Mr McGregor indicated that he accepted this argument would therefore intend to delete that averment and also the corresponding averment in condescendence 5.

[13] However, Mr McGregor maintained that was not the end of the pursuers' case. The question of tying in the brickwork to the roof void of an adjoining building was only one of three remedies available. The other two remaining remedies involved the removal of the brickwork from the roof level to the third floor ceiling level, or alternatively the erection of retaining scaffolding with a fan guard. Both of these remedial works, in his submission, would have been covered by the existing section 13 notice.

[14] In response Mr Dunlop argued on the question of prescription that the gable wall was mutual. In these circumstances the pursuers would have proprietorial rights in the wall. The title deeds provided that all proprietors had a mutual interest in the gable wall, and that meant that there was a common right to the whole wall for each of the proprietors. This was in accordance with normal practice and the general principles of tenement law. In these circumstances, the pursuer had suffered loss at the completion of the demolition works; they could therefore have at that time instructed remedial works; and accordingly the period of quinquennial prescription would run from the date when the demolition works were completed.

[15] In respect of the amendments proposed by Mr McGregor, Mr Dunlop accepted that the question of the relationship between the first and second defenders, and his submission that special circumstances had to be averred to make the first defenders liable for the second defenders' actions, were not mentioned in the note of arguments. However, that note of arguments had been lodged in 2003 and the court had not asked for an updated note. Since then there had been two procedural debates which had proved abortive because on each occasion the pursuers had offered to amend. He had mentioned that this argument might arise informally to counsel for the pursuers some 48 hours ago before the present debate took place. If the pursuers now accepted that the first remedial measures which they described were accepted to be irrelevant, he would further argue that the other two methods of remedying the situation averred by the pursuers were also irrelevant. The section 13 notice only allowed for the first defenders to demolish the building and did not permit the rebuilding of brickwork or for the extension of scaffolding. Section 13(5) of the Act provides for recovery of expenses, and proprietors subject to this process would challenge the recovery of any expenses not authorised by the original notice. In these circumstances all of the remedies suggested by the pursuers were irrelevant. This was disputed by Mr McGregor.

[16] In respect of the prescription argument, I am quite satisfied that the answer relies simply on the averments concerning the question of ownership of the mutual gable wall. I had no difficulty in accepting Mr Dunlop's legal submissions on prescription. Mr McGregor's only point in response to the first defenders' submission that the right of action had prescribed was that he had no rights of property in that wall. Accordingly, after the demolition of the first, second and third levels, which left the gable wall at those levels in a dangerous condition, he had no right of action against the first defenders. If he is right on that, and the pursuers have no property rights whatsoever in the mutual gable wall at levels 1, 2 and 3, but are restricted in their proprietorial interest to the mutual gable wall at their own level, then Mr McGregor's argument has force, and the action may not have prescribed. However, by corollary, it would follow that if the title deeds demonstrate that the pursuers did have a proprietorial interest in all of the mutual gable wall including that part of the wall adjacent to levels 1, 2 and 3 of the buildings now demolished, then it would seem to follow inevitably that their right of action would accrue when the damage was done to the gable wall and that accordingly the prescriptive period began to run at the date of the completion of the demolition work. In that circumstance, the present action has prescribed. This issue can easily be resolved by an examination of the relevant title deeds.

[17] As far as the question of amendment is concerned, there is clearly no difficulty in the proposal made by Mr McGregor that he wished to delete the averments about tying in the remaining brickwork on the mutual gable wall to adjoining roof voids. I would be prepared to allow that amendment. I do not think that removing these averments compromises the remaining remedies averred by the pursuers. They would remain liable to proof. There is more difficulty in my view in allowing amendment of the pleadings to develop the case against the first defenders, in effect by averring that they had responsibilities over the second defenders in the way in which the demolition works were carried out. However, I have decided that it would be appropriate to allow such amendment; it is the clear burden of the pursuers' second tranche of duties that they hold the first defenders liable for the way in which the demolition work was carried out. However, that does not dispose of the first defenders' submissions that such a case is irrelevant. No argument was put forward against that matter; the only response was a request to amend. In these circumstances, I have reluctantly decided that the pursuers should be allowed to amend on this topic and the question of whether or not there is a relevant case can be thereafter debated again, although I accept that this is unsatisfactory. I am swayed by the fact that this submission was not part of the note of arguments lodged in the case, even though the Court did not ask for an updated note. However, this issue will only become live if the pursuers can show, in terms of the relevant title deeds, that they had no proprietorial interest in the gable walls in the upper floors.