Tombs v Wilson Connolly Ltd. [2004] EWHC 2809 (TCC)

Case No Claim No. HT-03-3992004] EWHC 2809 (TCC)
IN THE HIGH COURT OF JUSTICE
QUEENS BENCH DIVISION
TECHNOLOGY AND CONSTRUCTION COURT
Venue Royal Courts of Justice, Strand, London, WC2A 2LLDate Date: 9 November2004
Before
HIS HONOUR JUDGE PETER COULSON Q.C.
Between
MR N. K. TOMBSClaimantWILSON CONNOLLY LTDDefendant
Mr David Berry (of Berry & Walton) for ClaimantMr Gideon Scott-Holland (instructed by Eversheds) for DefendantHearing Hearing dates : 4 th, 5 th, 6 th, 7 th,11 th and 13 th October 2004.
Judgment
[1]This case involves a variety of disputes which have arisen out of a series of Sub-Contracts agreed between Mr Nicholas Tombs, a sub-contractor specialising in the provision of bricklaying services, and Wilson Connolly Ltd (“WCL”), a house building company. These disputes have at their heart the circumstances in which Mr Tombs ceased to work for WCL in April 2003.[2]Prior to the first day of the trial, Mr Tombs was claiming £48,047.12 as the value of unpaid work which he had carried out for WCL, which claim was made up of a lengthy list of relatively modest individual items. He was also claiming £101,604.58 by way of damages for wrongful repudiation of the Sub-Contracts between the parties. WCL accepted only a part of the value claim, and rejected the damages claim in its entirety on grounds of liability, causation and loss. Indeed, it is WCL’s case that it was Mr Tombs who wrongfully repudiated the Sub-Contracts, although they do not make a counterclaim for damages in consequence. WCL did, however, maintain a counterclaim in respect of the cost of putting right allegedly defective elements of Mr Tombs’ work. This counterclaim fell into three parts: £66,143.46 in respect of the cost of rebuilding and repair works at 2 Comfrey Way, Pine Lea, near Thetford; £25,092.62 in respect of the cost of fitting missing wall ties at a number of other properties at Pine Lea; and £15,178 in respect of a long list of small snagging items arising under a number of the Sub-Contracts.[3]At 2pm on 4th October 2004, the first day of the trial, Mr Berry, the senior partner in Berry & Walton, Mr Tombs’ solicitors, who appeared on his behalf at the trial, and Mr Scott-Holland, who appeared on behalf of WCL, were able to tell me that the two aspects of the case which would have taken a disproportionate amount of Court time to resolve (namely Mr Tombs’ claim for the outstanding value of work done and WCL’s counterclaim for snagging items) had both been compromised. This was an extremely sensible course for the parties to take, since it then allowed them to concentrate for the remainder of the trial on the principal issues between them.[4]Accordingly, it was agreed that, after taking into account snagging items, the outstanding value of work done by Mr Tombs was £34,720.58. This was subject to just one point: a dispute about WCL’s payment of/credit for £7,872.68, which is dealt with at paragraphs 34-41 below. The remaining disputes centre on the allegations of repudiation (paragraphs 42-58 below) and the allegations of defective work (paragraphs 67-112 below). Before going on to dispose of these disputes in this Judgment, however, I should set out various matters by way of background.

THE BACKGROUND

[5]Mr Tombs has been a brickwork Sub-Contractor for about 12 years. He is principally a ‘labour-only’ sub-contractor; that is to say, he provides bricklaying gangs to main contractors, usually with a foreman in charge of his bricklayers on each site. He had been a sub-contractor to WCL for a number of years before the events in question. In the period between 2001 and 2003 Mr Tombs was working on four principal sites for WCL: Pine Lea, Thetford; Trinity Gardens, Ely; College Meadows, Caldecote; and Brackenfield, Witchford.[6]Pursuant to a Sub-Contract dated 1.10.01, Mr Tombs was engaged by WCL to provide bricklaying services at Plots 2,3, and 39-55 at the Pine Lea site. The brickwork was carried out in October/November 2001, and the houses themselves were completed in early 2002. By October 2002, Mr Bull, the new owner of Plot 55, now known as 2 Comfrey Way (“the Bull property”), had become concerned about various aspects of his new house. He engaged the Andrew Firebrace Partnership to inspect the property and they produced a short report dated 11.10.02. This was critical of a number of aspects of Mr Tombs’ work. Amongst other things, it said:
“The top triangle of brickwork forming the front gable wall above first floor window head level appears to be out of plumb…parts of the wall seem to lean inwards and parts seem to lean outwards…there are decorative brick corbels at the eaves of this gable wall. This corbelled brickwork is deformed. Generally speaking, the facing bricking workmanship is of an exceptionally poor quality around the entire building. The thickness of perpend and bed joints varies considerably, and perpend joints do not line up. Mortar joints have not been finished off properly. Mortar joints where concrete lintels meet brickwork are very poorly formed. On the rear elevation there appear to be some slight ripples in the face brickwork. It looks as though the bricks have been laid by a person without any training in bricklaying. We are of the opinion that the deformation of the brickwork of the front gable wall is due to exceptionally poor workmanship rather than due to structural movement. However, in view of the obvious lack of care and expertise exhibited by the bricklayers, one is led to think that perhaps there are hidden defects in the facing brickwork also. Namely, have sufficient cavity wall ties been provided, have the wall ties been fixed to the timber frame properly and has the deformation of the wall resulted in the cavity wall ties having insufficient embedment in the brickwork. We recommend that the top triangle of brickwork of the front gable wall be taken down to first floor window head level. The wall ties for the top triangle of the gable wall should then be inspected. If the wall ties are adequate, the brickwork should be rebuilt plumb. If there are insufficient wall ties, or if the wall ties have been poorly fixed, then a general survey of the wall ties throughout the building would be justified…”
[7]The National House Building Council (“the NHBC”) were also asked to inspect the Bull property. They produced a Resolution Report, which was based on an inspection in November 2002 and was dated 16th January 2003. This report identified a number of defects in the brickwork and confirmed many of the findings of the Andrew Firebrace Partnership. The NHBC recommended the rebuilding of some sections of the walls and the replacement of other areas of brickwork. Although Mr Tombs was not shown the Andrew Firebrace Partnership Report, he confirmed in his evidence that he did see the NHBC Resolution Report of 16.1.03. Indeed Mr Tombs was involved in February 2003 in removing a cracked lintel from the Bull property so as to allow an inspection to take place of the cavity beyond. On 4.2.03, Mr Bull wrote to WCL to tell them what had been revealed:
“… I was able to view inside the cavity to establish if sufficient wall ties had been used by the builder during the construction process. To my amazement, I have established that throughout the cavity area at the rear elevation of the house, there appears to be no more than twenty wall ties securing the outer skin of bricks to the timber frame. This area measures almost 70 square metres and when you consider that there should be at least four wall ties within a square metre, then you don’t have to be Einstein to realise that I am a few short. … I have today spoken to Mr Gerald King who I am sure you are aware of from the NHBC. He was appalled at what I told him and tomorrow will be initiating an enquiry with the inspections manager to establish who represented the NHBC during the build process and why they missed out the fact that the wall ties had not been fitted to the house or the under cloaking to the garage, both of which are NHBC requirements.”
[8]At this stage, WCL did not consider that the outer skin of brickwork at the Bull property required to be demolished and rebuilt. However, it appears that everyone was aware that some remedial work would have to be carried out. At a meeting on 11th February 2003 between Mr Badcock of WCL and Mr Tombs, Mr Tombs agreed to put in hand the remedial work that was recommended by the NHBC. In his confirmatory letter of 12.2.03, Mr Tombs said:- “I will as agreed supply all labour and materials to carry out the works to remedy the wall tie deficiency to this plot and will also finish off the items as mentioned in the NHBC report that we had begun to complete. I will as agreed await to hear the final decision that will be made by the NHBC after Friday’s inspection and will carry out the works as they recommend.”[9]At about the same time, the Andrew Firebrace Partnership inspected the cavity and noted that “very few ties were installed – approximately one third of that required.” They concluded: “The recent cavity inspection by Wilcon Homes confirms that there are indeed hidden defects in the external walls, and that the load bearing timber frame might have been damaged by the careless fixing of wall ties, or by the transmission of moisture across the cavity from the outer skin of brickwork. If a repair using remedial ties is employed, you would be left with the present extremely poor quality facing brickwork, the facing brickwork would be rather blemished by an array of marks where the remedial wall ties were inserted, and there could be problems in the future with damp penetration across the cavity. … We are of the opinion that the entire facing brickwork should be removed, the exposed timber structure inspected, and a new skin of facing brickwork be built in a workmanlike manner”.[10]Following an inspection of the cavity, the NHBC produced an Addendum Resolution Report, dated 18.2.03. This concluded that “the cavity wall ties have not been fixed at the correct spacing”. As to its recommendations, the Report said:
“The remedial options are:- Remove the outer brick leaf to damp proof course level and rebuild the walling, ensuring the wall ties are inserted in the correct positions. This will also resolve the other reported brickwork problems such as the chipped bricks, brickwork out of alignment and areas of unsatisfactory standard of brickwork. If the builder proposes to install remedial wall ties instead of rebuilding the brick outer leaf, the builder should provide full details of the installation method to NHBC and the owner for approval before works commence … the repair must not be noticeable on completion.”
[11]It is Mr Tombs’ case that he did not see either of these reports and was not told of these recommendations. WCL maintained that he was told of their recommendation to rebuild at the meeting on 11th March 2003. That meeting was attended by Mr Badcock and Mr Tombs. The only contemporary record of the meeting was that made 6 weeks later by Mr Broomfield of WCL, which described the meeting in these terms: “Further meeting held with N.K. Tombs, bricklayer on 11th March, with J. Badcock, where he was told that we had decided to take down and re-build. He stressed that he could rectify and would not accept financial responsibility for the total cost of the taking down and rebuilding. He asked that he be given the opportunity to prove effective and invisible repair by remediating the worst elevation and allow further inspection”.[12]Accordingly, as this note makes clear, by 11th March 2003 Mr Tombs was at least aware that WCL were likely to go for the rebuilding option, but that, prior to a final decision being made, they would (at his urging) make another attempt to persuade Mr Bull to plump for the lesser scope of work. This attempt was undertaken by Mr Broomfield. However, Mr Bull was adamant that he did not want Mr Tombs to carry out remedial works at his property. On 1st April 2003, he wrote to Mr Broomfield in these terms:
“Following the borascope investigation and the appointment of Mr Clive Ringer, the situation appeared to be finally showing a more positive direction. The day he and Mr Smith came to our home to inspect the faults, it was decided conclusively by them both that the outer brickwork would have to be removed totally and the wall ties inserted into the timber structure then, for the brickwork to be re-constructed in line with the NHBC standards. This was a turning point for us and I can remember saying to my wife how finally we may be nearing a resolution, but our hopes were short-lived when during your visit you asked us to consider giving Nick Tombs the opportunity to carry out remedial repairs to various areas of brickwork after he had told you he was confident he could carry out the repairs without the work showing. I think this was a little bit insensitive of you when you consider he was the original contractor that had allowed his so-called skilled labour to build the house and breach the NHBC standards in the process and because of this man, we are in this very stressful situation.”
[13]Mr Broomfield’s account of his meeting with Mr and Mrs Bull, also recorded in his note of 30.4.03, was in similar vein:
“I met with the Bulls the following week to put this [Mr Tombs’ offer] to them. An amicable meeting occurred, but they were not willing to accept this and had no trust or faith in Mr Tombs – to which I have to agree. It was concluded that we would progress the complete replacement of the brickwork.”
[14]On 10th April 2003, by which time Mr Tombs was no longer working on any of the WCL sites, Mr Broomfield wrote again to Mr and Mrs Bull to record his agreement that the brickwork would be taken down and rebuilt to the correct standard. It appears that this decision was actually taken by Mr Badcock of WCL. This remedial work was commenced in July 2003 and completed in November 2003.[15]There were at least two other areas of concern that WCL had about Mr Tombs during the first months of 2003. One was the nature of his claims for interim payment, in particular relating to the site at Caldecote, where it appeared that on more than one occasion, one written interim valuation containing specific items was given to WCL’s site manager for consideration/approval, but a different valuation document, showing different items of work allegedly carried out by Mr Tombs was then sent by him to WCL’s Head Office for payment. There were a number of significant discrepancies (“mistakes” was Mr Tombs’ word) in the applications which Mr Tombs made in respect of Caldecote on 27/28th March 2003. Although the two different valuations (the one sent to site and the one sent to Head Office) were in the same total sum of £13,151, they were made up of very different items of work. Simply by way of example, the version that went to site contained no claims at all in respect of plot Nos. 219 and 220, but the version that went to Head Office claimed that the first lift of brickwork had been carried out on both those plots, and sums of £3,184 and £2,863 were claimed in consequence. Mr Tombs was unable to explain this, or the curious coincidence that, although the component items in each application were very different, the total amount being claimed in each was precisely the same.[16]The second concern that WCL had was the progress of the brickwork on the sites at Thetford, Caldecote, Ely and Witchford. On 2nd April 2003 there was a discussion between Mr Rosher and Mr Tombs when progress was discussed, and WCL’s concern was made plain. It was Mr Tombs’ case that Mr Rosher asked him for a “cast iron guarantee” in respect of the programme for the bricklaying works. Later that day Mr Tombs wrote to Mr Rosher in unequivocal terms:
“It is because I cannot offer you a cast iron guarantee that your programmes will be met and not wishing to adversely affect your programme that I recommend that Thetford plots 15,16 and 17 are given to another sub-contractor, at Witchford plots 19 and 20 are given to another sub-contractor, at Ely plots 152 and 153 are given to another sub-contractor and that at Caldecote, plots 223 onwards are given to another sub-contractor so that you may attempt to meet your programmes as per our conversation of this morning. With regard to Witchford, I would recommend whilst you have a site agent who is slightly less capable than David Pugh was at Thetford (although David was a better man manager), you should seek another sub-contractor for the remainder of the site.”
Mr Tombs confirmed in his cross-examination that the plots identified in this part of the letter were all of the plots on the four sites which he had not yet commenced.[17]There was a meeting the following day on 3rd April 2003 between Mr Rosher and Mr Badcock of WCL and Mr Tombs. Mr Tombs said that at that meeting Mr Badcock told him not to start work on any new plots, and just to complete those that he had started. Mr Badcock’s evidence was that Mr Tombs told him that he was withdrawing all his labour from the sites because he had not received an unqualified promise that his applications of 27/28th March would be paid (see paragraph 24 of Mr Badcock’s first statement).[18]On either Friday 4th April 2003, or Monday 7th April 2003 (the date is disputed), Mr Tombs withdrew his labour from the four sites noted above. It was his evidence that he withdrew his labour because his applications for payment in respect of the work carried out on those four sites (which applications were dated 27/28.3.04, and included the Caldecote application referred to in paragraph 15 above) had not been paid.[19]On 16th April 2003, WCL purported to send Mr Tombs a cheque for £7872.68 on account of the interim payment applications of 27/28.3.03. The cheque was not actually included in the letter and Mr Tombs’ wife had to call WCL’s offices to pick it up. The cheque was banked. On 17.4.03, Mr Tombs wrote to WCL to say that, because the amount had not been apportioned across the different sites, “I have been unable to remove this amount from the total that your company owes”. On 20.6.03, WCL sent Mr Tombs a detailed analysis of their position, which identified a further sum of £11,244.54 due to Mr Tombs, subject to their counterclaim. Further correspondence was exchanged between Mr Tombs (and his then representative, Mr Rowley), and WCL, and there was at least one meeting between the parties, but the differences between them could not be resolved by agreement.[20]During the same period, that is to say the summer and autumn of 2003, extensive remedial work was being carried out at the Bull property to deal with both the brickwork and wall tie problems. In addition, by this time, it had been discovered that other properties at Pine Lea had inadequate numbers of wall ties, and remedial work, consisting of a scheme whereby ties were retro-fitted into the cavities, was also completed. Although Mr Tombs’ adviser, Mr Rowley, had been told about the rebuilding of the brickwork skin at the Bull property by letter dated 20th June 2003, it appears that Mr Tombs did not make a further inspection of the Bull property thereafter, although a representative of his insurers made an inspection in August. It also appears that Mr Tombs did not make any further inspections, and was not expressly invited to make any further inspections, of the other properties at Pine Lea.[21]These proceedings were commenced on 18th November 2003. Following the compromise referred to at paragraph 3 above, the following nine issues remain between the parties: 1) What were the operative terms and conditions of the Sub-Contracts between the parties in existence at April 2003? 2) Does the £7,872.68 paid by WCL in April 2003 fall to be deducted from the agreed sum of £34,720.58 to be credited to Mr Tombs? 3) Did WCL repudiate the Sub-Contracts in April 2003? 4) Did Mr Tombs repudiate the Sub-Contracts in April 2003? 5) If the answer to Issue 3 is yes, is Mr Tombs entitled to claim damages by reference to his alleged loss of profit, and if so, how is that claim to be measured? 6) Did the numbers of wall ties installed in various properties at Pine Lea constitute a breach of contract on the part of Mr Tombs? 7) Did the brickwork at the Bull property constitute a breach of contract on the part of Mr Tombs? 8) If the answer to Issue six is yes, are WCL entitled to claim damages and if so, how is that claim to be measured? 9) If the answer to Issue 7 is yes, are WCL entitled to claim damages and if so, how is that claim to be measured? 22. Issue (1): What were the operative terms and conditions of the Sub-Contracts between the parties in existence at April 2003?[22]There is no dispute that, with one exception, which I address at paragraph 32 below, the Issue that arises in respect of the operative terms and conditions of any given Sub-Contract between WCL and Mr Tombs is the same each time; in other words, the parties are agreed that there are no points peculiar to particular Sub-Contracts. Accordingly, I can set out my principal findings on this issue by reference to the Sub-Contract of 1.10.01, which related to, amongst others, the Bull property at No.2. Comfrey Way, Pine Lea. It was the documents relating to this Sub-Contract which featured in the vast bulk of the cross-examination on Issue (1).[23]As is so often the case in the construction industry, the only reason that Issue (1) even arises for consideration at all can be traced back to sloppy paperwork; a failure on the part of WCL to get their documents in order. The chronology is straightforward. On 28.9.01, WCL sent out to Mr Tombs the Sub-Contract documents in respect of Plots 2,3, and 39-55 at Pine lea. This included a front sheet entitled ‘LABOUR (AND MATERIALS) SUB-CONTRACT (Short Form)’ which referred to ‘General Conditions overleaf’ and ‘Special Conditions below’. On this particular front sheet there were no Special Conditions. Mr Canning of WCL told me that the General Conditions which were referred to were those created by WCL in the year 2000, which he called ‘the new short form terms and conditions’. He said these new conditions were sent out with the front sheet every time the front sheet was sent out. He was expressly asked about this in cross-examination. He said:
“The General Conditions were not printed on the back. The actual Conditions were sent with this front sheet. They would be behind. They were sent out every single time.”
Mr Berry repeated that last phrase as a question:
‘Every single time?’
Mr Canning replied: ‘Correct’. That was the extent of his questioning on this topic.[24]The front sheet also included, at the bottom of the page, a section for Mr Tombs to sign, date, and return, pursuant to which he expressly accepted “the terms and conditions of this sub-contract and authorise the deductions from payments made to me under Clauses 28,29,32,36.” This particular front sheet was signed and dated by Mr Tombs on 1.10.01, which would therefore appear to be the operative date of the Sub-Contract. There was no dispute that the references to Clauses 28, 29, 32 and 36 were Clauses within the new short form terms and conditions which Mr Canning had said were sent out every time and which, on his evidence, had been sent out with the front sheet in question in respect of the Pine Lea plots.[25]These new short form terms and conditions, having been created in 2000, were slightly amended in April 2002, although the changes are immaterial for present purposes. These new conditions were put to Mr Tombs in cross-examination. He confirmed that he had seen them and that he believed that they were “with some of the contracts I had with WCL, without a doubt”. He also confirmed that he had read the reference to clauses 28, 29, 32 and 36 before he had signed the acceptance on 1.10.01 and that he had “very possibly” looked at those individual clauses themselves before he signed the acceptance. He concluded by saying that “I assume that this [the reference to the four clauses] was part of the contract.”[26]So far, so good: it would appear indisputable on this evidence that the new terms and conditions were expressly incorporated into the Sub-Contract. However, Mr Berry argued that once Mr Tombs had signed the front sheet and sent it back, WCL then sent him a Sub-Contract Order. That Order, which was actually dated 27.8.01, but which, on the evidence, I find was only sent out to Mr Tombs after the front sheet (which he had signed on 1.10.01) had been received back by WCL, contained a list of printed terms and conditions on the reverse. Those terms and conditions were WCL’s old conditions, which had been superseded by the new short form terms and conditions but inadvertently left on the back of the Sub-Contract Order Form. The old conditions ran from clauses 1 to 20 inclusive: in other words, they bore no relation to the clause numbers - 28, 29, 32 and 36 - which Mr Tombs had expressly accepted on 1.10.01. Notwithstanding that, it was Mr Berry’s submission that it was these old conditions which were incorporated into the Sub-Contract, not the new ones. Mr Canning’s evidence was that the Sub-Contract Order was sent out for confirmatory purposes only and had no other relevance.[27]Thus, the dispute was whether the Sub-Contract incorporated the old conditions, as set out on the back of the Sub-Contract Order, or the new short form terms and conditions which was the only set of terms which included Clauses 28, 29, 32 and 36. For a number of separate reasons, I am in no doubt that all the Sub-Contracts incorporated the new short form terms and conditions.[28]First, Mr Tombs’ own evidence, summarised at paragraph 25 above, effectively accepted that these were the relevant terms and conditions of the Sub-Contract. Secondly, his express written acceptance of Clauses 28, 29, 32 and 36 only makes sense if it is the new short form terms and conditions which were being agreed and incorporated; the old conditions do not contain any such clauses. Moreover, it could not be said that this express acceptance related to irrelevant and immaterial matters; these Clauses were all concerned with the retention of monies by WCL against sums otherwise due to Mr Tombs, and were therefore of the greatest importance to him. Thirdly, Mr Canning was clear that the Sub-Contract contained the new short form terms and conditions because they were sent out every time a front sheet was sent out. As set out at paragraph 23 above, that evidence was not challenged in his cross-examination, and there was no evidence to the contrary. I therefore accept it.[29]Fourthly, any proper contractual analysis must lead to the conclusion that the old conditions on the back of the Sub-Contract Order were irrelevant as a matter of law. The sending of the documents to Mr Tombs on 28.9.01 (including the new short form terms and conditions) constituted an offer by WCL; that offer was accepted by Mr Tombs when he signed, dated and returned the acceptance on 1.10.01; the Sub-Contract therefore came into existence when Mr Tombs accepted the offer; accordingly the Sub-Contract Order was of no contractual relevance at all because, by the time it was sent out, the Sub-Contract had already been concluded. It is trite law that “the submission of a document by one party after the making of the contract will not affect the existence of the contract; nor will the terms of the document form part of the contract unless they are in turn accepted as variations of the contract either expressly or by conduct”. Chitty on Contracts, 29th Edition para 2-036.[30]Against all that, there was no evidence, either in Mr Tombs’ three written statements or in his oral evidence, as to how or why it was in fact the old conditions which were incorporated into the Sub-Contract. That left the possibility that there was a legal principle which Mr Tombs contended would have that effect. When questioned on the topic during his Closing Submissions, Mr Berry relied on an argument that, since the sending of the Sub-Contract Order, and therefore the old conditions, was the last event in the sequence, those should be the conditions which apply. He referred to this argument as a ‘battle of the forms’ point, although he cited no specific authority in support of his contention. However, in my judgment, this submission misses the important point that the Sub-Contract had already been concluded by agreement before the confirmatory Order was sent out. This is therefore not a true ‘battle of the forms’ case of the sort discussed by the Court of Appeal in Butler Machine Tool v Ex-Cell–O Corporation [1979] 1 WLR 401 at 404. Mr Berry’s argument could only get off the ground if it could be shown that the parties, by conduct, effectively agreed to the replacement of the new short form terms and conditions by the old conditions, but there was absolutely no evidence of that at all.[31]Accordingly, for all the reasons that I have set out above, I find that in all cases where the Sub-Contract Order came after the written acceptance by Mr Tombs, the relevant Sub-Contracts incorporated the new short form terms and conditions referred to by both Mr Tombs and Mr Canning in their respective cross-examinations, and included at bundle 4, tab 1, at pages 1-6 (pre April 2002) and pages 7-10 (post-April 2002). The old conditions were not agreed and have no contractual significance.[32]As noted in paragraph 22 above, the Pine Lea Sub-Contract of 1.10.01 was not typical of some of the Sub-Contracts in one respect. For some, the Sub-Contract Order was sent out before the written acceptance by Mr Tombs was completed and returned. In those situations, of course, the express written acceptance by Mr Tombs of the new short form terms and conditions superseded any suggestion that the old conditions applied. A fortiori, therefore, for all situations where the written acceptance of the new short form terms and conditions by Mr Tombs was the last event in the sequence, the relevant terms were those new short form terms and conditions. Indeed, Mr Berry did not seriously argue to the contrary.[33]Accordingly, I find that, in answer to Issue (1), all the Sub-Contracts with which I am concerned incorporated the new short form terms and conditions. Issue (2) Does the £7,872.68 paid by WCL in April 2003 fall to be deducted from the agreed sum of £34,720.58 to be credited to Mr Tombs?[34]At paragraph 19 of their Amended Defence and Counterclaim, WCL stated that, following Mr Tombs’ departure from site, they made a further payment of £7,872.68, for which credit had to be given in these proceedings. As noted in paragraph 4 above, the agreement of the sum of £34,720.58 was subject to this contention.[35]I was a little surprised when it became apparent, shortly before the trial, that Mr Tombs disputed WCL’s right to a credit of £7,872.68. After all, on 7th May 2003, Mr Tombs had written to WCL and said:
“I received your letter dated 16th April 2003 entitled ‘brickwork payment’. There was no cheque enclosed as stated in your letter, however, I was able to collect one from your Newmarket office for the amount stated… your letter stated that I would receive a breakdown of what was included in the cheque which I collected for £7.872.68. I have yet to receive this breakdown and so I have been unable to remove this amount from the total that your company owes.”
[36]Mr Tombs also accepted that payment of the £7,872.68 had been made in his written statements: see, for instance, his second statement of 6.7.04, at page 28B of bundle 1B, where, in commenting on paragraph 28 of Mr Badcock’s statement, he said:
“the comment that they paid me £7,872.68 on account is true….”
. It was for these reasons that I concluded that Mr Berry’s Written Opening, provided on behalf of Mr Tombs the week before the trial commenced, and which stated in respect of the sum of £7,872.68 that “the Court will have to make findings as to whether this has been paid, the claimant does not accept that it has”, was just plain wrong. Mr Berry did not elaborate on this point during his short oral Opening.[37]During his oral evidence in chief, Mr Tombs asserted that credit should not be given for the sum, not because the money had not been paid, but because his claims in this action for monies due already took into account the payment of this amount. He was, however, unable to point to any document which supported this assertion, which was itself entirely new, having never been suggested before. As we shall see, it was not the only important point which emerged for the very first time during Mr Tombs’ oral evidence in chief.[38]In his cross-examination on this point, Mr Tombs accepted that, by reference to his letter of 7.5.03 (paragraph 35 above) he had not at that stage given WCL a credit for the £7,862.68. In June of 2003, WCL provided a detailed breakdown of the position on each contract and Mr Tombs also accepted that, when Mr Rowley responded to this breakdown on his behalf on 27.7.03, Mr Rowley made no reference to any credit having by then been given for the £7,862.68. Mr Tombs also had to accept that, when he left the various sites in April 2003, his claims had been in the region of £46,000, and that his claim in these proceedings was for £48,000: in other words, if there had been an intervening credit for £7,862.68, it was impossible to see where it had arisen or how it had been taken into account.[39]I have concluded on the evidence before me that credit should be given to WCL for the payment of £7,872.68 and that the claims made by Mr Tombs did not at any stage (either before or after the commencement of these proceedings) make any allowance for this sum. I am bound to note that the only argument which he raised as to why there should be no credit (namely, that his claims already took it into account) was not pleaded in the Reply to paragraph 19 of the Amended Defence and Counterclaim, where the claim for a credit was clearly set up by WCL; it was not set out in Mr Tombs’ written evidence, despite the fact that he produced no less than three statements; and was not opened either in writing (where a different, and incorrect, point was raised) or orally. It was a point that emerged for the very first time when Mr Tombs gave oral evidence in chief. For these reasons, I have concluded that, unless this assertion can be supported by a contemporaneous document, it is not an element of his oral evidence that I can accept. Tellingly, there was not a single document amongst the eight files that constituted the Court Bundle which even began to suggest that Mr Tombs’ claim took into account the sum of £7,872.68. The only document that does deal with the point makes it clear that the sum had not been taken into account: Mr Tombs’ letter of 7.5.03 says that in the clearest possible terms. In addition, the sums claimed in these proceedings are almost exactly the same as the sums that Mr Tombs had claimed were outstanding when he left the sites, before the £7,872.68 had been paid. All this evidence leads me to the firm conclusion that credit was not given by Mr Tombs in his claim in these proceedings, and that it needs to be given now.[40]Mr Berry’s only argument in his Closing Submissions on this point was to say that none of the documents contradicted Mr Tombs’ oral (and very belated) assertion that he had allowed for the payment in his claim. But that contention was wrong (the letter of 7.5.03 did just that); it was also an attempt to reverse the burden of proof which, given the undisputed fact of payment and WCL’s pleaded reliance on such payment, was firmly on Mr Tombs to discharge. He failed to do so for the reasons which I have given.[41]Accordingly, I find that the sum due to Mr Tombs for the outstanding value of work done is £26,847.90, being the agreed figure of £34,720.58 less the sum of £7,872.68. The sum of £26,847.90 is, of course, subject to the counterclaim, which is addressed at paragraphs 67-112 below. Issue 3): Did WCL repudiate Sub-Contracts in April 2003? Issue 4): Did Mr Tombs repudiate the Sub-Contract in April 2003?

Issue 3): Did WCL repudiate Sub-Contracts in April 2003?

[42]Relevant Findings of Fact a). I find that, prior to 4th April 2003, WCL had no reason to believe that Mr Tombs was running short of money or was in difficulties in paying his bricklayers. There was no proper evidence of any such difficulties. b). I find that, prior to 4th April 2003, WCL did have reasonable grounds for checking carefully Mr Tombs’ interim valuations/applications for payment dated 27/28.3.03, particularly those relating to Caldecote, for the reasons set out in paragraph 15 above. c). I find that, prior to 4th April 2003, WCL did have reasonable grounds for trying to ensure that Mr Tombs performed in accordance with the respective programmes at the four principal sites. I find that it was therefore reasonable for Mr Rosher on 2nd April 2003 (paragraph 16 above) to seek some form of assurance from Mr Tombs as to his future performance. Mr Rosher may well have used the word ‘guarantee’ in connection with this future performance but I do not consider that, in all the circumstances, this was anything other than a reasonable request for an assurance that Mr Tombs could meet the WCL programmes. I reject the pleaded allegation that Mr Rosher was trying to (or did) impose some sort of unreasonable new condition on Mr Tombs in respect of programming and I agree with Mr Scott-Holland that Mr Tombs did not suggest that there had been any such imposition in his written or oral evidence. d). I find Mr Tombs’ written “recommendation” that new plots be given to another sub-contractor (paragraph 16 above) was made because he could not guarantee progress in accordance with the programmes on the four sites, and was honest enough to say so. I reject the suggestion that somehow Mr Rosher engineered or unfairly brought about Mr Tombs’ abandonment of the brickwork at the new plots; I find that Mr Tombs provided an unqualified “recommendation” to that effect because he considered it to be the best and fairest solution to WCL’s programming concerns. I also note that, in his letter of 2.4.03, Mr Tombs did not say that Mr Rosher’s request for a guarantee was onerous, unfair or unreasonable. e). I find that Mr Tombs’ recollection of the meeting on 3rd April is to be preferred at least to this extent: namely that Mr Badcock effectively accepted his written recommendation by telling Mr Tombs not to start work on any new plots; and that Mr Badcock told him that WCL were expecting him to complete those plots where he had already started the brickwork. The parties were therefore agreed that Mr Tombs would not start any new plots, but would complete those which he had started. However, to the extent that it was suggested that, at this meeting, Mr Badcock made any sort of unqualified promise to pay the applications of 27/28.3.03, I reject it; it seems clear to me that Mr Badcock, and Mr Rosher, who was present for at least part of the time, told Mr Tombs that the applications were being checked and that, following that investigation process, sums which WCL considered were properly due would then be paid. f). I find that Mr Tombs’ men worked on Friday 4th April 2003 on the plots where the brickwork had started, in accordance with the effective agreement at Sub-paragraph (e) above and that on Monday 7th April Mr Tombs then unilaterally withdrew his labour from all the WCL sites where he was working because, as Mr Tombs put it in paragraph 10 of his first statement, “I informed Mr Badcock that he left me no option but to withdraw my labour force due to non-payment.”[43]Two reasons were advanced by Mr Berry in support of his contention that WCL wrongfully repudiated the contract: the taking away of the new plots on the four sites; and the non-payment of the valuations/applications of 27/28.3.03. I deal with each of these matters in turn below. Reason 1: The Taking Away of the New Plots

Reason 1:

[44]This alleged reason can be disposed of shortly. As a result of my findings of fact at sub-paragraphs 42 (b) – (e) above, which are themselves based largely on Mr Tombs’ own recollection of events, the decision to take the new plots away from Mr Tombs was effectively reached by agreement. It was what Mr Tombs himself had ‘recommended’. Accordingly, the decision was a mutual one; it could not constitute a breach of contract on the part of WCL, and it certainly could not justify a decision by Mr Tombs to withdraw his labour from site on the grounds of repudiation by WCL. By the same token, I should say that, because the decision was mutual, it could not amount to a repudiation by Mr Tombs either. I therefore reject paragraph 34 of Mr Scott-Holland’s Closing Submissions.[45]In my judgment, the most important point of all is that, as a matter of fact, the decision that Mr Tombs would not work on any new plots did not cause any withdrawal of labour from the sites in any event. As I have found, again based on Mr Tombs’ own recollection, he continued to work on the sites following the meeting on 3rd April 2003, after the decision had been taken that others would be engaged to carry out the brickwork to the new plots. He therefore did not withdraw his labour in consequence of that decision. It follows that the taking away of the new plots did not cause and could not have caused the repudiation of the Sub-Contract by WCL or its acceptance by Mr Tombs. For these reasons, this case is wholly different on the facts to Sweatfield Ltd v Hathaway Roofing Limited (1997) CILL 1235, where the bringing to site of additional labour by the Main Contractor, in the teeth of the Sub-Contractor’s objections, was found to be repudiatory. I therefore reject in its entirety the first way in which the repudiation case was put by Mr Berry on behalf of Mr Tombs: it simply does not arise on the facts which I have found. Reason 2: The Non-Payment of the 27/28.3.03 Applications

Reason 2:

[46]There is no dispute that, in early April 2003, Mr Tombs chose to withdraw his labour from all the WCL sites where he was working, because of WCL’s failure to pay his 27/28.3.03 applications. Accordingly, if WCL were in breach of contract in not making payment in accordance with the Sub-Contracts, and if such breach justified his decision to withdraw his labour, it would constitute his acceptance of WCL’s wrongful repudiation of his Sub-Contracts. In the absence of any breach and any such justification, his withdrawal of labour would be unlawful and would itself constitute wrongful repudiation by him of the Sub-Contracts. Accordingly, the key issue becomes whether or not his withdrawal of labour on Monday 7th April was justified. For the reasons set out at paragraphs 47-58 below, I am in no doubt that WCL were not in repudiatory breach of contract and that Mr Tomb’s decision to withdraw his labour was wholly unjustified.[47]The starting point for any consideration of this part of the case is, of course, an analysis of the terms of the Sub-Contracts themselves. For the reasons which I have given (paragraphs 22-33 above) the Sub-Contracts incorporated what I have called the new short form terms and conditions. The relevant terms relating to payment are as follows: “(28) The Company [WCL] shall make interim payment(s) to the Sub-Contractor [Mr Tombs], on provision of an invoice or … a request for payment by the Sub-Contractor, in respect of the value of all works certified by the Site Manager as properly executed to the date of the invoice by the Sub-Contractor less any amounts previously paid under this Sub-Contract and any permitted deductions or retentions. (29) On completion of the work under this Sub-Contract, the Company shall pay to the Sub-Contractor the total sum of the agreed contract price, on provision of an invoice or a request for payment by the Sub-Contractor, less any amount previously paid under Clause 28, and any permitted deductions or retentions. Any invoice rendered by the Sub-Contractor at any time shall provide details of an appropriate VAT number and the amount of VAT due upon the sums due pursuant to that invoice. … (31) Invoices or requests for payment (as appropriate) delivered in accordance with Clause 28 and 29 above shall identify the site, the order number and plot(s) to which the works relate and shall be signed by the Site Manager. (37). The Company will process Sub-Contractors’ payments on a regular weekly/fortnightly/monthly basis based on returns received from site. It is the Sub-Contractor’s responsibility to enquire about the relevant payment day and the closing day for submission of returns from particular sites. The closing day in each weekly/fortnightly/month for submission of Sub-Contractors’ invoices and payment details may vary from site to site. 56. … (39). Each interim payment under clause 28 and the final payment under clause 29 shall become due for payment on the date of receipt by the Company from the Sub-Contractor of a valid invoice (“the Due Date for Payment”). The Company shall (subject to the provisions of clause 36) pay each payment which has become due for payment within 14 days of the relevant Due Date for Payment (except in respect of the final payment under clause 29 which shall become payable within 28 days of the relevant Due Date for Payment (“the Final Date for Payment”).[48]It follows that the interim applications sent by Mr Tombs to WCL Head Office on 27/28.3.03 relating to Caldecote were not valid because, contrary to clause 31, they had not been signed by the Site Manager. As I have already pointed out (paragraph 15 above) the invoice actually sent to WCL’s Head Office was very different in important respects to the one that had been seen and signed off by the Site Manager. This is not an idle technical point: the absence of the Site Manager’s signature on the interim application sent to Head Office allowed Mr Tombs to invoice WCL for items of work which had not been included in his original valuation, and which had not, therefore, been approved by the Site Manager. It follows that, since the invoices of 27/28.3.03 were invalid, WCL could not be in breach of contract for not paying them.[49]More fundamental still, Clause 39 provided a clear payment regime, which allowed WCL 14 days to make payment from the date of the relevant invoice. Thus, assuming that the applications of 27/28.3.03 were valid, the due date for payment was 28.3.03 and the final date for payment under the Sub-Contract was 11th April 2003. It therefore follows that WCL could not be in breach of contract for failing to pay the invoices on 7th April 2003, because the 14-day period in which they had to pay such invoices had not yet expired. Accordingly, Mr Tombs was not entitled to withdraw his labour for non-payment because WCL were not at that point in breach of contract. He wrongfully repudiated the contract by so doing, which repudiation was accepted when WCL engaged others to complete his work.[50]Mr Berry argued that the obligation to pay arose on the due date for payment – here, 27th or 28th March 2003 – and that the mere fact that WCL had a period of grace of 14 days to make that payment - “a concession” he called it - did not affect WCL’s legal obligation to pay on the due date. I consider that submission to be based on a misreading of the clause. The sum became due on 27/28.3.03 but it was payable at any time during the 14 days; thus WCL were not obliged to pay the amount claimed on a valid invoice until the end of the 14 days and Mr Tombs was not entitled to be paid the sum until the end of the 14 days. Accordingly, non-payment could not constitute a breach of contract by WCL until 11th April 2004 at the earliest.[51]I should say that, even if, contrary to my findings at paragraphs 22-33 above, the old conditions were incorporated into the Sub-Contract, it would not alter my conclusion that WCL were not in breach of the contract by not paying the monies claimed by Mr Tombs by 7.4.03. The old conditions did not contain any express provisions relating to the time for payment of invoices. Accordingly, the parties would have to rely on implied terms. Any implied terms would have to reflect The Scheme for Construction Contracts Regulations 1998, introduced by the Housing Grants Construction and Regeneration Act 1996. Under Part II of those Regulations, an interim payment would become due no earlier than 7 days after the making of the claim by Mr Tombs on 27/28.3.03, and the final date for payment would, pursuant to clause 8(2) of the Scheme, be 17 days thereafter. Therefore, Mr Tombs would not be in a better position if the old conditions applied; in fact he would be in a worse position, since on that analysis WCL were not obliged to pay his interim applications until 21st April 2004.[52]Mr Tombs said that he was regularly paid by WCL within 7 days from the date of the submission of his interim application to Head Office. I accept that evidence. However, there was nothing to indicate that this was or became any sort of contractual entitlement. Furthermore, in cross-examination on this point, Mr Tombs agreed that WCL were entitled to investigate his invoices and that, if this meant that WCL could not pay him within a week, then that was entirely reasonable. This part of the cross-examination went as follows:
“Q: You accept, I think, that WCL could check the invoice? A: Yes, I do not dispute that. Q: If it therefore took longer than a week to check the invoice prior to payment, that was not unreasonable? A: No, it was not unreasonable.”
Accordingly, it seems to me that even if, which was not the case, Mr Tombs had some sort of general entitlement to be paid within 7 days of his application, such an entitlement would always be subject to WCL’s right to check his invoice and, for the reasons which I have summarised at paragraph 15 above, it is plain that, in this case, the relevant invoices were quite reasonably the subject of detailed checking by WCL, which process was still ongoing on 7th April 2003. Thus, even on the basis of Mr Tombs’ contention that he should have been paid generally within 7 days, he is still unable to demonstrate that WCL were in breach of contract by not paying these applications by 7th April 2003. A: No, it was not unreasonable.”[53]For all these reasons, therefore, I am bound to conclude that WCL were not and could not have been in breach of contract because they had failed to pay the 27/28.3.03 applications by 7th April 2003. The decision to withdraw his labour by Mr Tombs on that day was therefore unjustified and constituted in law a wrongful repudiation of the Sub-Contracts.[54]But, even if I were wrong about that, and WCL were somehow in breach of contract for not paying the interim applications of 27/28.3.03, I am entirely satisfied that this failure could not amount in law to wrongful repudiation in any event. It is, of course, always a question of fact in each case whether a failure to pay an interim payment amounts to repudiation. However, there are a number of authorities which make it plain that the failure to pay one instalment out of many due under the terms of a contract is not ordinarily sufficient to amount to a repudiation. These authorities are summarised by the learned editors of Keating on Building Contracts, 7th Edition, at paragraph 6.94 where they conclude:
“Where there is such a duty [to pay by instalments] it is a question in each case whether failure to pay is a repudiation. Failure to pay one instalment out of many due under the terms of the contract is not ordinarily sufficient to amount to a repudiation.”
[55]Mr Berry was not able to point to anything which, on proper analysis, elevated this one non-payment of an interim payment to a situation which, in these circumstances, justified the withdrawal of labour. His point that withdrawal had to be seen in the context of the decision that Mr Tombs would not commence any new plots was of no assistance to Mr Tombs since that decision was effectively a mutual one: see paragraphs 44 and 45 above. And his complaint that WCL’s non-payment should be viewed in a harsh light because they apparently believed that Mr Tombs was having difficulty in making payments to his men (and were therefore making matters worse) does not get off the ground because it was Mr Tombs’ case (which I accept) that he had no such difficulties.[56]In the course of his careful Closing Submissions, Mr Scott-Holland identified an entirely separate reason why, even on his own case, Mr Tombs could not justify his decision to withdraw his labour unilaterally. Mr Scott-Holland argued that neither the new short form conditions nor the old conditions contained any express provisions dealing with Mr Tombs’ rights and obligations if sums were not paid to him in accordance with the Sub-Contract; therefore, he submitted the provisions of the Housing Construction and Regeneration Grants Act would have to be implied, and, pursuant to Section 112(2) of the Act, Mr Tombs would have had to have given 7 days’ notice before suspending his work, which he failed to do.[57]I accept Mr Scott-Holland’s submission on this point. The purpose of the Act was to regulate the proper payment of contractors and sub-contractors, and gave a contractor or sub-contractor the right to suspend his work on notice in the event of non-payment. This system of rights and duties is implied into these Sub-Contracts and there can be no argument that Mr Tombs did not give the required, or any, notice of his withdrawal. Thus, once again, even on Mr Tombs’ own case, the withdrawal of labour on 7.4.03 without notice was premature and amounted to wrongful repudiation of the Sub-Contract.[58]Accordingly, for all these different reasons the answer to Issue (3) is No, and the answer to Issue (4) is Yes. Issue (5): If the answer to Issue 3 is Yes, is Mr Tombs entitled to claim damages by reference to his alleged loss of profit, and if so, how is that claim to be measured?[59]In view of my conclusion that WCL were not in repudiatory breach of contract, this Issue does not, strictly speaking, arise for determination at all. However, since the matter was fully argued, and Mr Scott-Holland took a number of points on this part of the case, on which I have reached a clear conclusion, it is appropriate for me to deal with this Issue in this Judgment.[60]For a number of reasons, set out at paragraphs 62-65 below, I have concluded, that, even if WCL had been in repudiatory breach of contract, Mr Tombs would not be entitled to recover the sum of £101,604.58, or any sum referable to his alleged loss of profit.[61]Mr Scott-Holland’s first point was that a claim, such as this, for loss of profit, was expressly excluded by the new short form terms and conditions which I have found were incorporated into these Sub-Contracts.

(c) , which provided that:

“If the employment of the Sub-Contractor shall be determined as aforesaid or in any other way, then the Sub-Contractor shall be deemed to be in breach of this sub-contract and …the Company shall only be liable to the Sub-Contractor for the value of any work actually and properly completed and not paid for at the determination and for no other sum or sums whatsoever and shall have the right to recover or deduct from or set off against any such amount the amount of damage suffered and/or loss and expense incurred by the Company by reason of the determination of this contract under this clause”
. Mr Scott-Holland argued that, on the facts, the Sub-Contracts were terminated by WCL as a result of the withdrawal by Mr Tombs of his labour and that therefore this clause prohibited the claim for loss of profit. Whilst that may be right, this point actually adds nothing to WCL’s case since the withdrawal of labour, being wholly unjustified as I have found, amounted itself to a wrongful repudiation by Mr Tombs, which would mean that he could not recover his loss of profit in any event. I note in passing that, even if the old conditions were incorporated into the Sub-Contracts, this point (for what it is worth) would also be available to Mr Scott-Holland, since Clause 3(iii)(c) of the old terms and conditions was in identical terms to Clause 8(c).[62]Assuming now that, contrary to my unequivocal conclusion to the contrary, WCL repudiated the Sub-Contracts, I am unable to find, on the facts before me, that Mr Tombs’ pleaded claim for damages could succeed. The starting point for any analysis of this claim on the facts is the point set out at paragraphs 42 and 44-46 above, namely that, even on Mr Tombs’ own case, the only physical work at the sites affected by the withdrawal of labour on Monday 7th April 2003 was the work of completion on the plots which had already been started. Mr Tombs’ work to those plots which had not yet started had been omitted as a result of the decision of 2nd/3rd April 2003, set out at Sub-paragraphs 42 (c) (d) and (e) above. Accordingly it is impossible to see how that work, that is to say, the work to plots which had not yet started, could form any part of the claim for repudiation at all. The only work which could form the basis of the damages claims was the limited work of completion. Thus, because the pleaded claim for damages made by Mr Tombs encompasses an alleged loss of profit on both the plots not yet started as well as an alleged loss of profit on the work to plots which had been started, and in respect of which the labour had been withdrawn, the pleaded claim was obviously flawed. Although Mr Scott-Holland made this point plain in his Opening, Mr Berry did not seek to offer any evidence for a loss of profit claim limited to the works of completion on the plots already started, which, in my judgment, could be the only work caught by a proper claim for damages. I do not even know if Mr Tombs suffered any sort of loss because of his inability to complete the works to the existing plots, which he had started, as opposed to his inability to do any work on the plots which he had not started at all. The pleaded global claim must therefore fail in its entirety.[63]Mr Scott-Holland also submitted first, that there was no evidence of any actual loss of profit on the work in question which there would have to be if this claim for damages was to be successful, and that, secondly, on the limited evidence made available by Mr Tombs, I should conclude that Mr Tombs made bigger profits after he had ceased working for WCL than he had made when he was one of their brickwork sub-contractors. It seems to me that, on the evidence, both of these submissions are sound. As to the first point, Mr Tombs accepted that he had never done any calculation to see whether or not he would actually have made a profit on the individual Sub-Contracts or sites which were covered by his damages claim. He agreed profit margins varied from Sub-Contract to Sub-Contract. If Mr Tombs is unable to say whether or not he could have made a profit if he had been allowed to complete his work for WCL on a particular site, I am quite unable to do so on his behalf. The essence of a claim of this type is that the sub-contractor has been prevented from carrying out work which, had he completed it, would have been profitable. The repudiation therefore deprives the sub-contractor of the profit he would otherwise have made. That requires the sub-contractor, not to show that he intended to make a profit when he originally priced the work (which was the extent of Mr Tombs’ evidence); but to demonstrate that, on the balance of probabilities, the particular completion work, which he was prevented from carrying out part way through the job, would have in fact been profitable if he had been allowed to complete it. Often a sub-contractor can lose money on a sub-contract for reasons which he simply could not anticipate when he originally priced the work; there can even be occasions when the work is proving so unprofitable that the sub-contractor is not at all unhappy when it is taken away from him. Mr Tombs needed to show, on the basis of probabilities, that he would in fact have made a profit on the completion work which he could not perform, but he adduced no evidence at all in support of such a case.[64]Mr Berry said that it was “too speculative” to try and work out what the profit would have been on the work that was not performed; for the reasons which I have enumerated, I not only consider that contention to be misconceived, but I also regard such an analysis as fundamental to a claim for damages for loss of profit. But if trying to work out what, if any, profit would have been made on the work not performed was “too speculative”, then of course a claim made by reference to a profit percentage which was simply the hoped-for percentage inserted into the original Sub-Contract tender (which was the only basis of Mr Tombs’ claim) was, a fortiori, “too speculative”, and no proper measure of loss at all.[65]As to Mr Scott-Holland’s second point, Mr Tombs’ accounts for the period up to April 2003 showed a gross profit of 5.23% (far less than the 17% which formed the basis of his claim) whilst the accounts for the period from April 2003 to April 2004 showed a gross profit of 11%. Accordingly, since Mr Tombs was only able to rely on this very general evidence as to his profitability, he had to accept that his profitability increased once he no longer worked for WCL. Although he maintained that he would probably have been able to work for all these other contractors as well as to carry on his work for WCL, that was an assertion which was not made good on the evidence, and which I find to be intrinsically unlikely.[66]Accordingly, I have reached the firm conclusion that Mr Tombs has been quite unable to demonstrate on the evidence that he suffered any loss of profit as a result of his inability to complete the works for WCL in April 2003. Moreover, I should also say that the pleaded claim, based on a figure of 17%, never got off the ground; as Mr Scott-Holland pointed out, the annual accounts for the two years up to April 2003 showed a profit percentage of just over 5% each time. That would therefore be the maximum amount of the claim if Mr Tombs had got over all the points at paragraphs 62-65 above, but, for the reasons set out there, he could not do so. Issue (6) Did the numbers of wall ties installed at various properties at Pine Lea constitute a breach of contract on the part of Mr Tombs?[67]This Issue breaks down into a number of sub-issues: What were the relevant terms of the Sub-Contracts? Were those terms varied and, if so, what was the effect of the variation? Were the number of wall ties installed by Mr Tombs in breach of the original and/or varied terms?[68]There was no dispute that, whether pursuant to the old or the new terms and conditions, Mr Tombs was obliged to comply with the relevant NHBC specification: Clause 1 of the new short form terms and conditions; Clause 1 of the old. The relevant NHBC Specification provided that for traditional brickwork the wall ties would be at 900mm horizontal centres and 450mm vertical centres; for timber frame buildings such as the ones at Pine Lea the ties were to be at 600mm horizontal centres and 450 vertical centres. The WCL Trade Specification, which was also incorporated into the Sub-Contracts, provided for ties at 900mm horizontal centres and 450mm vertical centres. If there was any doubt as to which Specification to follow, the documents made it clear that the NHBC Specification was to be the lead document.[69]There was no dispute between the parties that Mr Tombs’ work did not comply with the NHBC Specification. Mr Taylor, Mr Tombs’ expert, confirmed in his cross examination that, on the basis of the material that he had seen, neither of the NHBC Specifications relating to the spacing of wall ties had been met. Mr Greenwood, WCL’s expert, said the same thing, and set out in some detail in his Report the extent of the non-compliance. Both experts were guided to this conclusion by the contemporaneous reports on the various Pine Lea properties prepared by the NHBC and the Burrell Partnership, which recorded in some detail the locations of wall ties found and the numbers and locations of wall ties that were missing.[70]It was Mr Tombs’ primary defence to this claim that the requirement to comply with the NHBC Specification had been modified on site, and that Mr Blackaby (WCL’s Site Manager, who no longer works for WCL and who was called as a witness by Mr Tombs) had given different instructions to the bricklayers at Pine Lea. Since Mr Scott-Holland accepted that Mr Tombs’ contractual obligations would be defined by any such variation, it is therefore necessary to look at the evidence concerning this instruction very closely.[71]Mr Tombs’ first statement (28.5.04) did not address the issue very clearly although, at paragraph 13, he referred to the manufacturers’ wall tie Specification and related documents and exhibited them marked NT3. I shall return to that reference later in this Judgment. His second statement (6.7.04) was also relatively vague: the most detail that he offered on the point about the wall ties is, when commenting on paragraph 15 of Mr Broomfield’s statement, he said:
“The reason why the lack of wall ties was not picked up during the build by Wilson Connolly’s own staff or the NHBC or myself was because the wall ties inserted matched the specification we were all working to.”
His third statement (13.8.04) did not address the point at all. In none of the three statements, beyond the reference to NT3, did Mr Tombs indicate how the specification his men were allegedly working to on site differed from the NHBC Specification with which he was contractually obliged to comply. This vagueness on such an important point of his own defence was matched by Mr Andrews, who was Mr Tombs’ foreman at the Pine Lea site. He simply refers to ‘a new specification’ supplied by Mr Blackaby. The most detail that Mr Andrews provided was that “the normal spaces between wall ties are 255mm but we were told to space them 300mm.” However it was agreed by both parties that if wall ties had been spaced at 300mm, the frequency of ties would have far exceeded the maximum required by the NHBC. As a result, neither side relied on this aspect of Mr Andrews’ evidence or suggested that it was right.[72]Unfortunately, Mr Blackaby, the alleged source of this variation instruction, was no more helpful. His two written statements are also extremely general. The first statement of 2.6.04 states:
“As far as I am aware, Mr Tombs’ gangs put in the number of ties that they were required to according to the specifications laid down by the timber frame manufacturers and/or the NHBC inspectors.”
His second statement of 21.6.04 talks about the Specification of the manufacturers of the ties, Guildway/Helifix, which he said was faxed to him on site and his verbal instruction to Mr Andrews to insert the wall ties ‘using the above-mentioned specification’. In cross-examination, Mr Blackaby was unable to remember the contents of the Specification faxed to him on site and could not recall what rate or frequency of wall tie insertion he had instructed the men to follow. He pointed out that the 300mm identified by Mr Andrews would have led to ties being ‘very close together’.[73]Accordingly, an extremely unsatisfactory position was reached whereby Mr Tombs was defending the allegation that he failed to comply with the NHBC Specification by maintaining that he had followed specific instructions from Mr Blackaby which varied that Specification, but he did not in his statements identify what those instructions were and was unable to adduce cogent evidence from anybody else on the same point.[74]In truth, the clearest evidence as to Mr Tombs’ case came from his expert, Mr Taylor. In his report at page 18, Mr Taylor referred to Mr Tombs’ position and reported that:
“The sheet was marked by hand to indicate a spacing of wall ties at 2.5 m² at 600mm vertical centres which the Site Manager instructed him to follow.”
At page 26, paragraph 4.04, Mr Taylor said:
“It is stated by Mr Tombs that he was instructed to install the wall ties at 2.5 per m², and this is the figure that had been circled in pen on the copy of Table B in the Helifix literature exhibited.”
And on the following page at paragraph 5.02 Mr Taylor repeated:- “It is alleged by Mr Tombs that he was instructed by the Site Manager to install wall ties at 2.5 per m². The Site Manager, Mr Blackaby, confirms in his second witness statement that he did give instruction to Mr Tombs regarding the spacing of wall ties.” It was therefore crystal clear from Mr Taylor’s report, as he confirmed in his oral evidence, that his understanding from Mr Tombs was that the bricklayers were instructed to install the ties at 2.5 ties per m². It should also be noted that it was not only Mr Taylor who understood that his client’s case was that there was an instruction to install the ties at 2.5 ties/m²; that is also the case set out in Mr Berry’s Written Opening provided in the week before the trial started.[75]Confirmation of this instruction can be found in the Guildway/Helifix Specification and accompanying documents, to which I have already referred. I find that these documents were sent to Mr Blackaby on site and were provided by him to Mr Tombs and his men. Importantly, these are also the documents exhibited to Mr Tombs’ first statement at NT3. The copy of the Specification exhibited by Mr Tombs at NT3, on the third page, is clearly marked, with a circle drawn around the figure of 2.5 ties per m² with ties in the vertical studs every 600 millimetres. (Another copy of this document, with a different part highlighted, was produced after the witnesses of fact had completed their evidence: the document was not proved; there was no explanation for the highlighting; and it was not the circled document specifically exhibited by Mr Tombs. It therefore added nothing). On the evidence I have heard, therefore, I find that the copy of the document in the form exhibited by Mr Tombs at NT3 was made available by Mr Blackaby to Mr Tombs’ men on site and, as set out repeatedly in Mr Taylor’s Report, the instruction given to Mr Tombs’ bricklayers was that they had to install 2.5 ties per m². In addition, I should also note that the letter of 16.5.01 from the manufacturers, which Mr Tombs also referred to in his statement and also exhibited to that statement at NT3, made it clear that “on no account should ties ever be put in at less than 2.5 ties/m².”[76]Accordingly, there is no evidence which could lead to a conclusion other than this: that Mr Blackaby instructed Mr Tombs’ men to set the spacings so that there were 2.5 wall ties per m² and that, in respect of the vertical studs, they had to be at 600mm spacing. Of course, that is, or ought to be, a finding in favour of Mr Tombs, since he specifically raised the question of the variation instruction to put in ties to a lesser specification, and everyone agreed that the Guildway/Helifix Specification, and the 2.5 ties per m², was a less onerous obligation than that required by the NHBC. The problem for Mr Tombs is that it is plain on the expert evidence that this variation instruction, which I have found to have been given by Mr Blackaby, does not in fact give him any sort of defence to this claim, because his men did not comply with it.[77]Mr Greenwood, WCL’s expert, analysed the NHBC and Burrell Reports in detail. He concluded that, if an instruction had been given by Mr Blackaby to install the ties at a ratio of 2.5 ties per m², the evidence was clear that Mr Tombs and his men had simply not met that lesser specification. As Mr Greenwood pointed out, this conclusion was confirmed by the records of the missing ties in the various properties. Perhaps most graphic of all was Appendix 3 to his first Report, which showed, in respect of Plots 3 and 53, where the ties should have been based on the Guildway/Helifix Specification and other documents, and where the ties were actually found. The discrepancies were huge, with the ties actually installed having been inserted in what can only be described as an entirely haphazard way. Remarkably, the detailed analysis at Appendix 3 was not challenged during Mr Greenwood’s cross-examination.[78]Mr Berry’s only real challenge to WCL’s evidence on this part of the case was an attack on the reliability of the reports produced by the Burrell Partnership. This attack was principally based on the point that, since the Burrell Partnership seemed (wrongly) to suggest that the ties themselves were no good, the entirety of their reports were unreliable. Mr Greenwood rejected that argument, pointing out that issues as to the type of tie used were quite different to a survey of the frequency at which the ties were installed. He said he had "no reason to disbelieve" what the Burrell reports said they had found in the cavities, and I accept that evidence.[79]The absence of any challenge to Mr Greenwood’s analysis may have been because Mr Taylor simply could not challenge the conclusions set out in the Greenwood Report. Although he said in his own Report that it was his “understanding” that Mr Tombs had met the 2.5 ties per m² modified specification, Mr Taylor confirmed in cross examination that this was simply what he had been told by Mr Tombs, and he emphasised that he had not done his own analysis to see whether or not this understanding was or could be correct. Moreover, he also had to accept that the documents, including the NHBC Reports, led to a very different conclusion. It seemed curious that an expert in a case of this sort had not produced his own analysis of what was, after all, the major technical point in dispute. But the result of this was that there was no evidence before me (aside from Mr Tombs’ unsustained assertion to his expert that he had met the modified specification) on which Mr Tombs could rely to challenge the clear evidence of the documents and Mr Greenwood’s detailed analysis to the effect that he had failed to meet the modified instruction and was therefore in breach of contract. I am, therefore, bound to find that Mr Tombs was in breach of contract, because the ties did not comply with the modified instruction with which he was obliged to comply.[80]I should here deal with an extremely unsatisfactory element of the case on the wall ties. During his oral examination in chief, Mr Tombs said, for the first time, that “I believe we were working to 1.8 wall ties per m²”. This was again an unsubstantiated assertion; when cross-examined Mr Tombs was unable to explain where this figure came from or how it might be supported. Of course, the actual bricklayers were never called to give evidence. Not only was this point missing from Mr Tombs’ three statements, but it was directly contrary to what Mr Tombs had told his own expert, Mr Taylor (see the references at paragraph 74 above). I am bound to agree with Mr Scott-Holland’s submission that this last-minute oral evidence was dictated by simple necessity rather than a desire to be truthful: Mr Tombs realised that his case on 2.5 ties per m² did not in fact get him off the hook, because he had not complied with this lesser specification either, and he therefore tried to reduce still further the specification to which he was allegedly working in order to try and create a defence where none would otherwise exist. I reject this part of his evidence as being wholly unreliable. I also accept Mr Greenwood’s evidence, on which he was not challenged in cross examination, that the records showed that, so inadequate were the ties installed by Mr Tombs, that he had not even complied with an alleged specification of 1.8 ties per m²; that, even on this basis, the ties “were short by a considerable amount”.[81]The only other element of the technical evidence on this part of the case concerned the area around the windows. Mr Taylor took the point on behalf of Mr Tombs that, at least around the windows, it was difficult for all the ties to go in because the strips which marked the location of the ties were obscured by the window reveals. However, as he himself fairly accepted, this point did not, on analysis, amount to very much. In cross-examination he accepted that, if the windows were in the way, the bricklayer would have to go and seek assistance from the Site Manager and that to carry on regardless – which was obviously what happened - was “cavalier”. Furthermore, as Mr Greenwood’s detailed analysis of the missing ties makes only too clear, ties were not only missing in the area of the reveals, but above and below the reveals as well, where there was no obstruction to prevent their insertion. Ultimately, therefore, this point went nowhere.[82]Accordingly, on the facts, WCL have made out their case that Mr Tombs was in breach of the terms of the Sub-Contract in respect of the spacing of wall ties at certain properties at Pine Lea. The remaining issues, namely Causation and the value of any Damages to be paid/credited by Mr Tombs in consequence; are addressed at Issue (8) below. The answer to Issue (6) is therefore Yes. Issue (7) Did the brickwork at the Bull property constitute a breach of contract on the part of Mr Tombs?[83]The breach of contract addressed in Issue (6) above related to the problem of wall ties at a number of the properties at Pine Lea, including the Bull property. But, as we have already seen, there were other problems there in respect of the outer skin of the brickwork itself. The relevant contemporaneous reports and other documents setting out those defects have been identified at paragraphs 6-10 above.[84]It did not seem to be seriously disputed by Mr Tombs that the brickwork to the Bull property was defective and constituted a breach of contract. When the defects in the brickwork were first put to him in late 2002/early 2003, he did not dispute that his work was defective: his sole concern was the nature and extent of the remedial works. None of his three written statements purport to set out a case to the effect that the brickwork complied with the Sub-Contract. Neither does Mr Taylor’s Report suggest that the brickwork at the Bull property complied with the Sub-Contract. The evidence of the deficiencies is of course extensive, being set out in the two reports from the Andrew Firebrace Partnership and the two reports from the NHBC. It was Mr Greenwood’s view that, based on these documents, the brickwork was plainly defective. He was not cross-examined on that point. When I asked Mr Berry about his position on Issue (7) during his Closing Submissions, he realistically confirmed that Mr Tombs “accepted that the brickwork required some remedial work. The debate is: the scope of that work”. Accordingly I find on the evidence that the brickwork carried out by Mr Tombs at the Bull property was performed in breach of the terms of the Sub-Contract.[85]Accordingly, the answer to Issue (7) is Yes. Again, the questions as to Causation and the Damages (if any) payable by Mr Tombs are dealt with below, under Issue (9). Issue (8) If the answer to Issue 6 is Yes, are WCL entitled to damages and, if so, how is that claim to be measured?[86]Mr Berry raised what he described as three Causation points in respect of the claim by WCL for damages arising out of the need to retro-fit wall ties into various properties at Pine Lea. Firstly, he said that the lack of an adequate number of wall ties was the fault of WCL; secondly he said that the failures arose as a result of the lack of proper inspections by WCL and/or the NHBC; and thirdly he argued that there was a complete failure on the part of WCL to mitigate because they failed to give Mr Tombs an opportunity to carry out the necessary remedial works. Each of these three points was said by Mr Berry to constitute a complete defence to the claim for Damages because each one amounted to an alternative case on Causation.[87]As to the first point, the alleged defaults on the part of WCL were set out in paragraph 18.2 of the Reply, provided very shortly before the trial. In respect of the wall ties, the specific allegations are that it was WCL’s fault that the numbers of wall ties were inadequate because they failed to design the properties properly (18.2.3); failed to provide proper tapes or indicators around the window openings (18.2.4); failed to give proper instructions as to the required standard to be achieved (18.2.5); and failed to provide proper information, in particular fixing schedules (18.2.2).[88]All but the last of these allegations has been dealt with, and rejected, in the paragraphs above. There was nothing wrong with the design of the properties at Pine Lea: they were standard timber-framed houses. If the bricklayers had any concerns at all about the location of ties, particularly in the area of the window reveals, they could and should have reported the matter to the Site Manager, as Mr Taylor accepted in his evidence. Furthermore, for the reasons set out at paragraphs 74-76 above, I am entirely satisfied that the instructions given in respect of the wall ties were clear: the problem was that Mr Tombs’ men simply failed to comply with those instructions.[89]That leaves the allegation at paragraph 18.2.2. about missing information, and in particular the absence of a fixing schedule. Given that these alleged criticisms were not set out in the reports of Mr Taylor, the only evidence available to Mr Berry in support of these criticisms was such evidence as he could adduce from Mr Greenwood in cross-examination. On this topic, Mr Greenwood was emphatic: he stressed that, in his opinion, Mr Tombs’ men had all of the information that they needed on site. The dimensions would come from the house plan, which it was common ground was available to Mr Tombs; the type of mortar was set out in the specification; ties of the required type and number were supplied and the correct spacing of the ties was set out in the various Specifications referred to above. Furthermore, as Mr Greenwood said, if there had been any doubt about any of this, the bricklayers could and should have queried the position with the Site Manager. He concluded that “in reality, Mr Tombs had all the information that he required.” Having adduced that evidence, it seems to me that Mr Berry cannot now seriously challenge or dispute it, particularly given the absence of any contrary view expressed by Mr Taylor. In any event, I make plain that I accept Mr Greenwood’s detailed exposition of the adequacy of the information available to Mr Tombs and the reasons why that information was more than enough to enable Mr Tombs to carry out the work pursuant to the terms of the Sub-Contracts.[90]For these reasons, therefore, I reject the submission that WCL were in breach of contract as alleged in paragraph 18.2 of the Reply. However, for the avoidance of doubt, I should also say that, even if I had accepted, on the evidence, any of the criticisms set out in paragraph 18.2 of the Reply, I would not have concluded that such default caused the absence of proper numbers of wall ties. It seems to me clear that that problem was caused solely by the deficiencies in the work being carried out by Mr Tombs’ bricklayers, and for no other reason. To be fair to Mr Berry, it appears that he was driven to make the rather bold submission that the paragraph 18.2 ‘faults’ on the part of WCL were the effective cause of the problem with the wall ties because of an original misapprehension on his part as to the law. As he made plain in his Closing Submissions, he had originally advanced these points as part of an argument as to contributory negligence on the part of WCL; however, when it was pointed out to him that such contentions could not amount to contributory negligence in this case, where Mr Tombs was being criticised for a failure to comply with a specific contractual obligation, rather than an obligation akin to a duty of care in tort, Mr Berry had no option but to try and persuade me that these criticisms amounted to the real cause of the problems with the ties. For the reasons which I have given, I reject that argument in its entirety.[91]The second so called causation point advanced by Mr Berry in his Closing Submissions was the wholesale failure of the various inspectors, whether employed by WCL or the NHBC, to spot the inadequate numbers of wall ties being inserted. It was not clear how this point was of any real benefit to Mr Tombs. To the extent that it was suggested that the failure to spot the defects by the inspectors somehow absolved Mr Tombs from liability, then I agree with Mr Scott-Holland’s description of such a point as “misconceived”. The thief cannot, following the theft, blame it on the policeman for failing to catch him before he had committed the crime. At one point I wondered whether it was being suggested that, because the cavities had potentially been inspected by a number of different people, the fact that the problem had not been pointed out during construction suggested that everybody was happy with the reduced numbers of ties and that this end result somehow demonstrated that the work was satisfactory. To the extent that such is Mr Tombs’ case I reject it, both on the evidence and as a matter of law. There was nothing to say that the wholly inadequate numbers of wall ties used in this case were approved or accepted by WCL or by the NHBC (or anyone else) and there was no event in law which could absolve Mr Tombs from his ordinary contractual liabilities if, at a later date, it was discovered that his work did not comply with the terms of his Sub-Contract. For these reasons, I therefore reject the second point on causation advanced by Mr Berry. I note, in passing, that this point took up a large amount of Court time since it was one of Mr Berry’s principal lines in cross-examination.[92]The third alleged causation point in respect of the wall ties concerned Mr Tombs’ complaint that he was not allowed to carry out the appropriate remedial work, and that, as a result, there could be no claim. This argument was essentially founded on clause 1(f) of the old conditions which required Mr Tombs “to make good at his own expense”, and the absence, in the old conditions, of a similar provision to clause (2) of the new short form terms and conditions which provided:
“For the avoidance of doubt, the Company may employ others to make good any defects for which the Sub-Contractor is responsible which appear in the sub-contract works without informing the sub-contractor and the company is not obliged to first afford the sub-contractor an opportunity to remedy the defects itself.”
[93]Since I have found that the new short terms and conditions were incorporated into this sub-contract, this third causation argument must fail: as clause (2) makes plain, WCL had no obligation to allow Mr Tombs the opportunity to carry out the necessary remedial work. But there are a number of further points which I should add, because in any judgment this argument was always unsustainable. First, even if I had found that the old conditions applied, I would have found that the right to carry out remedial work was not unqualified and that, if the defects came to light after the property had been sold and the new owner of the house had a reasonable objection to Mr Tombs’ returning to carry out the remedial work, then he would not be entitled to carry out that work. In this case, for the reasons which I have given, it was entirely reasonable for Mr Bull to make such objection. Therefore, even if the old conditions applied, I do not consider that the alleged lack of opportunity to carry out remedial works can constitute any form of defence.[94]Secondly, I reject this argument on the facts. For the properties at Pine Lea (other than the Bull property) where the only significant problem was the absence of ties, WCL mitigated their loss by leaving the vast majority of the brickwork in place, and retro-fitting additional quantities of wall ties. However, prior to the repudiation of the Sub-Contracts, Mr Tombs had never undertaken such work and was not a contractor approved by the manufacturer to carry out such work. He could not have done the work. In addition, by the time the remedial work was done Mr Tombs had repudiated the Sub-Contracts, and he was no longer entitled to rely on an alleged right which he claimed to have under Sub-Contracts which he had wrongfully brought to an end. His repudiation extinguished any such right he might otherwise have had.[95]Thirdly, I reject this argument on the law. As I pointed out to Mr Berry during his opening, he was wrong to suggest that the alleged existence of a right to carry out remedial work operated as a complete defence in Mr Tombs’ favour. The authorities make plain that, at most, the denial of a right to make good defects affects the measure of the loss and nothing else: see Pearce and High Ltd v Baxter [1999] BLR 101 and the earlier, careful Judgment of His Honour Judge Stannard in William Tomkinson v Parochial Church Council of St. Michael [1990] CLJ 319. Since there was no evidence from Mr Tombs as to the likely cost to him of doing the remedial work, which was necessary if this argument was to have a quantifiable effect, the point went nowhere: it certainly was not any sort of defence in law.[96]Having rejected, for the reasons set out above, the three causation arguments raised by Mr Tombs, my final task under Issue (7) is to assess the measure of loss. The damages claim in respect of the inadequate wall ties on the properties at Pine Lea (other than the Bull property) is £25,092.62. At paragraph 7.15 of his supplemental Report, Mr Greenwood confirmed that, in his view, this was a reasonable sum for the work carried out. Mr Taylor did not dissent from that view in his Reports, neither did he advance any alternative figure. Mr Berry did not cross-examine Mr Greenwood on his view that £25092.62 was reasonable for the work done. It is true that Mr Berry criticised the remedial contractors, Period Property Preservation, for not putting in sufficient ties even as part of the remedial works, but it was unclear how or why this point assisted Mr Tombs. For these reasons, therefore, I conclude that there is no material available to me on which I could or should reduce the sum claimed.[97]Accordingly, the answer to Issue (8) is Yes, and the damages are ascertained in the sum of £25,092.62. Mr Scott-Holland accepted that VAT is not payable in addition to this sum. Issue (9): If the answer to Issue 7 is Yes, are WCL entitled to claim damages and, if so, how is that claim to be measured?[98]Mr Tombs again raised a causation point in respect of this item of counterclaim. However, this point is considerably shorter than the points addressed in paragraphs 86-95 above. He does not and cannot rely on the alleged defaults of WCL at paragraph 18.2 of the Amended Reply to explain the deficiencies in the brickwork, and neither does he rely on the widespread failure of the inspectors. That leaves the third point, namely the contention that he ought to have been allowed to carry out the appropriate remedial work himself. Whilst I dismiss that contention for the same reasons set out in paragraphs 92-95 above, there is an additional reason why I consider, on the evidence, that this argument is not open to Mr Tombs in respect of the rebuilding of the brick outer skin to the Bull property.[99]In my judgment, it is plain that, in February and March 2003, Mr Tombs made clear to WCL that he would not rebuild the outer skin of the Bull property. Indeed, it was this objection which led to the final, futile attempt to persuade Mr and Mrs Bull to allow repair rather than reinstatement works to be carried out. Accordingly, it seems to me clear that, whether or not he was entitled to an opportunity to carry out remedial work, Mr Tombs was given that opportunity, and rejected it. Therefore, provided that WCL can show that it was reasonable to demolish and rebuild the outer skin of brickwork, then it must follow that Mr Tombs unreasonably refused to carry out appropriate remedial work and as a result, any defence under Issue (9) based on an alleged failure to give him that opportunity must fail completely. I deal with the points as to reasonableness below.[100]The claim in respect of the Bull property is for the cost of demolishing the outer skin, rebuilding it, and associated work. The pleaded claim is for £66,143.46, plus VAT. That sum is broken down by Mr Broomfield in his written statement and analysed in some detail by Mr Greenwood in his Report. It is considered in detail below. Mr Tombs’ objections to this claim essentially come down to three points: that it was unreasonable to demolish the outer brick skin; that the works took too long and therefore cost more than they should have done; and that some of the individual items were unjustified. I deal with each point in turn.[101]As to the reasonableness of the decision to demolish the outer brick skin (as opposed to carrying out patch repairs), I am in no doubt at all that that decision was entirely justified and reasonable. I have already referred at Paragraphs 6-10 above to the views of both the Andrew Firebrace Partnership and the NHBC that the outer brickwork should be demolished. True it is that the NHBC Addendum Resolution Report of 18.2.03 identified, as a secondary option, the possibility of patch repairing. However, the NHBC make clear that this option was subject to the owner’s approval. Mr Bull, having been told by the Andrew Firebrace Partnership that the wall should be rebuilt even before the problem of the wall ties emerged, reasonably refused to countenance any lesser scheme. On that basis, as Mr Broomfield explained in his evidence, WCL had no option but to agree to demolish the outer skin and rebuild. Since that was the first option identified by the NHBC in the Addendum Resolution Report, it is very difficult to see how WCL can be criticised now for undertaking such work.[102]Mr Greenwood, in his lengthy written answer to a question raised by Mr Tombs on this issue, concluded that “it would be reasonable for WCL to follow the [NHBC] recommendation as they did”, and for the reasons which I have given, I agree with him. I also note that Mr Taylor could not challenge or disagree with that conclusion in either of his two Reports.[103]For these reasons I was more than a little surprised when Mr Berry submitted in his Closing Submissions that the decision to take down the brickwork was “misconceived”. This argument appeared to be two-fold: that no independent report was commissioned by WCL before the decision to demolish was taken, and that WCL panicked because of the improper pressure from Mr Bull. Neither of these two points was advanced or adopted by Mr Taylor, and I regard both as ill-founded. WCL had access to sufficient reports and expertise to make the commissioning of yet another investigation a pointless waste of money. And Mr Bull’s concerns were reasonable and legitimate; I must not forget that, but for Mr Tombs’ breaches of contract, they would not have arisen at all.[104]Accordingly, on the first point, I conclude that the decision to demolish was entirely reasonable and these works should form the basis of WCL’s damages claim.[105]I should here deal with Mr Scott-Holland’s argument that it was not open to Mr Tombs to raise this, or indeed any other objections to the scope of the remedial work which were carried out, by reference to the principle in Great Ormond Street v. McLaughlin and Harvey [1987] CLJ 245. In my view this authority is distinguishable from the present case because here WCL were not relying on one independent professional view, like the Board of Governors did in GOSH; WCL took their own decision, albeit based on a wide range of available material and advice. I therefore consider that the points taken by Mr Tombs are open to him to raise although, for the reasons I have given, I reject the first point entirely on the evidence.[106]The second challenge made by Mr Tombs is as to the length of time that the remedial works took to the Bull property. It appears that the total period in respect of the remedial works was 22 weeks. However, the vast bulk of the brickwork which was the principal work involved apparently took about six weeks, from July to September 2003: see Mr King’s letter to Mr Rosher of 29th June 2004. I therefore consider that, in all the circumstances, the period of 22 weeks was excessive. It was not justified on the evidence. Mr Taylor was of the view that a maximum period of 12 weeks would be reasonable for a JCT contract in respect of this work, although he made clear that this assumed optimum conditions. Mr Greenwood assessed a period of 15 weeks as being reasonable and produced a detailed programme in support of his contention. This 15-week period was referable to Mr Greenwood’s objective scope of works, which was, on the detail, slightly different to the work actually carried out, and this was a further reason why he arrived at a period which was less than the time actually taken.[107]I consider that Mr Greenwood’s 15 week period is reasonable and I do not consider that WCL ought to be entitled to recover any sums by reference to the additional period of 7 weeks between Mr Greenwood’s theoretical period of 15 weeks and the actual period of 22 weeks. Mr Greenwood has allowed for the 15-week period, not the 22-week period, in the detailed evaluation in his Report. It is that analysis, therefore, which I then take as the starting point for my calculation of the damages due in respect of the defects at the Bull property, based on an item-by-item assessment. Mr Greenwood was emphatic that his assessment of this head of claim was calculated by reference to his period of 15 weeks; since I find that that was a reasonable period for the remedial works, that is sufficient reason for me to take Mr Greenwood’s calculation (and reduction) of WCL’s claim as the basis for my detailed evaluation of this head of loss. I then turn to my item-by-item assessment.[108]Schedule of remedial works Item 1: Ibstock Brick Claim: £2,853.13. The adjusted figure of £2,428.20 is less than the amount originally claimed because of the concession on VAT. Mr Taylor accepted it as reasonable. Item 2: Meadowstone Claim: £766.54.119. Items 3, 5, 7, 11, 17 and 22: Storage Charges120. Total Claim: £4,335.27121. Item 4: Ibstock Brick Claim: £214.32122. Mr Greenwood’s reduced figure of £182.40 was not challenged.123. Item 6: CQMS Claim: £1,028.13124. Items 8, 15, 16, and 21: TB Scaffolding Claims £12,255.25.125. Item 9: Salvage of Chimney Liners Claim £209.92126. Item 10: Existing stopcock Claim: £24.73127. Item 12: Meadowstone Claim: £103.17128. Items 13 and 30: Smith Building Services Claims: £28,098.97129. Item 14: Cavity Socks Claim: £122.20.130. Mr Taylor confirmed that the reduced figure of £104 reasonable.131. Item 18: Osborn Brickwork Claim: £22,945.40132. Items 19, 20, 23 and 24: Other brickwork Claims: £529.60133. Items 25 and 26: Landscaping Claims: £870 and £609.44134. Items 27, 28: Portico Claims: £264 and £245135. Item 29: Cleancare Claim: £443.56136. Item 31: Norfolk Drywall Claim: £240137. Item 32: P & B Flooring Claim: £1,029.30138. Item 33: Steve Leigh Claim: £52 This claim was for £44.25 exclusive of VAT. As a matter of principle, it follows from Item 10.[109]As a result of each of the matters set out in paragraph 108 above, I conclude that the right figure for damages in respect of the Bull property is £56,112 the total of each of the items analysed there.[110]Finally, there was a suggestion that a saving could have resulted if the garage roof had not been removed. This arose because it was suggested that the garage roof only had to be taken down because of the problem with the under-cloaking, which was not Mr Tombs’ responsibility. However, Mr Greenwood made plain that the garage roof did not have to be removed because of the under-cloaking: the under-cloaking could have been installed following the removal of just one or two roof tiles at either edge of the roof. The question then is: could the roof have been kept on whilst the remedial work to the brickwork was undertaken? In my view, it would have been unreasonable for the roof to be kept on during that work. It would have meant that the brickwork could only have been done one wall at a time, because three walls were necessary to keep the roof up. I think it is unreasonable to have expected WCL to carry out the work in that way: moreover, as was indicated in the evidence, such a methodology could well have been more expensive than removing the roof at the outset.[111]Accordingly, for all these reasons, I conclude that the right sum to be paid/credited by Mr Tombs to WCL in respect of the defects at the Bull property is £56,112, and that is the answer to Issue (8).[112]The only remaining question is whether there is any authority which is binding on me that ought to prevent me from making the deductions to the WCL claim that I have indicated at Paragraphs 106-110 above. Mr Scott-Holland contended (independently of his GOSH point) that, since the remedial work had actually been carried out, it would be wrong and unfair to penalise WCL while allowing Mr Tombs to reduce the amount that they had actually spent. Of course I recognise the principle that a contract-breaker cannot take every single point on the remedial work accounts. But I consider that, for the reasons which I have given, it is legitimate for me to reduce the amount claimed in line with Mr Greenwood’s analysis, because WCL cannot show that all the sums that they originally claimed were the natural and direct consequence of Mr Tombs’ breach. Those that were not the natural and direct consequence of his breach have been excluded; those that were make up the £56,112.

CONCLUSIONS

[113]As set at Paragraph 41 above, the total value of the outstanding work due to Mr Tombs was £26,847.90p. Against that, for the reasons set at in Paragraphs 67-82 and 86-97 above, Mr Tombs was liable in damages to WCL for £25,092.62 in respect of the wall ties; in addition, for the reasons set out in Paragraphs 83-85 and 98-112 above, Mr Tombs was liable in damages to WCL for £56,112 in respect of the defects at the Bull property. Accordingly, the net position, taking into account claim and counterclaim, is that Mr Tombs owes to WCL the sum of £54,356.72.[114]Accordingly, there will be judgment for WCL in the sum of £54,356.72. I would urge the parties to agree the question of interest; if it is not agreed, I will deal with interest, as well as costs, when this judgment is formally handed down.

Cited in 1 later judgment