“1. These proceedings are a retrospective construct designed by or on behalf of the guiding mind of the Claimants, Mr Darbara Singh Dhanoa (otherwise known as John Dhanoa), who belatedly realised the excesses of his own hubris when he was unable to achieve what he wanted. 2. Rather than take the failure of his venture on the chin, Mr Dhanoa seeks to recover from the Defendant (“F+P”) his costs of the venture and the lost profits he wishes he would have made if only he had opened a 5star hotel in September 2012. This is in circumstances where Mr Dhanoa has never got near to putting a spade in the ground to start the construction of the hotel. 3. Indeed, despite the fact that Mr Dhanoa obtained planning permission for his desired hotel (which F+P designed), over 8 years ago, on19 February 2009 , no planning permission has been applied for, let alone obtained, for the scheme which Mr Dhanoa now says F+P should have designed (“the Acanthus Scheme”), a scheme which even now has very little detail. 4. Mr Dhanoa has no case at all. Instead, having instructed solicitors on a CFA and taken out ATE insurance, he is playing with other people’s money trying to bluff his way through the Court as if civil litigation were some game of high stakes poker. At trial, F+P will expose Mr Dhanoa’s claim for the bluff that it is.”
“These were the size and number of rooms [etc] ... and (slightly bizarrely) the retention of the existing bowling alley which we understood his wife liked managing.”
“It is clear that [X] are a very competent fabrication and enabling works engineer. However, they are not in the class of design engineers which are required for this job. We need an engineer of proven design talent……they do not understand the commitment + talent we will require during the design process. No matter what people say at this stage, if they have under-priced the job, they will just not turn up when they start losing money….”
“From this line of authority I derive the following principles in the context of the present case: (1) In certain circumstances a court may be entitled to draw adverse inferences from the absence or silence of a witness who might be expected to have material evidence to give on an issue in the action. (2) If a court is willing to draw such inferences, they may go to strengthen the evidence adduced on that issue by the other party or to weaken the evidence, if any, adduced by the party who might reasonably be expected to call the witness. (3) There must, however, have been some evidence, however weak, adduced by the former on the matter in question before the court is entitled to draw the desired inference: in other words, there must be a case to answer on that issue. (4) If the reason for the witness's absence or silence satisfies the court, then no such adverse inference may be drawn. If, on the other hand, there is some credible explanation given, even if it is not wholly satisfactory, the potentially detrimental effect of his/her absence or silence may be reduced or nullified.”
“…..without in any way departing from the statements of principle that apply in this situation generally or applying a different standard, that procurement proceedings have a particular aspect to them that should be borne in mind. This is that there is an express obligation of transparency upon the contracting authority. On occasion, and without in any way shifting the burden of proof, contracting authorities and their evaluators may be required to justify or explain what has been done when evaluating tenders, particularly if a score given on a particular requirement has been changed by the SMEs themselves during the evaluation process. Reasons have to be recorded and the record is important; it helps compliance with the obligation of transparency. Such explanation is made far more difficult for a contracting authority if the directly relevant personnel who were centrally involved in that process are not called as witnesses. This justification or explanation is something that will or may arise if the material available shows a prima facie manifest error. That is probably simply a different way of stating the third of Brooke LJ’s principles in Wisniewski.”
“The Consultant warrants and undertakes that in the performance of its duties under this Agreement the Consultant has used and shall use all the skill, care and diligence to be expected of suitably qualified and experienced architects undertaking services the like of those undertaken by the Consultant in relation to projects of the scale and character of the Development and that it will observe and perform all the terms and obligations on its part to be observed and performed. For the avoidance of doubt, all duties and obligations of the Consultant under this Agreement are subject to the level of skill and care detailed in this clause 8.1 except where the Consultant is required to comply with any statutory requirements, permissions or law generally.”
“18Warranties for third parties 18.1 The Consultant shall, as the Employer may at any time or times require, deliver within 21 days of the Employer’s request a Warranty or Warranties in favour of Funders and/or Purchasers and/or Tenants and/or any company appointed to manage or repair or keep in repair the completed Development. 18.2 From the date of the Employer’s notice under Clause 18.1 and until and unless the Consultant enters into a Warranty in accordance with the Clause 18, the intended beneficiary of such Warranty shall be entitled, in accordance with theContracts (Rights of Third Parties) Act 1999 , to bring proceedings (other than for specific performance or injunctive relief) to enforce for its benefit any right or benefit of the Employer arising under this Agreement, but the parties to this Agreement may exercise any right which they may have to rescind, cancel and/or vary the terms of this Agreement without the consent of the intended beneficiary being required.”
“Project Direct approach for 500 room 5* hotel (50,000m 3) including fit-out. Cost about£75 million based on£150k /room. Fee Proposal£6.5m ( = 9.3% Resource£4m ) for full service. Terms and Conditions Propose F+P Memorandum Non refundable mobilisation fee Propose£150k . Expenses Plus 10% including travel and presentation…..”
“Also, in relation to PI insurance, I understand that the build cost could possibly reach 100 million, and therefore an appropriate level of cover will need to be put in place…..”
“Whether Foster was told (or otherwise had knowledge of) Riva’s budget for the Development (whether that be£70 or£100 million ) between July 2007 and January 2008 and, if so, what did that budget relate to?”
“Subject: Update – Riva Hotel budget Grant John intends to reduce the cost down to ~ 100mio. We will be optimising basements and construction methods (steel containers as an option to save 40% on the hotel above ground) etc. Let’s see how we are doing with this but it could bring the budget back to where we assumed it would be for fees. Chris”
"If I had been told at this stage that achieving the scheme for my budget would not be possible, I would have immediately changed to a more modest scheme."
"I always intended to building out the scheme?” A. Yes, it was -- Q. There is no qualification there along the lines of "unless someone made me a stupid offer"
"As stated above, I always intended to obtain planning permission, build out the scheme and then sell."
“There was nothing in the Appointment which required [Fosters] to design the hotel within a stipulated budget”
“A solicitor's duty to his client is to exercise all reasonable skill and care in and about his client's business. In deciding what he should do and what advice he should tender the scope of his retainer is undoubtedly important, but it is not decisive. If a solicitor is instructed to prepare all the documentation needed for the sale or purchase of a house, it is no part of his duty to pursue a claim by the client for unfair dismissal. But if he finds unusual covenants or planning restrictions, it may indeed be his duty to warn of the risks and dangers of buying the house at all, notwithstanding that the client has made up his mind and is not seeking advice about that. I say only that this may be his duty, because the precise scope of that duty will depend inter alia upon the extent to which the client appears to need advice. An inexperienced client will need and will be entitled to expect the solicitor to take a much broader view of the scope of his retainer and of his duties than will be the case with an experienced client.”
“when dealing with a client with experience in the relevant area… there is only a duty to advise if advice is sought”
“(i) A solicitor's contractual duty is to carry out the tasks which the client has instructed and the solicitor has agreed to undertake. (ii) It is implicit in the solicitor's retainer that he/she will proffer advice which is reasonably incidental to the work that he/she is carrying out. (iii) In determining what advice is reasonably incidental, it is necessary to have regard to all the circumstances of the case, including the character and experience of the client. (iv) In relation to (iii), it is not possible to give definitive guidance, but one can give fairly bland illustrations. An experienced businessman will not wish to pay for being told that which he/she already knows. An impoverished client will not wish to pay for advice which he/she cannot afford. An inexperienced client will expect to be warned of risks which are (or should be) apparent to the solicitor but not to the client.”
“Yet Lord Atkin [in Donoghue v Stevenson] himself sounds the appropriate note of caution by adding, at p580: 160. beyond the function of the judge, for the more general the definition the more likely it is to omit essentials or to introduce non-essentials’.”
“But since the Anns case a series of decisions of the Privy Council and of your Lordships’ House, notably in judgments and speeches delivered by Lord Keith of Kinkel, have emphasised the inability of any single general principle to provide a practical test which can be applied to every situation to determine whether a duty of care is owed and, if so, what is its scope……What emerges isthat, in addition to foreseeability of damage, necessary ingredients in anysituation giving rise to a duty of care are that there should exist between theparty owing the duty and the party to whom it is owed a relationshipcharacterised by the law as one of ‘proximity’ or ‘neighbourhood’ and that thesituation should be one in which the court considers it fair, just and reasonablethat the law should impose a duty of a given scope upon the one party for thebenefit of the other……I think the law has now moved in the direction of attaching greater significance to the more traditional categorisation of distinct and recognisable situations as guides to the existence, the scope and the limits of the varied duties of care which the law imposes.”
“It is preferable, in my view, that the law should develop novel categories of negligence incrementally and by analogy with established categories, rather than by a massive extension of a prima facie duty of care restrained only by indefinably “considerations which ought to negative, or to reduce or limit the scope of the duty or the class of persons to whom it is owed.”
“Per Lord Bridge of Harwich, Lord Roskill, Lord Ackner and Lord Oliver of Aylmerton. Whilst recognising the importance of the underlying general principles common to the whole field of negligence, the law has now moved in the direction of attaching greater significance to the more traditional categorisation of distinct and recognisable situations as guides to the existence, the scope and the limits of the varied duties of care which the law imposes.”
“Obtain from the client the project requirements, budget and timetable. Check these carefully, question incompatibilities and agree priorities”
"John, following our discussion yesterday evening I now understand what you need from us and will be sending a draft to you and Lindsey Jones later this morning."
“Given the circumstances around this letter I need your written confirmation to the following points before issuing the draft." You then make a number of points which I don't intend to read out but please take your time to read them. (Pause) A. Uh-huh. Q. And at the end you proposed that on receipt of a conditional consent or minded to approve motion you will be paid a success fee of£20,000 plus VAT. A. Uh-huh. Q. And you ask Mr Dhanoa to email you back confirming his agreement to the above and you'll then work on the draft. And it's correct, isn't it, that Mr Dhanoa refused to pay the monies you were seeking. A. In the first instance Mr Dhanoa agreed to pay, subsequently then called me to say he was not going to pay. Q. And you therefore refused to provide the letter. A. Correct.”
“…the Brief as contemplated by the Contract became the design as shown on the drawings, which were submitted after microscopic scrutiny by the Client and his Lawyer for Planning. We then successfully obtained a Planning Consent for the Client, which was at the time to his entire satisfaction”
“The backdrop is that Grant Brooker has asked if we can control the design and planning permission to get the development going with someone else (thereby retaining our involvement in the job) as the current Client owes us money and is not likely to proceed with the development. The question is therefore related to our question about Copyright, which is how do we take control of our design to enable another developer to pick up from the current client without being in breach?”
“Q: Was it a hundred [million pounds] or 98.5? A: No, it’s – sorry, I see what you mean. Well, it’s all right, okay. 98.5. It’s a million and a half difference at the end of the day.”
“And if Fosters had told you at this time that the scheme could not be brought down to£100 million , you would have said that's not your watch, EC Harris are working on this. A. No, that's not what happened, because Fosters -- first, it was actually agreed with myself and EC Harris for them to try and value engineer it then with -- and Chris Hammerschmidt wrote to EC Harris asking them to be involved in that value engineering exercise, which was actually then -- that's the two main reasons – people actually who could value engineer it down. It wasn't the rest of the team that could value engineer it. Q. But once they're working together the people you'd expect to give you the cost figures are EC Harris? A. Yes. On the scheme itself they would be the ones who would give me the cost figures.”
“43. First, although an evidential burden rests on the defendant insofar as it contends that there was a break in the chain of causation, the legal burden of proof rests throughout on the claimant to prove that the defendant’s breach of contract caused its loss. 44. Secondly, in order to comprise a novus actus interveniens, so breaking the chain of causation, the conduct of the claimant “must constitute an event of such impact that it ‘obliterates’ the wrongdoing…” of the defendant: Clerk & Lindsell on Torts (19th ed.), at para. 2-78. The same test applies in contract. For there to be a break in the chain of causation, the true cause of the loss must be the conduct of the claimant rather than the breach of contract on the part of the defendant; if the breach of contract by the defendant and the claimant’s subsequent conduct are concurrent causes, it must be unlikely that the chain of causation will be broken. In the circumstances where the defendant’s breach of contract remains an effective cause of the loss, at least ordinarily, the chain of causation will not be broken: County Ltd v Girozentrale[1996] 3 All ER 834 , at p.849 b-c, per Beldam LJ and at pp. 857 f-g and 858 b-c, per Hobhouse LJ (as he then was). Other examples can be found in the area of shipping law. Where, in breach of charterparty, charterers order a vessel to proceed to an unsafe port, the conduct of the vessel’s master in obeying the order (placed as he well may be, on the horns of a dilemma) will be judged sympathetically, in context and will not lightly be treated as unreasonable: Compania Naviera Maropan v Bowaters (The “Stork”)[1955] 2 QB 68 . But even negligent navigation following the charterer’s order to proceed to an unsafe port will not necessarily break the chain of causation: see, for example The Polyglory [1977] 2 Lloyd’s Rep. 353, at p.366. Conversely, where the negligence of vessel X caused vessel Y to run aground, vessel X was not liable for such damages as were attributable to the subsequent, clearly separate and negligent re-floating of vessel Y: The “Spontaneity”[1962] 1 Lloyd’s Rep 460 ; the negligence of vessel X had ceased to be operative. 45. Thirdly, it is difficult to conceive that anything less than unreasonable conduct on the part of the claimant would be capable of breaking the chain of causation. It is, however, also plain that mere unreasonable conduct on a claimant’s part will not necessarily do so - for example where the defendant’s breach remains an effective cause of loss, albeit in combination with the claimant’s failure to take reasonable precautions in its own interest: see, for example, County Ltd v Girozentrale, per Beldam LJ (loc cit). By its nature, reckless conduct by the claimant would or would ordinarily break the chain of causation, though there is no rule of law that only recklessness on the part of the claimant will do so: Lambert v Lewis[1982] AC 225 , per Roskill LJ (as he then was) in the Court of Appeal, at p.252; County Ltd v Girozentrale (supra), per Hobhouse LJ at p.857, more conveniently discussed below, when dealing with the claimant’s knowledge or lack of it.”
‘Where a party is contemplating a commercial venture that involves a number of heads of risk and obtains professional advice in respect of one head of risk before embarking on the venture, I do not see why negligent advice in respect of that head of risk should, in effect, make the adviser the underwriter of the entire venture. More particularly, where the negligent advice relates to the existence or amount of some security against risk in the venture, I do not see why the adviser should be liable for all the consequences of the venture, whether or not the security in question would have protected against them.’ 26. The Court of Appeal[1995] QB 375 reversed Phillips J’s decision on damages and rejected the principle which he had applied. They distinguished between “no transaction cases”, in which the transaction would not have proceeded but for the defendant’s negligence and “successful transaction” cases in which it would have proceeded but possibly on different terms or for a different amount. The Court of Appeal held that once it was proved that the lender would not have made the particular loan but for the valuer’s negligence, the valuer was liable for the entire loss flowing from the transaction so far as it was foreseeable. 27. The House of Lords allowed the appeal. They accepted the principle underlying Phillips J’s decision, but their reasoning was more elaborate and the way in which they applied it was different. The leading speech was delivered by Lord Hoffmann, with whom the rest of the Appellate Committee agreed. The essential distinction which underlies the whole of his analysis is between the assessment of the loss caused by the breach of duty and the extent of the defendant’s duty to protect the claimant against it. Referring to the principle applied by the Court of Appeal, that damages should be such as to put the claimant as nearly in the position that he would have been in had the breach not occurred. Lord Hoffmann said, at p 211: ‘I think that this was the wrong place to begin. Before one can consider the principle on which one should calculate the damages to which a plaintiff is entitled as compensation for loss, it is necessary to decide for what kind of loss he is entitled to compensation. A correct description of the loss for which the valuer is liable must precede any consideration of the measure of damages. For this purpose it is better to begin at the beginning and consider the lender’s cause of action’. 28. He then referred to the nature of the valuer’s duty in the case before him. The purpose of the valuation was to form part of the material on which the lender was to decide whether, and if so how much he would lend, what margin, if any would sufficiently allow for foreseeable valuation errors or a future fall in the market, accidental damage to the property and any other contingencies that may happen. ‘On the other hand, the valuer will not ordinarily be privy to the other considerations which the lender may take into account, such as how much money he has available, how much the borrower needs to borrow, the strength of his covenant, the attraction of the rate of interest or the other personal or commercial consideration which may induce the lender to lend’
“A duty of care such as the valuer owes does not however exist in the abstract. A plaintiff who sues for breach of a duty imposed by the law(whether in contract or tort or under statute) must do more than prove thatthe defendant has failed to comply. He must show that the duty was owed tohim and that it was a duty in respect of the kind of loss which he hassuffered.”
“the decision in SAAMCO has often been misunderstood, not least by the writers who have criticised it. The misunderstanding arises, I think, from a tendency to overlook two fundamental features of the reasoning”
“(1) Where the defendant’s liability arises from some contractual provision which does not depend on negligence on the part of the defendant. (2) Where the defendant’s liability arises from a contractual obligation which is expressed in terms of taking care (or its equivalent) but does not correspond to a common law duty to take care which would exist in the given case independently of contract. (3) Where the defendant’s liability in contract is the same as his liability in the tort of negligence independently of the existence of any contract.”
“Dear Hanif I failed to mention in my earlier e mail that another condition would [be] to construct the building within a£70 million budget”
“As discussed on the phone this week I suggest we get together for a brief session early next week to go through the budget costs for basements etc. We can do this with Knight Frank and EC Harris, but I think that it might be better in a really small group. Issues to discuss: Real budget? We need clarity with regards to what we need to achieve to not waste time on an unrealistic scheme. Planning: date moves back due to slow response times from Hillingdon….should we start with cost saving exercises now if they are needed? What are the options? Optimising the scheme? Redesigning? Can the budget be adjusted? Proposed time: 11:00 – 12:30 h on Monday 10.11.2008 we can then for lunch near F&P.”
“18Warranties for third parties 18.1 The Consultant shall, as the Employer may at any time or times require, deliver within 21 days of the Employer’s request a Warranty or Warranties in favour of Funders and/or Purchasers and/or Tenants and/or any company appointed to manage or repair or keep in repair the completed Development. 18.2 From the date of the Employer’s notice under Clause 18.1 and until and unless the Consultant enters into a Warranty in accordance with the Clause 18, the intended beneficiary of such Warranty shall be entitled, in accordance with theContracts (Rights of Third Parties) Act 1999 , to bring proceedings (other than for specific performance or injunctive relief) to enforce for its benefit any right or benefit of the Employer arising under this Agreement, but the parties to this Agreement may exercise any right which they may have to rescind, cancel and/or vary the terms of this Agreement without the consent of the intended beneficiary being required. 18.3 The obligations contained in this Clause 18 shall continue notwithstanding termination of this Agreement for any reasons whatsoever, including breach by the Employer or novation of this Agreement. However, any such Warranty or Warranties given after such termination shall be amended by the Employer so as to refer to the fact and date of such termination or novation and (in the case of termination only) to omit any provision enabling a third party or parties to assume the position of the Employer.”
“19.1 The Employer shall be entitled to assign the benefit of this Agreement by absolute assignment to any person and the term “Employer” shall be construed accordingly. 19.2 The Employer shall be entitled to charge and/or assign by way of security the benefit of this Agreement to any Funder without the Consultant’s consent”
“I can deal quite shortly with the arguments concerning assignation. I am not persuaded that s10.5 of the AEPA prevented the pursuer from obtaining a Panatown claim. Section 10.5 enables the pursuer — if it wishes — to assign rights it has under the AEPA to any wholly owned affiliate such as FZE. It was — and is — under no obligation (either to the defender or to FZE) to do so. That is a very precarious foundation for the argument which Mr Lindsay seeks to advance. If the pursuer does have a Panatown claim, it was — and is — under no obligation to divest itself of that claim by assigning it to FZE.”