Date: Fri, 14 Oct 2005 08:58:19 -0400

From: David Cheifetz

Subject: Contribution - Royal Brompton

Michael,

I'm not quite sure that my comments in the following paragraphs are responsive to your message. If not I apologize. I understand your point in stating that the decisions of the architect to grant the extensions could have been challenged via arbitration. But, those decisions were either right or wrong. If right, then the architect couldn't have been liable for damages or contribution at all, regardless of whether the contractor had any liability to the hospital.

If you are saying that the HL in RB essentially held that there was different damage because the contractor's misconduct (which caused delay) put the hospital to increased expense while the architect's misconduct deprived the hospital 'only' of the remedy to recoup that increased expense, then I agree with you that that's the substance of the HL's distinction. And, if the application of the UK contribution provisions, properly interpreted, is contingent on each of the wrongdoers having caused the same damage in the sense stated by the HL, then the formal result in the case can't be criticized given the finding that they did not. The legislation says what it says.

However, if we are required to look at the consequences of the wrongdoers' misconduct as a criterion for the application of the legislation, we could ask ourselves whether it was necessary for the HL to find that the damage caused by the contractor was the delay in construction (essentially the increased cost of that delay) and the architect the loss of remedy against the contractor for at least some portion of that increase. That is, we can ask ourselves whether the HL had to go back to the traditional analyses of the difference between damage (injury) and damages (the award for the injury). We could ask ourselves why the HL didn't ask itself, given the remedial purpose of the legislation, if the real question was something in the form of "what was the loss that was sustained by the hospital, assuming actionable causative misconduct on the part of both contractor and architect?". If that had been the question, wouldn't the answer be the extra amount paid by the hospital for the construction which wouldn't have been paid but for the misconduct of both?

For what it's worth, there's an aside in Glanville Williams Joint Torts which I believe equates "damage" and "damages" in apportionment contexts for contributory fault apportionment. It's been mentioned by the HL in Platform Home Loans Ltd v. Oyston Shipways Ltd and Others [1999] UKHL 10, albeit in a dissent. If that's the case for contributory fault, it probably should be the same for contribution. In Platform, the HL dealt with the meaning of "damage" in the Law Reform (Contributory Negligence) Act 1945. Lord Cooke (I think the dissent doesn't relate to the point under discussion) - wrote:

Similarly in his Joint Torts and Contributory Negligence (1951) Glanville Williams said at p. 118 that in short the word "damage" in section 1(1) "comprises any item of loss that would have been recoverable as damages at common law apart from the claimant's own fault." He repeated the proposition at p. 317.

We have to remember that we're dealing with indivisible damage in contributory fault cases - the injured person's contributory fault and the wrongdoers' fault each caused all of the damage. What the injured person recovers is the value of the injury, less the share corresponding to his degree of fault. But the damage is still the entire injury, not the amount recoverable from the wrongdoers. So, Williams, by stating that 'damage' in the Act meant the amount recoverable, equated damage with damages.

Be that as it may, much of the problem in contribution analyses (in my view) stems from the extent to which the scope of contribution rights between wrongdoers is made to depend on aspects of the characterization of the injured person's claims against each of the wrongdoers. That's the wrong focus. Unfortunately, the form of the various apportionment statutes effectively forces the courts to engage in the characterizations of the injured persons cause(s) of action. The point that may not have come through clearly in the general ODG messages, but was made separately to me by Andrew in a summary that I'll quote, is that contribution analyses make more sense if the criterion is "would payment by D1 reduce D2's liability pro tanto? This certainly seems closer to the unjust enrichment concept that contribution is ultimately based on."

Best,

David

___________________
David Cheifetz
Bennett Best Burn LLP

----- Original Message -----
From: "michael furmston"
Sent: Thursday, October 13, 2005 10:11 AM
Subject: Royal Brompton

I hesitate to intervene in the fascinating discussion about contribution but the discussion of the Royal Brompton case may go off on the wrong basis because of a misunderstanding of the construction contract position position. The decision of the architect as to extensions of time was not dispositive. It could have been challenged in a subsequent arbitration. In my experience such decisions are often challenged and often held to be wrong though more usually where they are in favour of the employer.

The possible claim against the contractor for delay had been settled as part of the global settlement. There was a conceivable claim against the architect that he had negligently granted an unjustified extension of time. If this could be shown it would damage the employer by putting him in a worse position in the settlement negotiations than if the extension had not been given. HL thought this a different kind of damage from having the building finished late.

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