Pearson Education Ltd v Charter Partnership Ltd

JUDGMENT: APPROVED BY THE COURT FOR HANDING DOWN (SUBJECT TO EDITORIAL CORRECTIONS) LORD PHILLIPS OF WORTH MATRAVERS, CJ : This is the judgment of the court. Introduction 1. This is an appeal against the order of His Honour Judge Thornton dated 28 October 2005 by which he awarded the Respondents (‘PEL’) agreed damages of £2.1 million together with interest. The damages were in respect of damage done to a stock of books owned by PEL when the guttering of the warehouse in which they were stored overflowed in a heavy rainstorm on 30 July 2002. PEL were the lessees of the warehouse. The guttering overflowed because the drainage system had not been designed to cope with the intensity of the rainfall experienced in that storm. It should have been. The appellants (‘CPL’) are architects who had overall responsibility for the design of the rainwater system when the warehouse was designed in 1988 and 1989. They specified that the system should be designed to cope with a rainfall intensity of 75mm per hour. Had they exercised reasonable skill and care they should have specified that the system should be designed to cope with a rainfall intensity of 150mm per hour. 2. There was a previous similar incident of damage to books stored in the warehouse. The warehouse was then leased to a company called International Book Distributors Limited (‘IBD(1)’). A stock of books that they owned was damaged by flooding as a result of a severe rainstorm on 24 July 1994. Loss adjusters instructed by the insurers of the books discovered that the capacity of the rainwater system was inadequate, but did not convey this information to IBD(1). The first issue raised by this appeal is whether, having regard to these intervening events, the damage caused to PEL’s books was caused by breach of duty of care owed by CPL to PEL. 3. The second issue raised by this appeal is whether, if the damage to PEL’s books was caused by a breach of a duty of care owed to them by CPL, the negligent act or omission on the part of CPL that caused the damage occurred outside the 15 year limitation period imposed by section 14B of the Limitation Act 1980 (‘the Limitation Act’). 4. Judge Thornton’s judgment extends to 62 pages. It includes a very detailed account of the circumstances in which the rainwater system of the warehouse was designed, the nature of the design of the system and the subsequent history of the warehouse. Although issues of primary fact were raised by CPL’s skeleton argument, these have not, ultimately, been pursued. In these circumstances we are able to deal shortly with the material facts. We propose to deal separately with the two issues raised on this appeal. Negligence The facts 5. The warehouse was built on the Magna Park Industrial Estate in Lutterworth, Leicestershire. The developers, McLagan Investments Limited appointed CPL as architect with effect from 1 June 1988. Their services were to include completion of a detailed design and specification, including coordination of any design work by subcontractors, and application for Building Regulation approval. 6. The warehouse roof contained three valleys, with a gutter in each valley. If the gutters overflowed the water would flood into the warehouse. It was thus important that the system for draining the gutters should be capable of coping with the intensity of any rainfall that could reasonably be anticipated during the life of the warehouse. 7. CPL originally designed a gravity rainwater drainage system under which the water from the gutters in the valleys would be drained through drainpipes running within the warehouse. These pipes were of a size designed to have a flow rate that would accommodate an intensity of rainfall of 75mm per hour, described by way of shorthand as ‘having a capacity of 75mm’. These were to be installed by a nominated roofing sub-contractor called Sharkey Dowd Limited. 8. The proposed drainage system was not satisfactory to the developers, who did not want the storage space in the warehouse to be restricted by drainage pipes. In these circumstances it was decided to adopt instead a siphonic drainage system, which relied upon suction rather than gravity to drain the gutters and which enabled the drainage pipes to be routed in a manner that did not invade the warehouse storage space. A sub-contractor, Fullflow, was engaged to design and install the siphonic drainage system. Fullflow were instructed to design a system with a 75mm capacity. CPL were responsible for that specification. The calculations that Fullflow carried out to give effect to the specification were complex and involved special expertise. Not even an architect would be capable of deducing, either from the calculations or from the physical system installed pursuant to them, the capacity of the system. 9. It was and is common ground that, in specifying a capacity of 75mm, CPL failed to exercise reasonable skill and care. The capacity that they should have specified was 150mm. 10. Practical completion of the warehouse occurred on 13 April 1990. The freehold of the warehouse was transferred by the developers to the Church Commissioners on 27 April 1990 and, by 1998, had been transferred again to the British Steel pension fund. The head lessees were initially Asda Storage, a company in the same group as the developers. The lease was for 25 years. On 17 July 1991 this lease was transferred to IBD(1), part of a group of companies headed by an American company, Simon & Schuster Inc. Both the lease and other assets of IBD(1) were subsequently transferred to PEL, a company in the Pearson group, by a rather complex series of transactions that it is not necessary to describe. These transactions began in 1998 and were completed by June 2000. No survey of the warehouse was carried out on the occasion of any of these transfers, nor is it suggested that a survey should have taken place in relation to any of them. Had a pre-purchase survey taken place it could not reasonably have been expected to identify the under-capacity of the siphonic drainage system. 11. We turn to consider the position when the first flood occurred in July 1994. IBD(1) had insurance that covered their stock of books against, inter alia, the water damage that occurred. This insurance was under a block policy taken out by their American holding company. The damage to the premises was covered by a policy taken out by the landlord, whose responsibility it was under the lease to insure against the risk of damage to the premises by ‘storm, tempest, flooding or overflowing of water tanks, apparatus and pipes’ and to make good such damage. 12. IBD(1)’s claim for damage to their books was settled promptly by their insurers, after consideration by loss adjusters called McLarens, for a sum of approximately $3 million. After settlement, in May 1995, the insurers instructed McLarens to investigate the cause of the flood. They in their turn instructed a firm of consulting engineers, architects and surveyors, called Pick Everard. Mr Bowler of that firm conducted the investigation. On 22 August 1995 Pick Everard reported to McLarens that the flooding had been caused by an inadequately designed drainage system in that the intensity of rainfall with which it could deal was too low. 13. The judge found as a fact that this information was never conveyed to IBD(1). In his skeleton argument Mr Nicholas Dennys QC, for CPL, challenged this finding, but he did not pursue that challenge. What he did submit was that, as Mr Martin, the Managing Director of IBD(1) was plainly aware of the fact that the rainfall on 24 July 1994 had exceeded the capacity of the drainage system, IBD(1) could have been expected to ascertain why this was. The judge found, however, that Mr Martin was informed that the design of the system complied with building regulations but that it had been overwhelmed by a rainstorm of exceptionally unusual intensity. There is no reason to doubt this. ‘The Bookseller’ for 25 November 1994 reported Mr Martin as saying that the flood had been caused by a torrential thunderstorm that produced about 3 inches of rain in 20 minutes. 14. The judge found that neither McLarens, nor the insurers by whom they had been instructed, were the agents of or had any duty to report their findings to IBD(1). This finding was not challenged. In these circumstances there is no reason to question the judge’s finding at paragraph 90 of his judgment that: ·         “IBD(1)’s officers and employees had no reason to be involved in any investigations, repairs or insurance claims and never learnt of the existence of the design defects inherent in CPL’s rainwater system design.” 15. The flood damage to the warehouse itself was repaired by the landlords, who claimed under their insurance cover. There was no evidence as to what enquiries, if any, were carried out by their insurers into the cause of the flooding. 16. We turn to the aftermath of the second flood. PEL had a block insurance policy that covered all their stock in the United Kingdom. They claimed successfully for the damage to their stock under this policy, so that the claim with which this action is concerned is a subrogated claim. The policy did not cover the damage to the warehouse caused by the second flood. PEL repaired this at their own expense. The cause of the flood was investigated and the under-capacity of the siphonic drainage system was identified. PEL installed a supplementary siphonic system that made good the deficiency in capacity. The appellants’ submissions 17. The submissions advanced to us by Mr Dennys can be summarised as follows: ·         i) It is accepted that CPL were potentially liable in negligence to an owner/occupier of the warehouse in respect of flooding damage caused to his property as a result of the inadequacy of the drainage system so long as that inadequacy remained latent. ·         ii) The inadequacy of the system ceased to be latent once it had been identified by Mr Bowler of Pick Everard. ·         iii) The first flood brought the potential liability of CPL in negligence to an end in that: ·         a) it was not reasonably foreseeable that any further damage would flow from the defective design once it had led to a flood, for it was reasonable to expect that this would lead to the identification of the defect; ·         b) it was not fair, just or reasonable that CPL’s duty of care should extend beyond the occurrence of the first flood; ·         c) the occurrence of the first flood broke the chain of causation; These submissions were variations on a theme, as are the three classic requirements of a duty of care in the law of negligence, namely foreseeability, proximity and what is fair, just and reasonable – see Caparo v Dickman [1990] 2 AC 605. 18. In support of his submissions Mr Dennys relied heavily on three authorities. The first was the seminal case of Donoghue v Stevenson [1932] AC 532. In that case Lord Atkin commented that the proximity between the manufacturer and user of a chattel that gave rise to a duty of care might depend upon whether there was a possibility of intermediate inspection. Lord Macmillan stated succinctly at p. 622: ·         “It may be a good general rule to regard responsibility as ceasing when control ceases. So, also, where between the manufacturer and the user there is interposed a party who has the means and opportunity of examining the manufacturer’s product before he re-issues it to the actual user.” 19. Donoghue v Stevenson marked the start of the development of the modern law of negligence. It predated the statutory interventions that made provision for contributory negligence and joint tortfeasors. The case cannot, as we shall show by reference to more recent authority, be relied upon to support the proposition that there will be no liability for the consequences of creating a dangerous defect in a chattel or realty merely because there is a possibility that the defect may be discovered by an intermediate inspection before the claimant comes into contact with it. 20. Mr Dennys referred us to a passage of the speech of Lord Keith of Kinkel in Murphy v Brentwood District Council [1991] 1AC 398 at p. 464: ·         “However, an essential feature of the species of liability in negligence established by Donoghue v. Stevenson was that the carelessly manufactured product should be intended to reach the injured consumer in the same state as that in which it was put up with no reasonable prospect of intermediate examination: see per Lord Atkin, at p. 599; also Grant v Australian Knitting Mills Ltd. [1936] A.C 85, 103-105, per Lord Wright. It is the latency of the defect which constitutes the mischief. There may be room for disputation as to whether the likelihood of intermediate examination and consequent actual discovery of the defect has the effect of negativing a duty of care or of breaking the chain of causation (compare Farr v. Butters Brothers & Co.[1932] 2 K.B. 606 with Denny v. Supplies & Transport Co. Ltd.[1950] 2 K.B. 374). But there can be no doubt that, whatever the rationale, a person who is injured through consuming or using a product of the defective nature of which he is well aware has no remedy against the manufacturer. In the case of a building, it is right to accept that a careless builder is liable, on the principle of Donoghue v. Stevenson, where a latent defect results in physical injury to anyone, whether owner, occupier, visitor or passer-by, or in the property of any such person. But that principle is not apt to bring home liability towards an occupier who knows the full extent of the defect yet continues to occupy the building.” This, he submitted, showed that there was no duty of care in respect of a latent defect where the likelihood was that the defect would be discovered before damage was caused. 21. Mr Dennys also referred us to a passage in the speech of Lord Oliver of Aylmerton at p. 488 that he submitted was to the same effect: “The case of physical injury to the owner or his licensees or his or their property presents no difficulty. He who was responsible for the defect – and it will be convenient to refer to him compendiously as “the builder” – is by the reasonable foreseeability of that injury, in a proximate “neighbour” relationship with the injured person on ordinary Donoghue v. Stevenson principles. But when no such injury has occurred and when the defect has been discovered and is therefore no longer latent, whence arises that relationship of proximity required to fix him with responsibility for putting right the defect?” 22. In Murphy v Brentwood the issue was whether the cost of remedying a defect in a building that might, if unremedied, cause injury or damage to property, was recoverable in negligence. The passages relied upon by Mr Dennys support no more than the proposition that an occupier who discovers a dangerous defect in a building will have no claim if he neglects to repair the defect and it then causes him injury or damage. That case does not support the proposition that the party responsible for the existence of a dangerous defect will escape all liability for damage resulting from it if it was reasonable to expect that the claimant would discover the defect, even though the claimant did not do so. Even less does it support the proposition that the claimant will have no claim if it was reasonable to expect a third party to discover the defect or if, unknown to the claimant, a third party did discover the defect. 23. Mr Dennys relied primarily on a recent decision of this court in a case the facts of which bear a close resemblance to those of the present case. In Baxall & Norbain v Sheard and others [2002] BLR 100, architects engaged by developers had shown want of care in respect of the design of a roof drainage system of an industrial building in two respects. They had failed to incorporate overflows into the system and they had failed to ensure that the drainage sub-contractor, Fullflow as in the present case, had designed a syphonic system that had sufficient capacity to cope with the expected rainfall, namely 150mm. Just as in the present case, Fullflow had only designed to a capacity of 75mm. 24. The respondents (‘the occupiers’), who were the claimants in the litigation, had caused a survey to be carried out before they took a lease of the premises. The absence of overflows was not discovered. A flood then took place at a time when the rainfall was less than the design capacity of 75mm. Damage was caused to electronic equipment owned by the occupiers. A survey identified the cause of the flooding as a partial blockage of the system by debris. Once again the fact that the system was defective because it did not incorporate overflows was not appreciated. A second flood then occurred, on this occasion because the intensity of the rainfall exceeded 75 mm and there were no overflows to take away the surplus. Further damage was caused to electronic equipment owned by the occupiers. On this occasion both the lack of overflows and the inadequate capacity of the system were identified. The occupiers sued the architects in negligence in respect of the damage caused by each of the two floods. 25. At first instance His Honour Judge Bowsher QC held that the architects were not liable for the consequences of the first flood. That had been caused in part by the blockage and in part by the lack of overflows. The architects were not responsible for the former and could not be held liable for the latter because the lack of overflows was a patent defect that should have been discovered by the claimants’ surveyors on the pre-purchase survey. He held, however, that the architects were liable for the damage caused by the second flood. There were two causes of that flood: the under-capacity and the lack of overflows. Although the latter defect was patent, the former was a latent defect for which the architects remained liable. 26. In the Court of Appeal the finding of liability in respect of the second flood was reversed. David Steel J gave the only judgment, with which the other two members of the court agreed. He held that the only effective cause of both floods was the absence of overflows and that this absence ought to have been appreciated by surveyors acting for the claimants, in the first instance on the purchase survey that had taken place and secondly, on the survey in the aftermath of the first flood. 27. We have had some difficulty in understanding David Steel J’s conclusion that the lack of overflows was the sole cause of the damage on the occasion of the second flood, but that is not to the point. What is important is to identify the principle that led him to conclude that the architects were not responsible for the damage caused by either flood, notwithstanding that flooding would not have occurred had the architects exercised reasonable skill and care in designing the drainage system. 28. David Steel J’s starting point was that an architect would only be liable in negligence for the consequences of a design defect if the defect was latent. He went on to define a latent defect: ·         “46. The concept of a latent defect is not a difficult one. It means a concealed flaw. What is a flaw? It is the actual defect in the workmanship or design not the danger presented by the defect. (A good example of the distinction is contained in Nitrigin Eireann Teoranta v Inco Alloys Ltd [1992] 1 WLR 498.) To what extent must it be hidden? In my judgment it must be a defect that would not be discovered following the nature of inspection that the defendant might reasonably anticipate the article would be subjected to. ·         47.There is, accordingly, a question here of degree. The consumer of a fizzy drink will not, in the normal course, bring in an expert to inspect goods he purchased. In marked contrast, the buyer of a building almost invariably would. Certainly in the commercial context, a defect would not be latent if it had been reasonably discoverable by the claimant with the benefit of such skilled third party advice as he might be expected to retain. ·         48. The classic definition of latent defect in the field of carriage of goods by sea is that contained in Riverstone Meat Pty Ltd v Lancashire Shipping Company Ltd[1961] AC 807, per Lord Keith of Avonholm at page 872: ·         ‘He will be protected against latent defects, in the strict sense, in work done on his ship, that is to say, defects not due to any negligent workmanship of repairers or others employed by the repairers and, as I see it, against defects making for unseaworthiness in the ship, if these could not be discovered by him, or competent experts employed by him, by the exercise of due diligence. (A similar approach is adopted in the insurance field: see The Caribbean Sea [1981] Lloyd’s Rep 338.)” 29. The judge then turned to deal with an argument advanced by the claimants, founded on citation from Murphy v Brentwood, that a defect remained latent until actually discovered. He held: ·         “52. In my judgment, the decision in Murphy v Brentwood was dealing with matters of broad principle and does not detract from the proposition that the defect is not latent if it is discoverable by the exercise of due diligence whether or not due diligence was in fact exercised. Awareness of the danger (i.e the propensity to flood) is not of itself only consistent with a flaw. The relevance of such awareness is to the ability to discover the actual defect by the exercise of due diligence. ·         53. In summary, I would put the matter in this way. Where, in the normal course of events, a surveyor would be engaged in a survey of a building for a purchaser, and, with the exercise of due diligence, that surveyor would have discovered a defect, that defect is patent whether or not a surveyor is in fact engaged and, if engaged, whether or not the surveyor performs his task competently. It follows that in my judgment, the judge was right to conclude as follows: ·         108. In the present case, the precise defect had not been discovered before the floods, but there had been at least one previous flood evidenced by markings on the floor in the building. In my opinion, the duty of the defendants to the claimants must depend on the question ‘Was there a reasonable opportunity of inspection of the drainage system and discovering the defects before the floods?’ If the claimants had a reasonable opportunity of inspecting the drainage system and discovering the defects before they suffered damage, it would not be fair just or reasonable to hold the defendants liable for that damage nor would it be right to say that there was a proximate relationship between the claimants and the defendants. ·         109. There was a reasonable opportunity of inspecting the building before the claimants took a lease. It would be normal procedure for any incoming tenant to have the building inspected by the surveyor, and that is what they did. Although the claimants received warnings from both surveyors and from Mr Meiklejohn of a danger, they were not told what was the precise problem. The surveyors could, and in my view should, have told the claimants that there were no overflows, and that overflows should be provided. The cost of overflows was very small and if the claimants had been advised to install them then I cannot think that they would have failed to do so. ·         110. If Lambert Smith Hampton had been more assiduous in the performance of their duties, the claimants would have been expressly warned of the absence of overflows and the floods would not have occurred. To what extent is the claimants’ claim affected by the acts of their professional advisers? Are they entitled to say, as they might in response to a defence of contributory negligence, that they took skilled advice and are entitled to rely on that advice? I do not think that that is the right approach. I do not think that it is fair just or reasonable that the extent of the liability of the defendants should depend on the assiduity of the surveyors instructed by the claimants. The claimants had the opportunity to discover the absence of overflows by reasonable inspection by professional advisers who might reasonably be expected to be instructed: whether that reasonable opportunity in fact revealed the defect is irrelevant. Because there was a reasonable opportunity to inspect, the defendants were not in a proximate relationship to the claimants so far as concerns defects which could have been discovered by that inspection, namely, the absence of overflows. But I repeat my previous finding that neither the claimants nor their surveyors could reasonably be expected to have discovered the under-design of the drainage system. 54. In my judgment the Judge’s analysis is correct. Actual knowledge of the defect, or alternatively a reasonable opportunity for inspection that would unearth the defect, will usually negative the duty of care or at least break the chain of causation unless (as is not suggested in the present case) it is reasonable for the claimant not to remove the danger posed by the defect and to run the risk of injury: see Targett v Torfaen BC [1992] 3 All ER 27 per Sir Donald Nicholls V-C at page 37.” 30. The material facts in Baxall can be summarised as follows: ·         i) The claimants could ‘reasonably be expected’ to instruct surveyors to inspect the drainage system. ·         ii) The claimants did instruct surveyors to inspect the drainage system. ·         iii) Had the surveyors exercised reasonable skill and care they would have discovered that the system was defective in that it lacked overflows. 31. David Steel J provided two explanations for holding that architects were not liable in a case such as Baxall. The first was that the duty of care was negatived. The second was that the chain of causation was broken. The decision in Baxall supports the following two principles, either of which can explain the result in that case: ·         i) Where it is reasonable to expect that an occupier will inspect a property before entering into occupation, no duty of care will be owed in respect of any defect that such an inspection should disclose. ·         ii) Where an occupier could reasonably have been expected in his own interests to carry out an inspection that would have revealed the defect, failure to carry out such an inspection, or to carry it out with reasonable skill and care, will break the chain of causation. 32. Neither principle seems to us to be wholly satisfactory. The first principle can perhaps be justified on the basis that if a subsequent inspection is anticipated, it will not be reasonably foreseeable that any defect will go undetected. But if an architect who has the primary responsibility for producing a safe design produces a defective design, it is not obviously fair, just and reasonable that he should be absolved from any liability in tort in respect of its consequences on the ground that another professional could reasonably be expected to discover his shortcoming. 33. So far as the second principle is concerned, it is not obvious why a failure of a person, put at risk by a defective design, to take due care for his own safety or that of his property should break the chain of causation, rather than amount to contributory negligence. 34. Whichever principle explains the decision in Baxall, neither can be applied in the present case so as to afford a defence to CPL. So far as the first principle is concerned, there was no reason, when CPL specified the capacity of the system, for them to expect that an inspection would be carried out that would reveal any error that they might make. The design shortcoming was truly latent. It was only the first flood that set in train the inspection that identified the error. 35. Mr Dennys submitted that the test of what was foreseeable should be applied on a contingency basis, so that the material question was ‘should CPL have foreseen that, if there was a flood, the defective system would not be discovered and remedied, so that a second incident of damage might occur?’ We are aware of no authority that suggests that the test of foreseeability should be conducted in this way. 36. It was reasonably foreseeable that, if CPL caused an inadequate drainage system to be installed in the warehouse, owners of property within the warehouse might suffer flooding damage to their property. The test of foreseeability in the context of duty of care does not require foresight of the precise sequence of events that results in damage: Hughes v Lord Advocate [1963] AC 837. 37. So far as the second principle is concerned, PEL neither knew nor should have known of the flood, so that there was no reason why they should carry out any investigation of the adequacy of the rainwater system. 38. The alternative way that Mr Dennys put his case was to argue that, once Pick Everard discovered the defect, it ceased to be latent and the chain of causation was broken. We can see no basis of principle or authority why the fact that a third party becomes aware of a latent defect should be deemed to make the defect patent to others who neither know, nor ought to know, of the discovery. 39. There are a number of authorities that give some assistance in analysing the significance in the law of negligence of the possibility of intermediate examination of a dangerous chattel or building. In Clay v Crump [1964] 1 QB 533 the owner of a site employed an architect to plan and supervise its redevelopment. He drew up a plan for the demolition of buildings on the site. Demolition contractors asked whether they could leave a wall standing. The architect authorised this, “if it was safe to do so”. The wall manifestly was not safe, as any competent inspection of it would have shown. The architect failed at any stage to make any inspection of the wall. The demolition contractors failed to identify the fact that the wall was dangerous and left it standing. The building contractors then moved in. Their manager negligently failed to inspect the wall, which subsequently collapsed and injured the plaintiff, one of his workmen. 40. At first instance and on appeal the architect, the demolition contractors, and the building contractors were all held jointly liable to the plaintiff. The significance of the case for present purposes is that the architect’s assertion that he could reasonably expect the defect to have been discovered by a subsequent inspection was held to be no answer to the duty of care that he owed to the plaintiff. Ormerod LJ held at p. 559: ·         “It may be that there was negligence in some degree on the part of both of the demolition contractors and the builders. If there was such negligence, it may be that it was a contributory cause of the accident. It cannot, however, in my judgment, absolve the architect from a share in the blame. To hold otherwise would be to hold that an architect, or indeed anyone in a similar position, could behave negligently by delegating to others duties he was under an obligation to perform and escape liability by the plea that the injuries caused were caused by negligence of that other person and not of himself. I do not accept that as being the true position in law and I am satisfied that it is not the law as laid down by Lord Atkin in Donoghue v Stevenson or by the judgments in any of the other cases to which we have been referred.” The other members of the court gave judgment to similar effect. 41. The facts of Clay v Crump differ from those of the present case in that in that case the architect’s negligence was not in respect of a defect in design and the consequence of his negligence was personal injury rather than damage to property. We cannot see, however, why the manner in which the principles of both foreseeability and remoteness were applied to the possibility of intermediate inspection in that case should not apply equally in a case such as Baxall or the present case. 42. May J. considered the effect of the possibility of discovering a defect by an intervening examination in Nitrigin Eireann v Inco Alloys Ltd [1992] 1 WLR 498 at 506. He was dealing with pipes that were defective because, so it was alleged, their manufacturers had been negligent. The pipes cracked in 1983, but the plaintiffs failed to ascertain the cause of the cracking. They subsequently ruptured, causing the damage to the plaintiff’s property that gave rise to the claim. May J said: ·         “The question which is begged by this analysis and which needs to be addressed is what the position would be if the plaintiffs ought reasonably to have diagnosed the cause of the cracking in 1983. Would that affect the accrual of a cause of action in negligence? In my judgment it would not. The fact of sufficient physical damage to sustain the plaintiffs’ cause of action would remain, but the first defendants could argue on appropriate facts that the plaintiffs’ recovery should be reduced or extinguished by the plaintiffs’contributory negligence.” 43. This approach is supported by the analysis of the High Court of Australia in Voli v Inglewood Shire Council (1962-3) 110 CLR 74. The appellant was injured by the collapse of the floor of a public building. The architect had negligently specified inadequate floor joists. The Council, whose building it was, approved the plans albeit the size of the floor joists was less than required by its own by-laws. The architect argued that he was under no liability because the defect in his specification ought to have been discovered by the subsequent inspection of his plans by the Council. This defence succeeded at first instance, but not on appeal. Giving the leading judgment, with which the other members of the court agreed, Windeyer J held at p. 87: ·         “There is, of course, an obvious difference between making or supplying a thing to be examined, tested or treated before use, and making or supplying a thing to be used without more ado. But, when harm ensues, the problem for a court is whether the proximate cause of it was the negligence of a person who was to examine, test, or treat it, or the combined negligence of both persons. In some cases, the failure of the person who was to make the test to do so properly, whether he was himself the contemplated user or a third person, may supersede the initial liability of the manufacturer or supplier of the defective article. But, if separate and independent acts or omissions of several persons have directly contributed to cause an injury, the first wrongdoer does not necessarily escape liability by proving that, though he was to blame, the injury would not have occurred but for the later negligence of another person.” 44. Finally we would draw attention to the comments of Lord Lowry CJ on the development of the law in relation to intermediate inspection since the decision in Donoghue v Stevenson in the case of McIlveen v Charlesworth Developments [1982] NI 216. The appellant had been injured when a push- chair collapsed as a result of a defect in its manufacture. At first instance her claim had been withdrawn from the jury on the ground that, as the push-chair would not be used without the likelihood of inspection that would reveal the defect, the manufacturers owed the appellant no duty of care. The Court of Appeal reversed this decision. At p. 221 Lord Lowry said this about the duty of care in negligence: ·         “That duty does not cease to exist because there is a possibility or probability of inspection by an intermediary or by the neighbour himself before the article is taken into use. If an inspection is certain and will reveal the defect and the person making the inspection will appreciate the danger, then no doubt a risk to the neighbour is not reasonably foreseeable. But such considerations raise questions of fact which will usually be questions for the jury. An exception arises when there is only one reasonable answer – in favour of the potential defendant, and in such a case the neighbour’s claim will fail for want of evidence reasonable to be laid before a jury. Most of the defences based on the possibility of discovering a defect raise questions on causation – ‘Has the chain been broken?’ – and, as such, are most invariably a matter for the jury, or questions of contributory negligence, the existence and extent of which are again for the jury.” 45. These decisions reinforce our conclusion that the first flood and the inspection to which it gave rise neither placed PEL outside the range of any duty of care owed by CPL nor broke the chain of causation between CPL’s want of care and the damage suffered by PEL. They also lend support to the criticism of the decision in Baxall made by Mr Duncan Wallace QC in the First Supplement to the 11th edition of Hudson’s Building and Engineering Contracts at paragraph 1.314 and in (2003) 119 LQR at p. 19 where he asked: ·         “could it not have been put rather differently, that a defect in a building must be so glaringly obvious that, if the “patent defect” defence is to apply, no reasonably competent adviser carrying out a normal inspection could fail to notice it? As expressed Baxall may offer an unnecessarily wide avenue of escape from liability for defective buildings, to developers, contractors and professional advisers and their insurers alike…?” 46. It may be that, in an appropriate case, Baxall will receive consideration by the House of Lords. For the reasons that we have given, on the facts of the present case it affords CPL no defence to PEL’s claim and we reject the grounds of appeal that have given rise to the first issue. Limitation 47. CPL relies upon section 14(B) of the Limitation Act 1980, which provides: ·         “(1) An action for damages for negligence, other than one to which section 11 of this Act applies, shall not be brought after the expiration of fifteen years from the date (or, if more than one, from the last of the dates) on which there occurred any act or omission-” ·         (a) which is alleged to constitute negligence; and ·         (b) to which the damage in respect of which damages are claimed is alleged to be attributable (in whole or in part).” The claim form was issued on 7 January 2004. Thus PEL’s claim will be time- barred unless they can establish an act or omission that caused the damage in respect of which they claim that occurred on or after 7 January 1989. The facts 48. CPL themselves designed the initial gravity drainage system for rainwater before 30 November 1988. The flow rate provided for by this design was 75 mm per hour. In fact the flow rate of a gravity drainage system will increase significantly if a head of water builds up in the gutter above the down pipes. Had a gravity system been installed with a 75mm capacity, this effect would probably have enabled it to cope with the rain that fell in each of the storms without the occurrence of flooding. On 1 December the developers explained that the proposed drainage system was not satisfactory as it invaded the warehouse storage space and suggested installing a siphonic system instead. On 13 December CPL sent to Sapaflow, suppliers of siphonic drainage systems, the drawings that they had prepared showing the gravity system and the stipulated capacity for that system of 75mm per hour. Sapaflow’s quote was not satisfactory and, in late January 1989 CPL invited Fullflow to quote, sending them the same drawings that had been sent to Sapaflow. 49. There was no direct evidence that CPL provided Fullflow with a stipulated design capacity of 75 mm per hour, but the judge found by inference from other evidence that they did so. He held at paragraph 54 of his judgment: ·         “It follows that CPL designed or specified the capacity of the siphonic system as being 75mm per hour and instructed Fullflow to prepare its design of the system using that as the capacity to which the system should be designed.” 50. There were negotiations with Fullflow in relation to the price of the system and on 20 April 1989 CPL approved the appointment of Fullflow as the specialist sub-sub-contractor for the design and installation of a siphonic drainage system. Fullflow’s contract in that capacity with Sharkey Dowd was concluded in May 1989. 51. Meanwhile, Building Regulation approval had to be obtained for the warehouse that included approval of the storm water drainage system. The calculations prepared by CPL for this purpose stated that they were based on a “design rainwater intensity of 75 mm/hr”. The local authority approved these calculations and the design of the drainage system on 25 April 1989. The issue 52. The judge held that there were at least two occasions after 7 January 1989 when CPL, in breach of their duty, omitted to check and adopt an appropriate capacity for the rainwater system. The first was when they submitted details of the system in order to obtain Building Regulation approval. The second was when they approved the nomination of Fullflow. He held that both their responsibility for the design of the rainwater system and their duty to co-ordinate the design work of specialists so as to ensure that the design work was compatible with the overall design of the building required them to check the adequacy of the system both when they sought Building Regulation approval and prior to the commencement of construction. More particularly, he held that they were under a duty to ensure that, when the contract was concluded with Fullflow to provide a siphonic drainage system, the specified capacity that Fullflow were required to provide was adequate. 53. Mr Dennys submitted that the judge’s analysis of CPL’s duty was erroneous. They had a duty to exercise reasonable care in deciding upon the capacity of the rainwater system, but this duty was breached in November 1988 when they designed a gravity system that only had a design capacity of 75mm per hour. This remained the design capacity specified subsequently for Sapaflow and ultimately for Fullflow, but no subsequent breach of duty occurred unless it could be demonstrated that there was some trigger that should have caused CPL to review the design capacity. There was no such trigger. 54. Mr Edelman submitted (i) that no breach of duty occurred when CPL designed a gravity system with a capacity of 75mm because this would in fact have proved adequate to cope with the rainfall experienced on the occasion of each flood, for the reason that we have explained at paragraph 48; (ii) when the gravity system was replaced by a siphonic system the design capacity of the system should have been re-considered because of the different way in which a siphonic system operates; (iii) CPL were under a continuing duty to keep the adequacy of the design of the rainwater system under review until practical completion or at least until completion of the installation of the drainage system; (iv) individual breaches of duty occurred both when Fullflow were nominated as the specialist sub-sub-contractor and when drawings were submitted for Building Regulation approval. 55. We do not accept Mr Dennys’ submission that, for limitation purposes, the relevant act or omission on the part of CPL was their initial mistake in adopting an inadequate capacity for the drainage. Section 14(B) of the Limitation Act requires the court to identify the latest date when CPL were responsible for a negligent act or omission to which PEL’s damage can be attributed. The gravity system designed by CPL was not incorporated in the warehouse. Whether or not CPL showed a failure to exercise reasonable skill and care in adopting a design capacity of 75 mm for that system, and on the evidence we believe that they did, is not relevant. The relevant negligent act or omission was the act or omission that caused an inadequate drainage system to be incorporated in the building. We consider that the most obvious negligent act that had this effect was specifying to Fullflow, who designed and installed the siphonic system, a design capacity that they, CPL, should have known was inadequate. That occurred in late January 1989, within the 15 year limitation period. 56. Having regard to this conclusion it is unnecessary to grapple with the difficult question of whether CPL were in breach of a continuing duty to keep the design capacity that they had specified under review, nor to decide whether the act of approving PEL as the nominated sub-sub-contractor on terms that would result in their installing a defective system, or their act of submitting plans for Building Regulation approval that were based on an inadequate design capacity constituted independent breaches of their duty of care that were causative of PEL’s damage. 57. For the reasons that we have given we are satisfied that this action was commenced within the 15 year limitation period. This appeal is dismissed.