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The current status of the complex structure theory

Nearly a quarter of a century has passed since Lord Bridge’s discussion of the complex structure theory in Murphy v Brentwood. One might have reasonably expected that in the years that have passed, the position of the complex structure theory in English tort law would have finally been settled upon. However, this has not been the case and uncertainty still remains as to the applicability and scope of the complex structure theory in English law.

What is the “complex structure theory”?

In principle, the complex structure theory entitles a claimant to circumvent the general rule that pure economic loss is not recoverable in the tort of negligence. To put this another way, in the seminal case of Donoghue v Stevenson:

“…the purchaser of a ginger beer bottle which contains a snail may recover for personal injuries caused if she drinks the ginger beer but not for the cost of the bottle.”(Linklaters Business Services v Sir Robert McAlpine Ltd.)

In the construction context, if a negligently constructed building contains a defect that causes injury to a person or damage to other property, the contractor will be liable in tort. However, the cost of rectification of the building itself is categorised as pure economic loss and no action in tort would exist. While this position should not trouble the contractor’s employer, those without a contractual claim are left without a remedy.

To overcome this limitation, in D&F Estates Ltd v Church Commissioners for England, Lord Bridge suggested that a claimant should be able to recover for damage where a structure is so complex that individual elements of it can be distinguished:

“…so that damage to one part of the structure caused by a hidden defect in another part may qualify to be treated as damage to ‘other property’.”

In Murphy v Brentwood, Lord Bridge rejected what can be described as the “extreme version” of the theory that would allow an action in tort to be brought against a main contractor by artificially segregating a building into different constituent parts that were capable of damaging each other.

Therefore, the complex structure theory is of greater application to actions brought in tort, not against the main contractor responsible for the construction of the whole building, but against specialist sub-contractors responsible for defects in separate components of the building. There is support for this approach in the speech of Lord Jauncey in Murphy v Brentwood:

“It seems to me that the only context for the complex structure theory in the case of a building would be where one integral component of the structure was built by a separate contractor and where a defect in such a component had caused damage to other parts of the structure, e.g. a steel frame erected by a specialist contractor which failed to give adequate support to floors or walls. Defects in such ancillary equipment as central heating boilers or electrical installations would be subject to the normal Donoghue v Stevenson principle if such defects gave rise to damage to other parts of the building."

Where are we now?

The most recent substantive consideration of the complex structure theory was offered by Akenhead J in Linklaters Business Services v Sir Robert McAlpine Ltd.

The facts of this case involved a claim arising from corrosion to insulation caused by leaking pipework that formed part of a single air conditioning system. As part of these proceedings, the sub-contractor sought contribution from its sub-sub-contractor. In relation to an ultimately unsuccessful summary judgment application, Akenhead J was unwilling to make a distinction between the insulation and the pipework, finding that:

“one would never have chilled water pipe work without insulation because… it would corrode.”

More generally, Akenhead J examined the difficulties that arise when seeking to analyse what would comprise a “thing itself”:

“Another way of considering this problem is to ask in this case: what is the ‘thing itself’ which is damaged? Mr Wilmot Smith QC highlighted the problem by an example which was the careless manufacturer of car paint which is applied to a particular car sold through distributors to a potential claimant; by reason of the carelessness, rain water penetrates the paint and seriously corrodes the underlying metal. Does the paint manufacturer owe the claimant a duty of care? It could be said that there is a duty of care in relation to the damage to the metal, albeit not to the failure of the paint itself but, if that is correct, the potential tortious liabilities of parties way down the chain are, almost, infinite and could, for instance, cover the careless provider to the paint manufacturer of a chemical which is incorporated in the paint, in which case the duty of care owed by the careless provider to the ultimate claimant could include damage to the paint itself as well as the underlying metal. Thus it could go on almost forever.”

While Akenhead J carefully considered the issues relating to the complex structure theory, his judgment went no further in resolving the uncertainties surrounding the theory.

Since the Linklaters decision, there has been little by way of judicial consideration of the complex structure theory. Indeed, there has even been some judicial reluctance in tackling the theory head on. In Robinson v P E Jones (Contractors) Ltd, Jackson LJ expressly refused to pass comment on whether the complex structure theory survived in English law. Since then, the complex structure theory reared its head in Broster v Galliard Docklands Ltd. However, Akenhead J found that the theory was of no application on the facts and there was no revealing discussion of the current status of the theory.

Conclusion

Unfortunately, the uncertainty surrounding the status of the complex structure theory continues. In some ways, this should not be surprising. After all, the complex structure theory does not involve any manipulation or damage to the ordinary principles of tort law. Instead, it rests on defining (at times, in an artificial way), what is meant by “other property”. This may explain why the courts have been unwilling (and possibly, are unable), to reject the theory in its entirety. Therefore, the pattern of the past twenty four years looks likely to continue: There will be occasional judgments where a court finds that the complex structure theory is of no application on particular facts, however, there is little chance of the theory being killed off in its entirety.