The Claimant (“C”) engaged the First Defendant (“D1”) to undertake works to the building management system at Sea Containers House. The Second Defendant (“D2”) was the M&E maintenance contractor. A flood occurred due to the failure of a high level alarm shutdown in water storage tanks. C alleged that D1 had been negligent in its modifications of the BMS and that D2 should have discovered the fault during routine maintenance and inspection.
During the 3-year pre-action period, all parties had operated on the assumption that the works were carried out by D1 or its sub-contractor; D1 admitted the same in its defence. Two months before trial, D1 applied to amend its defence to withdraw that admission and relied on new evidence from an electrical sub-contractor who stated that he was the only person appointed by D1 working on the electrical systems and that he had not done the work. In essence, D1 alleged that an unknown third party must have carried out the works.
Held that the Court needed to balance the factors listed in CPR PR14 para 7.2 and (1) the proposed defence was fanciful; (2) even if the defence could be established, due to the effluxion of time and the replacement of the relevant systems it would be impossible for C or D2 to claim any sort of contribution against the real culprit; (3) there was no evidence as to why D1 had not exhausted this line of inquiry sooner; (4) to the extent that D1 would suffer prejudice, it was clearly the architect of its own misfortune. Accordingly the application was refused.
Michael Wheater represented the Second Defendant. For further details please refer to the full judgment: Archlane Ltd v Johnson Controls Ltd & Anor  EWHC B12 (TCC)