Dwr Cymru (Welsh Water) v Carmarthenshire County Council, Court of Appeal - Technology and Construction Court, October 22, 2004, [2004] EWHC 2991 (TCC)

Resolution Date:October 22, 2004
Issuing Organization:Technology and Construction Court
Actores:Dwr Cymru (Welsh Water) v Carmarthenshire County Council

SMITH BERNAL WORDWAVEHT0455Neutral Citation Number: [2004] EWHC 2991 (TCC)IN THE HIGH COURT OF JUSTICETECHNOLOGY & CONSTRUCTION COURTRoyal Courts of JusticeStrand London WC2A 2LL22nd October 2004BEFORE:MR JUSTICE JACKSON- - - - - - - - - -DWR CYMRU (WELSH WATER)CLAIMANT- v -CARMARTHENSHIRE COUNTY COUNCILDEFENDANT- - - - - - - - - -Tape Transcript of Smith Bernal Wordwave Limited190 Fleet Street London EC4A 2AGTel No: 020 7404 1400 Fax No: 020 7831 8838(Official Shorthand Writer's to the Court)- - - - - - - - - -MR SIMON HUGHES appeared on behalf of the CLAIMANT MR STEPHEN WORTHINGTON appeared on behalf of the DEFENDANT- - - - - - - - - -J U D G M E N TMR JUSTICE JACKSON: This judgment is in seven parts, namely: Part 1, Introduction; Part 2, The Facts; Part 3, The Present Proceedings; Part 4, The Law on Acknowledgment of Claims; Part 5. Question 1: Can a claim for damages in tort fall within section 29(5)(a) of the Limitation Act 1980?; Part 6. Question 2: Is Welsh Water's claim against Carmarthen a liquidated pecuniary claim?; Part 7, Conclusion. Part 1. Introduction.This is the trial of a preliminary issue to determine whether a claim made in negligence and nuisance is statute barred. The claimant in this action is Dwr Cymru Welsh Water ("Welsh Water"), the defendant is the Carmarthenshire County Council ("Carmarthen"). Welsh Water began the present proceedings after expiry of the primary limitation period. Welsh Water contends that Carmarthen acknowledged the claim before expiry of the limitation period, thus triggering the operation of section 29(5)(a) of the Limitation Act 1980. Carmarthen denies that section 29(5)(a) is applicable to the present case. Having set the scene with these few introductory remarks, I must now turn to the facts of the case. Part 2. The Facts.Welsh Water owns a public sewer, which runs beneath Upper Robinson Street, Llanelli. In 1995 Llanelli Borough Council engaged contractors to carry out underpinning works to properties in Upper Robinson Street. Those contractors employed sub-contractors who carried out piling works in August and September 1995. Most unfortunately three of the piles installed during that period penetrated the public sewer. Two years later this mishap came to light. Carmarthen, who were, and are, the successors of Llanelli Borough Council, obtained a report from a firm of engineers. Those engineers carried out a CCTV survey and reported that three piles supporting No 44 Upper Robinson Street were penetrating the sewer. Carmarthen received this report during September 1997 and communicated the contents to Welsh Water on 30th September 1997. Thereafter, discussions proceeded between representatives of Carmarthen and representatives of Welsh Water about two matters, namely: (1) what remedial works should be carried out; and (2) who should pay for these remedial works. As to the first matter, over the next five years investigations were carried out, reports were prepared and a variety of different options were canvassed. No final agreement was reached between the parties as to what should be done. Nevertheless, it would be fair to say that by March 2002 localised repairs appeared to be emerging as the preferred option. No agreement was reached between the parties as to the cost of remedial works. I turn now to the second aspect of the discussions. From October 1997 onwards Welsh Water made it clear in correspondence that it expected Carmarthen to bear the cost of remedial works. Carmarthen did not initially make any concessions in this regard. However, matters came to a head during 1999 and 2000. I will read out relevant parts of the correspondence during this period. On 29th July 1999, Mrs Athay, the Litigation Solicitor of Welsh Water, wrote as follows to the Director of Rural and Administrative Services of Carmarthen:"In September 1997 Carmarthenshire County Council advised Dwr Cymru's Sewerage Section that following complaints of structural problems to houses in Upper Robinson Street a survey of the public sewer which runs beneath some of those houses had been carried out. The survey showed that the sewer had been damaged by piles having been driven through the sewer in the vicinity of No 44 Upper Robinson Street. It appears that piles were placed for the support of some of the houses when the gas works area was developed on behalf of the former local authority in 1995/96. "Dwr Cymru holds your Council responsible for the damage to the sewer. It will be necessary for remedial works to be carried out and your Council has in fact actively promoted the option of a diversion of the sewer to the rear of the properties. This is however likely to prove the most expensive option and we would like to discuss the position with you before remedial works are commenced. "We do however expect your confirmation that the Council will meet the costs involved. My understanding is that the piles were constructed at the instigation of Llanelli Borough Council and that your Council will have inherited the liability of the former local authority for the continued maintenance of the piles and the completion of the development of the area. In those circumstances it is considered that your Council has legal responsibility for the damage to the sewer. "If agreement cannot be reached, my instructions will be to commence legal proceedings against the Council. Although correspondence has not to date been helpful, I feel that a 'without prejudice' meeting, when hopefully we can have some constructive discussions, might enable litigation to be avoided." On 8th November 1999, a meeting took place between the parties. Mrs Athay was present as solicitor for Welsh Water; Mr Wolfe of Douglas-Jones Mercer was present as solicitors for Carmarthen and Carmarthen's insurers. At this meeting various remedial schemes were discussed, and Mrs Athay made it clear that Welsh Water required Carmarthen to bear the costs. On 8th December 1999 Mr Wolfe of Douglas-Jones Mercer wrote as follows to Mrs Athay: "I refer to our meeting on 8th November and now write to confirm, as Solicitors representing the Local Authority's insurers that this claim is now being dealt with under the Policy and, I understand, that independent consultants have now been instructed to draw up a scheme." Mrs Athay was due to retire during April 2000. On 3rd April, she wrote as follows to Mr Wolfe: "I have...

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