Royal Brompton Hospital National Health Service Trust v. Hammond and Others and Taylor Woodrow Construction (Holdings) Limited

Factual and Procedural Background

In 1987 the Plaintiff engaged the Respondent under a JCT 1980 standard-form contract to construct new hospital premises. The works were to be completed by 23 July 1989, with liquidated damages of £47,000 per week for delay. Practical completion occurred 43 weeks late. Acting under the contract, the Appellant (the project architect) granted extensions of time that removed the Respondent’s exposure to liquidated damages and certified approximately £5.2 million of prolongation and disruption costs.

The Respondent commenced arbitration seeking further sums; the Plaintiff counter-claimed. On 19 December 1995 the arbitration was settled: the Plaintiff paid about £6.2 million and indemnified the Respondent against any future contribution claims brought by the Appellant.

Separately, the Plaintiff sued the Appellant in negligence for (i) negligent certification of extensions of time (“section G”) and (ii) an instruction concerning Hydrotite waterproofing that shifted cost liability from the Respondent to the Plaintiff (“section F”). The Appellant issued Part 20 proceedings against the Respondent seeking contribution under the Civil Liability (Contribution) Act 1978 (“the 1978 Act”). The Respondent applied to strike out the contribution claim. Judge Hicks QC struck it out; the Court of Appeal affirmed. The Appellant appealed to the House of Lords.

Legal Issues Presented

1. Whether, for the purposes of section 1(1) of the 1978 Act, the liabilities of the Appellant and the Respondent were “in respect of the same damage,” thereby entitling the Appellant to seek a contribution.
2. Whether the lower courts erred in striking out the Appellant’s Part 20 notice concerning both the extensions-of-time and Hydrotite allegations.

Arguments of the Parties

Appellant's Arguments

• The phrase “the same damage” should receive a broad, purposive interpretation consistent with the reforming intent of the 1978 Act.
• Earlier authority (e.g., Friends’ Provident) supports a flexible approach that allows contribution where losses are substantially, if not identically, the same.
• The court’s wide discretion under section 2 of the Act to achieve what is “just and equitable” justifies permitting the claim to proceed.

Respondent's Arguments

• The Plaintiff’s claim against the Respondent concerns delay in completing the works, whereas the claim against the Appellant concerns the Plaintiff’s impaired contractual position caused by negligent certification; the damages are therefore distinct.
• Contribution is available only where both defendants share a common liability for an indivisible harm, which is absent here.
• Allowing contribution in the circumstances would unjustly require the Respondent to fund losses it did not cause.

Table of Precedents Cited

Court's Reasoning and Analysis

The House, led by Judge Bingham and Judge Steyn, undertook a detailed textual and historical analysis of section 1(1) of the 1978 Act.

• Historical foundation: Contribution has always depended on a common liability; the statutory phrase “in respect of the same damage” preserves, not relaxes, that requirement.
• Statutory construction: The words “same damage” mean identical harm, not merely similar or overlapping loss. Expanding the phrase would create uncertainty and unfairly burden parties who did not cause the relevant harm.
• Application to section G (extensions of time): The Respondent’s breach was late completion; the Appellant’s alleged breach was negligent certification that weakened the Plaintiff’s contractual position. The harms are different in nature, timing, and legal character; therefore they are not “the same damage.”
• Application to section F (Hydrotite): The cost of Hydrotite arose from an allegedly negligent instruction by the Appellant that transferred liability from the Respondent to the Plaintiff. Again, this is distinct from delay-related loss.
• Dismissal of contrary authority: Earlier expansive readings in Friends’ Provident and Hurstwood were criticised and declared incorrect.
• Policy considerations: Allowing contribution where liability is not common would oblige a defendant to pay for harm it did not cause, an outcome the statute does not permit. The broad discretion under section 2 cannot override the threshold requirement of section 1.

Holding and Implications

Holding: APPEAL DISMISSED.

The Appellant’s Part 20 claim was rightly struck out because the liabilities of the Appellant and Respondent were not “in respect of the same damage” within section 1(1) of the 1978 Act. The decision clarifies that:

• Contribution under the 1978 Act is available only where defendants share true common liability for the identical harm.
• Earlier authorities adopting a wider approach are no longer reliable.
• Parties should plead and analyse with precision whether alleged harms overlap before invoking the statutory right to contribution.