TECJET LTD AGAINST KIER CONSTRUCTION LTD

Factual and Procedural Background

This case arises from a fire at the Mackintosh Building of the Glasgow Art School on 15 June 2018. The Plaintiff was the tenant of adjacent premises known as the O2 Building, operating it as a nightclub and music venue. The Defendant was the principal contractor undertaking remedial work at the Art School site following an earlier fire in 2014. The fire in June 2018 caused extensive damage, spreading to adjoining buildings including the Plaintiff's premises. The Plaintiff brought an action against the Defendant for loss and damage caused by the fire, suing both in its own right and as assignee of claims from two other companies within its corporate group. The Plaintiff's case relied on the maxim res ipsa loquitur, contending that the fire's occurrence and spread under the Defendant's control evidenced negligence. The Defendant challenged the relevancy of the Plaintiff's case on several grounds, including the Plaintiff's title to sue and the sufficiency of pleadings.

Legal Issues Presented

1. Whether the Plaintiff had title to sue for its own alleged losses at the time the action was raised, particularly regarding the sufficiency of averments on leasehold interest and interruption of the prescriptive period.
2. Whether the Plaintiff had title to sue on behalf of the assignor companies for their alleged losses, considering the validity, execution, and intimation of assignations transferring rights.
3. Whether the pleadings of the Plaintiff were relevant and sufficiently detailed to establish a duty of care owed by the Defendant and to specify the quantum of losses claimed.
4. The applicability of the Construction (Design and Management) Regulations 2015, specifically regulation 29, to the Plaintiff's claims.

Arguments of the Parties

Defendant's Arguments

• The Plaintiff failed to establish the nature or basis of its right to claim damages for its own losses at the time the summons was served, as the pleadings only averred tenancy without reference to a lease until much later, after the prescriptive period expired.
• The summons as served did not constitute a "relevant claim" to interrupt prescription under the Prescription and Limitation (Scotland) Act 1973 because it lacked sufficient averments of title to sue.
• The first assignation purportedly transferring claims from the assignor companies to the Plaintiff did not convey property rights but only a mandate to litigate on their behalf, and was invalidly executed and not properly intimated as required by statute.
• The second assignation was executed and intimated after proceedings had started and could not cure any defect in title at the commencement of the action.
• The Plaintiff had no title to sue for the assignors' claims at the date proceedings were raised, rendering those claims prescribed and the action a nullity as to those claims.
• The Plaintiff's pleadings contained contradictions and lacked sufficient detail to establish a duty of care, particularly in respect of the assignors who were not tenants.
• The quantum of losses claimed was inadequately specified and amounted to a "global" claim without fair notice.
• The Construction (Design and Management) Regulations 2015, specifically regulation 29, were irrelevant to claims for property damage as they relate to preventing personal injury.

Plaintiff's Arguments

• The Plaintiff made claims both for the building and its contents, so the Defendant's argument on title only affected the claim related to the premises.
• A lack of specification of title in the pleadings at the outset did not prevent the summons from constituting a relevant claim interrupting prescription, as the substance of the obligation was brought into issue.
• The first assignation, properly construed, conveyed all rights to bring and conduct proceedings on behalf of the assignors, including compromise and settlement, thus conferring title to sue.
• The typographical error in the first assignation's reference to "Academy Group Limited" was an obvious mistake and did not affect its validity.
• The forms of intimation prescribed by statute were not exhaustive; intimation is a matter of fact and the Plaintiff had complied.
• The Defender did not challenge the formal validity of the first assignation's execution, and proof of authority was a matter for evidence.
• In the event the first assignation was ineffective, the second assignation, although subsequent, could cure defects in title during proceedings, consistent with established authority allowing title to be perfected after commencement in certain cases.
• The Plaintiff's case on duty of care was based on the neighbour principle and was neither novel nor controversial; the Defendant owed a duty to avoid causing damage by fire to neighbouring property.
• The losses claimed related primarily to contents (primary loss) and loss of profit arising from property damage, and the pleadings, including schedule of loss and vouching, gave fair notice of the claim.
• The averments regarding the CDM Regulations were relevant to demonstrate the Defendant's control over the site and standards expected of principal contractors, supporting the negligence claim.

Table of Precedents Cited

Court's Reasoning and Analysis

The court first examined the Plaintiff's title to sue for its own losses. It found that the summons as served met the statutory definition of a "relevant claim" under the Prescription and Limitation (Scotland) Act 1973 despite initial inadequacies in pleading the leasehold interest. The court emphasized that the substance of the claim and the Plaintiff's status as tenant were sufficient to interrupt prescription for the Plaintiff's own losses.

Regarding the assignors' claims, the court undertook a detailed construction of the first assignation. It held that the assignation conveyed only a mandate to litigate on behalf of the assignors and did not transfer property rights or title to sue. Consequently, the Plaintiff lacked title to sue for these claims at the time proceedings were raised. The second assignation, executed after commencement, could not cure this fundamental defect, rendering the action a nullity as to the assignors' claims. Accordingly, those claims were prescribed and dismissed.

The court rejected the Defendant's arguments concerning intimation and execution defects of the first assignation, finding those arguments unpersuasive and not determinative given the primary issue of lack of title.

On the relevancy of the Plaintiff's pleadings, the court found that the Plaintiff had pled a relevant duty of care based on established neighbour principles and that the claim was neither novel nor controversial. The Plaintiff's averments, while not highly detailed, were sufficient at this stage to give fair notice of the claim and its basis.

The court also found that the Plaintiff's averments relating to the Construction (Design and Management) Regulations 2015 were relevant to the issue of control exercised by the Defendant over the site and thus to the negligence claim.

Finally, the court recognized the need for the Plaintiff to revisit its quantum averments to exclude losses attributable to the assignors, given the dismissal of those claims.

Holding and Implications

The court sustained the Defendant's third plea-in-law and dismissed the action insofar as it related to the losses of the assignors, Academy Music Group Limited and Live Nation (Music) UK Limited. The Plaintiff's claim in its own right was not dismissed and was found to be a relevant claim capable of interrupting prescription.

The court ordered the case to be put out by order to allow the parties to address further procedure in light of the decision, particularly concerning the Plaintiff's quantum averments. All questions of expenses were reserved.

No new legal precedent was established; the decision applied existing principles on title to sue, prescription, and the construction of assignations. The direct effect is that the Plaintiff may proceed with its own claims but not on behalf of the assignors.