Source Article
Crosby (J) & Sons Ltd v Portland Urban District Council (1967) 5 BLR 121, QBD - EWHC
Keywords/summary

Construction law - assessment of damages - total cost method of assessment - global claim - cumulative impact - changes/variations - difficulty of assessment - nature of loss - delay and disruption - loss of productivity - apportionment of loss/damage 

The Facts

This case was concerned with a dispute arising from a contract for the construction of a pipeline under ICE standard from of contract 4th edition. Variations were instructed in respect of the line of the pipe, the method of working and in respect of significant amounts of additional work. There was also an element of contractor’s default and neutral events.

Fig 6.2: Crosby v Portland UDC

The arbitrator ordered that amounts attributable to certain items should be assessed by way of varied rates. In respect of the balance, the contractor submitted a general, ‘global,’ claim for delay and disorganisation. The arbitrator held that 31 weeks of the 46 week delay was due to the various matters for which the employer was responsible and that part of the disorganisation of labour cost was also attributable to these matters. He held that it was "impracticable if not impossible" to allocate parts of the ‘rolled up’ award to any one of the causative factors in isolation. 

Whether the total cost/global method of assessment was lawful

As to whether the arbitrator’s approach was correct/whether the loss attributable to each breach (cause and effect) had to be identified, Donaldson J said (at p136) that:

"I can see no reason why he should not recognise the realities of the situation and make individual awards in respect of those parts of individual items of the claim which can be dealt with in isolation and a supplementary award in respect of the remainder of these claims as a composite whole. This is what the arbitrator has done...."

Copyright Stewart Dunn except:
Extracts from Building Law Reports (BLR), originally published by Informa Professional Publishing, 30-32 Mortimer Street, London, W1W 7RE, UK, www.informalaw.com. For further details on Building Law Reports please contact Eleanor Slade at eleanor.slade@informa.com