Co-operative Group Ltd v Birse Developments Ltd and Stuarts Industrial Flooring Ltd [2013] EWCA Civ 474

This appeal concerned the level of abstraction at which a tribunal must select and compare facts already pleaded with those proposed by way of amendment, so as to determine whether an amendment brought outside the expiry of the primary limitation period is a "new claim" under section 35 of the Limitation Act 1980.

Co-op is the leasehold owner of a distribution centre in Rugby. Birse was the main design and build contractor in the centre's development. Stuarts were the flooring subcontractors.

Co-op sued Birse. Co-op pleaded that internal floor slabs had failed due to breaches of contract (specifically numbered clauses) for defective workmanship, defective design and non-compliance with the Employer's Requirements, such that the slabs would require repair.

After expiry of the limitation period, Co-op sought to plead by amendment that the slabs contained insufficient steel fibre content and, as such, were under-strength, in breach of the same numbered clauses as already pleaded, and that the slabs would fail if not replaced entirely. Co-op succeeded at first instance in obtaining permission for the amendments. Its submission was that there was no new claim, but merely further particularisation of already pleaded breaches of contract. The bare minimum of essential facts for the original claim, so said Co-op, were that:

(1) Birse owed Co-op contractual obligations in relation to the floor slabs, as defined and pleaded; and

(2) Birse breached its contractual obligations through defective performance under the building contract through:

(a) poor and/or inadequate design of the internal slabs;

(b) poor and/or inadequate workmanship; and

(c) failure to adhere to the Employer's Requirements.

The Court of Appeal disagreed.

In allowing Birse's appeal and thus refusing permission for the amendments, Tomlinson LJ (with whom Longmore and Rimer LJJ agreed) accepted Birse's submission that the originally pleaded case related to disparate defects in the slabs capable of disparate replacement and repair; but that the amended case alleged a systemic defect resulting in wholesale replacement.

The Court stated that the amendments relied upon a specific facet of a contractual duty of which no breach was hitherto asserted, namely an alleged failure of the slabs to withstand a pallet racking leg load of 70kN. The Court agreed with the learned judge's decision that, in any event, the steel fibre content claim did not arise out of the same or substantially the same facts.

The Court appears to have adopted a strict approach to amendments outside the limitation period and was not persuaded by submissions that:

(1) the allegation of insufficient steel fibre content in the slabs seemed to be a further example of how the very same slabs as were already in issue had failed and was pleaded by reference to the same numbered clauses and overarching breaches of contract in the existing statement of case;

(2) the authorities would appear to support the amendment in this case, as they required a comparison of the pleaded facts at "the highest level of abstraction", avoiding "unnecessary subtleties";

(3) the effect of an amendment on the nature and quantum of remedial works is ordinarily irrelevant, especially for breach of contract where the cause of action comprises (1) a contractual obligation and (2) breach of that obligation; there is no requirement to show damage.

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