Fladgate defends international contractor Van Oord

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Fladgate LLP has successfully represented Van Oord UK Limited (Van Oord), a leading international contractor specialising in dredging, marine engineering and offshore oil, gas and wind projects, against a claim brought by Mouchel Limited (Mouchel), a consulting and business services group.

Mouchel was sued by Kier Group (Kier), a construction company, for £1.2 million in respect of alleged design deficiencies in the under water outlet and inlet pipes serving a power station in the Humber River. Mouchel and Kier settled the claim for an all in figure of approximately £600,000 inclusive of damages and legal costs.

Mouchel then sought a substantial contribution from Van Oord in respect of the claim, alleging that the design had been the responsibility of Van Oord. In addition, they claimed that some bad workmanship by Van Oord had also contributed to the damages.

In the first judgment in this matter, relating solely to the liability of Van Oord, Ramsey J found that Van Oord had no liability whatsoever in respect of the design. However, he did find that there was some liability for poor workmanship, representing 8 per cent. of the damages settlement between Kier and Mouchel.

This gave rise to the question of liability for legal costs. Mouchel argued that Van Oord should be responsible for a large proportion of Kier’s and Mouchel’s legal costs in the main action. Van Oord argued that they should be liable for at most 8 per cent. of Kier’s costs in the main action and for none of Mouchel’s costs since they would have incurred the costs in defending the action in any event.

The Judge found that the liability to contribute to Kier’s costs was to be assessed under the Civil Liability (Contribution) Act 1978 but the liability to contribute to Mouchel’s costs fell under the court’s discretion. On these bases, he accepted Van Oord’s arguments and awarded that Van Oord pay 8 per cent. of Kier’s costs, pursuant to the Contribution Act but, exercising his discretion, found that Van Oord were not liable to contribute anything to Mouchel’s costs in the main action.

Fladgate litigation partner Frances Alderson advised Van Oord.

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