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Council Awarded Seven-Figure Damages for Flaws in Tram Depot Design

Disputes concerning major construction projects can simmer on for years after they are completed and one of the great advantages of litigation is that it offers finality. In one case, the High Court achieved that end by awarding more than £1 million in damages to a local authority in respect of flaws in a landmark tram depot.

After securing central government funding for an upgrade of its tramway system, the council had engaged a construction company to erect the depot under a design-and-build contract. The strikingly modern building was in a seaside town and featured a curved aluminium roof, decorative blue cladding in the form of waves, fully glazed double bi-folding tram doors and a polished metal wall facing out to sea.

Some years after the depot was completed and brought into operation, the council launched proceedings against the company, complaining that significant parts of the depot did not meet their intended design life of 50 years and had suffered corrosion due to being unsuitable for an exposed coastal environment. It was alleged that remedial works would cost more than £6 million.

The company conceded that some parts of the depot required attention. However, it argued that any corrosion was a result of the council's failure to maintain the depot appropriately. Characterising the council's claim as wholly excessive, it denied that that there was a contractual requirement for a 50-year design life and disputed the extent of remedial works required.

Ruling on the matter, the Court found that, depending on the component in question, the design life requirement was 20 or 25 years. It rejected claims that galvanised steel cold formed elements of the building were inadequate for their design life or otherwise unsuitable. Some components could be repaired or partially, rather than wholly, replaced. The council was awarded £1,110,781 in damages.

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