Coal Pension Properties Limited v Nu-Way Limited [2009]
EWHC 824 (TCC)
Mr Justice Simon had to consider whether the defendants, Nu-Way
Limited, had fulfilled their duty of care in connection with what
the claimants argued was an obligation to issue a warning.
Mr Justice Simon said that the duty to warn depends on all the
circumstances including the level of danger and its obviousness to
the reasonable user, although the necessity of avoiding undue alarm
is also to be taken into account. Where the duty applies a warning
must be such as to make the user as safe as reasonably possible. In
so far as dangers appearing after manufacture are concerned the
manufacturer may be under a duty to take reasonable steps to bring
it to the attention of those likely to be affected.
The case concerned an explosion at the BHS store on Oxford
Street, London on 15 August 2001. The explosion occurred as a
result of a gas leak from a GB 3500 gas booster manufactured by
Nu-Way in 1986. Coal Pension Properties Limited claimed that Nu-Way
knew by August 1998 that there were inherent dangers in the design
of the booster, which meant that it could fail at any time. Despite
this, they failed to issue any adequate warnings.
The GB 3500 booster was first designed and produced in 1975. All
was well until May 1990 when Nu-Way were notified of an incident
involving the same type of booster. It was unclear as to what
caused the failure.
In December 1995 there was another incident at Brunswick Campus
in Gloucester. It was discovered that the impeller spindle had
broken causing the impeller to strike the casing resulting in a
fracture. Nu-Way changed the design of the spindle and the new
design went into production in October 1996 with a further
modification in November 1996.
Another incident occurred in June 1997 with an explosion at a
block of flats in South London. Further testing was carried out by
Nu-Way to establish the damage that could result from a weakened
spindle. In February 1998 Nu-Way added a reinforcing rim around the
bottom half of the fan casing to reduce the risk of fracture.
In June 1998 there was an incident at the Nynex Centre in
Manchester. The booster had been fitted with a replacement bearing
housing and a revised spindle. Nu-Way could not establish the
definite cause of the failure. There was concern over the
maintenance regime and it was considered that the source of the
problem may have been mechanical damage caused to the spindle at
some time prior to installation in February 1997. Nu-Way advised
that in future all bearing housings would be supplied as a complete
unit.
On 24 July 1998 product information note 100 was issued
emphasising the need for regular inspection.
On 6 August 1998 production information note 102 was issued. It
noted that any bearing assembly failure would be replaced with a
complete pre-assembled unit. The latest version of the gas booster
handbook and data sheet were issued along with an instruction that
previous copies were withdrawn.
On 15 March 1999 a Dr Su of Nottingham Trent University
recommended the use of a key and locking nut to fix the impeller to
the spindle. The impeller was also lightened and Nu-Way then built
a prototype that was tested over a period of seven months. A new
design went into production in September 2000.
On 16 May 2001 there was a further explosion at a BASF factory
on Merseyside. There was an escape of gas from a GB 3500 gas
booster. That seems to have resulted from the use of non-authorised
parts and lack of maintenance.
On 15 August 2001 the BHS explosion occurred as a result of an
escape of gas from booster number 1. The root cause was the
fracture of the casing as a result of the disintegration of the
impeller and bearings.
Mr Justice Simon said that the issue in this case was whether a
warning should have been given in August 1998 and, if so, in what
form. He held that there was a duty to give a warning that
specifically addressed the risk to the fan casing. By that stage
there had been three incidents in which the fan casing had broken.
The risk had been addressed by modifications to both the fan casing
and the spindle, but there were still boosters in operation that
had never been modified. Product information notes 101 and 102 did
not specifically address those boosters. Mr Justice Simon
considered that Nu-Way were entitled to take the view that it would
not be practicable to call in all unmodified boosters and that a
warning of the need for proper and effective maintenance would make
the continued use of such boosters as safe as was reasonably
possible.
Mr Justice Simon said that a warning in the following terms
should have been issued:-
"There is a risk that boosters manufactured before February
1998 may suffer failure of the casing if not properly maintained.
It is particularly important to carry out proper inspection and
maintenance of these boosters".
Mr Justice Simon then considered the question of causation. He
heard evidence about the maintenance programme of BHS and was
unimpressed. He found that inspection and maintenance had been
carried out only every second year between 1993 and 1999. There was
a lack of maintenance records. He concluded that the evidence
suggested a very low general standard of inspection and maintenance
of the boosters. Accordingly Mr Justice Simon was not satisfied
that, if the warning had been given in the terms which he found
that it should have been, that it would have been heeded and the
loss would have been avoided.
This case was decided on the reassuring basis that existence and
extent of a duty to warn sufficiently is dependent on all of the
facts and circumstances and the need to show that the breach caused
the claimant loss.
Contributed by Catriona Stewart