HT-2020-000448 - [2024] EWHC 1185 (TCC)

DBS contends that there were two broad categories of loss caused by the alleged breaches. The first is the need for consultancy support, and the second is incoming supply cost.

In relation to the first category, it is said that because of the deficiencies in the STP up to and including STP v.09 and the lack of co-operation that betrayed, the programme to procure a replacement supplier and transition the services was significantly more complicated than it would otherwise have been.

Ms Graves explained in her third witness statement that DBS’ plans for transition and exit accelerated in around August 2018, when she says it retained Ms Wooller to assist with this project. The transition and exit had to be planned alongside the procurement of a new supplier to take over the services. DBS did not have the internal capacity to take on the exit and transition project, alongside all the work that was being undertaken at the time for R1 Barring and Basics. Ms Graves considered that some consultants would always have been needed by DBS, even if the transition away from TCS had been smoother, ‘without the disputes between the parties’. Therefore, when considering DBS’ costs of exit, Ms Graves gave credit for the “normal” costs of exit, assuming that DBS would have retained an additional project manager (a senior “Grade 6” project manager), plus advisers to assist with TUPE and employment issues. Ms Graves also said that DBS was not claiming for the costs of work done by consultants who were analysing “future” options (such as disaggregation) since she considered that similar advice would have been sought in any event and was not due to TCS. Ms Graves then tabulated the claims made excluding the CGI costs as follows:

The starting point for the connecting the claimed losses to the established breach is not promising for DBS: the pleaded case from which the losses were claimed to flow included allegations of a failure to have acted reasonably during the Exit and Service Transfer arrangements, and to have co-operated with DBS (i.e. the execution allegations). However, as explained above, these claims were not pursued. The remaining narrow claim focussed on certain aspects of the STP document, and of the 5 complaints made, only one has partially succeeded.

In respect of knowledge transfer, there is no dispute that the exercise undertaken by Mr Padannayi in October 2019 was ‘comprehensive’ and has not been criticised, and there is no case that the v0.18 STP plan was materially deficient. It is also not said that TCS in any way failed to execute the plan agreed, and Ms Wooller stated in terms (at paragraph 21 of her statement) that from December 2019 onwards, TCS delivered pretty much as per the requirements agreed in the plan.

In this regard, I also view the factual evidence against the background of the opinion of evidence of the IT experts, neither of which provided any support for the proposition that any deficiency in the STP in fact caused any problems.

Dr Hunt’s evidence (Day 20/184) was :

Mr Britton’s evidence, in his Second Report, was:

The costs claimed, save for the CGI costs, relate to the costs of additional external and internal resources. The only evidence in relation to additional personnel required came from Ms Wooller, who at paragraphs 36 and 37 of her Witness Statement said:

Even taken at its highest, it is not possible to link the additional personnel to the established breach by reference to this evidence. In any event, I do not accept Ms Wooller’s evidence more broadly in relation to causation. It is clear that by reference to DBS’s own draft exit plan in August 2018, a large team was planned, as demonstrated by the following organisational chart:

It is obvious that no part of DBS’s decision to include the various personnel within its own transition organisation was a result of inadequacies in v0.9 (or, indeed, any preceding draft) of the STP. The draft exit plan does not refer to any TCS failure in this regard, and indeed specifically states at paragraph 1.5.3 that one of the ‘exclusions and constraints’ to which the plan was subject was that. ‘responsibility for the development of an exit transition plan will rest with TCS’. In other words, the plan itself rested on the assumption that TCS would comply with its contractual obligations with regard to transfer and exit, not that it was required, or had been expanded in any way, because of any actual failure on TCS’s part, or a perceived risk of future failure.

Moreover, in relation to the causal link between her own employment and DBS’s claim, it is plain from the specification (dated January 2018, many months before v0.9 STP) attached to her contract that her very broad brief related to the overall DBS strategy at the time, and was not caused by TCS’s failure in respect of knowledge transfer (or, indeed, the state of any part of the STP). Even though the breaches were not pursued, it seems obvious that the breadth of her role was also completely unrelated to the alleged lack of co-operation which lay months in the future (on DBS’s pleaded case). The background to the requirement/overview of requirement within the specification set out as follows:

Furthermore, it is clear that the reason for additional personnel related in Ms Wooller’s eyes to general lack of co-operation from TCS (which allegation was not pursued) and the difficulties of transitioning whilst also dealing with R0 legacy issues (resulting from DBS’s own strategy to remove R1-D and for which TCS is not responsible). In evidence, Ms Wooller repeated her understanding that DBS needed external support during exit and transition because there was not the capacity within DBS to carry out transition work together with the ongoing day-to-day work on R0 ‘and the relationship with TCS’. Moreover even if general ‘lack of co-operation’ was a pursued and established breach, which it is not, Ms Wooller made clear that after September 2019, once DBS had presented what it felt should be in the service transfer plan, TCS cooperated.

In my judgment, DBS have failed entirely to establish on the evidence any proper causal link between the costs claimed and the only breach established, which was a failure on the part of the STP to have included more detailed (but nevertheless remaining relatively general) descriptions of the knowledge transfer process. Indeed, even if the STP related allegations under Clause 3 of Schedule 2-11 had all been made out, DBS’s claim would still have failed. There is simply no link between the additional personnel costs incurred by DBS in transitioning to the new supplier and the STP deficiencies alleged (and which were resolved, even on DBS’s case) for the execution of service transfer itself.

I find that none of the specific individuals in respect of which claims are made (Kim Wooller, Paul Kerr, Jordan Vaughan and Sunaina Shori (items 26, 27, 28 and 29 of the Updated Schedule of Loss) were employed as a result of the established breach (or, indeed, the alleged STP related breaches). The same applies to the miscellaneous personnel employed through the CACI agency (item 30). There is no evidence – either documentary or by way of narrative from a factual witness – that sheds any light on the link between the IBM costs claimed (item 25) and any part of DBS’s case in relation to STP deficiencies, or even the transition (relating as they do to a period after transition).

In the circumstances, the claims for additional external, agency and IBM personnel (items 25 to 30 of the Updated Schedule of Loss) fail.

The remaining claim, which at £3,526,593 is not insignificant, is pleaded on the basis that DBS engaged CGI to perform service transition work and to create contingencies, such as alternative accommodation, including the assessment and documentation of the design of the inherited systems. The costs were part of Lots 1 and 2 ‘were caused by the lack of documentation and the Claimant’s refusal to co-operate’. No claim for lack of documentation or refusal to co-operate, save in the limited sense relating to the STP specific alleged breaches, was advanced at trial let alone established. Ms Wooller confirmed in evidence that none of Lots 1, 2 or 3 related to complaints concerning TCS in relating to the STP. Ms Wooller also confirmed that if CGI had increased the cost of its bid as a result of not knowing more about knowledge transfer, that would have been set out within their risks and assumptions and their risk premiums. There is no evidence that this happened. Moreover, the suggestion that they may have done would be inconsistent with the evidence of Ms Mather of DBS, who said CGI provided lots of evidence of its experience with dealing with similar transitions and said that it was not unduly concerned about the fact that this would be a difficult transition, which they had plans to manage without seeking to rely on DBS to help support them. There is no link whatsoever between the sum claimed and the breach established (or, indeed, the breaches alleged).

In the circumstances, item 31 of the Updated Schedule of Loss fails.