HT-2025-000282 - [2025] EWHC 850 (TCC)

Fecha: 09-Abr-2025

Betterment if no deduction made in respect of Northlight (£25,000) [D-369]

Betterment if no deduction made in respect of Northlight (£25,000) [D-369]

Professional fees:

Calfordseaden: £77,548.95 [D-369]

ii.

Eckersley O’Callaghan: £17,356.19 [D-369]

iii.

Membrane Roofing: £5,121.00 [D-369]

iv.

Triodos Bank: £13,500 [D-369]

Warrington Fire Testing: £51,090 [D-369]

vi.

Michael Puttrick: £0 [D-369]

vii.

Thornton Consulting: £0 [D-369]”

I consider that it is fair to conclude that the Defendant’s quantum summary looks somewhat improbable and somewhat unreasonable. However that doesn’t mean that the Claimant’s quantum case should not be rigorously probed and challenged.

92.

Taking each of the Claimant’s head of claims

-1 Sums paid to BKS

I accept that the appropriate legal test is as set out in the Defendant’s Closing Written Submissions: -

“212.
As Akenhead J held in AXA Insurance UK Plc v Cunningham Lindsey UK [2007] EWHC 3023 (TCC)," …it is generally incumbent upon an innocent claimant entitled to damages to demonstrate not only that the loss was within one of the Hadley v Baxendale limbs but also that it is reasonable to recover damages of the type and extent claimed."
213.
The touchstone is, therefore, reasonableness.
214.
In this particular case, the court should not use the costs in fact incurred as a starting point when considering what is reasonable: see Brit Inns Ltd v BDW Trading Ltd [2012] EWHC 2143 (TCC), 145 Con LR 181. The remedial works were not undertaken pursuant to a competitive tender; they were not undertaken by an experienced main contractor; and they were not managed by an experienced client representative (Mr Calderbank).”

93.

However I consider that the criticisms of how Mr Calderbank procured, managed and implemented the remedial works are unfair and unjustified. I was impressed by Mr Calderbank’s evidence and in difficult circumstances despite not being professionally qualified, I consider and so find that he acted reasonably and the costs incurred were reasonably incurred and it is reasonable to recover the damages of the type and extent claimed.

94.

I found the written and oral evidence of the quantum experts less helpful than I had expected.

95.

David Baldwin: the Claimant’s independent quantum expert was advised that the Defendant had not pleaded “mitigation” and was only subsequently instructed to engage in discussion of any mitigation points raised by the Defendant’s expert.

96.

Chris Huntley: the Defendant’s independent quantum expert concluded that for the purpose of his Report he had in many cases insufficient documentation to review the quantum figures. However very late in the day the independent experts produced a Post Joint Statement statement dated the 24^th January 2025.

97.

Both independent experts did their best to assist the court but I consider it may have been more helpful if from the outset the scope of their reports and the precise issues they were being asked to address could have been agreed well before they produced their first Joint Statement.

98.

The Defendant has sought to criticise the Claimant's procurement of the remedial works with BKS, both by its cross-examination of Mr. Calderbank and Mr. Baldwin and by the evidence of its own quantum expert (Mr. Huntley). However, in his oral evidence, Mr. Huntley accepted that the reasonableness of the Claimant's approach in this respect was a matter of fact.

99.

The factual background was explained by Mr. Calderbank. When cross-examined on this subject, his evidence remained clear, consistent and persuasive. In short as summarised in the Claimant’s Written Closing Submissions.

.1 Calfordseaden's original specification was issued in July 2020, providing for the works to be carried out on the basis of full panel replacement (save for minor matters). Following a tender exercise, Kingerlee was selected.

.2 BKS was introduced as Kingerlee's proposed subcontractor for the panel replacement works, following which the possibility of repair rather than replacement was raised.

.3 Between September 2020 and January 2021, there were discussions between inter alia BKS, Kingerlee, Eckersley O'Callaghan (the structural engineers) and the Claimant regarding the feasibility and methodology of a possible panel repair scheme.

.4 That repair-focused (rather than replacement-focused) remedial scheme had a number of advantages from the Claimant's point of view, in particular minimising disruption to internal M&E services and to the Claimant's operations in the building.

.5 Kingerlee pulled out of the remedial project in around February or March 2021, and suggested that BKS should take over.

.6 That left the Claimant with a choice: either to continue with BKS, or to go back to the drawing board and look for another contractor.

.7 Faced with a difficult position through no fault of its own, the Claimant acted decisively and they went with BKS. BKS was already familiar with the remedial scheme which it had helped to develop, and had a good relationship with the Claimant and the rest of the team.

100.

I consider and so find that the Claimant acted reasonably in deciding to proceed with BKS.

101.

The Defendant seeks to compare the sums paid to BKS with the sums originally proposed by the tenderers in August 2020 following the July 2020 Specification. This ignores the following:

.1 The Calfordseaden tender evaluation report identifies that the estimate of building works cost was "based on a partial replacement of the CLT panels and remedial repairs to those panels where the decay is minimal.” In other works, the basic philosophy of the proposal was replacement, with a possibility of repair "where the decay is minimal".

.2 The remedial scheme in fact adopted was based on repair of the CLT panels, with replacement only where repair was impossible. See item 3.7.5.4 of the July 2021 Specification. The philosophy of the two approaches was therefore very different.

.3 Those sums which were calculated by the tenderers - such as preliminaries - varied subject to change. That was particularly so because the figures were drawn from first stage tenders. Mr Huntley failed to take account of any of this in his evidence. Indeed, despite expressly identifying that the tenders were first stage tenders and subject to change, he sought in his oral evidence to suggest that they were firm prices. [Day 7/1258/12-24]

102.

The Claimant submits, in my view, correctly in its Written Closing Submissions that this connects to a wider issue with the Defendant's quantum evidence, which is the relative superficiality of Mr Huntley's analysis. The Claimant in its Written Closing Submissions state: -

“.1 The quantum experts were provided with, among other things, detailed breakdowns of the claims for prelims and scaffolding costs as well as over 1,100 pages of ITPs and related records in respect of the repair and replacement of the CLT panels.
.2 Mr Huntley's report suggests that the quantum of the claim should be reduced by over £1.3 million in respect of those three categories of costs alone:
Claim
Huntley
Difference
Prelims
£935,703.71
£137,470.00
£798,233.71
CLT works
£390,098.18
£249,733.18
£140,365.00
Scaffold
£1,069,700.00
£663,477.00
£406,223.00
TOTAL
£2,395,501.89
£1,050,680.18
£1,344,821.71
.3 Despite that startling reduction, Mr Huntley's report does not engage with any of that information.
.4 Instead, the majority of Mr Huntley's analysis is limited to comparing elements of the BKS cost (at a very high level) with the sums proposed at an early tender stage by Kingerlee and / or Speller Metcalfe.
.5 There are three problems with this.
.6 First, such comparisons are inherently flawed for the reasons given above.
.7 Second, it is not an adequate degree of scrutiny to support any contention that the sums paid to BKS are so unreasonably high that the Claimant is not entitled to recover them. Such contentions are, again, unpleaded allegations of failure to mitigate. Even if the Defendant was entitled to pursue them, they would require a very high degree of unreasonableness to be shown.
.8 Third, it means that the complaints Mr Huntley makes elsewhere in his report about not having been provided with enough detail ring hollow. The Court has no reason to believe that he would have engaged with the additional detail he refers to, because he did not even engage with the detail he did have.
.9 This failure to engage with the detail is another example of what has previously been described as Mr Huntley's "lax" or "cavalier" approach to his role as an expert.

	Claim	Huntley	Difference
Prelims	£935,703.71	£137,470.00	£798,233.71
CLT works	£390,098.18	£249,733.18	£140,365.00
Scaffold	£1,069,700.00	£663,477.00	£406,223.00
TOTAL	£2,395,501.89	£1,050,680.18	£1,344,821.71

103.

I share these concerns regarding Mr Huntley’s evidence and in these circumstances in respect of the reasonable costs of the remedial works I prefer the evidence and findings of Mr Baldwin save in respect of the hypothetical cost of the credit for a temporary roof.

104.

To take just an example of Mr Huntley’s approach see the Claimant’s cost of the CLT works £390,098 18. Mr Huntley's main criticism of the cost of the CLT works was that the hourly rates for joiners and telehandler drivers were high.

105.

As to that I agree with the Closing Written Submissions of the Claimant.

.1 This is an unpleaded allegation of failure to mitigate.

.2 Mr Calderbank’s factual evidence was that the rates charged were the rates which the Claimant could in fact achieve [Day 3/410/10-18]

“A. My experience of quantity surveyors is that they can always find a slightly cheaper price in a book than what we could actually get to site. In one of the discussions about joiners we had, I remember Michael Moran pulling out the industry guide saying what a joiner should cost and the site team saying, "If you can find us a joiner for that cost that is competent at doing it we would use them" and so it does not surprise me that the quantity surveyor can find a cheaper hypothetical joiner.”

.3 On that basis, Mr Huntley expressed the view orally that to pay those rates "was unreasonable but potentially may have been unavoidable "

.4 It is not unreasonable to pay a rate which was "unavoidable". It has never been suggested (and it could not sensibly be suggested) that it was unreasonable for the Claimant to carry out the CLT works at all.

.5 Mr Baldwin also identifies that such rates may have included other elements such as attendant labour.

106.

Mr Huntley also made a complaint about not having the necessary records, to demonstrate that the extent of the works done. It emerged from his cross-examination that this complaint was less significant than it might otherwise have appeared to be, because he expressly accepted the time spent on the works.

107.

In any case, he had not considered the extensive records of the remedial works supplied by the Claimant (and to be found in volumes [E11] to [E14] of the trial bundle).

108.

I consider that the Claimant’s criticisms of the Defendant’s quantum expert are fair and are justified and save for the cost of the credit for a temporary roof I prefer Mr Baldwin’s figures which are fully explained in his column of comments and which I consider are both reasonable and are suitably supported by contemporaneous documentation. Accordingly I adopt the following costs and fees relating to the remedial works on the basis that if contrary to my findings the Defendant did act in breach of duty as alleged by the Claimant.

REF	DESCRIPTION	CLAIM	BALDWIN OPINION	BALDWIN COMMENT
				I have been advised by the Claimant's Solicitor that WTA has not pleaded mitigation and that mitigation should not therefore be an issue for discussion. However, I have been instructed to engage in discussion on any mitigation points raised by Mr Huntley, and to highlight that this should not be taken as an acceptance by the Claimant that mitigation is an issue for discussion.
	SCOPE OF REMEDIAL WORKS			I agree with Mr Huntley's brief description of the scope of remedial works carried cut. A full description of the works can be found in 'Section 3 Schedule of Works' of the Contract Documents (pages 345-383 of QS Requested Documents).

	CONTRACT WORKS (9 weeks lead in and 56 weeks on site			It is agreed that BKS allowed for 9 weeks pre-construction lead in and a 56 week programme for the Works on site. The tenders which included programme periods ranging from 26 to 40 weeks were tenders received on 21st August 2020, These tenders were for a different scope of works than those carried out by BKS. Refer to the Schedule of Works included in the Tender Documents at PR0D.000S079 of the Claimant’s Disclosure. It should be noted that BKS commenced on site on 8th November 2021 and completed the works on 8th December 2022 which is 56 weeks, as per the programme allowance, Within the disclosed documents, I have not seen any evidence to suggest that BKS were delaying the works or not making reasonable progress with them. This suggests that the 56 weeks programme allowance was reasonable.

a)	Early works order			It is agreed that the early works order includes £33,960.00 for management and design and £136,990.14 for CLT and plywood for the remedial works.
				The fact that Kingerlee may have elected to withdraw from the project has no relevance whatsoever on the entitlement of BKS to payment of sums included in its contract under the early works order.
	Head Office Management	7,950.00	7,950.99	See above
	Drawing and Detailing	16,200.00	16,200.00	See above

	Temporary Works Scaffold Design	9,810.00	9,810.00	See above
	CLT Replacement Panels (Stock material)	124,779.39	124,779.39	Some materials, as detailed in BKS Cost Breakdown, were purchased in advance in order to mitigate additional preliminary costs arising from delays resulting from long material lead-in times. The precise quantity of materials required could not be ascertained until the works were opened up for inspection and testing. In my opinion, ordering; materials in advance was a sensible and reasonable commercial action. ln any event, the quantity of 'spare materials' is recorded as being minimal. In the Client Progress Report dated 8th November 2022 (page 1215 of QS Requested Documents) states "3nr valley panels at our storage, is the storage for this being extended?”

	CLT Transport	12,210.75	12,210.75	This sum forms part of the Contract Sum and BKS Is entitled to payment thereof
	Management & Staff prelims			As stated above, the lenders which were received on 21st August 2021 were for a different scope of works than those carried out by BKS and a direct comparison of preliminary costs allowed should be treated with caution This longer programme period allowed and required by BKS would naturally increase the cost of preliminaries. I have already stated that I considered the 56 weeks programme to be reasonable.
	Off site	45,270.01	45,270.01	These are off-site staff costs relating to the 9 weeks pre construction period and I consider them to be reasonable.

	On-site	454,972.03	454,972.03	These are on-site staff costs relating to the 56 weeks construction period and I consider them to be reasonable. The costs cannot be compared with Klngerlee's preliminaries because of the different scope of works and longer programme period.

c)	Site set up	435,461.67	435,461.67	These are fixed and time related costs associated with site establishment and running costs for a 56 weeks construction period.

d)	Temp scaffold roof	1,069.700.00	1,069.700.00	Of the four tenders returned on 21 August 2020, only one included a price for scaffolding and the others expressly excluded it from their tender. Atelier included an allowance of £303,000 in its tender but qualified it by stating "budget costs only - to be priced in stage 1 period" (see page 1231 of QS Requested Documents), in its tender covering letter, Atelier stated that it would require the opportunity to re-review the scaffolding, support and roof costs, and that the costs will be heavily influenced by the engineering design and the temporary works design checks which would be carried out in the pre construction period.

e)	Roofing package	638,023.06	638,023.06	All the roof covering had to be removed to enable all areas of CLT panels to be inspected and tested. It had already been established that the amount of water damage and decay was extensive so it was not unreasonable to allow for the whole roof to be checked. In the event, areas of CLT panelling within the northlight section of the roof did require, and were repaired and/or replaced.
			-25,000.00	The only difference in the Sarnafil coverings/membranes for the 25 year warranty was that the Sarna ‘S327-15EL' membrane was upgraded to a '5327-20EL' membrane. The other work which was required to achieve the warranty status, and which can therefore deemed to be betterment was the formation of the upstands at the Velux rooflights. The cost of this, however, was claimed as a variation and is adjusted in that section.

f)	Lightning protection system	7,802.00	7,802.00	Agreed

g)	New Mansafe	31,987.50	31,987.50	In paragraph 16 of his witness statement, Daniel Calderbank of Vltsoe states that the existing “mansafe” fall arrest system was condemned during a routine annual inspection due to a failure of posts which were anchored to decayed CLT panels. He has since advised me that he was informed that the system could not be repaired and reused because it would not comply with the latest regulations. I am unaware of the precise details, but I do know that BS 7883 which is the code of practice covering fall arrest systems was amended in 2019. The original system was installed in 2017.

h)	Remove & replace solar panels	12,337.50	12,337.50	The solar panels had to be removed to enable the roof coverings to be removed (see item ref e) above). They obviously required re-fixing after the roof covering was replaced.
i)	Removal and replace CLT	390,098.18	390,098.18	The disclosed documents (1,975 pages entitled 'CLT Moisture Evidence') contain significant records, including record drawings, showing the extent of works carried out. It is agreed that £59.02/hour is a very high rate for a Joiner but that is the rate used in the contract price. Although not stated as such, It Is probable that the rate includes an allowance for subsistence. The rate also specifically includes tools, which included more specialist equipment than normally expected and it is possible that the rate included an allowance for attendant labour which wasn't priced elsewhere. lt is agreed that £46.67/hour is a very high rate for a telehandler driver but that is the rate used in the contract price. Again, it is probable that the rate includes an allowance for subsistence.

k)	Material Storage of CLT off-site	5,000.00	£5,000.00	Agreed

l)	Storage of existing insulation	5,500.00	5,500.00	Agreed

	SUBTOTAL	£3,267,102.09	£3,242,102.09

	Insurance 2%	65,342.04	64,824.04	Agreed that 2% is a reasonable percentage

	SUBTOTAL	£3,332,444.13	£3,306,944.13

	Bks Risk Contingency 2.5%	83311.10	82,673.60	BKS carried out the works, not Kingerlee or Speller Metcalfe. It should also be noted that Atelier included 3% risk contingency in its tender.

	SUBTOTAL (CONTRACT WORKS)	£3,415,755.24	£3,389,617.74

	VARIATIONS			In my opinion, paragraphs 48 to 62 of Daniel Calderbank's witness statement provides an adequate explanation of the variations and why they arose. I accept that no detailed cost build-ups are provided. Unless slated otherwise below, I am of the opinion that the variations are valid and arose as a result of the remedial works.

VO1	Additional internal Scaffolding GL A-B	13,788.00	13,788.00
VO2	Re-routing of Chimney	5,575.00	5,575.00

V03.1	Rooflight Alterations	109,039.20	Nil	In his witness statement Daniel Calderbank confirms that the alterations were required to achieve the Slka 25-year warranty status.
V03.2	Valley Insulation Replacement- Phase 1	10,805.39	10,805.39
V03.3	Roof Insulation Replacement· Phase 1	47,986.54	47,986.54
VO3A	Additional Insulation	3,143.50	3,143.50
VO4	Additional Internal Scaffolding to Phase 3	18,819.60	18,819.60
VO5	Isolating and removing extraction units and cover vents thorough the main roof and canteen	17,405.28	17,405.28
VO6	Drilling of angles to suit revised connection detail	1,018.86	1,018.86
VO7	Additional plywood	9,928.50	9,928.50
VO8	New Temporary Works Beams	5,939.65	5,939.65
VO9	Valley Insulation Replacement Phase 2 and 3	24,549.59	24,549.59
V10	CLT Panel Removal – Phase 2	11,439.75	11,439.75
V11	Roof Insulation replacement Phase 2 and 3	89.439.57	89,439.57
V12	Additional 50mm Insulation	577.85	577.85
V13	CLT Panel Removal – Phase 3	23,803.00	23,803.00	An explanation of variation 13 ls included In paragraph 57 of Mr Calderbank's witness statement.
V14	Kitchen Extraction Unit	4,143.68	Nil	An upstand would be required to achieve the Sika 25 year warranty status which, In my opinion, is betterment
V15	Site Security	27,000.00	Nil	In my opinion, this variation did not arise as a result of the necessity for the remedial works.
V16	Scaffold Fire Blanked	Not required	nil
V17	Fire damage repair	6,783.87	nil	Although costs may have been incurred to repair the fire damage, I agree that it was not a defect due to WTA and, in any event, I would expect recovery of costs to have been made through an insurance claim,
V18	Storage of CLT materials from 1^st October 22 including scaffold tent hire	2,415.00	2,415.00	The quantity of surplus materials is recorded as being minimal. In the Client Progress Report dated 8th November 2022 (page 1215 of QS Requested Documents) slates "3nr valley panels at our storage, is the storage for this being extended?

	SUB TOTAL (VARIATIONS)	£433,601.77	£286,635,02

	GROSS VALUE	£3,849,357.01	£3,676,252.76

	Final Account Settlement deduction	-£99,157.01 -	-£94,888.95	It is agreed that there was a 'Final Account Settlement' at £3,750,000,00 It is also agreed that there were no details of specific Items or costs which comprised the amount reduced. A commercial settlement with a lump sum reduction is not unusual and in my opinion, the reduction should be spread pro-rata through all the items, i.e., 2.581%
	Total BKS Structure - FinaI Account	£3,750,000,00	£3,581,363.81

	Less £25,000.00 for betterment	-£25,000.00

	Total Recoverable Loss	£3,725,000.00		As para 36.12 of re-amended POC

	Pre construction work by Kingerlee	£23,877.00	£23,877.00	As para 36.2of re-amended POC As noted in paragraph 20 of Daniel Calderbank's Witness Statement, Kingerlee arranged for temporary scaffolding to prop the roof in the north east corner of the building where roof panels had been identified as being al risk of failure lf there was significant snow. Kingerlee's invoice no. S1003 873 was in respect of these works.

	PROFESSIONAL FEES

	Calfordseaden LLP - Contracts administrator for the remedial works	157,742.00	157,742.00	I do not consider that the services provided were unreasonable or that the costs are excessive.

	Eckersley O'Callaghan Ltd -Structural englneer for the remedial works	35,278.00	35,278.00	I do not consider that the services provided were unreasonable or that the costs are excessive.
	Membrane Roofing Consultancy Ltd· Consultant engaged to assess the adequacy of the initial design for the purposes of determining the nature and scope of	5121.00	5,121.00	I do not consider that the services provided were unreasonable or that the costs are excessive.
	Triodos Bank UK ltd- Cost of quantity surveyor for the remedial works engaged by the funding bank but paid for by the	13,500.00	13,500.00	It is not unusual for a lender to insist that a bank monitor is employed and I do not consider the cost claimed to be unreasonable.
	Warrington fire Testing & Certification and EKova Consultants engaged to investigate the moisture content of the timber and investigate the need for remedial works	51,090.00	51,090.00	It is agreed that the Invoices included in the disclosed documents 'QS Requested Documents' only total £50,140.00. There was an invoice missing from the disclosed documents and a copy has now been provided.
	Mlchael Puttick - Building consultant engaged to advise on how to fix the roof. Thornton Consulting - carried out roof integrity testing to ensure that there were no leaks.	4,580.00 4,215.00	4,580.00 4,215.00	The invoices refer to WTA and to Hess which suggests that the services were in respect of the water damage to the CLT. This testing was an essential part of the procedure for determining the extent of damage and decay to CLT.
	SUB TOTAL (PROFESSIONAL FEES)	£271,526.00	£271.526.00	As para 36.3 of re-amended POC

	Claimant’s Loss	£4,020,403.00	£3,876,766.81	Para 38 of re-amended POC. The amount stated in para 38 is £4,045,403 which Is incorrect because the £25k betterment adjusted under para 36.1 has not been deducted.

109.

There are two deductions or credits which the Defendant contends the Claimant should give against its claim

-1 a credit for the hypothetical cost of a temporary roof which would have been incurred if the Defendant had given proper advice.

-2 Mr Huntley’s ‘north lights’ deduction and a deduction in respect of PV panels.

110.

The amount of any deductions must be established by the Defendant. See Pattni v First Leicester Buses Ltd [2011] EWCA Civ 1384, [2012] RTR 17, [35] (deduction for betterment); Thai Airways International Public Company Ltd v KI Holdings Co Ltd [2015] EWHC 1250 (Comm), [2016]1 All ER (Comm) 675, [92] (deduction for additional profits made as a result of mitigatory steps).

Taking each in turn.

-1 Hypothetical cost of a temporary roof

The Court has been presented with at least four figures for the hypothetical cost of a temporary roof during the original works:

.1 Claimant’s pleaded figure: £250,000

.2 Defendant’s pleaded figure: £1 million.

.3 Mr Baldwin’s figure £476,000

.4 Mr Huntley’s figure £1,342,968

It is surprising that this figure could not be agreed and the difference between the parties’ figures is startling.

Mr Baldwin’s figure is based upon a quotation from Kirk who never visited the site and it was accepted by Mr Baldwin that the temporary roof described in the Kirk quotation was too low to be effective.

Mr Huntley’s views or approach is as follows:

Ground preparation: £64,400.

Scaffold and temporary roof: £702,828. This is a robust figure because it is an inflation adjusted version of H&H's quotation when they tendered to Kingerlee in November 2020.

Extra cost of Hess in light of extended programme: £242,188.

Scaffolders' attendance on Hess: £86,400.

Extra cost of JCA in light of increased programme time for scaffold erection: £130,080.

Extra cost of JCA in light of increased programme time for installation: £117,072.

Total: £1,342,968.

I consider and so hold that Mr Huntley’s approach is logical, reasonable and well-reasoned. I consider the sum to be deducted for the cost of a hypothetical temporary roof in 2016 is £1,342,968.

-2 The North Lights and PV panels deduction

I reject the Defendant’s case for further deductions. As the Claimant explained in its Written Closing Submissions.

“Vitsoe had a timber roof which was rotting. The remedial scheme which it adopted was to uncover the whole of that roof, inspect it, and carry out remedial works or panel replacement as and when required. That was a reasonable and appropriate approach in circumstances where the soundness of the CLT could not otherwise be known with any degree of certainty. As Mr Calderbank put it in cross-examination:
A. There was an intention to inspect them to see if they needed replacing. Our suspicion is because they were pitched they would not be as badly affected, but if they had been damaged we would have replaced them.
and:
A. Well, it [the removal of the solar panels] was required to strip off all the roof membrane and to inspect the panels, so you could not take the membrane off and inspect without removing the solar panels.”

These costs had to be incurred as a result of the remedial scheme and they were reasonably and appropriately incurred. It would have been thoroughly unreasonable to expect the Claimant to have left their solar panels and roof in place and just hope for the best.

Finance Costs

111.

Mr Adams accepted in evidence that the First Loan was raised for general working capital requirements and the Second Loan was raised partly to increase capital reserves and partly for an IT project. He accepted that some of the money raised by both loans would have been allocated towards' lawyers' and experts' fees [T7/1184/13-19]. He also accepted the proposition that "in claiming the costs of these loans, you are at least in part asking WTA to be responsible for the costs of borrowing money to sue it”. In those circumstances there is no or insufficient evidence of ringfencing.

112.

In Hope Capital Limited & Anor v Alexander Reece Thomson LLP [2023] EWHC 2389 (KB), Constable J was faced with a claim for cost of funding. One of the sources of funding in issue was not ringfenced. The judge held as follows:

“126.
There is, in my judgment, an insurmountable difficulty with the claim advanced by Hope in this regard, arising from the fact that the Claimants' borrowings, from which they derive their Cost of Funds rate, is derived from both the Triple Point and High Net Worth lending costs. Whilst it is right that the Triple Point funding is effectively ringfenced for lending purposes, the High Net Worth funding is not. It is, effectively, borrowing which is used to fund the operation of the business, including the bringing of legal claims including the present action and, for example, the Jones litigation. It is not possible to determine what the proper Cost of Funding would be after stripping out elements which should not be included in such a calculation.
127.
In the circumstances, I conclude that any statutory interest which may be due should be recoverable at a reasonably foreseeable rate, namely that which would be typical for companieslike Hope. Mr Penman, Hope’s lending expert, agreed that this would be in the region of 3-4% over base. I therefore consider 3.5% over base to be appropriate.

113.

I agree with Mr Justice Constable’s analysis. I cannot see what are the costs of just funding the remedial works because there is no way of understanding how such funding was ringfenced or could be ringfenced. Accordingly the Claimant is left with statutory interest and I share Mr Justice Constable’s view that that interest should be in the region of 3 – 4% over base and as such I consider 3.5% over base to be fair and appropriate.