Hastings Borough Council has failed in a final bid to overturn a High Court declaration that it is liable to pay three months’ worth of compensation for closing Hastings Pier for safety reasons in the summer of 2006.
In 2013, the High Court declared the council liable under the Building Act 1984 to pay damages to Manolete Partners plc, which acquired its cause of action from a former tenant, Stylus Sports Ltd, which operated an amusement arcade and bingo hall on the pier but went into liquidation in 2012. That decision was upheld by the Court of Appeal in 2014, and now the Supreme Court has unanimously dismissed the council’s latest challenge.
Manolete Partners brought the claim as an assignee of the business Stylus Sports, which went into liquidation in late 2011. Stylus had leased two units from the freeholder of the pier, Ravenclaw Investments, and had operated a bingo hall and amusement arcade.
Following an inspection in June 2006, which found that at least five of the pier’s support tresses had failed, the council closed the pier immediately from the main entrance of the pier building. It applied to Hastings Magistrates Court on 16 June for an order requiring Ravenclaw to prohibit public access until repair works were carried out.
Stylus itself obtained a court order against Ravenclaw, allowing it to carry out necessary remedial works to the pier, but was left to foot the bill itself. Though it obtained a judgment against its landlord, Ravenclaw had no assets other than the pier, which was subject to a building society charge. As a result, Stylus could not enforce its judgment.
Stylus initially brought these proceedings seeking compensation under section 106 of the 1984 Act for the period between the pier closure and the court order.
The council, in its defence, alleged that Stylus had breached the Occupiers Liability Act 1957, which imposes a duty of care towards visitors, and the Health and Safety at Work Act 1974, which imposes a duty on an employer to ensure the safety of his employees and the safety of the workplace. It claimed that these alleged breaches established a “default”, thereby precluding a compensation claim under the 1984 Act.
However, like the High Court and Court of Appeal, the Supreme Court today rejected that argument.
Lord Carnwath said that the lower courts had been right to hold that the authority had “no defence in principle to the claim for compensation”, not because there was no default under the 1984 Act, but because it was not default by Stylus which led to the emergency action under section 78.
Compensation will fall to be assessed by an arbitrator.
Manolete Partners plc v Hastings Borough Council Supreme Court (Lord Carnwath, Lady Hale, Lord Kerr, Lord Toulson and Lord Hodge) 27 July 2016
Steven Gasztowicz QC and Jack Parker (instructed by Legal Services, HastingsBorough Council) for the appellant
Martin Bowdery QC (instructed by Gaby Hardwicke Solicitors) for the respondent