Fountain & Colonnade Management Ltd v Westminster City Council

Repairing agreement — Claim for contribution to cost of repairs — Whether repairs in connection with highway — Whether repairs or improvements — Fair proportion of cost — Claim allowed The claimant held a lease of two buildings that had been constructed, along with a highway, on a raft above the platform and tracks of Victoria railway station. The raft incorporated four movement joints that were intended to protect the highway and buildings from damage due to expansion and contraction caused by temperature variation. The claimant’s predecessor in title had entered into an agreement with the defendant council under section 38 of the Highways Act 1980. By clause 9 of that agreement, it had undertaken to “maintain the Structure and all service media passing through the Structure”, while the defendants agreed “to pay a fair proportion of the reasonable cost of repairing and maintaining all such items enjoyed in connection with the Highway”. The “Structure” was defined as “the structure below the [Highway]… including the movement joints”. A survey later revealed that the movement joints were in a poor state, and were likely to allow water to leak into the station below. The claimant had the joints replaced with joints of a different type. It also renewed the concrete plinths, which were discovered to be damaged. It subsequently sought to recover a proportion of the cost of the works from the defendants pursuant to the section 38 agreement, arguing that the damage had been caused by public use of the highway. The defendants denied any liability to pay. In proceedings brought by the claimant, the defendants argued that: (i) the expression “all such items” in clause 9 did not include the structure itself; (ii) the joints were not items “enjoyed in connection with” the highway; and (iii) in any event, the works amounted to improvements and not repairs. The parties’ experts were agreed that replacement joints of the type used were an appropriate solution. Held: The claim was allowed. The defendants were liable to pay a fair proportion of the cost of the works. The expression “all such items” in clause 9 comprehended “the Structure and all service media”. The claimant’s predecessor had covenanted to maintain the structure and service media, while the defendants had covenanted to pay a fair proportion of the reasonable cost of complying with that covenant, subject only to the cost being incurred in respect of items “enjoyed in connection with the Highway”. The movement joints were enjoyed in connection with the highway. They formed part of the raft and made up part of the surface of the highway. They had to extend through the surface of the highway in order to perform their intended function of protecting it and the buildings from damage caused by expansion and contraction. Landlord and tenant authorities relating to repairs/improvements were of little assistance in the present context: Ravenseft Properties Ltd v Daystone (Holdings) Ltd [1980] QB 12; [1979] 1 EGLR 54; (1978) 249 EG 51 considered. The real question was what constituted a fair proportion for the defendants to pay towards the costs that had actually been incurred by the claimant, and not suggested to be unreasonable, of repairing and maintaining the structure. However, were it appropriate to categorise the remedial works as either repair or improvement, they were works of repair. When assessing a fair proportion, the relevant question was the extent to which the use of the highway by the public had contributed to the need for the repairs, compared to the use of the highway for access to the claimant’s buildings. Since 90% of the traffic was public traffic, including the heavy buses and coaches that were the major cause of the damage, a fair proportion for the defendants to pay was 90%. Martin Bowdery QC (instructed by Macfarlanes) appeared for the claimant; Thomas Graham (instructed by the solicitor to Westminster City Council) appeared for the defendants. Sally Dobson, barrister