SSE GENERATION LIMITED AGAINST HOCHTIEF SOLUTIONS AG AND ANOTHER [2018] ScotCS CSIH_26 (10 April 2018)

SSE GENERATION LIMITED AGAINST HOCHTIEF SOLUTIONS AG AND ANOTHER [2018] ScotCS CSIH_26 (10 April 2018)

The court held that the contractor's liability for defects due to design was limited to the exercise of reasonable skill and care, as per Option M of the contract. The collapse was not proven to be due to a defect arising from a failure to exercise reasonable skill and care in design or construction. The defenders had not been shown to have breached the standard required, and the contract did not impose a fitness for purpose obligation. The existence of joint insurance did not bar the claim, but the pursuers failed on the merits regarding liability for the collapse.

Citation
[2018] ScotCS CSIH_26
Parties
Pursuers and Reclaimers: SSE Generation Ltd; Defenders and Respondents: Hochtief Solutions AG and Another
Jurisdiction
Scotland
Judgment Date
10 April 2018
Procedural Posture
Civil Appeal (reclaiming Motion) / Inner House, Court of Session (appellate Decision)
Outcome
Appeal dismissed; cross-appeal on insurance issue dismissed; other cross-appeal points determined as per judgment
Legal Topics
Contract Interpretation, Standard of Care in Design and Construction, Allocation of Risk, Joint Insurance, Defects Liability, Damages for Breach of Contract
Construction Law Contract Law Insurance Law Contract Interpretation Standard of Care in Design and Construction Allocation of Risk Joint Insurance Defects Liability +1 more

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Parties

SSE Generation Ltd

Pursuers and Reclaimers

Hochtief Solutions AG and Another

Defenders and Respondents

Procedural Posture

Civil Appeal (reclaiming Motion) / Inner House, Court of Session (appellate Decision)

Legal Issues

  1. 1 Whether the collapse of the tunnel was due to a defect in design or construction under the contract
  2. 2 Whether the contractor's liability was limited to reasonable skill and care or extended to fitness for purpose
  3. 3 Whether the existence of joint insurance precluded the claim

Ratio Decidendi

The court held that the contractor's liability for defects due to design was limited to the exercise of reasonable skill and care, as per Option M of the contract. The collapse was not proven to be due to a defect arising from a failure to exercise reasonable skill and care in design or construction. The defenders had not been shown to have breached the standard required, and the contract did not impose a fitness for purpose obligation. The existence of joint insurance did not bar the claim, but the pursuers failed on the merits regarding liability for the collapse.

Court Disposition

Appeal dismissed; cross-appeal on insurance issue dismissed; other cross-appeal points determined as per judgment

Orders

  • Pursuers' reclaiming motion refused
  • Defenders' cross-appeal on insurance issue refused