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Recent Decisions on Delays in Legal Proceedings: How Long is Too Long?

There are two cases from 2015 in relation to delays in legal proceedings that will be of particular interest to construction professionals, as they both concern actions against engineers:  Farrell v Arborlane Ltd & Ors and Tanner v O’Donovan & Ors

The 2015 decision of the High Court in Farrell v Arborlane1  has received a significant amount of attention among construction professionals.  The case concerned an application by an engineer to have proceedings against him struck out on the grounds of inordinate and inexcusable delay.  The High Court refused to dismiss the proceedings despite a delay of 5 years by the plaintiff between issuing proceedings and serving a statement of claim.  

The case arose from substantial defects that came to light in an apartment block in South Dublin.  One of the defendants, a structural engineer, had issued an opinion on compliance with the Building Regulations in the usual form.  In 2002, approximately two years following completion of the development, cracking and leaks developed in the complex.  HomeBond refused to provide cover for the defects, on the basis that they were not structural in nature.  

A structural survey carried out by a firm of engineers in 2007 concluded that the defects were attributable to poor detailing and inadequate construction.  The contractor responsible for building the development had carried out a number of remedial works prior to its insolvency in 2009, which had not rectified the problems.

Amongst the grounds put forward by the defendant in seeking to have the proceedings dismissed was the point that it was no longer possible to secure documents from the building contractor, which had gone into liquidation several years previously.  The Court, however, was highly critical of the actions of the defendant in having failed to take steps, in the two year period between service of the summons and the liquidation of the building contractor, to seek records relating to the opinion on compliance that he had given in relation to the development.

The Court noted in this regard that the engineer could have contacted the management team at the building company, or even the liquidator, to ask for copies of papers he thought necessary to defend himself.

The Court was also critical of a delay of ten months between service of the statement of claim and the defendant’s application to have the proceedings struck out for want of prosecution.  The Court noted that the plaintiff during the period between issue of the proceeding and service of the statement of claim was making efforts to have the work rectified, while the defendant had taken no steps to secure the relevant records from the building contractor prior to its insolvency.

The Court did hold that the period of five and a half years between service of the summons and issuing of the statement of claim was inordinate and inexcusable.  However, the Court found that the balance of justice lay with the continuance of the proceedings, noting that:-

  1. the plaintiff throughout the relevant time had been making continuing efforts to get one or more of the defendants to do the remedial works, which would have avoided the need for the court proceedings, and 
  2. the defendant engineer ‘remains unaware as to whether he has the papers necessary to defend this case, despite having had eight years to check them, including two years when Arborlane was still in existence.

The significance of this decision is that it illustrates that a plaintiff may issue proceedings within the time limit of the Statute of Limitations, but that the proceedings may lie for a number of years without any further action by the plaintiff.  The plaintiff may then serve a statement of claim (which sets out the case against the defendant) years later, by which time records and other information may be very difficult to assemble.

The decision also underlines the importance of being able to demonstrate that one has responded appropriately to proceedings, including by taking steps to gather the appropriate materials or evidence necessary to defend the proceedings, while waiting for the claim to proceed.  It is apparent from this case that the delay did not relieve the defendant of taking steps to prepare his defence, even in circumstances where he believed that the contractor was attending to the remedial works.

The Arborlane decision can be compared with another High Court decision from 2015, in the case of Tanner v O’Donovan2  , which also arose from a construction project.

A High Court order had been obtained to strike out proceedings for want of prosecution, where the Court was satisfied that there had been inordinate and inexcusable delay by the plaintiffs and where the balance of justice required the dismissal of the proceedings.

The facts were as follows.  The first and second named defendants were retained around 1997 as architects, and the third defendant as engineer, in respect of the construction of a hotel in Clonakilty, Co Cork.  The hotel was completed in 1999; proceedings were issued in respect of significant defects in the hotel in September 2003.  The High Court ordered that the plaintiff’s claims be dismissed in 2010 on the basis of inordinate and inexcusable delay, but the plaintiff’s appeal to the Court of Appeal meant that the proceedings were not finally dismissed until 2015, nearly twenty years after the defendants were originally appointed.

The Court noted that there had been delays on both sides, but pointed to the failure of the plaintiff to take steps to progress the matter, for example the plaintiff’s failure to seek delivery of the defence well over five years after delivery of the statement of claim, and two and a half years after the defendant had been ordered to produce a defence.  It was also a relevant factor that two witnesses had died since the commencement of the proceedings, although the plaintiff claimed that their testimony would not have been essential.  The plaintiff presented very little by way of justification for the period of delay, other than instances that might have warranted a short delay (such as a change of solicitors).

The Court found that the delay was both inordinate and inexcusable.  Six years had passed between issue of the proceedings and the motion to dismiss, during which time the defendants had been before the court eight times.  The Court also accepted that the delay was prejudicial, on the basis that the contract between the parties was an oral contract, and that key witnesses had died in the period since the contract was entered into.  The Court also observed that the delay could seriously impact on the professional reputations of the defendants, not only if there was a finding of negligence, but also with regard to their capacity to secure professional indemnity insurance and any obligation to notify their professional bodies.

The Court therefore dismissed the appeal, 12 years after the proceedings were originally issued.

Deirdre Ni Fhloinn

For further information on this topic, please contact Peter Kearney in our litigation department at pkearney@reddycharlton.ie

1[2015] IEHC 54

2[2015] IECA 24


Keywords: Deirdre Ní­ Fhloinn, Publication, Construction, Commercial Litigation

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