By Thames Menteth
A property developer has lost a legal case for £7.5M of damages against two engineering firms whose ground investigations failed to identify a ground hazard at a proposed development site near Reading.
Property development company Darcliffe had claimed the damages for negligence and breach of contract from engineering firms Glanville and Ground and Water Limited (GWL), reports Construction News’ sister title Ground Engineering.
Darcliffe launched the claim after “erroneous advice” provided by the firms via geo-environmental surveys and site investigations at Stoneham Farm on Long Lane, near Reading.
Darcliffe had alleged that Glanville and GWL failed to disclose in their reports that the proposed development site was at high risk of ground dissolution due to the presence of chalk beneath it.
It further alleged that, after purchasing the site, it was discovered that it is affected by widespread chalk dissolution. As a result, Darcliffe had to pay substantial remediation costs when constructing the development.
However, a High Court judge ruled that the erroneous findings of the investigations had little impact on the property developer’s decision to purchase and develop the site, and therefore dismissed the claim.
The trial was heard in the High Court in October 2024, with closing submissions delivered on 22 November.
The proceedings were against Glanville only, as Darcliffe and Glanville settled all their claims against GWL before the trial began.
Glanville was commissioned by Darcliffe to carry out a geo-environmental survey of the site in 2014 and was commissioned in 2016 to produce an updated report on the site’s ground conditions.
These were desk study reports that included a phase 1 geo-environmental assessment of the site.
Planning permission for the construction of 66 homes on the site was granted in December 2016.
GWL was then appointed to undertake a phase 2 intrusive site investigation of the land in November 2017, which it carried out later that month. The site investigation involved various activities, including drilling two cable percussion boreholes to depths of between 18m and 19.95m below ground level.
In November 2019, Darcliffe purchased the site for around £5M to build the housing development. It claimed that it relied on the reports produced by Glanville and GWL when purchasing the site.
The High Court judge found that Glanville was obligated to carry out a phase 1 geo-environmental assessment with “reasonable care and skill”.
Expert witness testimony also indicated that Glanville failed to meet the standard of “reasonable competence” expected in its reports.
The court noted that a reader of Glanville’s first report would have been satisfied that the site did not present any significant problems regarding the ground conditions.
The report gave a “clean bill of health” so far as the phase 1 geo-environmental assessment was concerned.
The report stated: “Ground dissolution occurs when water passes through soluble rock and produces underground cavities. These cavities reduce support to the ground above. Rocks that commonly suffer with dissolution stability hazards are salt, gypsum, limestone and chalk. It is indicated that the sites geology is at a low [risk] from ground dissolution.”
The court noted that the second report was identical to the first report and did nothing to dispel the impression created by the first report.
But High Court judge Adrian Williamson ultimately rejected Darcliffe’s claim on the basis that “the effect of the Glanville reports upon Darcliffe’s corporate mind was minimal”.
“Darcliffe’s corporate mind would not have been much affected, if at all, if Glanville had given non-negligent advice,” High Court judge Adrian Williamson ruled.
The court dismissed Darcliffe’s claims against Glanville and GWL. It said there was a lack of evidence to support that the alleged negligence by the engineering firms had a significant impact on Darcliffe’s decision to purchase and develop the site.
It added that the claims against Glanville were not actionable under the law as presented.
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