Construction & Engineering Case Note - Costain Limited v Charles Haswell & Partners Limited

In reaching a settlement with one party, you need to be careful how it will affect potential recovery against another party.

The recent case of Costain Limited v Charles Haswell and Partners Limited once again raises the problem of settling with a party "up the line" and then taking proceedings against a different party "down the line".

Costain was engaged by United Utilities ("UU") to design and construct the Lostock and Rivington Water Treatment Works at Bolton. Costain retained Charles Haswell ("Haswells") as their civil engineering design consultants. Part of the design related to the design of the ground treatment works.

Haswells interpreted the geological data as showing the ground to be "predominantly granular". As a result Haswells recommended that a "surcharging" procedure be used. This procedure involves placing a load on the ground where foundations are later to be constructed in order to cause the ground to settle by a pre-determined amount. There are two types of surcharging: the first is known as "pre-loading". This involves applying a load to the ground broadly equivalent to the load which will ultimately be imposed by the relevant structure once it has been completed. The other is known as "surcharging" which, as its name suggests, involves applying a load to the ground greater than the load ultimately to be imposed by the completed structure.

Haswells recommended pre-loading. In the event, neither the interpretation of the geological data nor the recommendation to use pre-loading proved to be the right choice. Accordingly, Costain expended time and cost in testing the pre-loading, designing piled foundations and completing the piling works.

Costain sought to recover these costs against Haswells. At trial it was found that Haswells had been negligent, both in interpreting the geological data as showing the ground to be "predominantly granular" and for recommending pre-loading. However, Costain faced an uphill struggle in proving that part of its losses were attributable to Haswells' negligence.

The trouble was that, before claiming against Haswells, Costain had made two settlements...