| Date | 10 December 2003 |
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| Judgment | Yarm Road Limited v Hewden Tower Cranes Limited, CA 31 July 2003 |
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| The Issue | Interpretation of the risk of loss and damage arising out of the Construction Plant Hire Association's model terms and conditions. |
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| Implication |
Under the CPA conditions, the hirer is responsible for loss or damage occurring during the period of hire, except where the plant is in transit or is being erected or dismantled at the site. In certain circumstances, adaptations to the plant carried out by the owner during the hire period will be treated as erection and thus responsibility for loss or damage will transfer to the owner. |
printIn May 2000 a tower crane collapsed at the site of the new HSBC headquarters building at Canary Wharf in Docklands. At the time of the collapse, the crane was being 'climbed', an exercise in which additional sections of mast are added to raise the height of the crane. The collapse caused three fatalities, serious injury to two other persons, extensive property damage and very substantial delay and disruption to the construction works on site. The contractors that had hired the crane, Yarm Road Limited, made claims approaching some £16.5 million against the owners of the crane, Hewden Tower Cranes Limited. Whether Hewden, or its insurers, would be liable to meet such claims depended upon the contract of hire which the parties had entered into and which incorporated the Construction Plant Hire Association's Model Conditions. Clause 13 of those conditions deals with the parties' responsibilities for loss and damage. Clause 13(b) establishes a general rule, namely that the hirer, in this case Yarm, indemnifies the plant owner, Hewden, against all claims arising out of the use of the plant during the hire period. Clause 13(c) then provides an exception to the hirer's general responsibility, imposing liability upon the plant owner in any of five particulars situations where damage, loss or injury may arise. These are, (i) prior to delivery of any plant to the site of the hirer, where the plant is in transit by transport of the owner; (ii) during the erection of the plant where the plant requires to be completely erected on the site, providing the erection is under the exclusive control of the owner; (iii) during dismantling of the plant, similarly to erection; (iv) after the plant has been removed from site and is in transit back to the owner; and (v) where plant is travelling to or from the site under its own power with a driver supplied by the owner. At the heart of the dispute as to whether Hewden was responsible for the loss and damage caused by the collapse, was therefore the question of whether the 'climbing' operation to extend the height of the crane fell within the meaning of 'erection' of the plant as set out in clause 13(c)(ii) of the conditions. If this was the case, Hewden would be responsible, otherwise the general obligation for Yarm to indemnify Hewden, under Clause 13(b) of the conditions, would prevail. The Technology and Construction Court examined this question as a preliminary issue in November 2002, and subsequently the matter was heard in the Court of Appeal in July of this year in the case of Yarm Road v Hewden Tower Cranes. The court heard detailed evidence concerning the climbing of the tower crane. It was revealed that when climbing had to be carried out, it was first necessary to tie the crane mast to the building, then lift the top of the crane and insert additional mast sections using the crane's own external self climb equipment. The procedure involved the fitting of what was called a tie collar around the mast of the crane at a predetermined height. Three telescopic tie legs were to be connected to the tie collar at one end and to an anchor point on the building at the other end. The crane was then balanced using a spirit level, the ties adjusted and the telescopic part of the tie legs welded. The welds were tested and if all was satisfactory the crane would then be 'climbed'. This involved the use of a climbing frame incorporating a hydraulic unit which was used to raise the top of the crane. The new mast section would then be inserted and secured. On the occasion of the collapse, the intended climb was for the insertion of six new sections each 4.5 metres high. It was accepted by both parties that the collapse of the crane had taken place after the ties had been welded and certified as fit. Precisely what had caused the collapse was not however known. Although the collapse had taken place more than three years prior to the hearing in the Court of Appeal, at that stage the Health and Safety Executive had still not produced a report explaining the causes. By a majority of 2 to 1, the Court of Appeal agreed with the earlier trial judge's decision, to the effect that the climbing operation fell within the meaning of the word 'erection' in clause 13(c). The Court of Appeal also agreed that the climbing operation was under the exclusive control of the owner of the plant, Hewden. This meant that during the climbing operation, responsibility for loss or damage lay with Hewden. This was the case even though the climbing operation included a number of steps that were preparatory to the actual climb, which were undertaken jointly by the hirer and the owner, such as the installation and welding of the ties between the crane and the building. Hewden's arguments that the climbing operations were to be regarded merely as adaptations to the plant were dismissed. So too were their arguments that during climbing operations, they were not in exclusive control of the plant. The preparatory works which had been jointly undertaken with the hirer, such as the installation and welding of the ties, were quite separate operations from the climbing itself. In conclusion, there was nothing in the contractual documentation that threw the risk of collapse on to the hirer, Yarm, during climbing operations to extend the height of the tower crane.
CJ-0347
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