BG Buckley Ltd v Chapman Hugo Ltd

• Jurisdiction: Jersey
• Court: Royal Court
• Judge: Bailiff
• Judgment Date: 29 March 2005
• Neutral Citation: [2005] JRC 35
• Date: 29 March 2005

[2005] JRC 35

ROYAL COURT

(Samedi Division)

Before:

M. C. St. J. Birt, Esq., Deputy Bailiff with Jurats Tibbo and Allo

Between

B G Buckley Limited

Plaintiff

and

Chapman Hugo Limited

Defendant

Advocate P. M. Livingstone for the Plaintiff

Advocate S. J. Young for the Defendant

No Authorities

Contract dispute, over employment as sub-contractor. Claim re payment for work carried out and to whom payment owed.

Bailiff DEPUTY

1 This case raises a short issue of fact. Was the plaintiff, which is a plumbing company, a sub-contractor of the defendant, a building contractor, in relation to plumbing work carried out at Alphington Lodge, St Saviour or was it employed directly by the owners of the property, Mr and Mrs Muren? The plaintiff alleges the former whereas the defendant contends for the latter.

2 We cannot avoid commenting upon how unfortunate it is that the matter has not been settled. The plaintiff's claim is for £12,000. Not only has this litigation had the unfortunate consequence of bringing to an end the personal friendship between the two principals, who are uncle and nephew, but the legal costs will no doubt have mushroomed out of all proportion to the sum at stake. The likely consequence is that, even assuming an order for standard costs in its favour, the winner is likely to be worse off than if the matter had been settled on a 50:50 basis at an early stage.

3 We propose to summarise first the broad factual background, most of which is not in dispute. We will then highlight some of the evidence relating to the disputed areas, refer to some of the key documents and then give our conclusions.

Factual background

4 Chapman Hugo is a building firm owned equally by Mr Hylton Hugo and Mr Adrian Chapman. Chapman Hugo has done a lot of work over the years with B G Buckley Limited, a plumbing company owned by Mr Buckley. We propose for convenience to refer to ‘Mr Buckley’ both when referring to him personally and when referring to his company. Mr Hugo is Mr Buckley's nephew. Not only did they work regularly together on projects but they also had a close personal relationship. The vast majority of work which they have undertaken together has been on a sub-contract basis i.e. Mr Buckley's contractual relationship has been with Chapman Hugo rather than with the ultimate client. However there have been a few occasions where Mr Buckley has contracted directly with the client and has not been a sub-contractor of Chapman Hugo as main contractor.

5 In 2001 Mr and Mr Muren were the owners of a property known as Alphington House, St Saviour. They decided to renovate the property, which was in poor condition. On 10th April 2001 Aquaheat (CI) Limited (“Aquaheat”) submitted an estimate to the Murens for plumbing work involved in the project. The Murens obtained at least two quotations from main contractors. In the first place they obtained a quotation from Mr Paul Cowieson of PDB Carpenters & Builders Limited (“PDB”). According to his evidence he was asked to exclude various associated trades such as electrical and plumbing and this he did in his quotation of 2 ^nd May.

6 The Murens also obtained a quotation from Chapman Hugo dated 9th May 2001, which was accepted. This quotation contained PC sums for matters such as electrical and plumbing work. The PC figure for plumbing was £15,000. Chapman Hugo began work on site in late May or early June.

7 According to Mr Hugo, after they had been on site for a short while, Mrs Muren asked him if he could recommend a plumber to provide a competitive quote to that which she had already obtained from Aquaheat. Mr Hugo recommended Mr Buckley because they had worked together so often before and Mr Hugo respected Mr Buckley's work as a plumber. Mr Buckley was approached by Mr Hugo. Although Mr Hugo cannot recall having been handed a copy of the Aquaheat quotation, it would appear that Mr Buckley had access to it. He produced a quotation dated 18th June in a total sum of £19,500. The quotation was addressed to Mr and Mrs Muren at Alphington House. However it is agreed that the quotation was handed to Mr Hugo and he in turn conveyed it to the Murens.

8 Mr Buckley's quotation was accepted and he started work not long thereafter. Chapman Hugo submitted a first valuation in July. Although there was some delay, this was paid. No plumbing work was included in this valuation as Mr Buckley had only just started work.

9 In August, Mr Buckley submitted a first valuation of £6,000 for the first fix of his plumbing work. This request for payment was addressed to Mr and Mrs Muren but was sent to Chapman Hugo. Chapman Hugo submitted a second valuation in the total sum of £45,706.89. Included in this figure under the heading ‘nominated sub-contractors’ was the sum of £6,000 in respect of ‘plumbing’. Electrical work was listed in the same manner.

10 There would appear to have been a reminder from Mr Buckley dated 7th September in respect of the sum of £6,000. Again this was addressed to Mr and Mrs Muren but was sent to Chapman Hugo. Difficulties now began. The Murens did not pay the second valuation of Chapman Hugo. A dispute arose between them and Chapman Hugo. There were regular discussions between Mr Buckley and Mr Hugo about this. About this time Mr Buckley telephoned Mrs Muren about the outstanding £6,000. According to Mr Buckley he made this call at the suggestion of Mr Hugo in order to put additional pressure on the Murens; according to Mr Hugo, it was entirely Mr Buckley's decision. Whoever instigated the call, there appears to be a measure of agreement between Mr Buckley and Mrs Muren as to what happened during that conversation. She told him in no uncertain terms that she did not owe him anything and he must look to Chapman Hugo for his money. There was however a discussion as to the various stages at which he expected to be paid for his work and he agreed to write to her explaining this. There is a letter dated 25th September which sets this out. It may well have been linked with a letter of the same date from Chapman Hugo to Mr and Mrs Muren in which Chapman Hugo gave an estimate of the cost to completion and said that a copy of the plumbing quotation and breakdown of valuation would follow. Again the letter is addressed to Mr and Mrs Muren but was sent to Chapman Hugo. It is not clear whether it was ever sent on to Mr and Mrs Muren. Mr Buckley is adamant that no correspondence was ever sent by him to them as he did not know where they lived and was under the impression that they would not receive mail sent to Alphington House, which was an empty shell. In fact, there was a mail redirect service in operation.

11 Ultimately Mr Hugo made it clear to the Murens that, unless Chapman Hugo were paid by the following Friday, they would stop work. There was no such payment and accordingly everyone was pulled off site. Following this, Chapman Hugo submitted a third valuation in the sum of £80,246.71. Included in this figure under the heading ‘nominated sub-contractors’ was £12,000 in respect of plumbing. This is the amount currently in dispute.

12 On 15th October Mr Buckley wrote to Mr Hugo stating that he had been waiting for payment for the first valuation for well over a month. He realised that Mrs Muren had not paid Chapman Hugo and said that he would appreciate it if Mr Hugo would let Mrs Muren know that he was not prepared to wait any longer as he had been more than fair. He said that unless he was paid in the next three days he would have no choice but to take further action. He did not however explain what this might be.

13 On 23rd October Mr Buckley wrote again to Chapman Hugo about some outstanding invoices. One of these was the £6,000 in respect of Alphington. The letter sought payment by return of post as the accounts were overdue and went on to say that, in relation to the Alphington matter, Mr Buckley would be referring this to Cashback Limited (the debt collecting agency) unless payment was received the next day. In fact Mr Buckley appears not to have taken any action in this respect at that stage.

14 On 27th or 28th October (there appear to be two different versions of this letter) Mr Buckley wrote a letter addressed to Mr and Mrs Muren. The letter falls into two parts. The first part is in lighter type. It could in theory be intended for the Murens or for Chapman Hugo although the use of the phrase “along with yourselves” in the context of the advancement of building works, suggests that it was intended for Chapman Hugo. What is quite clear is that the second part of the letter, written in bold type, is written to and intended for Chapman Hugo. It refers to “problems surrounding the contract with your clients the Murens” and various other matters. The whole tenor of the letter is a complaint that the £12,000 has not been paid.

15 Various discussions then seem to have taken place between Chapman Hugo and the Murens with a view to trying to resolve matters but these were unsuccessful. Eventually Chapman Hugo instituted proceedings against Mr and Mrs Muren by Order of Justice dated 21st March 2002. This claimed the sum of £80.246.71. It follows that, included in this sum, was the £12,000 in respect of the plumbing work carried out by Mr Buckley.

16 On 12 ^th July 2002 Mr Buckley prepared a letter to Cashback Limited (“the Cashback letter”). No signed version of the letter has been produced but it seems probable that the letter must have been sent to Cashback although they did not action it. It is an important document. In it, Mr Buckley gives a version of events which is consistent with that put forward by Chapman Hugo and inconsistent with his own; in other words he asserts that he entered a contract with Mr and Mrs Muren. We will revert to the Cashback letter in due course.

17 The litigation by Chapman Hugo against Mr and Mrs Muren took its course. There was correspondence from Advocate Taylor (who had...