McLaren Construction is being sued by the owner of an industrial distribution warehouse in north London for alleged poor design and construction.
Prudential Assurance claims breach of contract and is demanding damages of more than £14m to cover the cost of repairs to Enotria House in Brent.
In a document filed last month with the Technology and Construction Court, Prudential argues that McLaren breached multiple clauses in a JCT contract signed in 2009 with Standard Life, which transferred the freehold of the property to Prudential in 2014.
The works were completed by McLaren in October 2009.
Prudential claims a reinforced concrete surface slab on the ground floor of the 5,900 square metre warehouse is cracked because it was not designed and installed in line with building standards.
The claimant insists that the building contract imposed various performance obligations on McLaren in relation to the design of the slab, “together with full design and build responsibility” to complete the job “in a proper and workmanlike manner”.
Key performance requirements included a design in accordance with the Concrete Society’s TR34 standard, a uniform distributed load of 50kN/m2 to all areas, and a design that would enable rubber-wheeled forklift trucks to drive on the slab.
However, the slab “suffers from extensive cracking which far exceeds what would normally be expected from a properly designed and constructed concrete floor slab”, Prudential alleges, and it is “unstable, inadequately strong and liable to further cracking due to further settlement”.
Warehouse tenant Enotria first noticed cracks on the floor in February 2015. Prudential claims the extent of cracking increased with time and in February 2015, as the slab was more extensively loaded, 21 per cent of the concrete panels or bays were found to be affected, rising to 34 per cent in April 2015 and 86 per cent in August 2017.
The cracking results from “flexural hogging failure” so that the slab curves upwards, lawyers for the claimant allege. “The settlement and differential settlement of the underlying soils has resulted in slab-hogging moments exceeding the tensile strength capacity of the concrete,” they claim.
The cracks are due to design defects such as an “inappropriately thin slab” with insufficient reinforcement and inadequate subgrade, “in terms of soil-types, geotechnical properties, thickness and density which results in lateral and vertical variability”, Prudential states, adding that the slab is too thin to support the specified design floor loading levels.
Hence the structural design and construction of the slab is allegedly not in accordance or compliant with TR34. Nor does it support a maximum loading of 50kN/m2 “without significant settlement and excessive cracking”, and the design is unsuitable for rubber-wheeled forklifts.
“The wheels of these trucks are currently breaking down crack edges,” Prudential claims. If the problem is not addressed, “the safe use of trucks in areas suffering from cracking will be compromised. Alternatively, it will only be feasible to use trucks in areas suffering from such cracking if an excessive and expensive maintenance regime is adopted”.
In its claims document, Prudential estimates it will cost £12m plus VAT to repair the damage and it would also lose £2.3m in rent while the work takes place.
Moreover, the property “is worth less than it would be had McLaren not been in breach of contract”, and Prudential asserts that the loss in value “is equivalent to the cost of the works together with the loss of rent”.
The claimant is prepared to wait until Enotria’s 15-year lease expires in 2029 before ordering the repair works.
The lawsuit comes after McLaren’s financial results were announced earlier this month, with the contractor making a pre-tax profit of £2m in the year to July 2022, having made a £12m pre-tax loss in its previous financial year.
A spokesperson for McLaren told Construction News: “McLaren Construction can confirm that it has received a claim against it by Prudential Assurance relating to a dispute over allegedly defective flooring at Enotria House. McLaren denies the allegation that it is responsible for defective flooring at Enotria House and is confident that this claim will not affect the day-to-day activities of McLaren’s business.”
This story was updated on 23 February with comment from McLaren.