J U D G M E N T

MR JUSTICE COLMAN:

2. The approach which has traditionally been taken, and which is supported by decisions of the Court of Appeal, notably in Bubaya v. Holman and in the Barclays Bank v. Bemister case, is to ask whether it is inappropriate that the action proceedings should remain in the Commercial Court.

3. Inappropriateness, seems to me, to be something which has to be approached with reference to the overriding objective in the CPR. This obviously involves considerations, the aim of which is to achieve a just and efficient resolution of the issues which are raised in the proceedings. One only has to look at CPR 1.1 to appreciate that it is important to consider such matters as the amount of money involved, the importance of the case, the complexity of the issues, ensuring that the trial is dealt with expeditiously and fairly, and allotting to it an appropriate share of the court’s resources while taking into account the need to allot resources to other cases.

4. Where the Commercial Court finds that there has been started within it an action which raises matters of law or construction or both, or matters of fact which are peculiarly within the province of the Commercial Court and may be described, so to speak, as core issues, in the sense that they are the kind of issue which the Commercial Court deals with regularly, and with which its judges are extremely familiar, its approach generally, in my experience, is to retain the matter within the court, unless it takes the view that other issues in the case are of a nature which so strongly demands that they should be determined by another court, as to outweigh the consideration that the Commercial Court-type issues ought to be retained for trial.

5. In the present case there are specific issues of insurance law and construction which have to be resolved as a necessary part of the proceedings. One of the issues, to which I would refer as “the ascertainment point, and another of the issues, which is the breach of warranty point,” are so fundamental to the overall global issue between the parties, that their resolution will determine whether indeed it is necessary for the court to investigate that part of the case which is said to be a typical Technology and Construction Court case, namely, the issue whether and to what extent Bovis was liable to Braehead, and if so, to what extent Bovis was entitled to recover its claim from Braehead.

6. If the claim by Bovis against Braehead had been considered alone and without the underlying insurance issues, there can be no doubt, in my judgment, that it would not have been a claim which this court would have retained. That is because, if one looks at the type of dispute which the Commercial Court normally determines one does not include within it building disputes. It is perfectly true that there are frequently cases in this court about ship building and the construction of oil-rigs. But essentially, disputes concerned with the details of the construction of buildings on land are not dealt with in the Commercial Court and never have been. And when they come before this court it has been for many years the practice to transfer them to, originally, the Official Referee’s court, and now to the TCC.

7. In approaching the application which is now made for the transfer out of the present case, there has in my judgment, to be a balancing exercise. That exercise involves consideration of the overall significance of the insurance issues which arise in this case and a determination as to whether their significance is out-weighed by the fact that if those insurance issues are determined one way, it will be necessary for the court to go further and embark upon a determination of what is essentially, the TCC part of the case, that is to say, liability of Bovis to Braehead, or of Braehead to Bovis.

8. At the end of the day it is necessary to take a view, and bearing in mind the relative impact of these two parts of the proceedings, as to whether the presence of the TCC part of the case renders this court inappropriate, having regard to the wider considerations in the CPR, and having regard, in particular, to the nature of the insurance issues. Now, I have to say that I regard one of the insurance issues, to which I referred as the ascertainment point, not only as fundamental to the matters at large between the parties in this case, but as of far-reaching importance in the law of insurance generally. It seems to me that the issue, as to the extent to which the concept of the ascertainment of liability for the purposes of a liability policy requires quantification by a settlement agreement of the amount of the liability in question can be so regarded. It involves a consideration of the circumstances in which a cause of action under a liability policy can be said to arise, and the scope of the judgment and the principles underlying the judgment in Post Office. v. Norwich Union.

9. If the court determines that there is in fact no ascertainment for the purpose of insurance law in the present case, it will, as I have said, be unnecessary for it to go on and consider any of the other issues in the case, including, in particular, the major issue as to whether Bovis and Braehead are mutually liable to each other.

10. The Commercial Court, obviously, from time to time has to deal with matters of great technical complexity. Not only is this in connection with construction contracts, such as ship building and oil-rig building, but also in connection with physical, technical problems in all sorts of other fields. Balancing the nature of the issue raised by the question of liability as between Bovis and Braehead on the one hand, and the importance and specialist nature of the insurance issues on the other, I have come to the conclusion that on balance, this case ought not to be transferred. It seems to me, that to regard this case as inappropriate to be retained in the Commercial Court, within the concept of the CPR, it is necessary to look at the structure of the litigation as a matter of reality. And to determine how this court’s case management processes may in fact be brought to bear on what could be quite a complex trial.

11. This court’s case management processes involve, and indeed, in this case ought to involve, the consideration of the determination of the insurance issues before determining the issues relating to liability between Bovis and Braehead. The reason for this is simple. Insurance issues can be determined in the course of a very short trial. A very short trial can be fixed at any time from the summer of 2004 onwards. It would take very little to prepare for that type of trial, and if matters were determined, particularly in relation to the ascertainment and the breach of warranty points, in one particular way, it would be unnecessary for any court, whether the Commercial Court or the TCC, to go on to consider, what may be described, as the building contract liability point.

12. Time is of course a relevant factor, and Mr Stennard QC, who has appeared on behalf of Bovis, has strongly pressed the point that a date for the whole trial could be obtained as from February 2005 in the TCC, whereas a date in the Commercial Court for the whole trial could not be obtained until towards the end of 2005. That would be a difference of some nine months or thereabouts, and that would be an important consideration, because in general it is appropriate that litigation of this or any other kind, should be resolved as quickly as the courts can provide a service for that purpose.

13 On the other hand, I have to take into account also, the relative expertise of the courts concerned. I also have to take into account the relative importance of the issues which are particularly appropriate to one court or another. I accept, that if this matter were tried in one continuous trial, dealing with all the issues at the same time, including the Bovis/Braehead liability issue, the trial would be likely to take at least six weeks in the Commercial Court, and of that six weeks, the bulk of the time would be devoted to the Bovis Braehead liability issues.

14 I have come to the conclusion that the course, which in the interests of justice and the fairness to all parties concerned, ought to be adopted, is that the case ought to be managed and tried in the Commercial Court. The process of management can be a matter of further discussion. In terms of the case management order, my present position is that the insurance issues must be determined first. And they should be determined in the course of 2004 rather than later, so that the parties will know whether they have to spend what could be, a very considerable amount of money on a further trial on the Bovis/Braehead liability issue.

15. In relation to that I would simply say this. There is nothing to stop either party applying, at a later stage, when the position under the insurance issues has been determined, for transfer to the TCC of the remaining issues. I am not encouraging that, though, because it seems to me that the process of management which ought now to be adopted by this court, should involve the fixing, not only of a date for the purpose of determining the insurance issues, but also a date for determining the residual issues, should the insurance issues, when determined, leave residual issues to be tried.

16. The question as to what should go into a case management order, I would have thought, should be determined straightaway, and if the parties are able to attend, I would be prepared to do it after the short adjournment.