Ocado sues Carillion for £1.2m in High Court

Online grocery firm Ocado has lodged a £1.2m High Court claim against Carillion over the construction of its only UK distribution centre.

The breach of contract claim alleged that Carillion was liable for defects with the external service yard or “slab” at the distribution centre at Hatfield aerodrome, Hertfordshire.

The slab consists of 168 concrete bays for Ocado’s fleet of delivery vans, which have become progressively more cracked since the distribution centre was first handed over to the retailer in 2002, the claim said.

Carillion built the centre for landowner API but also signed a warranty agreement for the building with Ocado in 2004, according to court documents seen by Building.
“The slab has continued to crack and the existing cracks have continued to deteriorate,” the claim said. “As a result, the slab is at risk of structural failure as a consequence of the cracking permitting water ingress to the sub-base.”

The claim alleged that Carillion failed to properly reinforce the slab using steel mesh and instead substituted “synthetic polypropylene fibres” that it argued were unsuitable for such large bays.

It concluded that the slab “did not have a reasonable design life, appropriate to the centre”.

Ocado argued that it had minimised the financial losses caused by the problems with the slab by continuing to use the distribution centre, carrying out “patch repairs” with input from Carillion and instructing its drivers to avoid the worst areas.

However, it added that no further remedial works had been done because the two parties had been “unable to agree the appropriate remedial method and its cost” despite years of correspondence.

A spokesperson for Carillion, which is yet to file a defence, said it had noted the action but declined to comment further.