Dormant divisions of consultant that advised on troubled incinerator hit with claims of damages
Two companies forming part of the Currie & Brown Group are facing one of the biggest claims in the history of the construction industry over a PFI project in Wales.
The £54m lawsuit relates to an incinerator in Crymlyn Burrows near Neath, for which Currie & Brown provided technical advice. After the £32m plant opened in 2002 locals complained of odours coming from it. It was then shut down over environmental breaches in 2003. A few weeks later it was damaged by fire.
Neath Port Talbot council is demanding £54m from the defendants, named as Currie & Brown Project Management and Currie & Brown Consulting, both of which have been dormant companies since Currie & Brown changed its status from partnership to limited company.
A legal source said: “That sum is a big claim in anyone’s books – even large consultants only tend to carry professional indemnity insurance of £10-20m. It’s unusual for consultants to face a claim of this size.”
Currie & Brown Project Management produced a technical due diligence report on the project for investors in 2000.
Currie & Brown Consulting was appointed technical adviser to the investors in 2000 and the division was also directly appointed technical adviser to the council in 2002.
The claim, issued in the Bristol district registry, concerns the cause of deficiencies at the waste-to-energy plant and damages the council claims to have suffered as a result of the plant’s alleged failure to perform.
Neither Currie & Brown nor Neath Port Talbot council would say whether the dispute involved the foul smells coming from the incinerator.
A High Court judge said: “I’m told that if the claim against them succeeds even to a fraction of the sum claimed, the defendants are likely to be forced into liquidation.”
He said this was owing to “uncertainty” over the companies’ insurance cover and a separate dispute with their insurers.
However, Currie & Brown this week insisted that defeat would not affect the future of the £63m turnover parent company as both subsidiaries were dormant. It added that insurers would be liable should the claim succeed.
Proceedings are scheduled for April 2009 and will be tried in Bristol by a High Court judge.