Time and costs in dispute between Alstom and British Airways has been slashed by new legal rules.
The first major construction dispute handled under the new civil law procedures has slashed millions off legal fees, say City lawyers.

On 1 November, services contractor Alstom and British Airways are due to appear in the High Court over a contractual dispute on the £250m World Cargocentre that opened at Heathrow Airport in May. Alstom claims that BA unfairly took work away from the contractor. It issued a writ on 4 November 1998.

Alstom's lawyer Lovell White Durrant says that, because the case has been conducted under the Woolf procedures, it will go before court two years earlier than it would have done under the previous system.

Lovell's head of construction, Nicholas Gould, who is handling the case, said this has saved both sides millions of pounds in legal fees.

Gould said that lawyers predicted that the complex case would not go before court until 2002. But under the stewardship of Judge Humphrey Lloyd, the case will go before court in less than 12 months.

Cramming the work in to get to court in such a short time has proved tough, says Gould. "There have been up to 40 lawyers in the City involved in this over the last year," he said. "There are also nine barristers involved: six for BA and three for us." Under the Woolf reforms, lawyers must disclose their cases to the judge earlier than they would usually and the case is fast-tracked. The reforms do not apply to traditional construction industry disputes settled by arbitration.

The Cargocentre dispute revolves around BA's employment of German contractor Lödig.

It is claimed that BA gave Lödig work that it had previously agreed to give Alstom, which had a £90m contract to install high-tech cargo handling systems.

Alstom lawyers say the case could result in damages worth tens of millions of pounds.

BA's lawyer, Linklater, refused to comment.

  • Leading construction lawyer Dr Philip Capper has joined Lovell White Durrant from Masons.

    He is being groomed to take over from Nicholas Gould as head of construction.

    Capper also brings to the firm his expertise in rail work, said Gould.

Woolf in a nutshell

The Civil Procedure Rules, introduced in April, were intended to make litigation cheaper and faster. They affect many areas of civil law, from expert witness to disclosure of documents, but the main aim is to discourage the parties from taking their dispute to court at all. They are supposed to use informal resolution procedures, and if a party acts to increase time and expense, the court can punish it with punitive costs. These can be increased by adding interest at a rate of several per cent over base – potentially a huge sum in a long-running case.