The Contractor’s Obligations - Building Contract - page 125

I deal first with three general matters which are of some relevance to the plaintiffs' conten-
tions both in relation to the long-route and short-route arguments. First, clause 14(b) deals
with injury to property, whereas clause 14(a) deals with injury to persons. I have not set out
the latter because [counsel] rightly did not press any argument to the effect that one gets any
real assistance on the construction of sub-clause (b) from the wording of sub-clause (a) and
I note that Mocatta J took the same view in the AMF case. Secondly, I approach the construc-
tion of this clause on the basis that, being an indemnity clause, it should be construed strictly,
analogously to an exemption clause; at any rate to the extent to which the defendants are
thereby sought to be held liable for defaults etc. by persons other than themselves over whom
they have no control. This is the position here, since it is not suggested by the plaintiffs that
there was any negligence, omission or default on the part of the defendants in any respect
whatever. This general approach to the construction of the clause is in my view established by
authority. It was the approach adopted by the Privy Council in the leading case of Canada
Steamship Lines Ltd v. Regem (1952), where the Board was dealing both with an exemptions
clause and an indemnity clause, and approached the construction of both in the same way.
This approach was followed by Mocatta J in the AMF case and in the decision of the Court
of Appeal in Walters v. Whessoe Ltd (1960) there cited. More recently there is further direct
authority that this is the correct approach to indemnity clauses in Gillespie Brothers & Co Ltd
v. Roy Bowles Transport Ltd (1973), where the Canada Steamship Lines case was again followed,
at any rate by the majority of the court, in the context of an indemnity clause, and where
Buckley LJ expressly equated the approach to the construction of indemnity clauses with that
to exemption clauses. I therefore proceed on the basis that if and in so far as the wording of
clause 14(b) does not clearly have the effect of rendering the defendants liable for the defaults
etc. of other persons, then the plaintiffs cannot successfully rely upon it.
. . . The plaintiffs' final, and in my view most difficult, submission was that the words 'or
of any sub-contractor' are wide enough to include sub-sub-contractors. They contend that
[K] were sub-sub-contractors of the defendants. It could not, of course, avail the plaintiffs
merely to rely on the fact that [K] were sub-contractors of Smith's, since they are not suing
Smith's and since there is no indemnity clause in force between the plaintiffs and Smith's.
[Counsel] said - in my view rightly so far as it goes - that any one working on a site otherwise
than under some contract of employment is in general parlance often referred to as a 'sub-
contractor'. But I have come to the conclusion that such a wide construction cannot properly
be given to the indemnity clause in this contract. There are a number of reasons for this. First,
as conceded by [counsel], the contract nowhere uses the words 'sub-contractor' in a context
which requires it to be read as including sub-sub-contractors. It especially provides in clause
13(a) for the subletting of part of the works by the main contractor with the written consent
of the architect, and in clause 21 for the appointment of nominated sub-contractors by the
main contractor. Both these clauses therefore refer only to sub-contractors of the main con-
tractor, and the contract nowhere deals, either expressly or by necessary implication, with
further generations of sub-contractors. I therefore see no sufficient reason for attributing any
wider meaning to the words 'sub-contractor' in the indemnity clause. Secondly, if it had been
intended that the indemnity clause should have the wide meaning for which the plaintiffs
contend, then it would have been easy to say so. Instead of referring to 'any sub-contractor' it
would have been easy to say something like 'anyone executing any part of the works' or 'anyone
working on the site'. Further, I do not think that anything is added to the plaintiffs' submis-
sions, or provides any answer to the foregoing points, by relying on the main contractors'
obligations in relation to insurance, to which I have already referred. [Counsel] said that
the employer would wish to be covered by insurance, and therefore also by indemnity, in
relation to anyone working on the site and not merely in relation to the first generation of