body: [Richard](https://www.uclan.ac.uk/staff_profiles/richard-taylor.php) and [Damian](https://www.slaughterandmay.com/who-we-are/partners/damian-taylor/) Taylor. [*Contract Law Directions* (2019 7 ed)](https://global.oup.com/academic/product/contract-law-directions-9780198836599?&lang=en&). [BAILII](http://www.bailii.org/uk/cases/UKHL/2000/43.html) has *Alfred McAlpine Construction Limited v. Panatown Limited* [2000] UKHL 43. p 349.
  
  
  
  > 
  > ### Benefits in construction contracts
  > 
  > 
  > The House of Lords confirmed in the complex case of *Alfred McAlpine v Panatown* (2001) that,
  >  outside the social/consumer contracts where the contract is made by one party for the benefit
  >  of others as a matter of convenience and simplicity, there is no general rule allowing a contracting
  >  party to recover a loss on behalf of a third party.
  > 
  > 
  > McAlpine contracted with Panatown to construct a building on land owned by UIPL, a company
  >  in the same group as Panatown. McAlpine also provided a ‘duty of care deed’ to UIPL directly
  >  whereby they agreed to use all reasonable skill, etc. in constructing the building.
  > 
  > 
  > 
  
  
  p 350
  
  
  
  > 
  > The project did not go well and the costs of repairs for the alleged defects plus damages for
  >  delay were estimated to be tens of millions of pounds. **The decision was made by the group of
  >  companies to sue under the main contract between McAlpine and Panatown rather than under
  >  the duty of care deed between McAlpine and UIPL. [I boldened.]** McAlpine argued that Panatown, as opposed
  >  to UIPL who was the owner of the defective building, had suffered no loss. Panatown
  >  argued in the House of Lords: (i) that it was entitled to recover the loss suffered by UIPL on its
  >  behalf; and (ii) that in any event it had suffered a loss itself in that it had not received what it
  >  bargained for even if it was itself financially no worse off.
  > 
  > 
  > [![enter image description here](https://i.stack.imgur.com/8zd3I.jpg)](https://i.stack.imgur.com/8zd3I.jpg)
  > 
  > 
  > On the first point relating to recovery of loss suffered by a third party, the House of Lords was
  >  clear, as has already been said, that there was no general rule permitting such recovery. The real
  >  issue here however was whether Panatown could rely on a special rule traceable back to *Dunlop
  >  v Lambert* in 1839 and referred to in *The Albazero* (1977) by Lord Diplock in relation to contracts
  >  for the carriage of goods. This rule was then developed by the House of Lords in *Linden Gardens
  >  v Lenesta* (1994) so as to apply to contracts for the construction of a building.
  > 
  > 
  > The *Dunlop v Lambert/Albazero* exception applies to contracts whereby the claimant is the
  >  original consignor of goods to the defendant carrier, it being contemplated that the ownership
  >  of the goods will be transferred on by the claimant to subsequent purchasers whilst still being
  >  carried by the defendant. The subsequent purchasers are therefore the ones who are, by the
  >  time of the breach, the owners who suffer the actual loss or damage to the goods but who have
  >  no contract with the defendant carrier. The exception recognizes that the claimant can recover
  >  damages even though he suffers no loss personally and that he holds the damages on behalf
  >  of the subsequent purchasers who have suffered loss.
  > 
  > 
  > This exception was applied by the House of Lords in *Linden Gardens v Lenesta* (1993), or more
  >  accurately in the second case heard and reported with that case, *St Martin’s Property Corporation
  >  v McAlpine*.
  > 
  > 
  > 
  
  
  
title: Why did McAlpine (M) sue under the main contract between M and Panatown, rather than under the duty of care deed between M and UIPL?