REUTERS | Christian Hartmann

October to December 2017 case review for construction practitioners

Lewis Carroll, Through the looking-glass:

“‘When I use a word,’ Humpty Dumpty said in rather a scornful tone, ‘it means just what I choose it to mean – neither more nor less’.”

A selection of the more interesting decisions affecting construction and engineering practitioners during the final quarter of 2017.

Adjudication

In Actavo UK Ltd v Doosan Babcock Ltd, O’Farrell J enforced the first adjudicator’s decision but declined to grant the declaratory relief sought in relation to the impact of the second adjudicator’s decision (the Hutton v Wilson guidelines were applied), which Matt Molloy discussed.

In Bernhards Sports Surfaces Ltd v Astrosoccer4u Ltd, Coulson J granted permission to continue adjudication enforcement proceedings after the defendant threatened to give notice of an intention to appoint an administrator. The court also granted summary judgment enforcing the adjudicator’s decision.

In DC Community Partnerships Ltd v Renfrewshire Council, Lord Doherty held that the adjudicator failed to “exhaust his jurisdiction” when he failed to consider the Council’s set-off defence, which Jonathan Cope discussed.

In Edinburgh Schools Partnership Ltd v Galliford Try Construction (UK) LtdLord Bannatyne held that the claimant did not assign all of its rights under a design and build contract to the Bank of Scotland as security trustee. Rather, there had been an “assignation in security”, which meant that it still had “title” to sue and to start an adjudication, which Matt Molloy discussed.

In Jacobs UK Ltd v Skanska Construction UK Ltd, O’Farrell J declined to grant injunctive relief to prevent the referring party proceeding with a second adjudication of the same dispute in circumstances where the referring party withdrew from the first adjudication, which Jonathan Cope discussed.

In Merit Holdings Ltd v Michael J Lonsdale Ltd, Jefford J reminded parties that using CPR 8 for declarations relating to “adjudication business” is only appropriate for the types of matter identified in the TCC Guide, not for every dispute with an adjudication background, which Jonathan Cope discussed.

In Morgan Sindall v Westcrowns Contracting Services, Lord Clark held that the adjudicator did not act outside his jurisdiction, did not fail to “exhaust his jurisdiction”, did not breach the rules of natural justice and did not deal with more than one dispute.

In Rossair Ltd v Primus Build Ltd, O’Farrell J enforced an adjudicator’s decision, finding that the defendant had taken no steps to bring into effect a moratorium in respect of a company voluntary arrangement (CVA) and that no moratorium was in place.

In The Vinden Partnership Ltd v Orca LGS Solutions Ltd, HHJ Stephen Davies granted summary judgment in an adjudicator’s claim for payment of his fees, which Matt Molloy discussed.

Arbitration

In Glencore Agriculture BV v Conqueror Holdings Ltd, the Commercial Court set aside an award under section 72 of the Arbitration Act 1996 because the notice commencing arbitration was emailed to a junior employee who was not authorised to accept service.

In Sino Channel Asia Ltd v Dana Shipping & Trading PTE Singapore, the Court of Appeal held that a fronting company had actual and ostensible authority to accept service of notice of arbitration. The arbitration award was set aside under sections 67 and 72 of the Arbitration Act 1996.

In Tonicstar Ltd v Allianz Insurance, the Commercial Court granted an application under section 24 of the Arbitration Act 1996 to remove a party nominated arbitrator for lack of qualification.

Construction claims

In HSM Offshore BV v Aker Offshore Partner Ltd, Coulson J held that liquidated damages provisions did not apply following contract amendments and the paying party was not estopped from reviewing interim payments at the final account stage.

In Interserve Construction Ltd v Hitachi Zosen Inova AG, Jefford J granted a declaration that a contractor ought to have been given the opportunity to remedy its breach before its employment was terminated, which James Frampton discussed.

Contract interpretation

In Dynniq UK Ltd v Lancashire County Council, Coulson J refused to grant declarations on the proper meaning of bespoke provisions in a NEC3 Term Service Contract relating to traffic signal maintenance and construction.

In North Midland Building Ltd v Cyden Homes Ltd, Fraser J upheld a contract clause that expressly disallowed a building contractor’s claim for an extension of time in cases of concurrent delay, which Melissa Moriarty and Yassir Mahmood discussed.

Damages

In Dhaliwal v Hussain, the High Court assessed a claim for damages for, among other things, fraudulent misrepresentation relating to the sale of a dental practice.

In Tiuta International Ltd (in liquidation) v De Villiers Surveyors Ltd, the Supreme Court reinstated the High Court’s decision to award the defendant valuer summary judgment in respect of a negligent valuation claim, adopting a back to basics approach to the assessment of damages.

Evidence

In Ashdown v Griffin, the High Court considered how it should approach its assessment of expert evidence where only one party had submitted expert evidence on an issue.

Indemnities, guarantees and bonds

In Multiplex Construction Europe Ltd v Dunne, Fraser J granted a contractor’s summary judgment application in a claim against an individual who had given an indemnity in relation to “on account” payments to a sub-contractor.

In Ziggurat (Claremont Place) LLP v HCC International Insurance Company plc, Coulson J granted declaratory relief, finding that following the building contractor’s insolvency, operation of the building contract’s termination provisions was sufficient to give rise to a debt that, in turn, triggered liability under a performance bond.

Litigation

In Budana v The Leeds Teaching Hospitals NHS Trust, the Court of Appeal held a success fee was payable under a conditional fee agreement entered into before 1 April 2013 and subsequently transferred to another firm of solicitors under section 44 of the Legal Aid, Sentencing and Punishment of Offenders Act 2012 (LASPO).

In DPM Property Services Ltd v Emerson Crane Hire Ltd, Coulson J overturned a County Court decision to allow additional expert evidence.

In Edwardian Group Ltd v Singh, the Chancery Division added a gloss to the test to be applied when considering whether documents benefit from legal advice privilege on the basis that they reveal the substance of the legal advice given.

In Freeborn v Marcal (t/a Dan Marcal Architects), Couslon J issued a strongly worded warning to parties not to abuse the court’s tougher approach to non-compliance by requiring their opponent to make an application for relief from sanctions, or opposing such an application, where it is not proportionate or appropriate.

In Optical Express Ltd v Associated Newspapers Ltd, the High Court departed from the ordinary costs consequences of late acceptance of a Part 36 offer, awarding the defendant offeror standard basis costs for a period pre-expiry of the relevant period, and indemnity basis costs thereafter.

In The Bullring Ltd Partnership v Laing O’Rourke Midlands Ltd, Coulson J granted the defendant’s application for early specific disclosure, which had been made after the claim form had been issued but before the particulars of claim had been served in final form.

Negligence

In Riva Properties Ltd v Foster + Partners Ltd, Fraser J found that an architect had been negligent in preparing a design without reference to its client’s budget, which Mark BriggsHelena White, Catherine Piercy and Matt Molloy all discussed.

Payment under the Construction Act 1996

In Adam Architecture Ltd v Halsbury Homes Ltd, Jackson LJ in the Court of Appeal confirmed that a party must give a pay less notice if it wishes to pay less than the sum claimed, which David Sears QC discussed.

In Muir Construction Ltd v Kapital Residential Ltd, Lord Bannayne considered the meaning of “the basis on which” and held that a party’s pay less notice was invalid, which Matt Molloy discussed.

In Severfield (UK) Ltd v Duro Felguera UK Ltd, Coulson J found largely in favour of a sub-contractor’s claims in a final account dispute, making obiter comments about the exceptions to the Construction Act 1996 and when a party can argue that time is at large.

In Systems Pipework Ltd v Rotary Building Services Ltd, Coulson J granted declaratory relief related to the interpretation of the final account provisions in the parties’ sub-contract, which Katharine Tulloch discussed.

Professional appointments

In Riva Properties Ltd v Foster + Partners Ltd, Fraser J found that an architect had been negligent in preparing a design without reference to its client’s budget, which Mark BriggsHelena WhiteCatherine Piercy and Matt Molloy all discussed.

Want more?

For details of the year’s previous judgments, see our January to March, April to June and July to September case reviews. Public procurement decisions are detailed in the Public procurement case tracker.

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