Part 2 of the Building Law Reports covers the following key judgments:
- Alstom Transport UK Ltd v Network Rail Infrastructure Ltd [2019] EWHC 3585 (TCC)
- ISG Construction Ltd v English Architectural Glazing Ltd [2019] EWHC 3482 (TCC)
- VVB M&E Group Ltd and Another v Optilan (UK) Ltd [2020] EWHC 4 (TCC)
- Munich Re Capital Ltd v Ascot Corporate Name Ltd [2019] EWHC 2768 (Comm)
- Mann v Paterson Constructions [2019] HCA 32
A copy of the Introduction is reprinted below.
Introduction to the Building Law Reports Part 2 [2020]
In Alstom Transport UK Ltd v Network Rail Infrastructure Ltd, Mrs Justice O’Farrell in the TCC, on a major infrastructure procurement project, had to consider the proper approach to be adopted in relation to the lifting of the automatic suspension applicable in public procurement preventing the contract tendered for being actually placed with the successful tenderer. The Cyanamid principles had been held by earlier decisions of the TCC to be applicable and thus the court needs to consider whether there is a serious issue to be tried, whether damages would be an adequate remedy and where the balance of convenience lies. As in numerous other cases, it was conceded that there was a serious issue to be tried but the claimant (the losing tenderer) failed at that the other hurdles. Indeed, the judge held that damages would not be an adequate remedy for Network Rail, for instance in relation to continuing safety risks arising if the new contract was not placed. The balance of convenience, she found, favoured placing of the new contract with the successful tenderer not least because the work proposed involved replacement of installations which were at or near the end of a useful working life. It is extremely unlikely that this test could be successfully undermined.
ISG Construction Ltd v English Architectural Glazing Ltd, another TCC case, involved a party to adjudication seeking declarations in court pursuant to Part 8 of the Civil Procedural Rules on matters which could impact adjudications between the parties. The practice is one which is open to any party with access to the court, but it is circumscribed by special considerations in relation to adjudication. The granting of declarations is a discretionary remedy and the court must have regard to policy considerations in relation to adjudication. One can have regard to whether the Part 8 procedure is being used to challenge enforcement of adjudicators’ decisions, whether there are disputed questions about relevant facts and whether resolving the issues will serve a useful purpose or otherwise do justice. The highly respected Manchester TCC judge, HHJ Stephen Davies, considered the relevant declarations sought. This judgment provides a useful example as to how and when declarations relating to adjudication issues should (or should not as in this case) be given.
In VVB M&E Group Ltd and Another v Optilan (UK) Ltd, the TCC was concerned with an application for “delivery up” of goods and materials and the extent to which “Vesting Certificates” had the effect of transferring ownership of the goods or materials in question. It is common for such parties to be paid for goods or materials before they are delivered to the site and provision is made in those circumstances for ownership to vest with one or other party “up the line”. Primarily, one looks at the contracts between the various parties to see whether, and if so when and to whom if at all, ownership passes from the provider up the line to sub-contractor, main contractor or ultimate employer. Here the “Vesting Certificates” provided for unconditional vesting of the property or title “upon receipt of the interim payment” for the goods or materials in question. This is a useful judgment on an everyday problem for suppliers and subcontractors in the construction business in this decision is a good example of how the vexed question of vesting of ownership or title in materials or equipment kept all stored by the supplier or fabricator works in practice.
The Commercial Court decision in Munich Re Capital Ltd v Ascot Corporate Name Ltd involved consideration of a construction re-insurance policy. The claim related to piles and steel tendons used to tension a buoyant hull where bolts connecting the steel tendons to the piles failed. Ultimately, the main issues were resolved by interpretation the contract with the judge, Mrs Justice Carr, being unpersuaded that the purely literal interpretation of the re-insurance policy was correct but found that the construction in a commercial context was the appropriate one, taking into account, for instance, the ordinary expectations of parties to an offshore CAR (Contractor’s All Risks) policy and the fact that it would be an ordinary expectation as to when the Project Period insured for ran.
Mann v Paterson Constructions is a decision from the highest court in Australia the High Court which strongly merits reporting. It raised issues relating to restitution where a building contract provided for progress payments at stages, but the owners requested, and the builder carried out variations without giving notice; this was followed by repudiation of the contract after the builders raised an invoice claiming for the variations. In many countries including the UK, the innocent party to repudiation could elect to claim a quantum meruit, alternatively damages claim from the repudiatory breach of contract. However, in Australia, the courts are not willing to allow such a claim because it displaces the operation of the compensatory principle applicable in contractual cases. The primary case relied upon in the UK jurisdictions, Lodder v Slowey, to justify the alternative claim to quantum meruit, was no longer to be applied. This argument may well be one which is sought to be followed in the UK courts, but it would, in all probability, have to be decided by the Supreme Court.
About the Building Law Reports
Edited by members and former members of Atkin Chambers, the Building Law Reports are essential reading for legal professionals, construction industry professionals, law libraries and universities. Each report provides expert commentary on key judgments from the editors, including the substance of a case and its implications on past and future decisions.
Described as “the most established and authoritative construction law reports available”, they provide comprehensive coverage from the Technology and Construction Court, Court of Appeal, Supreme Court and other relevant jurisdictions worldwide, including Hong Kong, Australia and Singapore.
Consulting Editor: The Honourable Mr Justice Fraser
General Editors: Sir Robert Akenhead, Chantal-Aimée Doerries QC, Dominique Rawley QC, Marc Lixenberg and Omar Eljadi
