Building Law Reports – Part 6 [2021] now published

18th Aug 2021

Part 6 of the Building Law Reports covers the following key judgments:

Introduction to the Building Law Reports Part 6 [2021]

In this volume we report five decisions from the TCC, comprising two applications for summary judgment, an application for relief from sanction, an application under CPR Part 11 contesting the court’s jurisdiction, and a preliminary issue. As Covid-19 restrictions begin to ease again in the UK, the court continues to field a busy caseload encompassing a wide variety of substantive and procedural issues.

In Multiplex Construction Europe Ltd v Bathgate Realisations Civil Engineering Ltd and Others, Fraser J was asked to determine as a preliminary issue whether a designer appointed by a concrete sub-contractor to carry out an independent design check owed a common law duty of care to avoiding causing economic loss to the main contractor, Multiplex, with whom it had no contractual relationship. The claim had been brought against the designer’s insurer pursuant to the Third Parties (Rights Against Insurers) Act 2010. Applying long established principles set out in a variety of well-known leading decisions, the judge found no such duty was owed. There was no contractual relationship, and the designer had not provided services directly to Multiplex. Multiplex had no role in selecting the designer’s involvement, nor any direct communication with the designer. In the circumstances, the designer had not assumed responsibility to Multiplex. Fraser J explained that parties who had carefully and intricately structured a set of contractual relationships were entitled to assume they could rely on that structure, such that the court would be slow to find the existence of a common law duty which cut across that structure. Multiplex had a direct claim against its sub-contractor.

In Transport for Greater Manchester v Kier Construction Ltd, O’Farrell J addressed an issue relating to adjudication about which there has been little authority. Often adjudication clauses dictate that, if there has been no notice of dissatisfaction within a set time after the publication of a valid adjudication decision, the adjudication decision becomes final and binding. In this case, the contractor commenced an adjudication and, on 25 November 2019, received a decision in its favour awarding it approximately £600,000. On 29 November 2019, the employer’s solicitors wrote saying that it was clear that the adjudicator had “erred in law and in his interpretation and application of the express terms of contract … ”. The employer issued Part 8 proceedings on 12 August 2020 seeking a declaration that the adjudicator was wrong in law and seeking return of the monies paid following the adjudication. The contractor applied for an order declaring that the court had no jurisdiction on the grounds that there was no notice of dissatisfaction within the four weeks called for in the contract. Although the word “dissatisfaction” did not appear in the letter of 29 November 2019, the judge was clear that it was a valid notice of dissatisfaction. One needs to look at the substance of what is said to determine whether dissatisfaction is being notified.

Mott Macdonald Ltd v Trant Engineering Ltd was a summary judgment application arising out of a contract for the construction of a power station at an RAF base in the Falkland Islands. The parties had partly settled their differences in a settlement agreement containing certain limitation and exclusion clauses in favour of the claimant consultant. The claimant sued for various fees said to be outstanding under that agreement and another. The claim was met with a counterclaim for damages for “fundamental, wilful or deliberate” breaches said not to be covered by the agreed limitation and exclusion clauses. The judge was prepared to construe and apply the settlement agreement (on the assumption that the facts pleaded by the defendant were correct) on a summary judgment application, finding that the words used were sufficiently broad to cover all types of breaches. In that context, he re-affirmed the Photo Production decision of the House of Lords to the effect that there are no special rules of construction applicable to exemption and limitation clauses. Normal principles of construction apply, and no special wording or form of words is required to achieve the effect of excluding even deliberate, wilful or fundamental breaches. If the language is properly capable of only one meaning, then the court must give effect to it.

In Boxwood Leisure Ltd v Gleeson Construction Services and Another, the claimant’s solicitors mistakenly failed to serve the claimant’s claim form within the extended period for service ordered by the court under CPR rule 7.6, serving the particulars of claim and acknowledgement of service forms alone. This failure, attributed to the impact of Covid-19 on the firm’s working systems, was only identified six days later. After a further six days (and after the defendant had contended the proceedings were now a nullity) the claimant applied pursuant to CPR rules 3.9, 3.10, 1.2 and 3.1(2)(m) seeking relief from sanction, asking the court to rectify an error of procedure, and asking that the order setting out the date for service of the claim form be varied. It did not make an application pursuant to CPR rule 7.6(3) for a retrospective extension of time for service of the claim form. O’Farrell J determined that the court only had power to extend time for service where the conditions set out in CPR rule 7.6(3) were satisfied and more general powers, including under CPR rules 3.9, 3.10, could not be deployed to circumvent the requirement to satisfy those conditions. Having made no application under CPR rule 7.6(3), and not satisfying the conditions therein, the claimant’s application was refused.

Finally, in Prater Ltd v John Sisk & Son (Holdings) Ltd, the court considered an application for enforcement of an adjudicator’s decision made pursuant to Option W2 of the NEC3 Conditions of Subcontract. The decision in question arose from the fourth adjudication between the parties. The defendant argued the decision should not be enforced because it was based, in part, on findings made in the decision arising from the second adjudication, which was itself unenforceable because the claimant had then referred multiple disputes to adjudication. The judge enforced the fourth decision, finding that the decision in the second adjudication had not been challenged and remained binding in the fourth adjudication, such that it was not open to the adjudicator to reopen that decision. In obiter dicta, the court went on to consider whether multiple disputes had in fact been referred in the second adjudication. Applying well-known guidance, including that in Witney Town Council v Beam Construction (Cheltenham) Ltd, the court decided that the matters referred to were part of a larger single dispute between the parties and did not therefore constitute multiple disputes.

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, Dominique Rawley QCMarc Lixenberg, Omar Eljadi, David Johnson, and Felicity Dynes.

The Building Law Reports are published by Informa.

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