Sutton Housing Partnership Limited and Rydon Maintenance Limited  EWCA Civ 359
Steven Walker QC appeared for the Appellant, Sutton Housing Partnership Limited, in an appeal from the Technology and Construction Court concerning the proper construction of the termination provisions in a five-year contract for the provision of repair and maintenance services.
Sutton terminated the contract for poor performance based on the contractor’s failure to achieve minimum acceptable performance levels (MAP levels).
The contractor (Rydon Maintenance Limited) argued that the contract did not specify any such MAP levels and therefore the termination was unlawful. The contractor successfully brought a claim for damages for wrongful termination in adjudication.
Sutton sought declarations under CPR Part 8 in order to challenge the outcome in the adjudication. The judge at first instance agreed with the adjudicator that the contract did not contain MAP levels. Sutton successfully appealed. Jackson LJ said the judge had been correct to say that the court should proceed with care when determining whether contractual provisions are sufficiently clear to permit the termination of a relatively long-term contract.
In allowing the appeal, the Court of Appeal focused on the consequences of the contractor’s interpretation which were that the contractor would not receive performance-related bonuses and Sutton would not be able to terminate for a failure to achieve MAP levels.
Jackson LJ concluded that Sutton’s construction was “the only rational interpretation of the curious contractual provisions into which the parties have entered”.
(Instructed by instructed by SA Law LLP)
Related barristers: Steven Walker QC
To view the full judgment please click here.
18 May 2017