The facts

Breakshore Ltd (Breakshore) employed Red Key Concepts Ltd (Red Key) to construct a six-storey tower block in Kent under a JCT contract. The contractual completion was expected to take place May 2021, however, Red Key suspended works in August 2021 on the grounds that the tower block had been built 1.5m taller than the height approved in the planning permission. This pushed back the completion date to October 2021, prompting Breakshore to claim liquidated damages at adjudication.

The High Court recently held that damages would not be awarded for wasted management and staff time despite finding an unlawful means conspiracy to have existed. In Zenith Logistics Services (UK) Ltd and others v Keates and others, Judge Keyser QC held the monetary loss needs to be proven, otherwise the damages will not be awarded.

In Abbey Healthcare (Mill Hill) Ltd v Simply Construct (UK) LLP, the Court of Appeal recently determined that a collateral warranty, signed four years after completion, was a construction contract that applied retrospectively, therefore an adjudication award applied to the dispute under the warranty and was enforceable.

The court’s decision provides clarity that a collateral warranty can be sufficient evidence of contractual obligations to seek enforcement of an adjudication award.

On 1 June 2022 standstill agreements were made permissible in Scotland by s13 of the Prescription (Scotland) Act 2018 (“the 2018 Act”). Our earlier article on the key changes of the 2018 can be found here. The new legislation allows for parties to enter into a contractual agreement to extend the prescriptive period by one year. This is a welcome change, as previously extending the prescriptive period was prohibited.