Construction contract notice provisions held to be conditions precedent to contractor’s claims for loss and expense
The Inner House (appeal division) of the Scottish Court of Session determined in FES Limited v HFD Construction Group Ltd that notice provisions under a construction contract were conditions precedent to a contractor’s entitlement to reimbursement for loss and expense.
Background
In 2020, FES Limited (FES) and HFD Construction Group Ltd (HFD) contracted to fit out an office building on Bothwell Street in Glasgow.
The fine margin for natural justice challenges: Lord Sandison finds no frolicking and enforces the adjudicator’s decision
In ATG Services (Scotland) Ltd v Ogilvie Construction Ltd [2024] CSOH 94, the Court of Session enforced the adjudicator’s decision, finding there had been no breach of natural justice as the adjudicator had not gone off on a frolic of his own.
Interest rates in construction contracts: What is considered a “substantial remedy”?
In two recent cases, the Technology and Construction Court (TCC) has clarified how parties can disapply the statutory right to interest on late payments under the Late Payment of Commercial Debts (Interest) Act 1998 (“1998 Act”).
In the first case, the court held that applying interest to “undisputed” debts – but not to “disputed” debts – was sufficient to oust the 1998 Act. In the second case, the court held that an interest rate of 2% above the Bank of England base rate was insufficient to oust the 1998 Act.
Court holds exceptional circumstances required for an injunction to restrain adjudications
In Beck Interiors Ltd v Eros Ltd, the Technology and Construction Court (TCC) clarified that exceptional circumstances are required for an injunction to prevent an adjudication from proceeding.
Background
In 2020, Eros Ltd (Eros) contracted Beck Interiors Ltd (Beck) as design and build fit-out contractor in the development of The Residence, Mandarin Oriental, in Hanover Square, London.
Court of Appeal holds contractor permitted to terminate JCT Contract due to employer’s repeated late payment
In Providence Building Services Ltd v Hexagon Housing Association Ltd, it was held that a contractor could terminate its employment under an amended Joint Contracts Tribunal (JCT) Design and Build Contract due to the employer making a second late payment, thereby repeating a “specified default”, even though the first late payment did not give rise to a right to terminate.
Collateral warranty held not to be a construction contract – clarity provided by the Supreme Court
The Supreme Court has clarified that a collateral warranty in traditional form is not a construction contract under the Housing Grants (Construction and Regeneration) Act 1996 and, therefore, does not engage the payment or adjudication provisions of the Act.