Practical Guidance From The High Court On Interpretation Of "Days" In A Construction Contract

• Published date: 09 May 2023
• Subject Matter: Corporate/Commercial Law, Real Estate and Construction, Contracts and Commercial Law, Construction & Planning
• Law Firm: Gowling WLG
• Author: Mr Ashley Pigott, Emma Knight and Annie Johnson

In Elements (Europe) Ltd v FK Building Ltd,¹ the Technology and Construction Court (TCC) considered the meaning of "days" in a Joint Contracts Tribunal (JCT) subcontract, holding that an interim payment application could be received at any time up to 11.59pm on the required day.

The TCC noted that the parties had settled their dispute after receiving the draft judgment. Nonetheless, it considered it appropriate to hand down the decision given that it relates to the "proper construction" of an important element of a widely used JCT standard form, which had not previously been considered by the courts. We consider below the practical guidance offered by this case as to the Court's interpretation of "days" in circumstances where a contract specifies a day / number of days for performance of an obligation, or service of a notice or application.

Background facts

• FK Building Ltd (FK) engaged Elements (Europe) Limited (Elements) as subcontractor to carry out remediation works on three buildings, comprising a residential apartment scheme in Salford The contract incorporated the JCT Standard Building Sub-Contract Conditions SBCSub/C 2016 Edition, with bespoke amendments.
• Clause 4.6.3.1 dealt with the timing of interim payment applications, providing that these must be "received not later than 4 days prior to the Interim Valuation Date for the relevant payment...".
• Elements sent its Interim Payment Application No. 16 (IA16) to FK by email on 21 October 2022 at 10.07pm. The relevant interim valuation date was 25 October 2022.
• FK did not issue a pay less notice, and disputed that any sums were due pursuant to IA16, arguing that IA 16 had been received late.
• Elements commenced adjudication proceedings in December 2022 The adjudicator rejected FK's arguments and determined that FK owed Elements the sum of '3.9 million.
• FK continued to withhold payment and commenced Part 8 proceedings, seeking final determination in the Courts. Elements issued Part 7 enforcement proceedings. The Court dealt with the Part 7 and Part 8 proceedings together.

The dispute

FK's arguments centred around the semantics of clause 4.6.3.1 which, it contended, meant that Element's interim payment application, sent by email on 21 October at 10:07pm, had been submitted late.

Meaning of "4 days"

FK submitted that Clause 4.6.3.1 required interim payment applications to be received:

1. four 'clear' or 'full' days prior to the interim valuation date; and
2. on or before the end of site working hours, on...