The TCC Considers Crystallisation Of A Dispute Arising From An Extension Of Time Claim

Published date22 June 2020
AuthorMr Iain Drummond and Leigh Herd
Subject MatterCorporate/Commercial Law, Real Estate and Construction, Strategy, Contracts and Commercial Law, Construction & Planning, Technology
Law FirmShepherd and Wedderburn LLP

In the recent case of MW High Tech Projects UK Ltd v Balfour Beatty Kilpatrick Ltd the Technology and Construction Court ("TCC") reinforced the principles relevant when deciding whether or not a dispute had crystallised.

Background

The parties contracted in respect of the building of a laboratory in Hull, with Balfour Beatty Kilpatrick Ltd ("Balfour Beatty") engaged by MW High Tech Projects UK Ltd ("MW") to carry out mechanical and electrical works.

The works were delayed. Balfour Beatty intimated five contractual notices of delay to MW, but no responses were issued by MW within the 16 week periods required by the parties' contract.

By letter of 30 July 2019 Balfour Beatty produced an expert report in support of their claim and increased the extension of time sought by 71 days to 282 days in total. The letter requested confirmation within seven days that the extension of time was accepted.

Eight days later, having received no response, Balfour Beatty referred the dispute to adjudication. The adjudicator decided in Balfour Beatty's favour and awarded the full extension of time claimed.

The case brought to the TCC

MW raised court proceedings to seek a declaration that the adjudicator did not have jurisdiction to decide the dispute and that the adjudicator's decision was therefore invalid.

MW's argument was that the dispute had not crystallised prior to the commencement of the adjudication. If that was correct then the referral of the dispute to adjudication was premature.

The principles for assessing whether or not a dispute has crystallised have been set out and refined in case law. The courts avoid an overly legalistic analysis and instead consider the essential claim that has been made. It is possible to infer that a dispute has arisen where a party does not respond to notification of a claim.

The matters to be decided by the TCC

In this case, amongst the issues to be decided by the TCC were whether or not service of the expert report on 30 July 2019 constituted a new notification of delay, and - if so - whether the 16 week contractual period for MW to respond to the notification was restarted on that date. If Balfour Beatty's letter of 30 July 2019 was a new notification of delay then a dispute could not have crystallised prior to the commencement of the adjudication.

On the other hand, if the letter of 30 July 2019 simply added further particulars to the previously...

To continue reading

Request your trial

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT