Key Facts
- •Geoquip contracted with Tower to provide offshore geotechnical services in Cameroon.
- •Geoquip claimed an outstanding balance of US$610,091.68 (lump sum) and US$1,619,541.69 (standby charges) due to Tower's delays.
- •The delay was attributed to Tower's failure to secure a licence extension, permits, and security for Geoquip's vessel.
- •The High Court awarded Geoquip the lump sum but dismissed the claim for standby charges.
- •The Court of Appeal focused on whether Geoquip had a contractual right to standby charges under clauses 4.5 and 34.
- •The condition precedent in section 10.2 of the contract concerning the licence extension was waived by both parties.
Legal Principles
Contractual interpretation: Terms should be given their natural meaning within the context of the contract as a whole.
Court of Appeal judgment
Waiver of condition precedent: If a condition precedent is waived, the parties must be deemed to have intended that the other contract terms would apply according to their natural meaning.
Court of Appeal judgment
Concurrent causes: Where there are two or more concurrent, equally effective causes of an event, and only one engages the contractual provision in question, that provision is engaged.
FCA v. Arch Insurance (UK) Ltd & Ors [2021] UKSC 1, [2021] AC 649 (SC)
Outcomes
The Court of Appeal allowed Geoquip's appeal.
The judge erred in law by failing to consider the effect of the waived condition precedent. The Court of Appeal held Geoquip was entitled to standby charges based on its interpretation of clauses 4.5 and 34.
Geoquip's application to amend its notice of appeal was refused.
The amendment sought to introduce a new argument on causation that differed from the case presented to the High Court and would require a new trial.
Geoquip was awarded an additional US$1,619,541.69 in standby charges.
The Court found that Tower's failure to secure a licence extension and to provide security were independent concurrent causes of the delay, triggering Geoquip's right to standby charges under clause 4.5.