Key Facts
- •CLS Civil Engineering Limited (CLS) engaged WJG Evans and Sons (WJGE), a building contractor, for construction works.
- •The terms of engagement are disputed, with CLS claiming a Letter of Intent (LOI) limited their liability to £1.1 million.
- •WJGE contends the contract was governed by JCT terms and that CLS's liability was not capped.
- •WJGE did not sign the initial LOI but commenced work and subsequently engaged in several revisions to the LOI increasing the liability cap.
- •WJGE's final valuation exceeded the final agreed cap of £1.1 million.
- •CLS brought a Part 8 claim seeking declaratory relief regarding the scope of the LOI and the liability cap.
Legal Principles
Proper scope of Part 8 claims and approach when disputed facts exist.
Part 8 of the CPR
Guidelines for Part 8 applications arising from adjudications (though not applicable in this case).
Paragraph 9.4.3 of the TCC Guide and Hutton Construction v. Wilson Properties (London) Ltd [2017] EWHC 517
Part 8 proceedings are unsuitable for trials on estoppel issues; disputed claims of estoppel require careful pleading.
ING Bank NV v Ros Roca SA [2012] 1 WLR 472
In Part 8 proceedings, the court can consider disputed matters against a summary judgment test (Part 24), assessing if the defendant has a real prospect of success.
Gavriel v Hope [2019] EWHC 2446
When construing contractual correspondence, the communications are construed objectively.
Smith v Hughes (1870-71) LR 6 QB 597
Requirements for Part 8 claims as outlined in Cathay Pacific Airlines Ltd v. Lufthansa Technik [2019] EWHC 484.
Cathay Pacific Airlines Ltd v. Lufthansa Technik [2019] EWHC 484
Precedent for deciding disputes of fact under Part 8 in construction contracts.
OD Developments v Oak Dry Lining Limited [2020] EWHC 2854 (TCC)
Outcomes
The court found for CLS.
WJGE's liability was capped at £1,100,000 based on the objective construction of the correspondence and Matthew Evans' admission. Estoppel arguments lacked merit.