Drax Energy Solutions Limited (formerly Haven Power Limited) v Wipro Limited
[2023] EWHC 1342 (TCC)
CLS Civil Engineering Limited v WJG Evans and Sons
2 February 2024
[2024] EWHC 194 (TCC)
High Court
A builder (WJGE) and developer (CLS) disagreed about the price. The developer said there was a price limit (£1.1 million); the builder said there wasn’t. Even though there were some arguments about other things, the judge said there was a clear agreement on the price limit because the builder had agreed to it several times, and the emails showed it clearly. So, the judge said the builder was stuck with the price limit.
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.
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