J & B Hopkins Limited v A & V Building Soltuions Limited
[2023] EWHC 301 (TCC)
Ubhi Construction Limited v Aspire Enterprises (UK) Limited
9 May 2024
[2024] EWHC 1089 (TCC)
High Court
A construction company sued another company for breach of contract. The judge believed the contract was real and not dependent on getting funding, so the construction company got paid for its work and lost profits.
Key Facts
- •Ubhi Construction Limited (Claimant) and Aspire Enterprises (UK) Limited (Defendant) dispute a JCT construction contract for 14 houses.
- •The Claimant alleges Mr. Dhanda, associated with the Defendant, signed the contract; the Defendant denies this.
- •The Claimant claims payment for plant and equipment hire, standstill charges, and lost profit.
- •The Defendant argues only an oral agreement for site clearance existed, which was paid for.
- •The contract's conditionality on funding is a key dispute.
Legal Principles
Contractual liability: A party is bound by a contract signed by an authorized representative, even if that representative was not a director at the time of signing.
None explicitly stated, implied through court interpretation of evidence.
Evidentiary standards: The court assesses the credibility of witnesses and considers documentary evidence to determine the facts of the case.
None explicitly stated, inherent judicial process
Contractual interpretation: A contract is interpreted according to its express terms and surrounding circumstances.
None explicitly stated, inherent judicial process
Damages for breach of contract: The claimant is entitled to recover losses directly flowing from the breach, including lost profit and reasonable expenses.
None explicitly stated, inherent judicial process
Outcomes
The court found that Mr. Dhanda signed the JCT contract.
The court considered witness testimony and compelling contemporaneous emails contradicting Mr. Dhanda's denial, and Companies House records showing his shareholding in the Defendant company.
The contract was not conditional upon funding.
The contract lacked any express conditionality; contemporaneous correspondence didn't indicate a conditional agreement; a conditional contract would lack commercial logic; and the Defendant's evidence regarding conditionality was found unreliable.
The Claimant is entitled to plant and equipment hire charges but not standstill charges.
While the Claimant incurred costs for plant hire, the standstill charges were deemed to duplicate the claim for lost profit.
The Claimant is entitled to £279,675 lost profit.
The court accepted the Claimant's evidence of a 20% profit margin, supported by the significantly lower price of the replacement contractor.
Total award to Claimant: £307,115 (£27,440 for plant hire + £279,675 lost profit)
Based on the above findings.