UK: 2012 Construction Case Law Summary (January – June)

Last Updated: 2 August 2012
Article by Suzanne Reeves

Following on from our case law summary of 2011, the first half of 2012 has also seen a number of important decisions made in the Courts which may affect our clients and contacts in the property and construction sectors. A selection of these cases is set out below:

Claims consultants and legal professional privilege:

Walter Lilly & Company Ltd v Mackay & Anor [2012] EWHC 649

This case is a reminder of the scope of legal professional privilege. The claimant in this case was a building contractor who had been engaged to construct a house for one of the defendants. The defendant had engaged a claims consultant (Knowles) for "contractual and adjudication advice". The defendant claimed that the majority of the Knowles documentation was privileged and did not disclose it. The contractor applied for an order requiring disclosure of these documents and the Court agreed holding that legal professional privilege did not apply. The Judge gave weight to the fact that Knowles was not retained to provide legal advice and had not held itself out as a firm of solicitors or barristers. It was immaterial that the people providing the advice had trained at the Bar and that the defendant honestly believed that it was engaging Knowles to provide legal advice. It is therefore very important that parties are clear as to the services they are providing to avoid any surprises as to what documentation could subsequently be subject to disclosure.

Quantity Surveyor's duty to obtain a bond:

Sweett (UK) Ltd v Michael Wight Homes Ltd [2012] EW Misc 3 (CC)

The QS was obliged by its appointment to "prepare contract documentation and arrange for such documents to be executed by the parties thereto". The contractor became insolvent before providing the performance bond in favour of the employer. The court rejected the employer's argument that the QS was under an absolute obligation to procure the bond from the contractor. The QS was subject to the implied test of reasonable skill and care and had satisfied its duty in these circumstances (as he had chased the contractor for this and advised the employer of the importance of the bond). If you wish to imply an absolute obligation on another party to procure something, very clear wording should be used.

Professionals' duty to review previous work:

Shepherd Construction Ltd v Pinsent Masons LLP [2012] EWHC 43

Shepherd argued in this case that their solicitors were under an ongoing duty to review the suitability of clauses in standard sub-contracts that had been drafted by the solicitors some time ago, but which were now ineffective due to a change in the law and left Shepherd facing claims from third parties. The Court did not agree, finding that on the facts there was no general retainer to review and revise previous work stating "there is something commercially and professionally worrying if professional people are to be held responsible for reviewing all previous advice or indeed services provided". Without a specific retainer such a duty to review previous work will not exist which will be good news to insurers and professionals alike.

Fire damage and insurance:

United Marine Aggregates Ltd v G.M.Welding & Engineering Ltd & Anor [2012] EWHC 779

The claimant (UMA) had engaged the defendant (GM) to carry out works at its plant which included welding. A fire occurred as a result of these hot works. Court found that GM was not liable to UMA for this fire as on the facts GM had acted with reasonable skill and care when carrying out the works. However, it was held that had GM been liable, their claim for an indemnity from their insurers would have failed as they had breached one of the conditions of their insurance in respect of hot works, reminding of the importance of complying with insurers' requirements.

Settlement agreements:

Point West London Ltd v Mivan Ltd [2012] EWHC 1223

The case concerned an agreement the contractor and developer had made in respect of sums to be paid to the contractor. The Court had to decide whether the agreement had also released the contractor from liability for defects to a penthouse which were still not resolved. On the facts the Court held the contractor was released from liability. It is important to be certain of, and clear in the terms of any agreement, what the effect of any settlement will be.

Good faith in commercial contracts:

Compass Group UK and Ireland Ltd (trading as Medirest) v Mid Essex Hospital Services NHS Trust [2012] EWHC 781

The contract obliged the parties to a long term facilities agreement to "co-operate with each other in good faith". The Trust in this case had the right to terminate Medirest's engagement because Medirest had exceeded the number of permitted "service failure points", but the key question was whether Medirest also had the right to terminate owing to a breach of the obligation to act in good faith. The Court held that it was; the Trust had breached a material obligation to act in good faith (having prepared "patently absurd", "cavalier", "indefensible" calculations of service credits under the contract).

E-Disclosure practices:

West Africa Gas Pipeline Co Ltd v Willbros Global Holdings Inc [2012] EWHC 396

Willbros had provided a guarantee in relation to a contract between West Africa and its contractors. West Africa terminated the contract and completed the project using different contractors, seeking payment from Willbros for additional costs incurred. During e-disclosure a number of problems occurred including duplication of documents, inconsistent redaction, inadequate collection and preservation of documents, and errors by outsourced reviewers. Willbros was awarded damages to compensate them for increased work of its solicitors and litigation support providers. The Court ordered that the damages awarded to Willbros applied in any event, regardless of the outcome of the case. It is important to ensure that during litigation e-disclosure systems and any outsourcing used are used appropriately as the courts will not be sympathetic to errors caused by inadequate practices.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

In association with
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.