UK: Construction, Property & Real Estate (Case Law Review - January 2006)

Last Updated: 20 January 2006

By Anthony Lavers, Director of Research and Professional Development

ADJUDICATION

Construction Law Vol. 16, Issue 9, November 2005 contains the following articles:

How far can you go?
By Paul Newman, Hugh James (on challenges to adjudication decisions and Carillion Construction v Devonport Royal Dockyard (Stephen Furst QC and Louise Randall))

Wrong to resign
By Fraser McMillan, Pinsent Masons (on Bennett v FMK Construction) (Justin Mort and Jessica Stephens).

See Bennett v FMK Construction under Keating Chambers Reported Cases on the resignation of an adjudicator.

See Wimbledon Construction v Vago under Keating Chambers Reported Cases on evidence of a party’s financial position in resisting enforcement.

See Carillion Construction v Devonport Royal Dockyard under Keating Chambers Reported Cases on the adjudicator’s power to award interest.

ARBITRATION AND DISPUTE RESOLUTION

Arbitration – the Journal of the Chartered Institute of Arbitrators Vol. 71, No 4 November 2005 contains the following articles:

Current trends in dispute resolution
by Robert Gaitskell QC, Keating Chambers.

To tech or not to tech in selecting a construction third party neutral
by John Madden, Madden Mediation, Dublin.

Mandatory ADR and access for justice
by Arthur Marriott, Le Boeuf Lamb Greene and Macrae, London.

Alternative Dispute Resolution developments within the European Union
by Ann Brady, Rougemont Chambers, Exeter.

Starting out as an arbitrator: how to get appointments and what to do when you receive them
by Stephen Jagusch, Allen & Overy, London

Interest in the event of under-certification: some further thoughts
by Thomas Thompson.

Japan’s new Arbitration Law
by Haig Oghigian, Jones Day, Tokyo.

See Amec Civil Engineering v Secretary of State under Keating Chambers Reported Cases on the meaning and existence of a ‘dispute’ in arbitration.

International Arbitration Law Review Vol. 8 Issue 5 October 2005 contains the following articles:

The arbitration agreement in light of case law of the UNCITRAL Model Law (Articles 7 and 8)
by Norbert Horn, University of Cologne.

Jurisdiction of the arbitral tribunal: current jurisprudence and problem areas under the UNCITRAL Model Law
by Prof. Alan Uzelac.

Interpretation of the Written Form Requirement Article 7(2) UNCITRAL Model Law
by Christopher Liebscher, Wolf Thiess, Vienna.

Setting Aside proceedings in Model Law jurisdictions- selected procedural and substantive questions from the case law
by Stefan Kröll, Cologne.

Appointment of arbitrators according to the UNCITRAL Model Law on International Commercial Arbitration
by Tatsuya Nakamura, Kokushikan University, Tokyo.

The making of the award: comments on case law developments under the UNCITRAL Model Law
by Christopher Drahozal, University of Kansas.

Case Law on the recognition and enforcement of arbitral awards under the UNCITRAL Model Law on International Commercial Arbitration
by Pilar Perales Viscasillas, University of Carlos III, Madrid.

Arbitration Law Monthly Vol.5 No.10 November 2005 contains the following articles:

Procedure
on Thyssen Canada v Mariana Maritime
(objection to serious irregularity and waiver)

Parties to the arbitration
on SEB Trygg Holding v Manches
(on proceedings commenced in the wrong name)

Law applicable to the substantive contract
on King v Brandywine Reinsurance
(on the significance of the arbitration clause)

Enforcement of New York Convention awards
by Louis Flannery, Howes Percival on IPCQ v Nigerian National Petroleum Corp
(on court powers to order security for costs and claims)

Stay of arbitration proceedings
on Carvill America Incorporated v Camperdown UK
(on third party rights)

Anti-suit injunctions
on C v RHL (on mediation as an alternative to injunctive relief)

Asian Dispute Review October 2005 contains the following articles:

The Bangladesh Arbitration Act 2001
By Munir Maniruzzaman, University of Portsmouth

Procedural problems in arbitration
By Mr. Justice Reyes, High Court of Hong Kong

A challenge to the appointment of an arbitrator under the UNCITRAL Rules
By Craig Shepherd and Anita Chiu, Herbert Smith, Hong Kong.

The time limit for making an arbitration award
By Dato Kevin Woo, Chartered Arbitrator, Malaysia

Proposed changes to the ICSID Arbitration Rules
By Mark Kantor, Georgetown University

What an Asian company needs to know about enforcing arbitral awards in the United States
By Jung-Hye Yeum, Duane Morlis, New York

The internationalisation of commercial mediation
By Elizabeth Burch, London

Challenge of errors in arbitral awards
By Ellis Baker and Anthony Lavers, White & Case, London

How final is final? Calderbank offers in arbitration and the re-opening of final awards
by Tim Haynes, Pacific Chambers, Hong Kong

Enforcing an ADR agreement
By Keith Mak, Baker & McKenzie, Hong Kong

Challenge to award
Lesotho Highlands Development Authority v Impregilo [2005] 101 Con LR 1 HL
Already reported in BLR, this is a major decision of the House of Lords on judicial challenges to arbitral awards, reversing an unanimous Court of Appeal. Lord Steyn, giving the principal speech, referred to the far-reaching changes made by the Arbitration Act 1996 to the prospects of challenge and to the powers of arbitrators. In this case, being an ICC arbitration, challenge on a point of law was excluded. The allegation was that the arbitrators had exceeded their powers regarding the currency of the award and the award of interest. The majority (Lord Phillips dissenting) held that there was no excess of jurisdiction by the arbitrators:

"The erroneous exercise of an available power cannot by itself amount to an excess of power. A mere error of law will not amount to an excess of power under section 68(2)(b)."

Refusal of mediation
Wethered Estate Ltd v Davis [2005] Law Society Gazette 13 October Ch. Div.

Defendants parked every day on claimants’ property. Claimants refused defendants’ offer to mediate until first the vehicle was removed and second the issues in dispute were clarified. Mediation proved unsuccessful and the claimants won at trial. The court rejected the defendants’ submission that the claimants were not entitled to their costs because of refusal of mediation. It was certainly reasonable to refuse mediation until the vehicle was removed. While often it would not be reasonable to wait until litigation proceeded before agreeing to mediation, here the defendants had failed to show that the claimants were unreasonable in wanting the issues defined.

CONSTRUCTION AND ENGINEERING CONTRACT LAW

Construction Law Vol. 16 Issue 9 November 2005 contains the following articles:

Simple words could save fortunes
by Michael Phipps, Thurston Consultants
(on the JCT Minor Works Building Contract)

New JCT 2005 Framework Agreements
by Neil Jones, Pinsent Masons.

What is a statutory undertaker?
by Lindy Patterson, Dundas & Wilson.

Battle of the forms
by Sam Nichols, Taylor Wessing
(on the BPF and CIC Consultancy Agreements)

See Henry Boot Construction v Alstom Combined Cycles under Keating Chambers Reported Cases on certificates as a condition precedent to payment.

See Gerling General Insurance Co v Canary Wharf Group under Keating Chambers Reported Cases on the scope of a project insurance policy as applied to loss/damage to the site.

See Shawton Engineering Ltd v DGP International Ltd on termination of a contract for failure to complete within a reasonable time.

GENERAL AND PROFESSIONAL NEGLIGENCE

Causation
Causation by Lord Hoffman, Law Quarterly Review Vol. 121 October 2005 p.592
This is the text of the 2005 Blackstone Lecture by Lord Hoffman, dealing extensively with his speech in the House of Lords in South Australia Asset Management Corp v York Montague. Lord Hoffman accepts criticisms made by

Professor Jane Stapleton of his language in the famous passages relating to causation, blurring the distinction between the scope of the valuer’s duty of care and the extent of the consequences for which the valuer is liable. Lord Hoffman summarises what he sees as the current position on causation, including Fairchild v Glenhaven Funeral Services "an exceptional case" and Chester v Afshar "Another recent deviation".

Construction Law Vol. 16 Issue 9 November 2005 contains the following articles:

CDM Regulations – will they get it right this time?
by Michael Conroy Harris, Laytons

The sky’s the limit!
by Matthew Hardwick, Shadbolt & Co. (on developments in nuisance).

See Fuji Seal Europe Ltd v Catalytic Combustion Corporation under Keating Chambers Reported Cases on collateral warranties and the duty of care to advise.

Duty of care restricted – Australia
Woolcock Street Investments v CDG Pty Ltd [2005] 101 Con LR 113 High Court of Australia
Already reported in BLR, this is a landmark decision in the development of the tort of negligence in Australia, which may influence other common law jurisdictions. The majority of the (seven man) High Court of Australia distinguished Bryan v Maloney, the 1995 decision in which it had not followed Murphy v Brentwood. Some of the judges seem virtually to have restricted the principle that a builder of a dwelling house owes a duty to subsequent purchasers to the specific circumstances of Bryan v Maloney itself.

Dual vicarious liability
Viasystems (Tyneside) Ltd v Thermal Transfer (Northern)
[2005] BLM Vol. 22 No 10, [2005] 42 EG 234 CA.
Contrary to a long-standing assumption in some quarters, English law can recognise the possibility of two employers both being vicariously liable for the torts of a single employee. In this case, an employer hired labour to another, but it was held that both retained a sufficient degree of control over the actions of the employee for vicarious liability to be invoked when his negligence caused flood damage.

Escape of fire
LMS International v Styrene Packaging and Insulation [2005] BLM Vol. 22 No 10, p.5 TCC
This is an application of Rylands v Fletcher in the TCC to a case where fire escaped to damage adjoining premises. It is especially significant that it discusses Lord Hoffman’s speech in Transco v Stockport MBC and concludes that Rylands v Fletcher remains decisive in such cases.

PRACTICE AND PROCEDURE

Non-monetary payment
Baker & Davies plc v Leslie Wilks Associates
[2005] 101 Con LR 82 and [2005] BLR 425 TCC
This case concerns s.1 of the Civil Liability (Contribution) Act. The word ‘payment’ under the Act was held to be capable of including a payment in kind. The claimant contractor could be entitled to claim contribution from its structural engineer even though the contractor had settled the employer’s claim against it by doing remedial work at its own expense, rather than paying over a sum of money to the employer.

See McGlinn v Waltham Contractors under Keating Chambers Reported Cases on the recoverability of costs of a claim discontinued under the pre-action protocol.

See Yorkshire Water Services v Taylor Woodrow Construction under Keating Chambers Reported Cases on attempts to appeal to the CA on errors of fact and law.

KEATING CHAMBERS REPORTED CASES

McGlinn v Waltham Contractors Ltd [2005] BLR 432 TCC
Here a defendant sought costs in respect of a claim discontinued through the pre-action protocol process. Pre-action protocol costs were held to be, in principle, ‘incidental to’ subsequent proceedings for s.51 Supreme Court Act. However, unless the circumstances were exceptional and involved unreasonable conduct, such costs would not be recoverable where the issues were subsequently dropped.
Lucy Garrett

Yorkshire Water Services Ltd v Taylor Woodrow Construction Northern Ltd [2005] BLR 395 CA
Following earlier reported litigation on the significance of contractual performance tests on an allegedly defective sewage treatment works, the appellants sought to argue that the first instance judge’s decision was substantially wrong on fact and law. The Court of Appeal held that the appeal was simply not viable unless the claimant/appellant was allowed to re-open large parts of the judge’s findings.
Timothy Elliott QC
Gideon Scott-Holland

Amec Civil Engineering Ltd v Secretary of State for Transport [2005] 101 Con LR 26 CA
Already reported in BLR, this decision has attracted considerable interest because of the ‘seven propositions’ by which the dispute/no dispute issue is to be decided, adduced at first instance by Jackson J and approved by the CA. This is known as the ‘Thelwall Viaduct’ case. The contractor had argued that there was no dispute or difference capable of reference to arbitration. However, the CA’s view was that ICE (5th edition) Clause 66 should not be construed legalistically, so as to preclude timely commencement of arbitration proceedings. The CA held the judge’s analysis to have been correct, given the claimant’s resistance to the defective work allegations.
Vivian Ramsey QQ
John Marrin QC
Simon Hughes
Sarah Hannaford

Henry Boot Construction Ltd v Alstom Combined Cycles Ltd (No. 2) [2005] 101 Con LR 52 CA
This is a case considering the time at which the civil engineering main contractor’s right to payment arose in a power station project in North Wales and whether (under ICE 6th) the issue of a certificate is a condition precedent to payment. The right to claim interest on a sum which should have been certified becomes statute-barred six years after accrual of the right.
Stephen Furst QC

Wimbledon Construction Co 2000 Ltd v Vago [2005] 101 Con LR 99 TCC
Already reported in BLR, this is a case on adjudication enforcement. Even if evidence of a successful party’s financial position indicated that it was probable that it would be unable to pay sums awarded at a substantive trial, that would not normally be sufficient to stay the execution of a summary judgment enforcing an adjudicator’s decision. Such evidence might, in principle, constitute special circumstances justifying a stay, but the purpose of adjudication, namely summary enforcement of an interim result, would normally prevail.
Simon Hughes

Bennett v FMK Construction Ltd [2005] 101 Con LR 92 TCC

This TCC case decided that the resignation of an adjudicator in the belief that proceedings were flawed could be cured by a subsequent re-referral to the same adjudicator within the time limits for commencement of proceedings.
Justin Mort
Jessica Stephens

Gerling General Insurance Co v Canary Wharf Group [2005] EWHC 2234 LAWTEL Commercial Court
This case covered the scope of a project insurance policy on buildings in Canary Wharf damaged by the collapse of a tower crane and the interpretation of the word ‘imminent’ as applied to loss or damage to the construction site. It was argued that costs incurred in the project had been incurred to prevent or minimise delay caused by ‘imminent’ damage.
Marcus Taverner QC
Vivian Ramsey QC
Jonathan Lee
Jessica Stephens

Fuji Seal Europe Ltd v Catalytic Combustion Corp [2005] Vol. 22 No 10 p.10 TCC
The court refused to find a collateral warranty in connection with a contract for the supply of a chemical abatement plant to control factory emissions. The court’s decision was based on the fact that the parties were experienced and well-advised commercial companies and it was inappropriate for the court to supplement the contractual arrangements they had chosen to make. However, there was a breach of duty of care in the advice given.
Richard Harding

Carillion Construction v Devonport Royal Dockyard [2005] Times Law Reports 24 Nov CA.
This is part of extensive litigation arising from the dockyard project; being an appeal on the adjudicator’s powers to award interest. The CA dismissed the client’s appeal against the TCC decision. There is no free-standing power to award interest under cl.20(c) of the Scheme. However, in the circumstances, the client had not disputed the adjudicator’s power to award interest on moneys outstanding. The parties had therefore agreed that interest should come within the scope of the adjudication, conferring on him a jurisdiction he would not otherwise have had.
Stephen Furst QC
Louise Randall

Shawton Engineering Ltd v DGP International Ltd [2005] All ER(D) 241 CA

In a design sub-sub-contract relating to a process plant at Sellafield for handling nuclear waste, the issue arose as to the circumstances in which a contracting party could lawfully terminate a contract for delay in performance where the obligation was to complete within a reasonable time.
David Thomas QC
Adam Constable

The articles and papers published by Keating Chambers are for the purpose of raising general awareness of issues and stimulating discussion. The contents must not be relied upon or applied in any given situation. There is no substitute for taking appropriate professional advice.

This material is prepared for Chambers by our Director of Research and Professional Development, Professor Anthony Lavers (LL.B., M.Phil, Ph.D. MCI.Arb, MRICS Barrister), Visiting Professor of Law, Oxford Brookes University.

www.keatingchambers.com

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