UK: Case Law Review - Construction, Property & Real Estate (October 2008)

Last Updated: 21 October 2008
Article by Keating Chambers


Alleged bias in nomination

Makers UK Ltd v Camden London Borough Council [2008] CILL 2618 TCC

Camden sought to challenge the adjudicator's jurisdiction on the ground that he had been improperly appointed by RIBA. Makers had contacted RIBA to request the appointment of the adjudicator actually appointed. The court rejected the existence of an implied term that neither party should seek to influence the appointment, since the nominating body was under no obligation to accede to the representations. There was no appearance of bias in appointing an adjudicator previously requested by one of the parties.

Construction Law Vol. 19 Issue 7 August/September 2008
contains the following articles:

Deduction of LADs under withholding notices
by Anna Rabin, Jeffrey Green Russell
(on Reinwood v L Brown) (John Marrin QC and Stephen Furst QC)

Adjudication must comply with justice
by Sean Brannigan, 4 Pump Court

Extension of time for service of response

CJP Builders Ltd v William Verry Ltd [2008] CILL 2609 TCC
Contractors Verry engaged subcontractors CJP on a DOM/2 sub-contract. CJP referred a withholding notice dispute to adjudication. Verry requested an extension of time beyond the 7 days in the DOM conditions and was over 5 hours beyond the extended deadline in serving its response. The adjudicator held that he could not consider the response and found in favour of CJP. In an action for enforcement, the court held that the adjudicator had the power to set the timetable and that his failure to consider the response was a breach of natural justice.

Public law perspective

Public law and statutory adjudication
by Julian Bailey, CMS Cameron McKenna
Construction Law Journal 2008 Vol. 24 No. 6 461
The article is based on the first prize-winning essay in the SCL Hudson Prize competition 2007. It considers whether public law is applicable to HGCR Act adjudication, how the courts have considered public law issues in relation to statutory adjudication and how this affects enforceability of adjudicators' decisions. The author's conclusion is that HGCR Act adjudications are amenable to challenge on public law grounds. If this is correct, the grounds for challenge would be broader than recognised hitherto. The two main cases analysed are London and Amsterdam Properties v Waterman Partnership and Carillion v Devonport Royal Dockyard. (Stephen Furst QC and Louise Randall)


Construction Act Review
by Peter Sheridan and Dominic Helps
Shadholt & Co
Construction Law Journal 2008 Vol. 24 No. 6 p.506
The regular Con LJ column considers the following topics: the use of statutory demand/winding-up procedure as an alternative to adjudication of a debt dispute, or as a means of enforcing an adjudicator's decision, stay of execution and particular considerations in relation to liquidation, receivership and administration.

See VGC Construction v Jackson Civil Engineering under Keating Chambers Reported Cases on attempt to resist enforcement of adjudicator's decision on grounds that claim was nebulous and ill-defined or had been withdrawn.


Journal of International Arbitration Vol. 25 No. 4 August 2008
contains the following articles:

Challenges to international arbitration awards: The French approach
by Robert Kovacs

Pathological arbitration clauses and Indian courts
by Alok Jain

The private dimension of the international customary nature of commercial arbitration
by Illias Bantekas, Brunel University

Arbitration and crime
by Dragor Hibert and Vladimir Pavic, University of Belgrade

Integrating mediation into arbitration: why it works in China?
by Gabrielle Kaufmann-Kohler and Fan Kun, University of Geneva

The CMS case: a lesson for the future?
by Jose Rossell, Hughes Hubbard & Reed
(on the ICSID arbitration CMS Gas Transmission Co. v Argentine Republic)

Arbitration Law Monthly Vol. 8 No. 7 August 2008
contains the following articles:

Enforcement of arbitration awards
on Gater Assets Ltd v Nak Nafrogaz Ukrainiy
(refusal of enforcement on public policy grounds)

on Sumukan v Commonwealth Secretariat (No. 2) (validity of appointment of arbitrators)

Appeals from arbitration awards
on Gulf Import & Export Co. v Bunge SA
(grounds of appeal under ss67-69).

Enforcement of foreign arbitration awards
on IPCO (Nigeria) Ltd v Nigerian National Petroleum Corporation (No. 2)

See Owen Pell v Bindi (London) under Keating Chambers Reported Cases on natural justice in an expert determination.

Arbitration Law Monthly Vol. 8 No. 9 October 2008
contains the following articles:

on Czech Republic v European Media Ventures SA
(Bilateral investment treaties).

Conflict of laws
on Musawi v RF International
(law applicable to disputes and to arbitration clauses).

Validity of the arbitration clause
on Heifer International Inc. v Christiansen
(formation and formalities).
Note: effect of Unfair Terms in Consumer Contracts Regulations 1999 on arbitration clauses.

Anti-suit injunctions
on Verity Shipping v Chartworld Shipping Corporation The Skier Star
(criteria for grant).

Confidentiality in the arbitration
on Emmott v Michael Wilson & Partners Ltd
(the scope of the confidentiality obligation).

Arbitration: the international journal of arbitration, mediation and dispute management (CIArb) Vol. 74 No. 3 August 2008
contains the following articles:

The new world of unilateral offers to arbitrate: investment arbitration and EC Merger Control
by Gordon Blanke, SJ Berwin and Borzu Sabahi, Fulbright & Jaworski

Obtaining discovery in international arbitral proceedings: the European v American mentality
by Oliver Bolthausen, Bridgehouse Law Rueckel & Bolthausen, Atlanta and Peter Acker

Settling international commercial disputes in Ukraine; participants, legal framework, arbitration: practice and enforcement of awards
by Vasil Marmazov, Yuris Law Offices and Pavlo Pushkar

The Jewish contribution to the English Legal System
by Sir Bernard Rix

Stop-or go? Injunctions and arbitration
by Graham Dunning QC, Essex Court Chambers

Practice Guidelines on Mediation
(approved January 2008)
Guidance on Confidentiality in Mediation.

International Arbitration Law Review 2008 Vol. 11 Issue 4
contains the following articles:

With the globalisation of arbitral disputes, is it time for a new convention?
by Mark Mangan, Freshfields Bruckhaus Deringer, London

Disputes in the fast lane: fast-track arbitration in merger and acquisition disputes
by Alice Broichmann, P&P Pöliath, Munich

Arbitration and private international law
by Giuditta Cordero Moss

No costs for invalid arbitration

Crest Nicholson (Eastern) Ltd v Western [2008] CILL 2599; [2008] BLM Vol. 25 No. 8; [2008] BLR 426 [2008] TCLR 9 TCC

In a dispute over the NHBC Buildmark scheme, the court held that an arbitrator who had heard submissions from both parties had no jurisdiction, because there was no arbitration clause in the Buildmark policy. This gave rise to the question as to whether the court could award costs in respect of the invalid arbitration. It was held that there was no clear statutory power to do so, and so the court could not make such an award.

ICC's International Court of Arbitration Bulletin 2008 Vol. 19 No. 1
contains the following information on ICC arbitrations in 2007.

Geographical origins of parties shows:

Latin America and Caribbean

22.1% (356)

North Africa
Rest of Africa

3.5% (57)

Central & West Asia
(including Middle East)
South & South East Asia

17.9% (288)


North & West Europe
Central & East Europe

55.3% (891)

Languages of award top 5

English          (70%)

Awards in 2007 349 approved by Court

Modifications in 317 (including 35 resubmission required)

32 approved without comment

Arbitration International 2008 Vol. 24 No. 3
contains the following articles:

Treaty and contract in investment arbitration
by James Crawford, Matrix Chambers

Towards a new paradigm in international arbitration: the 'Town Elder' model
by David Rivkin, Debevoise & Plimpton

The set-off paradox in international arbitration
by Alexis Mourre

New Zealand's arbitration law receives a tune-up
by Amokura Kawkaru, University of Auckland

Investment arbitration in Brazil
by Jean Kalicki and Suzana Medeiros, Arnold & Porter, Washington DC

The Most Favoured Nation clause in BITs as a basis for jurisdiction in foreign investor-host state arbitration
by Mara Valenti, University degli Studi di Milano

Agora: thoughts on Fiona Trust

Jurisdiction: the validity and width of arbitration agreements and the House of Lords' decision in Premium Nafta Products v Fili Shipping
by Steven Gee QC

The doctrine of separability and consent to arbitrate
by Mark McNeill, Shearman & Sterling, Paris and Ben Juratowitch, Freshfields Bruckhaus Deringer, Paris

Separability and construing arbitration clauses: the House of Lords' decision in Premium Nafta and Fiona Trust
by Adam Samuel

Fiona Trust: 10 years on, the Fresh Start entrenched
by Christopher Style QC and Matthew Knowles, Linklaters, London

Global Arbitration Review 2008 Vol. 3 Issue
contains the following articles (Russia Special Issue):
Russians think old duopoly is eroding
by Sarah Dookhun (on Russia's MKAS and Sweden's SCC)

Who's who of arbitration in Russia

Perspective on MKSAS
(from Western arbitrators with experience of the Russian Centre)

Particularities of Russia-led international arbitration
by Richard Chlup, Mannheimer Swartling, Moscow

The effect of parallel litigation under Russian law
by Vladimir Khvalei, Baker & McKenzie, Moscow

Public policy, arbitrability and enforcement
by Eugeny Raschevsky, Yukov, Khrenov & Partners, Moscow

Problems with optional arbitration clauses
by Alexey Barnashov, White & Case, Moscow

Russian and the ECT: the unplumbed depths of provisional application
by Sophie Nappert, 3 Verulam Buildings

A rare breed of relief
by Alex Bevan, Shearman & Sterling, London

A critique of Desert Line
by Meriam Al Rashid, George Washington University

Construction Law Vol. 19 Issue 7 August/September 2008
contains the following articles:

The dangers of being positive
by Paul Newman, 3 Paper Buildings
(on settlements and mediation)

Mediation goes on tour
by John Sheils, Shadbolt & Co
(on the EU Mediation Directive)

Arbitration Law Monthly Vol. 8 No. 8 September 2008
contains the following articles:

(on the European Union Directive 2008/52/EC)

Anti-arbitration injunctions
on Republic of Kazakhstan v Istil Group Inc. (No. 3)
(jurisdiction and discretion of the English courts)

on (El Nasharty v J Sainsbury Plc (No. 2)
(validity of the arbitration clause)

The law applicable to arbitration proceedings
on C v D
(significance of the seat)

Global Arbitration Review 2008 Vol. 3 Issue 3
contains the following articles:

A closer look at the proposed 'New New York Convention'

Australian court opts for archaic, rather than Arkansas
by Tim Griffiths, HWL Ebsworth, Sydney

Insolvency and arbitration
by Marina Mendes Costa

Taking appropriate intervening measures

Lessons from the Indian Arbitration Act
by Joseph Tirado and Daniel Perera, Norton Rose

Statistics from arbitral institutions for 2007


Risks in Tunnelling

Tunnel vision
by Gordon Anderson and Cecily Davis, DLA Piper
Construction Law Journal 2008 Vol. 24 No. 6 p.494
The authors consider risk management in tunnelling, particularly in past major projects like the Heathrow Express, and Channel Tunnel Rail Link and future ones such as Crossrail and Thames Tideway. They examine inherent risks in tunnelling, such as support, water leakage, contamination and unforeseen ground conditions and look at risk sharing. There is some comparison of relevant provisions in ICE 7th, IChemE, NEC and FIDIC contracts.

Construction Newsletter August 2008
contains the following articles:

PR v profitability? Industry's reaction to sustainability in the current economic climate
by Katie Graham, Stephenson Harwood

If we don't cover everything
(on letters of intent and adjudication)
by Paul Newman, 3 Paper Buildings

The International Construction Law Review Vol. 25 Part 4 October 2008
contains the following articles:

Joint and several liability in construction contract law
by Monika Chao-Duivis, Delft University of Technology

The avoidance of disputes by contractors in design and construct contracts
by Donald Charrett, Victoria

On-demand performance bonds: is fraud the only ground for restraining unfair calls?
by John Lurie, Dechert

Some thoughts on NEC3
by His Honour Humphrey LLoyd QC, Atkin Chambers

Allocation of construction risks on a mega-BOT: the Taiwan High Speed Rail project
by Paul Tobin, Clayton Utz

The rise and rise of two-stage tendering
by Cecily Davis and Peter Dornan, DLA Piper, London

The right law for construction? Choice of law and European reform: update
by Philip Britton, King's College, London

Construction Law Vol. 19 Issue 7 August/September 2008
contains the following articles:

No regrets over demise of 22D insurance
by Michael Phipps, Thurston Consultants
(on JCT 2005)

Compensation for collusion – how to get it
by James Jamison, Lawrence Graham

Contract drafters beware insurance clauses
by Hamish Lal and Emily Busby, Dundas & Wilson

Employer's liability – a problem for insurers
by John D Wright, JD Risk Associates

See Diamond Build v Clapham Park Homes under Keating Chambers Reported Cases on the contractual effect of a letter of intent.


Minimum order provision

Port Tilbury (London) Ltd v Stora Enso Transport & Distribution [2008] BLM Vol. 25 No. No. 8 TCC
The claimant had entered into a 15 year contract with the defendant for the provision of paper handling facilities and services. The defendant was obliged to make a minimum order in the course of a year and make a payment if the order fell below the minimum. The order did fall below the minimum and the claimant invoiced for the payment, but the defendant refused to pay, arguing that the claimant's default in providing services had limited the order. The claimant obtained summary judgment before a master, but the TCC held that the defendants had a reasonable prospect of success in arguing for a set-off and so summary judgment should not be allowed.

Contract administration disputes

The value is whatever I say it is: determinations by the Principal under construction contracts by Trevor Thomas, Clayton Utz, Melbourne Construction Law Journal 2008 Vol. 24 No. 6 p.481
The article is based on a Highly Commended entry in the 2007 SCL Hudson Prize Essay competition. The author reviews principally Australian case law on the issue of whether the decisions of the contract administrator are final and binding on the parties to the contract.

He concludes that the answer depends on consideration of the contract as a whole and in its commercial context.


Personal injury in nuisance

Claimants appearing on the Register of the Corby Group Litigation v Corby Borough Council [2008] CILL 2597 and [2008] BLR 411 CA
The claimants, born with physical deformities, brought a group action pleaded in negligence and public nuisance against the Council, which had acquired and used 680 acres of heavily contaminated land from British Steel. The allegation was that exposure to toxic materials during the reclamation and decontamination programme had affected the pregnancies of the claimants' mothers. The Council applied to strike out the nuisance claim on the ground that it could only affect rights over land, but the Master and then the Court of Appeal dismissed the application, on the grounds that it was at least arguable that a personal injury claim could be brought in public nuisance.

Valuer's breach of duty

Platform Funding Ltd v Bank of Scotland plc [2008] Times Law Reports October 6th CA
The lending institution succeeded in having upheld judgment in its favour against valuers retained to value a house under construction. The plot inspected was the wrong one and the lenders argued successfully that this was breach of an unqualified obligation to inspect the particular property being valued. The Court of Appeal upheld the judge's decision, despite a dissenting judgment from the Master of the Rolls.

See Galliford Try Infrastructure v Mott MacDonald under Keating Chambers Reported Cases on alleged negligent misstatements in tort by client's engineer to design and build contractor.


Anti-suit injunction

Masri v Consolidated Contractors International Co. SAL [2008] BLR 391 CA
The claimant succeeded in getting upheld a Commercial Court judgment in his favour granting an anti-suit injunction against the defendants. The case is unusual in that the defendants were based in Lebanon and Greece and the contract in dispute concerned oil concessions in the Yemen. The CA made a number of findings on the nature of anti-suit injunctions, which are discretionary and must be exercised in accordance with international law and comity. While the English courts are normally "circumspect" (in the words of the BLR Editors) in accepting jurisdiction over matters outside the UK involving foreign parties, here they had submitted themselves already to hearings before UK courts.

Costs for failure to comply with Protocol

TJ Brent Ltd v Black & Veatch Consulting Ltd [2008] BLM Vol. 25 No. 8 TCC
A claim had been made by the employers against the claimant contractors and the contractors had commenced proceedings against the defendant engineers, who denied all liability and refused to attend meetings to discuss the matter. The employer's claim was settled by the claimant, who now sought a contribution from the defendant under the Civil Liability Contribution Act. The defendant made an application for costs against the claimant for non-compliance with the Pre-Action Protocol. The application was refused; any non-compliance was technical and the application was intended to secure a tactical advantage.

Late payments as repudiatory breach

Alan Auld Associates Ltd v Rick Pollard Associates [2008] BLR 419 TCC
Under a contract for professional services, the defendant agreed to provide advisory work on removal of radioactive waste on behalf of the claimant, to the UK Atomic Energy Authority. The claimant frequently delayed payment to the defendant. The issue for the court was whether this repeated late payment constituted repudiatory breach by the claimant, entitling the defendant to terminate the contract. The judge found that time was of the essence in the payment obligation and that the defendant had been justified in terminating the contract. The claimant's appeal was dismissed by the CA, whose members noted that the claimant's late payments had been persistent and cynical and that the defendant, while not an employee, was dependent on the payments as its only source of income in an analogous way and had made repeated complaints.

Unilateral Mistake

The 'drastic' remedy of rectification for unilateral mistake
by David McLauchlan, Victoria University of Wellington, Law Quarterly Review October 2008 Vol. 124
This is an area of law recently applied to construction and development in such cases as Chartbrook v Persimmon Homes and especially George Wimpey v VI Construction. It is a more controversial and difficult version of the doctrine of common mistake. It is seen as drastic because, if granted, it imposes on the defendant a contract which he did not, and did not intend, to make. The author contends against these received truths, arguing that in principle rectification for unilateral mistake ought not to be regarded as drastic or unusual as a means of remedying unconscionable behaviour by a contracting party, and should be seen as no more problematic than common mistake.

The Commercial Litigation Journal No. 20 July/August 2008
contains the following articles:

Shareholders remedies: a new landscape
by Jemima Fearnside and Kate Grayling, Nabarro

Unfair contract terms: reasonable limits
by Andrew Horrocks and Jonathan Isaacs, Barlow Lyde & Gilbert

Competition law: clarity begins at home
by Scott Campbell, Cohen Milstein Hausfield & Toll

Forum: swinging on a gate
by Andrew Hearn and Edward Allen, Dechert

Advertising: EU rules seek harmony and discipline
by Helen Swaffield, University of Wolverhampton

Securities: collateral damage
by Donald Stewart and Stephen Llewellyn, Faegre & Benson

Electronic disclosure: total recall – but only partial precision
by Chris Paley – Menzies, RGL


VGC Construction Ltd v Jackson Civil Engineering Ltd [2008] EWHC 2082 LAWTEL TCC
The respondent main contractors, Jackson, sought to resist enforcement of an adjudication decision in favour of the applicant sub-contractor VGC. The court, granting VGC's application, rejected Jackson's arguments that there had been a binding agreement to withdraw the claim or that it had been so nebulous and ill-defined as to be incapable of giving rise to a dispute.
Sarah Hannaford QC, Alexander Nissen QC, Samuel Townend

Diamond Build Ltd v Clapham Park Homes Ltd [2008] CILL 2601 and [2008] BLM Vol. 25 No. 8 TCC
A letter of intent for a refurbishment project was held to have given rise to a simple contract with all the necessary elements, to cover the period until a formal contract could be entered into. The claimant successfully contended that the contract was based upon the standard form referred to in the specification.
Marc Rowlands

Owen Pell Ltd v Bindi (London) Ltd [2008] CILL 2605 and [2008] BLR 436 TCC
The court granted summary judgment for the enforcement of a RICS-appointed expert determination. There was considered to be no need for the expert to follow the rules of natural justice in his procedure and there was no implied term in the agreement to submit to this effect.
Charlotte Ellis

Galliford Try Infrastructure Ltd v Mott MacDonald Ltd [2008] CILL 2612 TCC
The claimant design and build contractors claimed substantial damages from the client's consulting engineers in relation to the conversion of a building into a commercial and residential complex. It had been expected that the client's engineers would be novated to the contractors, but this had not happened. The contractors maintained that they had been misled as to the amount of work remaining to be done. However, the engineers successfully argued that the requirements for negligent misstatement were not met on the facts, due to absence of reliance and the presence of a valid disclaimer.
Stephen Furst QC

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.

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