In the recent Court of Appeal case A & V Building Solutions Ltd v J & B Hopkins, 2023 [EWCA Civ 54], the Court held that an application for payment submitted one day after the date specified in the sub-contract, actually wasn't late so as to be invalid.

The key matter before the Court in terms of payment was whether or not an application for payment which was due on a Sunday, according to a payment schedule (provided at Appendix 6 of the contract), was valid if it was served on the following Monday (i.e. a day late).

There were two Adjudications and a trial in the Technology and Construction Court (TCC) before the matter reached the Court of Appeal. Given the decision in the second Adjudication, the Court of Appeal decision was largely academic but is of interest nonetheless. The history is as follows:

  • A & V Building Solutions Ltd (AVB) was appointed by J & B Hopkins (J&B) as sub-contractor to carry out mechanical and electrical engineering works as part of the construction of a new campus for University of Brighton;
  • Under their sub-contract, AVB was entitled to payment on an interim basis. A payment schedule included at Appendix 6 of the sub-contract set out the application and valuation dates for each month. Pursuant to this, and as a condition precedent to payment; AVB was required to issue its application for payment no later than seven days prior to the relevant valuation date;
  • The date for service of AVBs payment application for March 2021 fell on a Sunday, and so AVB issued application 14 on the following Monday – a day late;
  • A dispute arose between the parties as to whether payment was due under application 14, with J&B arguing that the application itself was invalid because it was served out of time;
  • During the course of that dispute, AVB referred the matter to Adjudication; seeking a declaration that their payment application was valid. The Adjudicator decided in their favour in January 2022.
  • J&B failed to pay the sum due to AVB and whilst enforcement proceedings were pending, J&B issued a part 8 claim in the TCC for declaratory relief on the basis that application 14 was out of time. By the time the Judge made their decision (in April 2022), the Adjudicator's decision had been made, however because the claim was made before the Adjudicator's decision was provided, the Judge approached it based on the merits of the parties' positions rather from an enforcement perspective. The Judge found against AVB, stating that the application was invalid.
  • AVB appealed the decision of the TCC.

Whilst the appeal was considered on multiple grounds, the key question for the Court of Appeal was whether or not application 14 was valid. The TCC Judge had determined the application was late because the dates set out in the payment schedule were described as being condition precedent to payment in clause 9.2 of the sub-contract. If the date was missed, the application was simply invalid.

The Court of Appeal looked beyond that however, to further payment provisions in the contract. In particular clause 9.4 stated: "Interim payments shall be due at regular intervals calculated from the date when the first payment was due. The final date for payment shall be in accordance with Appendix 6". This contradicted the view that the dates in the payment schedule were rigidly fixed, as it indicated that interim payment dates were contingent on the date the first payment was due.

In addition to clause 9.4, two paragraphs which followed the payment schedule at Appendix 6 indicated an intention for the dates set out in the schedule to be flexible. Further, those paragraphs indicated that in the event the application for payment was not received seven days before the valuation date, AVB would have to wait until the next payment cycle to make another claim. The implication being that as long as the application was made seven days before the valuation date (which this application was, despite it being a day after it was due according to the payment schedule), it was valid.

The paragraphs referred to read as follows:

"In the event that Interim Payments become due beyond the dates set out in the schedule above then the Due Dates shall continue to occur at the same intervals as set out above and dates for submission of applications, valuations, Payment Notices, Pay Less Notices and Final Date for Payment shall occur at the same time from the Due Date as for every month as set out above.

For the avoidance of doubt if applications are not received from the Sub-Contractor 7 days prior to the Valuation Date then the Sub-Contractor shall not be entitled to any payment, whether or not a payment notice is served by the Sub-Contractor until the procedure set out above is repeated in relation to the next Valuation Date."

Essentially, the Court of Appeal held that whilst the dates set out in the payment schedule were to be adhered to (in accordance with clause 9.2), there was some lee-way provided by the paragraphs which followed the schedule in Appendix 6. The court held this lee-way should prevail because:

  • the paragraphs of Appendix 6 were part of specific bespoke terms agreed between the parties, as opposed to clause 9.2, which was a general provision in JBH's standard terms; and
  • the second principle of construction law is such that where a contract contains general provisions and specific provisions which potentially contradict each other, the specific provisions will be given greater weight ("principle of common sense")


Just because a contractor has submitted an application for payment outside the date allowed in the payment schedule, it doesn't automatically mean that the application is invalid. A payment schedule isn't necessarily the holy grail of payment deadlines, and must be considered in light of other payment provisions in the contract to see whether there are any contradictions or further specifications.

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.