{"id":274259,"date":"2022-09-23T10:00:18","date_gmt":"2022-09-23T04:30:18","guid":{"rendered":"https:\/\/www.scconline.com\/blog\/?p=274259"},"modified":"2022-09-23T10:00:18","modified_gmt":"2022-09-23T04:30:18","slug":"technology-and-construction-court-england-and-wales-high-court-of-justice-dispute-resolution-procedure-unenforceable-unclear-terms-construction-contract-and-agreements-legal-updates-legal-researc","status":"publish","type":"post","link":"https:\/\/www.scconline.com\/blog\/post\/2022\/09\/23\/technology-and-construction-court-england-and-wales-high-court-of-justice-dispute-resolution-procedure-unenforceable-unclear-terms-construction-contract-and-agreements-legal-updates-legal-researc\/","title":{"rendered":"High Court of Justice- TCC | “Unusual and surprising” Dispute Resolution Procedure between Children’s Ark and Kajima Construction declared unenforceable due to unclarity"},"content":{"rendered":"
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The High Court of Justice (Technology and Construction Court):<\/b> While deciding the instant matter revolving around the Dispute Resolution Procedure (DRP)<\/b> in a construction contract between the parties; the Bench of Justice Joanna Smith, DBE, termed the DRP in question to be “unusual and surprising” and observed that the Procedure did not include a sufficiently defined mutual obligation upon the parties in respect to referral of their dispute to the Liaison Committee and the ensuing process, thus, creating an obvious difficulty in determining whether either Children’s Ark Partnership or Kajima Construction had acted in breach.<\/p>\n

The Facts of the Case:<\/span><\/b> In June 2004, Children’s Ark Partnership (CAP)<\/b> entered into an agreement with Sussex University Hospital NHS Trust (Trust)<\/b> to design, build and finance the redevelopment of the Royal Alexandra Hospital for Sick Children. Subsequently, CAP and Kajima Construction<\/b> entered into a “construction contract”<\/b> whereby which Kajima was appointed to design, construct and commission the afore-stated hospital.<\/p>\n

The Trust was entitled to make deductions from CAP under the Project Agreement in respect of service failures arising from defects and Kajima Construction would be liable to reimburse those Deductions under the terms of the Construction Contract. Kajima Construction carried out the work between 2004 and 2007.<\/p>\n

In September 2018, concerns around cladding and fire-stopping issues were notified to Kajima Construction, which agreed to carry out remedial works at its own cost on a without prejudice basis. The project commenced in December 2018 but had to be sequenced over a long period of time in order to minimize disruption at the Hospital. The parties agreed to a Standstill Agreement<\/b> dated 29-03-2019, which was subsequently varied on four occasions to protect their mutual positions. The provisions of the standstill agreement made clear that it did not preclude steps being taken under the DRP in the construction contract.<\/p>\n

On 30-11-2021, Kajima Construction informed CAP that since its remedial works had now been largely completed, thus it has reasonably met all possible liabilities that could arise from the design and construction of the Hospital and that therefore, it no longer wished to extend the standstill period. However, the Trust informed CAP that the finished work contained “certain design and\/or construction defects”.<\/p>\n

Trust wanted CAP to remedy the defects but CAP asserted that the defects arose from the failure on the part of Kajima Construction to comply with its obligations under the Construction Contract and\/or breach of its tortious duty. Therefore, CAP sought “damages” and\/or “sums due” pursuant to the terms of the Construction Contract or in tort.<\/p>\n

Relevant Clauses of the Construction Contract<\/span><\/p>\n