Design and build projects proceed on the basis that the contractor bears responsibility for carrying out and completing the design. Where the employer provides a design that has been progressed to a certain level, the contract should explicitly state the extent to which the contractor can rely on that existing design.

Difficulties arise when the contract is not as clear as it might be, and the parties disagree about the scope of the contractor’s design responsibility. In interpreting the disputed contract provisions, do individual sentences carry more weight than the agreement in its entirety? Can pre-contractual submissions qualify the language of the contract?

The TCC was asked to consider issues such as these in the recent case of Workman Properties Limited v Adi Building Refurbishment Limited [2024.  The judgment also provides further guidance as to when the use of the Part 8 procedure is, and isn’t, appropriate.

What happened?

The case concerned an amended 2016 JCT design and build contract for the extension of facilities at Cotteswold Dairy in Gloucestershire.

Differences arose regarding design responsibility—who was contractually responsible for completing the design up to RIBA Stage 4?

The employer, Workman, argued that it’s contractor, Adi, had inherited responsibility for pre-contract design work and had agreed to accept full responsibility for the design. Adi contended that a specific sentence in paragraph 1.4 of the Employer’s Requirements constituted a contractual warranty given by Workman that it had completed the design to Stage 4.

An adjudicator agreed with Adi, deciding that the sentence in question did amount to a contractual warranty. Since the employer had breached such warranty, Adi would be entitled to additional time and money for completing its Works.

Workman was dissatisfied and brought Part 8 proceedings seeking declarations regarding the interpretation of the contract. Adi contended that Part 8 was not appropriate. It claimed the case involved substantial disputes of fact—including representations made during the tender process—such that the conventional Part 7 procedure would need to be followed.

What did the Court decide?

Finding in favour of Workman, the judge determined that:

• “General reference to what might have …been said at meetings,” was not enough to show a genuine factual dispute affecting the question of contractual interpretation. The declarations sought concerned legal points of interpretation; therefore, the Part 8 declaration could be utilised.
• The focus must be upon the express terms of the contract, not speculation about the parties’ intentions or representations made during pre-contractual negotiations. All relevant contract terms pointed to Adi taking full responsibility for the design, except one sentence in paragraph 1.4. That isolated provision was not sufficient to qualify all the other (clear) contractual terms and did not amount to a contractual warranty.

What can we learn from this?

The contract says what it says.

Neither isolated statements, pre-contractual negotiations, nor the parties’ subjective assumptions will qualify the express provisions of a contract. If representations made during the tender process are critical, they should be clearly incorporated in the contract—draft and review contracts carefully to ensure design responsibilities are clearly defined.

This case also confirms that Part 8 remains the correct procedure for clarifying legal questions that do not involve a substantial dispute of fact. If in doubt, consider seeking directions from the Court on the appropriate procedural route.

 

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This article contains information of general interest about current legal issues, but does not provide legal advice. It is prepared for the general information of our clients and other interested parties. This article should not be relied upon in any specific situation without appropriate legal advice. If you require legal advice on any of the issues raised in this article, please contact one of our specialist construction lawyers.

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