Aspect Contracts (Asbestos) Ltd v Higgins Construction Plc

The surveyors cause of action to recover the sum awarded by the adjudicator to the contractor on the basis that it was not in breech of any contractual or tortious duty of care arose when it provided its (allegedly) negligent report and not when it paid the sum awarded


Technology and Construction Court
Akenhead J
23rd May 2013
The contractor referred a claim against the surveyor it had engaged to adjudication based on its allegedly negligent report. The adjudicator awarded the contractor a specified sum. The adjudication took place about four years into the limitation period for bringing the claim. The surveyor chose not to commence court proceedings to recover the sum awarded until some two years after the adjudication when the contractor’s cause of action for its claim was otherwise statute barred by limitation. The surveyor claimed a negative declaration that it was not liable for any sum and repayment or restitution of the sum awarded and contended that there was an implied contractual term that its cause of action to recover the sum paid accrued when it paid the sum awarded.
Akenhead J held that the surveyor’s cause of action to recover the sum awarded to the contractor accrued when it (allegedly) breached that duty by providing its report and was (therefore) barred by limitation. The surveyor did not have any cause of action to recover that sum in restitution. Judge Davies’ decision in Jim Ennis Construction Ltd v Premier Asphalt Ltd (2009) that the cause of action accrued when the responding party paid the money in consequence of the adjudicator’s award was wrong. There was therefore no implied contractual term as was contended for by the surveyor.
The dispute referred to adjudication in the instant case was the contractor’s contested claim for damages for contractual negligence and the cause of action for that claim did not and does not disappear by reason of the adjudication process or decision and existed and is as good before as it is after the decision. The surveyor had a cause of action to recover the sum paid as from the time that it provided its report. The cause of action for the negative declaration sought by the contractor was in contract. The limitation period for a cause of action based on a simple contract is six years from the latest date when the contract was performed. The implication of the proposed term could not be said to be reasonable, equitable or necessary to make the contract work (business efficacy) and did not go without saying. Lastly there was no overriding policy reason why the proposed term should be implied.