Beck Interiors Ltd V UK Flooring Contractors Ltd

The decision awarding the contractor specified sums for its increased costs of completing the sub-contract works and for liquidated damages should be severed so as only to enforce the award in respect of the increased costs of completion
 
 
Beck Interiors Ltd V UK Flooring Contractors Ltd
Technology and Construction Court
Akenhead J
4 July 2012
 
The two claims advanced by the contractor in the adjudication for the increased costs of completion and for liquidated damages were both based on the sub-contractor’s liability for late completion of its works. There was clearly a dispute in relation to the claim for the increased costs of completion by the time the contractor’s notice of adjudication was served.
 
As to no dispute having arisen in relation to the claim for liquidated damages, the five day period over the Easter holiday weekend between the contractor’s letter intimating the liquidated damages claim (sent just before the start of that weekend) and the despatch of the notice of adjudication (on the Tuesday after that weekend) was sufficiently long to have given rise to an inference that that claim was disputed. However (i) There had been no real hint before the letter that there was to be a claim for liquidated damages; and (ii) The contractor should by inference be taken to have known that the sub-contractor would have no opportunity in working hours before the following Tuesday to consider it or have any realistic chance of producing any response. In any event the claim for liquidated damages intimated in the letter did not relate sufficiently closely to what was put forward in the notice of adjudication because even if it could be said inferentially that claim in the letter was disputed after the five day period (by the following Tuesday), the claim as set out in the notice of adjudication was materially different from the claim in the letter.
 
As to severing the decision, in reality there was only one crystallised dispute referable to adjudication, namely that in relation to the contractor’s claim (as slightly adjusted) for the increased costs of completing the sub-contract works. It was clear from the body of the notice of adjudication that the claim advanced in the adjudication was made up essentially of two parts, namely for the direct increased costs of completion and for liquidated damages. These two claims were presented in effect as two separate arguments with separable evidence supporting them, albeit that the losses flowed from the failure to complete on time or indeed at all. There was no difficulty in identifying clearly the two specified sums awarded in relation to each of the two claims.
 
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