Conor Engineering Ltd v Les Constructions Industrielles

The sub-contracts for the installation of boilers and associated pipework where the main contract was the construction of a plant for the incineration of waste and the generation of electricity were not "construction operations" within the meaning of section 105(2)(c)(i)
 
CONOR ENGINEERING LTD v LES CONSTRUCTIONS INDUSTRIELLES

DE LA MẺDITERRRANẺE (CNIM) SA
Technology and Construction Court
Mr Recorder David Blunt QC
2 April 2004
 
The contractor challenged the enforcement of the adjudicator's decision in the sub-contractor's favour. The contractor contended that the adjudication provisions of the Construction Act 1996 did not apply to the sub-contracts for the installation of boilers and associated pipework where the main contract was the construction of a plant for the incineration of waste and the generation of electricity. The challenge was that the installation work was the "construction operation" of the assembly or installation of plant or machinery on a site where the primary activity was power generation within the meaning of section 105(2)(c)(i). This section provides that the assembly or installation of plant or machinery on a site where the primary activity is "power generation" is not a "construction operation" within the meaning of the Act.
 
Mr Recorder Blunt QC held that the site's primary activity was not power generation within the meaning of section 105(2)(c)(i) with the result that the Act did apply. This was on the basis that, as a matter of fact, the prime purpose of the plant and the principal physical activity at the site were the incineration of waste. What was the "primary activity" of a site is a question of fact and whilst the primary purpose of a site would always be a relevant consideration in deciding what was the "primary activity", it was possible to imagine situations that could give rise to an argument that an activity embarked upon for only secondary reasons was in fact (for example by reason of its scale or output etc) the "primary activity".
 
The plant was constructed as part of an integrated waste management strategy and the plant was developed principally as a means of finding alternatives to landfill sites for the purpose of disposing of waste. The sheer volume of waste incinerated as contrasted with the modest output of electricity that was generated was impressive. Whilst it might have been appropriate to refer to the plant as an "Energy Recovery Incinerator", this did not mean that its principal purpose was power generation.
 
Advice Note
This decision provides a useful guide as to the application of section 105(2)(c)(i) of the Construction Act. The "primary activity" of a site is a factual question and its primary purpose of a site is only a relevant consideration.
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