NORTH MIDLAND CONSTRUCTION PLC V AE & E LENTJES UK LTD

The enabling and civil engineering works to be carried out under the sub-contracts at the power stations were construction operations within section 105(1) of the Construction Act and were not excluded as being the assembly or installation of plant or machinery under s105(2)(c)(i)
 
 

Technology and Construction Court
Ramsey J
18 June 2009

 
The main contract for the provision of flue gas desulphurisation units to two coal fired power stations required enabling works and civil works before the units and other associated parts of the system could be installed or completed. The issue for determination was whether the Construction Act applied to these works on the basis that they were "construction operations" within the meaning in section 105(1). It was argued that whilst the works could be regarded as such operations, they could also be regarded as coming within the specific exclusion of such works from what would otherwise be such operations in section 105(2)(c)(i). This exclusion is where the primary site activity is, inter alia, power generation, the following operations are not construction operations, namely the assembly, installation or demolition of plant or machinery or the erection or demolition of steelwork for the purposes of supporting or providing access to plant or machinery.
 
Ramsey J in considering this issue noted that Judge Thornton in Palmers v ABB Power Construction (1999) construed the scope of section 105(2) narrowly so that the following operations would not come within the exclusion, namely the construction of buildings and concrete foundations for use with the plant and any painting of the internal or external surfaces to the plant. On the other hand Judge LLoyd in ABB Power Construction v Norwest Holst Engineering (2000) construed the scope of section 105(2) broadly so that all the construction operations necessary to achieve the aims and purposes of the owner or of the principal contractors would be exempt and a sub-contractor providing paint systems or cathodic protection systems necessary to protect plant against corrosion or erosion would be exempt. Ramsey J considered that the narrower approach to the construction of section 105(2) adopted by Judge Thornton would generally be appropriate. Ramsey J applied this approach. The enabling and civil engineering works could not on a narrow construction of section 105(2)(c)(i) be described as "assembly, installation or demolition of plant or machinery". He declined to carry out a minute analysis to find an item which arguably was a construction operation or was within the exclusion so as to defeat the purpose of giving or excluding the rights of the Act.
 
Download