Trustees of the Stratfield Saye Estate v AHL Construction Ltd

The contract was evidenced in writing within the meaning of section 107(2)(c)
 
TRUSTEES OF THE STRATFIELD SAYE ESTATE v AHL CONSTRUCTION LTD

Technology and Construction Court
Jackson J
6 December 2004
 
 
The issue for determination by Jackson J was whether contract between the employer and the contractor for the contractor to make the building in question weathertight was an agreement in writing within the meaning of section 107 of the Construction Act 1996 The judge stated that the principle of law to be derived from the majority judgments of Ward and Robert Walker LJJ in RJT Consulting Engineers v DM Engineering (2000) was that an agreement was only evidenced in writing for the purposes of section 107(2), (3) and (4) if all the express terms of the agreement were recorded in writing and that it was not sufficient to show that all terms material to the issues had been recorded in writing.
 
The judge held that the contract was evidenced in writing within the meaning of section 107(2)(c) insofar as the following express contractual terms were recorded in writing: (i) The scope of the works was described on construction drawings and set out in the minutes of a site meeting (ii) The surveyor's letter to the contractor in its heading included the phrase "phase 1" and that phrase was understood to mean by all parties works to make the derelict building weathertight (iii) A letter from the contractor and the surveyor both recorded that payment was to be made on a cost plus basis and recorded the agreed rates that the employer would pay for labour, plant and materials. Also the surveyor gave evidence that he accepted that every term of the contract negotiated by him on behalf of the employer with the contractor was recorded in writing.
 
In the alternative the exchanges of written submissions between the parties in the first two adjudications constituted a sufficient record of the contract for the purposes of section 107(5) insofar as (i) There were two adjudications prior to the adjudication concerning the dealings between the parties in relation to the building in question that formed the subject matter of the instant case and (ii) The existence of an agreement falling within the scope of the Act was admitted by the employer in those first two adjudications.
 
Advice Note
There is a requirement under the Construction Act for every construction contract to be in writing. It is now established law that every express term of the contract must be in writing to meet that requirement.
Download