Westfields Construction Ltd V Lewis

The home owner could not be regarded as a residential occupier for the purposes of section 106 of the Contruction Act
Technology and Construction Court
Coulson J
27th February 2013
Section 106 provides that a construction contract with a residential occupier means one which principally relates to operations on a dwelling which one of the parties to the contract “occupies” or “intends to occupy” as his residence.
The homeowner contended that he intended to occupy the property as his residence after the works had been completed and that if he could demonstrate his occupation of the property as his residence on the day the contract was made, he could in any event rely on section 106 regardless of the separate (disjunctive) category of those who intended to occupy.
Coulson J rejected these contentions. There was no ongoing residential occupation because on the evidence the homeowner intended to let out the property once the refurbishment works had been completed and acted in accordance with that intention at all times. To the extent that the specific question of occupation at the time the contract was made was relevant, the homeowner had not demonstrated on the balance of probabilities that he was occupying the property as his residence at that date.
Section 106 excluded adjudication in respect of construction works carried out for those who occupied and would continue to occupy as their home the property that was the subject of the works (even if they had to move out when those works were carried out) or had bought the property and intended to live there when the construction works were completed. Whilst the date of the formation of the contract is particularly important in any consideration of any alleged “intention to occupy”, “occupation” is an ongoing process and cannot be tested by reference to a single snapshot in time and "occupies" must carry with it some reflection of the future in that it indicates that the employer occupies and will remain at (or intends to return to) the property. Therefore the evidence about the position at the date that the contract was made has to be considered in the context of all of the evidence of occupation and intention, both before and after the agreement of the contract. Section 106 needs to be approached with commonsense on the basis that it ought to be plain on a brief consideration of the facts whether the employer is or is not a residential occupier within the terms of the exception.