EWJ 60 April 2025 web - Journal - Page 93
The court found that Placefirst's payless notice was
valid because it was not, in fact, served prematurely.
This was due to the amendment of Subcontract clause
4.6 which required CAR to submit an interim payment application which included "a statement of the sum
that [CAR] considers to be due to him … at the date when the
relevant interim payment shall be calculated and the basis on
which that sum is calculated".6 This wording was different
from the ordinary unamended standard JCT form
and brought CAR’s application for payment into compliance with the Act. This finding resulted in Placefirst’s payless notice being valid as it was issued after
the payment application, now payment notice (sent by
CAR).
eral principles in this regard and previous authorities.
This judgment also highlights the ongoing
importance of adhering to statutory and contractual
requirements for payment and payless notices in construction contracts, to ensure that parties avoid being
embroiled in costly adjudication and/or litigation to
dispute what are effectively administrative matters.
This case has confirmed the court’s approach to looking at the content of a notice as opposed to its title to
assess validity, and also that enforcement will not be
delayed due to a dispute on the substantive point.
References
1. www.bailii.org/ew/cases/EWHC/TCC/2025/100.html
2. Paragraph 9.a.
3. Paragraph 9.b.
4.Paragraph 13. Note: Placefirst only needs to succeed on
one of these points to succeed. This is because, as is clear
from the provisions of the Act, and as is common ground, in
the circumstances of this case it is only necessary for Placefirst to have served a valid payment notice or a valid payless
notice, not both.
5. Paragraph 42.
6. Paragraph 52.
The Payment Notice:
The court’s decision on the payless notice was
sufficient to determine the dispute in Placefirst’s
favour. However, the court also went on to consider
whether the workbook attached to the same email as
the payless notice would itself have amounted to a
valid payment notice for the purposes of the Sub-contract and the Act. CAR argued that Placefirst's email
on 31 July 2024 was clearly a payless notice rather
than a payment notice and was therefore invalid as a
payment notice. Placefirst contended that its worksheet attachment, "Valuation 3O.xlsm," was intended to
have a contractual status separate and distinct from
the payless notice, and should thus be considered a
valid payment notice.
Authors
Jake Wright
Associate
Claire Kilpatrick
Managing Associate
www.stevens-bolton.com
The judge agreed with Placefirst, finding that the
content and context of the communication met the requirements for a payment notice under the Act. This
interpretation was based on the understanding that
both a payment notice, and a payless notice serve the
same purpose: to state the sum that the payer or payee
considers to be due and the basis on which that sum is
calculated. Although both were sent by the same
email, there were two distinct notices within the email
and the worksheet attachment was a valid payment
notice in its own right.
Accordingly, the adjudicator’s decision was not
enforced.
Key takeaways
While the court’s decision not to enforce an adjudicator’s award for reasons of a ‘wrong’ decision by the adjudicator on the substantive dispute is unusual, this
case highlights that enforcement may be successfully
challenged by way of parallel Part 8 proceedings
where the substantive dispute is of a ‘short, crisp point,
requiring little, if any factual evidence beyond the relevant
terms of the contract and the notices in question’ and can be
heard at the same time and with no delay to resolution
of the enforcement proceedings. While at first glance
this may seem contrary to the ‘pay now, argue later’
rule often quoted by the courts in enforcement proceedings, the particular facts of this case (including the
narrow remit of the substantive dispute), the fact that
Part 8 proceedings had already been issued prior to
enforcement, and the ability of the court to decide the
substantive dispute (without any delay to the enforcement proceedings), do still align with the court’s genEXPERT WITNESS JOURNAL
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