Autolink Concessionaires (m6) Plc V. Amey Construction Limited And Others
| Jurisdiction | Scotland |
| Judge | Lord Kingarth,Lord Eassie,Lord Menzies |
| Date | 24 February 2009 |
| Court | Court of Session |
| Published date | 25 February 2009 |
| EXTRA DIVISION, INNER HOUSE, COURT OF SESSION | |
| Lord Kingarth Lord Eassie Lord Menzies |
[2009] CSIH 14 CA23/2006 OPINION OF THE COURT delivered by LORD KINGARTH in causa AUTOLINK CONCESSIONAIRES (M6) PLC Pursuers and Respondents; against (FIRST) AMEY CONSTRUCTION LIMITED AND OTHERS Defenders and Reclaimers: _______ |
Alt: Currie, Q.C., Lake, Q.C.; Pinsent Masons
24 February 2009
[1] In this action the pursuers and respondents ("the respondents") seek inter alia declarator that the defenders and reclaimers ("the reclaimers") are liable in terms of clause 51 of the contract between the parties dated 30 April 1997, described as the Construction Contract M6 DBFO Project (the "Construction Contract"), to remedy certain alleged defects said to exist between road base courses in the New Scottish Motorway (as defined in the said Contract), being an extension of the M6 Motorway. By interlocutor dated 5 June 2007 the Lord Ordinary, following debate, inter alia refused the reclaimers' motion to dismiss the action as irrelevant. Against that interlocutor the reclaimers have reclaimed.
Relevant Contractual Provisions
[2] It is convenient to begin by setting out, so far as relevant and referred to in the course of the reclaiming motion, the contractual background to the parties' dispute.
The DBFO Agreement
[3] By agreement dated 24 April 1997, described as the M6 DBFO Agreement (the "DBFO Agreement"), the respondents contracted with the Secretary of State for Scotland to carry out certain operations. These operations include not only the construction of new sections of the M6 Motorway both in England and in Scotland, but also, for a period of 30 years from the operations' commencement date, the maintenance of the new and existing sections of the motorway. By clause 10(a) of the DBFO Agreement the operations which the respondents undertook to carry out include the design, construction and completion of the New Scottish Motorway being a ...
"special road to be constructed in Scotland ... in accordance with the New Works Requirements between Paddy's Rickle Bridge and Cleuchbrae, together with the junctions and slip roads relating thereto, ..."
(Part 1 of Schedule 1 of the DBFO Agreement). The New Works Requirements are set out in Schedule 2, being a detailed specification in respect of the operations to be undertaken, the nature of which will be considered more fully later in this opinion.
The Construction Contract
[4] Significantly for the purposes of the present action, on 30 April 1997 the reclaimers, trading together in a joint venture, undertook in the Construction Contract to carry out part of the operations which the respondents had agreed to perform in the DBFO Agreement.
(i) Certain general provisions
[5] In the preamble, it is stated, inter alia:
"(E) The Employer has reached agreement with the Contractor whereunder the Contractor undertakes and each member of the Contractor jointly and severally undertakes that it will design, construct, test, complete and maintain the Works in accordance with this Contract to enable the Employer to discharge its obligations to the Secretary of State for Scotland in respect of the Works in accordance with the terms of the M6 DBFO Agreement and the Employer undertakes to exercise any right or power granted to it under the M6 DBFO Agreement, on request by the Contractor, which may be necessary to enable the Contractor to discharge its obligations to the Employer in accordance with the terms of this Contract."
In the definition clause (1.1) the "Works" are defined as including "the New Works". The "New Works" are defined as having the meaning given in clause 10(a) of the DBFO Agreement and include the design, construction and completion of the New Scottish Motorway. The Works also include "Maintenance" under clause 51, more particularly referred to later, and certain planned maintenance work along the line of the "New Works". It is enough for present purposes to note that this planned maintenance work was to be carried out in accordance with, so far as relevant, the specification set out in detail in Schedule 4 of the DBFO Agreement, referred to as the "O&M Requirements".
[6] Clause 6 provides (so far as relevant):
"6.1 Responsibility
6.1.1 The Contractor shall be responsible for the design, construction, completion, commissioning and testing of the Works, which shall be carried out in strict accordance with the New Works Requirements, the Certification Procedure, the Review Procedure and all other requirements of this Contract.
6.1.2 In performing its obligations under Clause 6.1.1 the Contractor shall design the Works (including the specification of materials and Plant where required) with reasonable skill and care and in accordance with practice conventionally accepted as appropriate at the time of the execution of the Works having regard to the size, scope and complexity of the Works."
By virtue of the definition clause, and Schedule 2, the New Works Requirements are, so far as relevant and applicable, the same as those in Schedule 2 of the DBFO Agreement.
[7] In clause 9 the reclaimers, as contractors, gave certain warranties. These, so far as relevant, are:
"9.1 Warranties
The Contractor without prejudice to any other warranties and undertakings expressed elsewhere in this Contract or to any warranties and undertakings implied by law hereby warrants and undertakes that:
9.1.1 it has fully considered and understood and will comply with and meet the New Works Requirements and (to the extent applicable to the obligations of the Contractor under this Contract) the O&M Requirements; ...
9.1.3 the Works when constructed and the Maintenance when completed will comply in all respects with the New Works Requirements; ...
9.1.9 It will carry out, and shall procure that each Sub-Contractor and any other sub-contractor of any tier will carry out, the Works so that upon acknowledgement of the Final Completion Certificate for a Phase by the Secretary of State under clause 14.3(b)(ii) of the M6 DBFO Agreement the Works in respect of that Phase will be fit for the specific purposes set out in the M6 DBFO Agreement including, for the avoidance of doubt, the New Works Requirements; ...
9.1.10 the Works will comprise or use only materials or Plant which are of sound and merchantable quality and have been manufactured or prepared in accordance with the New Works Requirements to the extent applicable to the obligations of the Contractor under this Contract and with the quality assurance procedures established pursuant to Clause 28 and all workmanship shall be in accordance with sound construction practice at the time of construction. ..."
[8] Clause 12 provides:
"The Contractor shall be deemed to have satisfied itself before entering into this Contract as to the correctness and sufficiency of the Contract Sum to cover all its obligations under and in relation to this Contract and all matters and things necessary for the proper completion of the Works including, without limitation, the carrying out of the design, construction, commissioning and testing of the Works."
The effect of clause 57 and clause 60 is that the contract sum is to be paid in monthly instalments over a period of some 32 months ending effectively on the date of the anticipated completion of the works.
[9] Clause 21 provides for the care of the works and force majeure as follows:
"21.1 Care
Subject to Clause 21.4, the Contractor shall be responsible for and shall take the full risk in the care of the Works and materials and Plant for incorporation therein from the date of execution of this Contract or, if earlier, the date when it commences manufacture of materials or Plant until the date of issue of the Permit to Use when such risk and responsibility in the relevant part of the Works shall pass to the Employer or Local Person or the Secretary of State provided that the Contractor shall take full responsibility for the care of and risk in:
21.1.1 any Maintenance and materials and Plant for incorporation therein during the Maintenance Period; and
21.1.2 any Works to be carried out in respect of a Phase remaining to be completed between the issue of the respective Permit to Use for that Phase and the acknowledgement by the Secretary of State pursuant to clause 14.3 of the M6 DBFO Agreement and by the Employer pursuant to Clause 50.3.2 of the corresponding Final Completion Certificate and any materials and Plant for incorporation therein until such Final Completion Certificate is issued.
21.2 Responsibility to rectify Loss or Damage
If any loss or damage happens to the Works, or any part thereof, or materials or Plant for incorporation therein, during the period for which the Contractor is responsible for the care thereof in accordance with Clause 21.1, from any cause whatsoever, (subject to Clause 21.4) the Contractor shall, at its own cost, rectify such loss or damage so that the Works conform in every respect with the provisions of this Contract to the satisfaction of the Employer's Agent."
Clause 50.1 provides in effect that the employer is to issue a Permit to Use when there had been substantial, albeit not final, completion of any phase of the New Works.
[10] Clause 32.4 provides:
"32.4 Operations Change in Law
The occurrence of an Operations Change in Law after 19 November 1996, or the upgrading or amendment of any non-statutory standards which the Contractor is required to comply with in accordance with this Contract, of which the Employer could not have reasonably been expected to be aware prior to that date shall be deemed to be equivalent to the making of a Secretary of State's Variation to the New Works Requirements prior to Substantial Completion of any Phase of the New Works or the O&M Requirements, as appropriate, requiring the Contractor to implement such Operations Change in Law, or to comply with such upgraded or amended standards as the case...
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