Rwe Npower Plc v Alstom Power Ltd
| Jurisdiction | England & Wales |
| Judge | His Honour Judge Havelock-Allan |
| Judgment Date | 23 December 2009 |
| Neutral Citation | [2009] EWHC 1192 (QB) |
| Date | 23 December 2009 |
| Court | Queen's Bench Division |
| Docket Number | Claim No. 9BS90329 |
[2009] EWHC 1192 (QB)
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
BRISTOL DISTRICT REGISTRY
TECHNOLOGY AND CONSTRUCTION COURT
Bristol TCC
His Honour Judge Havelock-Allan QC
Claim No. 9BS90329
Andrew Kearney (instructed by Osborne Clarke) for the claimant
Sean Brannigan QC (instructed by Hammonds LLP) for the defendant
HTML VERSION OF JUDGMENT
This judgment follows the trial on documents and witness statements of preliminary issues concerning the enforceability of the decision of an adjudicator.
The adjudication took place under a contract concluded in October 2006 for the repair and maintenance of the boilers at the Aberthaw power station in the Vale of Glamorgan. The defendant, Alstom, is a contractor who specialises in carrying out works to plant and machinery at power stations. The defendant, RWE, owns and operates the Aberthaw power station.
The boiler contract was one of three contracts concluded between Alstom and RWE at about the same time. There was also a contract for the overhaul of the feed system at the power station ("the feed system contract") and a contract for reactive maintenance going forward ("the term maintenance contract").
RWE planned for the boiler overhaul to be spread over three years because only one unit could be taken out of service at any one time. Alstom produced a programme of works which envisaged an interim outage of Unit 7 and a major outage of Unit 9 in 2007, a major outage of Unit 8 in 2008 and completion with an interim outage of Unit 9 and a major outage of Unit 7 in 2009. However the boiler contract was to run for an initial period of only 12 months (from 1 st January to 31 st December 2007) with RWE having the option to extend it for two further 12 month periods covering 2008 and 2009. In the events that happened, the contract was extended to cover 2008 but was not renewed for 2009.
The boiler contract and the feed system contract incorporated a set of standard conditions entitled Model Conditions of Contract for Repair Modification and Rehabilitation of Boilers and Associated Plant ("the GB/WTBA Conditions 1980"). These were subject from the outset to some bespoke modifications and additions, none of which are material to the preliminary issues. The clauses in the GB/WTBA Conditions which are of relevance are the following:
" 29 Extension of Time
(i) If, after the date of the Contract, the Contractor shall have been delayed or impeded by any act or omission of the Owner, a direction by the Engineer under clause 12 (Variations), industrial dispute, or any circumstances beyond the reasonable control of the Contractor, whether such delay or impediment occur before or after the time (if any) or extended time fixed for the taking over of the Works, or any section thereof, the Engineer shall, subject to the provisions of subclauses (ii) and (iii) of this clause grant the Contractor from time to time in writing either prospectively or retrospectively such extension of the time fixed for the taking over of the Works or any section or portion thereof as may be reasonable.
(ii) If the Contractor shall have reason to believe that he is being delayed or will be delayed as aforesaid, he shall forthwith apply for an extension of time, informing the Engineer in writing of the circumstances which in his opinion will cause such delay and of the extent of the actual or estimated delay.
(iii) The Engineer shall without delay investigate the said circumstances and the Contractor shall consult with the Engineer in order to determine the steps (if any) which can be taken to overcome or minimise the actual or anticipated delay. The Contractor shall thereafter without delay comply with all reasonable instructions which the Engineer shall give in order to overcome or minimise the said delay.
33. Recovery of Extra Costs
(i) All reasonable extra costs incurred by the Contractor:-
….
(c) As the result of the granting under Clause 29 (Extension of Time) of an extension of time fixed for the taking over of the Works or any section or portion thereof in consequence of a variation made under the provisions of Clause 12 (Variations)
shall be added to the Contract Price, provided that no such addition shall be made unless the Contractor has complied with the requirements of Clause 34 (Notification of Claims) and furnished full particulars of any benefits whether direct or indirect, which shall have accrued or may be expected to accrue to the Contractor and the said benefits shall be taken into account in determining the amount of the addition to the Contract Price. …
34. Notification of Claims
(i) In every case where by virtue of these Conditions circumstances arise which entitle the Contractor to claim extra costs the following provisions shall take effect:
(a) Within 90 days of the date of issue of the notice, instruction, approval or other communication in writing relevant to the case the Contractor shall, if he intends to make any claim for payment of such extra costs give to the Engineer notice in writing of his intention to make a claim and shall state the reasons by virtue of which he considers that he is entitled to additional payment.
(b) If the clause under which the Contractor is entitled to claim extra costs does not provide for the issue of a notice, instruction, approval or other communication in writing the period of 90 days mentioned in (a) above shall commence from the date of issue to the Contractor of the Engineer's confirmation in writing of the action which the Contractor proposes to take.
(c) As soon as reasonably practicable after the date of the notice given by the Contractor of his intention to make a claim for extra costs and not later than the expiry of the last defects liability period the Contractor shall submit to the Engineer (with copies for transmission to the Owner) full particulars and the actual amount of his claim. The Contractor shall thereafter promptly submit such further particulars as the Engineer may reasonably require to assess the value, if any, of the claim.
(ii) Notwithstanding anything in these Conditions contained the Owner shall not be liable to make any payment in respect of any extra costs incurred as aforesaid, unless and until the Contractor has complied with the requirements of this clause.
….
37. Interim and Final Certificates
(i) The Contractor may at the times and in the manner following apply for interim and final certificates, as referred to in clause 41 (Terms of Payment)….
(ii) Applications for interim certificates may be made to the Engineer from time to time during the progress of the Works.
….
39. Payments due from the Contractor
Without prejudice to any other remedy which the Owner may have he shall be entitled to deduct from any monies due, or becoming due to the Contractor under the Contract, all costs, damages or expenses for which under the Contract the Contractor is liable to the Owner.
….
41. Terms of Payment
(i) The Owner shall pay to the Contractor in the following manner the Contract Price adjusted to give effect to such additions thereto and such deductions therefrom as are provided for in these Conditions:
(a) within 14 days from the presentation of each interim certificate a sum equal to 90% of the net value certified therein. …"
The boiler repair works in 2007 overran. The planned outages of Unit 7 and Unit 9 took longer than planned and Alstom claimed that extra costs had been incurred. There was concern that the scheduled outage of Unit 8 in April 2008 might also overrun. Against that background the parties discussed and agreed the terms of a deed amending the boiler and feed system contracts ("the Deed").
The Deed was finalised and executed on 25 June 2008. It settled a number of financial and procedural matters regarding the works being undertaken in 2008. The key provisions were that: (i) the contract price for the Unit 8 outage under the boiler contract and the feed system contract was agreed, (ii) there would be an additional payment made to Alstom under the boiler contract, (iii) the rates in each contract for scaffolding, thermal insulation and asbestos removal were to be the subject of an uplift, (iv) a new programme for the Unit 8 outage was established with a takeover date of 9 July 2008, (v) RWE agreed to waive liquidated damages for one week (until 16 July) if the works were not completed by 9 July, (vi) certain payments were agreed to be made by RWE to Alstom in respect of work done under the boiler contract up to the date of the Deed and these were agreed to be in full and final settlement of sums due in respect of all variations and work instructions issued prior to the date of the Deed.
Having dealt with the above matters the Deed provided in clauses 5 and 6 as follows:
"5. The rights of any Party arising by virtue of any failure by the other Party to comply with any obligations arising by virtue of this Deed are hereby expressly preserved.
6. This Deed amends and supplements the Contracts and in the event of any conflict between this Deed and the Contracts this Deed shall prevail. For the avoidance of doubt the Contracts shall, subject to the amendments herein and provisions hereof, remain in full force and effect and the Parties shall continue to comply with the provisions of the Contracts.
There followed, in clause 11 of the Deed, the following provision:
"11. The Parties hereby agree to amend the terms of Clause 45 of the Contracts as follows:
(i) Re-number existing Clause 45(ii) as 45 (iii) and insert "or adjudication" after "arbitration" in lines 1 and 4.
and
(ii) Insert a new clause 45(ii) as follows:
"If at any time any dispute or difference shall arise under or in connection with the Contract between the Owner or the Engineer or the Contractor, then any party may refer such dispute...
To continue reading
Request your trial
-
Dodika Ltd v United Luck Group Holdings Ltd
...matter” or “ event” giving rise to the claim, namely the Tax Investigation, which was notified (see Highwater Estates Ltd v Graybill [2009] EWHC 1192 (QB)). (e) The requirement of “ reasonable detail” depends on the nature of the claim and it is unlikely to have been the parties' intention......
-
MDW Holdings Ltd v James Robert Norvill
...linked to the specific breach in question. 235 Mr Sims relied on the decision of HHJ Waksman QC in Highwater Estates Ltd v Graybill [2009] EWHC 1192 (QB). The share purchase agreement provided: “The Vendor shall not be liable for a claim unless it receives from the Purchaser written notice......
-
Decision Inc. Holdings Proprietary Ltd v Stephen Garbett
...of the general purpose of notification clauses being to enable early settlement was emphasised in Highwater Estates v Graybill [2009] EWHC 1192 (QB). At [43], HHJ Waksman QC (as he then was) stated: “the commercial purpose of such clauses is to enable the vendor to know in sufficient detai......