Steria Ltd v Sigma Wireless Communications Ltd

JurisdictionEngland & Wales
CourtQueen's Bench Division (Technology and Construction Court)
JudgeHis Honour Judge Stephen Davies
Judgment Date15 November 2007
Neutral Citation[2008] EWHC 3454 (TCC)
Date2008
Docket NumberCase number 6BM50037

[2008] EWHC 3454 (TCC)

IN THE HIGH COURT OF JUSTICE

HIS HONOUR JUDGE STEPHEN DAVIES SITTING AS A JUDGE OF THE HIGH COURT

BIRMINGHAM DISTRICT REGISTRY

TECHNOLOGY AND CONSTRUCTION COURT

BIRMINGHAM CIVIL JUSTICE CENTRE

QUEEN'S BENCH DIVISION

33 BULL STREET

BIRMINGHAM B4 6DS

Case number 6BM50037

Steria Limited
claimant
and
Sigma Wireless Communications Limited
defendant

Mr Simon Hargreaves of Counsel (instructed by Wragge & Co LLP) for the Claimant

Mr David Blunt, Q.C. of Counsel (instructed by Pinsent Masons) for the Defendant

1

APPROVED JUDGMENT

2

I direct that pursuant to CPR PD 39A paragraph 6.1 no official shorthand note shall be taken of this Judgment and that copies of this version as handed down may be treated as authentic.

His Honour Judge Stephen Davies
4

A. INTRODUCTION

5

1. This case arises out of a project for the provision of a new computerised system for the fire and ambulance services in the eastern counties of the Republic of Ireland. The project was known as a Computer Assisted Mobilising Project (‘CAMP’ for short), and thus the employers were collectively known as ‘CAMP East’. What was to be provided was a computer aided mobilisation and communications system, operated from a regional command centre. This was to replace the mix of existing systems used by the various services within CAMP East, some of which were manual and others being computerised systems of varying vintage and quality. Under the new system the fire and ambulance services were to enjoy the benefit of a region wide computerised system for taking emergency calls, mobilising emergency services, and other associated and ancillary functions.

6

2. CAMP East contracted the provision of the computer aided mobilisation and communications system to the main contractor, Sigma, a company incorporated in the Republic of Ireland and the Defendant in this action, for a contract price of €6,467,827. Sigma sub-contracted a substantial element of the works, namely the provision of the computer aided despatch system with a sub contract value of €3,075,736.73, to Steria the Claimant in this action.

7

3. Sigma has paid the vast majority of the sum due under the sub-contract, but has refused to pay the final tranche of 5% (€153,786.84) due at the expiry of the defects liability period. In defending the claim it is not asserting that there were any defects in the sub contract works; instead it is contending that Steria delayed in completing the sub-contract works, and as a result it is entitled to set off against the final payment due under the sub contract (which it does not otherwise dispute) and to counterclaim either: (i) liquidated damages of €307,573.73 under the sub contract, or; (ii) general damages, in a sum in excess of €380,000, for losses which it contends it has incurred as a result of the delay.

8

4. It will immediately be seen that the amounts involved in this case are not significant in comparison to the value of the main contract or the sub-contract. Nonetheless the case has been keenly contested by both sides, with substantial documentation having been produced, with evidence heard over 5 sitting days, and with detailed written opening and closing submissions. I have been told, and have no reason to doubt, that the costs incurred by both parties are substantial.

9

5. In order to avoid over-loading the introductory section of this judgment with explanations of the various parties, people and places involved and descriptions of the more important technical terms involved, I have provided as appendices to this judgment glossaries to provide that information. In this judgment I indicate by asterisking the first substantive reference in this judgment to someone or something which is within the appendices. I also include references to the trial bundle by using their file number and page number, thus A1/001 is page 1 of bundle A1, and references to the evidence by using the day on which the evidence was given and the page number of the transcript of evidence, thus 1/001 is page 1 of the transcript of evidence of day 1 of the hearing.

10

Structure of the judgment

11

6. The judgment is separated into the following sections:

12

A. Introduction (pp.2–3)

13

B. The history leading up to the conclusion of the sub-contract and the main contract (pp.3–5)

14

C. The terms of the sub-contract (pp.6–20)

15

D. The scope of Steria's obligations in relation to legacy data loading and integration (pp.21–24).

16

E. The terms of the main contract (pp.25–28)

17

F. The extension of time provisions of clause 6.1 of the sub-contract (pp.29–36)

18

G. Is clause 7.1 of the sub-contract a valid liquidated damages clause or a penalty? (pp.37–42)

19

H. Causes of delay and delay notices (pp.43–82). This is sub-divided into:

20

H.1. Causes of delay to FAT2 (pp.50–74)

21

H.2. Causes of delay in delivery to Dublin and in installation at Dublin and OBI (pp.75–77)

22

H.3. Causes of delay in achieving SAT (pp.78–82)

23

I. Sigma's counterclaims (pp.83–86)

24

J. Conclusions (p.87)

25

K. Glossaries (pp.88–92)

26

B. THE HISTORY LEADING UP TO THE CONCLUSION OF THE SUB CONTRACT AND THE MAIN CONTRACT

27

7. In June 2000 Mason* produced the tender documentation for the main contract. The Invitation to Tender (‘ITT’) comprised a series of separate tender documents; as relevant to this case it included the following documents:

28

(1) Tender Document 1 – Project Overview, the aim of which was to provide tenderers with an understanding of the project procurement.

29

(2) Tender Document 2 – ITT Contract Document, the aim of which was to provide tenderers with details of the contract terms which would apply to the project.

30

(3) Tender Document 4 – CAD* System User Requirement, the aim of which was to provide tenderers with the user requirements for the CAD system element of the project.

31

There was also a Tender Document 3, which outlined the user requirements for the communications element of the project, but this element was not sub-contracted to Steria and is therefore of no direct relevance to this case. Finally, there was a Tender Document 5, which outlined the user requirements for the MIS* element of the project which, although sub-contracted to Steria, is not at issue in this case.

32

8. It appears that both Sigma and Steria (or more accurately Bull Information Systems Limited – ‘Bull’, the company whose business was acquired by Steria during the course of this project) were on the tender invitation list, and both tendered for the whole project. All tenderers were required to provide detailed responses to Tender Documents 2 – 5 inclusive, stating in one integrated document on a paragraph by paragraph basis whether their offer was: (i) compliant with the individual requirements of those documents; (ii) non-compliant; or (iii) part-compliant.

33

9. In the event, whilst CAMP East was inclined to select Sigma as the main contractor, it was sufficiently impressed with the Bull tender for the command and control system to want to use Bull as sub-contractor for that works package. Mason therefore wrote to Sigma on 13 December 2000 [ C1/022], inviting it to undertake negotiations with Bull to that end. On 19 December 2000 [ C1/024] Bull wrote to Sigma confirming an offer to undertake the relevant works package work as Sigma's sub-contractor, on the terms of its completed Tender Documents 2, 4 and 5, which had all been re-dated 13 December 2000 and addressed to Sigma. They were re-dated and re-sent with a letter dated 15 February 2001 [ C1/137].

34

10. There followed a series of meetings and communications involving CAMP East, Mason, Sigma and Bull over the period from December 2000 through to June 2001. That process included negotiations as to the terms of the main contract, which culminated on 29 June 2001, when:

35

(1) CAMP East wrote to Sigma [ C2/725], informing it that the relevant authority had sanctioned Sigma's proposals, and that Mason had been instructed to conclude a contract with Sigma.

36

(2) In turn, Sigma wrote to Bull [ C3/726], informing it that CAMP East had awarded the project to Sigma, that Bull was the ‘nominated CAD supplier’, and that Sigma was intending to place an order with Bull in accordance with its quotation of 15 February 2001.

37

11. However it was not until 30 August 2001 [ C3/802] that Dublin Corporation wrote to Sigma enclosing a counterpart of the main contract which appears to have been executed under seal on its behalf. The version I have also bears what appears to be the signature of Mr Maguire, Sigma's managing director.

38

12. Although there is no correspondence to this effect, it is apparent that sometime around 11 September 2001 the draft sub contract agreement was signed by Mr Maguire on 11 September 2001, and then forwarded to Bull. It was then signed by a Mr Lambert on behalf of Bull on 2 December 2001. The reason for the delay —either by Sigma in submitting the draft sub contract to Bull, or by Bull in signing the sub contract on receipt —was not explored in evidence, but it is not alleged that there was any agreement to vary the terms of the sub contract as a result of the delay in its execution. It appears from the Particulars of Claim and from David Cartwright's witness statement that the sub-contract was novated by Bull to Steria (then known as Integris Limited) in January 2002; it is unnecessary for me to consider the precise legal mechanism by which this process was achieved in this judgment because it is common ground in this case that the contracting parties for all relevant purposes are Sigma and Steria.

39

C. THE TERMS OF THE SUB CONTRACT

40

13. The sub contract was in writing. It was a heavily revised version of the standard MF1 Form of Sub-Contract. In addition to what were described as the Special Terms and Conditions contained in the main body of the agreement itself (the ‘Special Terms’), the sub-contract also had 13...

To continue reading

Request your trial

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT