Energy Works (Hull) Ltd v MW High Tech Projects UK Ltd & Ors [2020] EWHC 2537 (TCC) (24 September 2020)

Energy Works (Hull) Ltd v MW High Tech Projects UK Ltd & Ors [2020] EWHC 2537 (TCC) (24 September 2020)

On termination for contractor default, MW assigned all accrued and future rights under the Sub-Contract to EWHL; assignment did not transfer obligations and did not amount to novation. MW cannot pursue direct claims against Outotec under the Sub-Contract for accrued rights. MW and Outotec are not liable for 'same damage' under the Civil Liability (Contribution) Act 1978 in respect of delay damages, termination losses, or defects; MW's contribution claim fails.

Citation
[2020] EWHC 2537 (TCC)
Parties
Claimant: Energy Works (Hull) Limited; First Defendant / Part 20 Claimant: MW High Tech Projects UK Limited; Second Defendant: M&W Group GmbH; First Defendant / Part 20 Defendant: Outotec (USA) Inc
Jurisdiction
England and Wales
Judgment Date
24 September 2020
Procedural Posture
Commercial Construction Dispute / Preliminary Issues Determination
Outcome
Preliminary issues determined against MW; assignment transferred all rights to EWHL, no novation, no contribution claim.
Legal Topics
Assignment of Contract, Novation, Contribution Claims, Termination for Default, Liquidated Damages
Contract Law Construction Law Commercial Law Assignment of Contract Novation Contribution Claims Termination for Default Liquidated Damages

Case Brief

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Parties

Energy Works (Hull) Limited

Claimant

MW High Tech Projects UK Limited

First Defendant / Part 20 Claimant

M&W Group GmbH

Second Defendant

Outotec (USA) Inc

First Defendant / Part 20 Defendant

Procedural Posture

Commercial Construction Dispute / Preliminary Issues Determination

Legal Issues

  1. 1 Effect of assignment of subcontract: whether accrued and future rights transferred
  2. 2 Whether assignment also transferred obligations (novation)
  3. 3 Whether MW can pursue contribution claims against Outotec for 'same damage' under Civil Liability (Contribution) Act 1978

Ratio Decidendi

On termination for contractor default, MW assigned all accrued and future rights under the Sub-Contract to EWHL; assignment did not transfer obligations and did not amount to novation. MW cannot pursue direct claims against Outotec under the Sub-Contract for accrued rights. MW and Outotec are not liable for 'same damage' under the Civil Liability (Contribution) Act 1978 in respect of delay damages, termination losses, or defects; MW's contribution claim fails.

Court Disposition

Preliminary issues determined against MW; assignment transferred all rights to EWHL, no novation, no contribution claim.

Orders

  • MW cannot pursue claims against Outotec under the Sub-Contract for accrued rights.
  • MW's contribution claim under the Civil Liability (Contribution) Act 1978 is dismissed.