Reinwood Ltd v L Brown & Sons Ltd

Reinwood Ltd v L Brown & Sons Ltd

The contractor's notice of default dated 12 May 2005 was valid as the provisional VAT assessment complied with the contract and the employer did not serve a valid objection. The subsequent default in June 2006 was a repetition of a specified default, entitling the contractor to determine the contract under clause 28.2.4. There was no waiver by the contractor of its right to rely on the earlier default.

Parties
Claimant/appellant: Reinwood Limited; Defendant/respondent: L Brown & Sons Limited
Jurisdiction
England and Wales
Judgment Date
17 October 2008
Procedural Posture
Civil Appeal (construction Contract Dispute) / Court of Appeal Judgment
Outcome
Appeal dismissed
Legal Topics
Contract Termination, Repudiation, VAT Under Construction Contracts, Waiver, Notice Requirements
Construction Law Contract Law Contract Termination Repudiation VAT Under Construction Contracts Waiver Notice Requirements

Case Brief

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Parties

Reinwood Limited

Claimant/appellant

L Brown & Sons Limited

Defendant/respondent

Procedural Posture

Civil Appeal (construction Contract Dispute) / Court of Appeal Judgment

Legal Issues

  1. 1 Whether the contractor's notice of determination dated 4 July 2006 was valid based on an earlier default by the employer in April 2005
  2. 2 Whether the employer's failure to pay VAT constituted a specified default under the contract
  3. 3 Whether the contractor's provisional VAT assessment and the employer's response complied with contractual requirements

Ratio Decidendi

The contractor's notice of default dated 12 May 2005 was valid as the provisional VAT assessment complied with the contract and the employer did not serve a valid objection. The subsequent default in June 2006 was a repetition of a specified default, entitling the contractor to determine the contract under clause 28.2.4. There was no waiver by the contractor of its right to rely on the earlier default.

Court Disposition

Appeal dismissed

Orders

  • The appeal is dismissed; the contractor's notice of determination under clause 28.2.4 is upheld.