Birse Construction Ltd v Eastern Telegraph Company Ltd [2004] EWHC 2512 (TCC) (05 November 2004)

Birse Construction Ltd v Eastern Telegraph Company Ltd [2004] EWHC 2512 (TCC) (05 November 2004)

Birse Construction is liable to remedy or pay for all defects listed in snagging sheets as defined in the March 1994 settlement agreement, regardless of whether they constitute breaches under the original contract. Eastern Telegraph is entitled to set-off or recover the estimated costs of remedying outstanding snagging defects against the unpaid balance under clause 3.1, and if the retained sum is insufficient, to recover the balance as a debt under clause 3.3.

Citation
[2004] EWHC 2512 (TCC)
Parties
Third Part 20 Claimant and Fifth Part 20 Claimant: Birse Construction Limited; Third Part 20 Defendant and Fourth Part 20 Claimant: Eastern Telegraph Company Limited
Jurisdiction
England and Wales
Judgment Date
05 November 2004
Procedural Posture
Construction Dispute (defects and Retention) / Final Judgment After Trial
Outcome
Liability established for Birse Construction for defects as defined in the settlement agreement; Eastern Telegraph entitled to set-off and recovery as per agreement.
Legal Topics
Defective Works, Final Account Settlement, Retention, Remedial Works, Interpretation of Settlement Agreement
Construction Law Contract Law Defective Works Final Account Settlement Retention Remedial Works Interpretation of Settlement Agreement

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Parties

Birse Construction Limited

Third Part 20 Claimant and Fifth Part 20 Claimant

Eastern Telegraph Company Limited

Third Part 20 Defendant and Fourth Part 20 Claimant

Procedural Posture

Construction Dispute (defects and Retention) / Final Judgment After Trial

Legal Issues

  1. 1 Whether Birse Construction is liable for unremedied and remedied defects under the March 1994 settlement agreement
  2. 2 Whether Eastern Telegraph is entitled to set-off or recover costs for defects not remedied
  3. 3 Interpretation of 'snagging defects' and scope of contractor's obligations under the settlement agreement

Ratio Decidendi

Birse Construction is liable to remedy or pay for all defects listed in snagging sheets as defined in the March 1994 settlement agreement, regardless of whether they constitute breaches under the original contract. Eastern Telegraph is entitled to set-off or recover the estimated costs of remedying outstanding snagging defects against the unpaid balance under clause 3.1, and if the retained sum is insufficient, to recover the balance as a debt under clause 3.3.

Court Disposition

Liability established for Birse Construction for defects as defined in the settlement agreement; Eastern Telegraph entitled to set-off and recovery as per agreement.

Orders

  • Adjustment of ET's claim to account for settlement with MJP (£11,044.29 for Pozament render, £4,654.61 for Armouralia)
  • ET entitled to set-off admitted defect values against £13,725 balance under clause 3.1