O'Rourke Construction Ltd v Healthcare Support (Newcastle) Ltd & Ors [2014] EWHC 2595 (TCC) (28 July 2014)

O'Rourke Construction Ltd v Healthcare Support (Newcastle) Ltd & Ors [2014] EWHC 2595 (TCC) (28 July 2014)

The Independent Tester is to consider only the Completion Criteria in Schedule 12, Part 2, when deciding whether to issue a Phase Certificate of Practical Completion. Minor breaches or nonconformities that do not materially affect the amenity or functional use of the building do not prevent certification. Disputes between Project Co and the Trust are irrelevant to the Independent Tester's judgment. The Trust retains remedies for defects post-completion.

Citation
[2014] EWHC 2595 (TCC)
Parties
Claimant: Laing O'Rourke Construction Ltd (formerly Laing O'Rourke Northern Ltd); 1st Defendant: Healthcare Support (Newcastle) Ltd; 2nd Defendant: Newcastle upon Tyne Hospitals NHS Foundation Trust
Jurisdiction
England and Wales
Judgment Date
28 July 2014
Procedural Posture
Part 8 Claim (cpr) / Judgment on Application for Declaratory Relief
Outcome
Application granted in part; declaration made as to the role of the Independent Tester; other declarations refused.
Legal Topics
Practical Completion, Certification, Private Finance Initiative (pfi), Declaratory Relief, Independent Tester Role
Construction Law Contract Law Public Procurement Practical Completion Certification Private Finance Initiative (pfi) Declaratory Relief Independent Tester Role

Case Brief

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Parties

Laing O'Rourke Construction Ltd (formerly Laing O'Rourke Northern Ltd)

Claimant

Healthcare Support (Newcastle) Ltd

1st Defendant

Newcastle upon Tyne Hospitals NHS Foundation Trust

2nd Defendant

Procedural Posture

Part 8 Claim (cpr) / Judgment on Application for Declaratory Relief

Legal Issues

  1. 1 Whether the Independent Tester must withhold the Phase Certificate of Practical Completion for any breach of contract or only for failure to meet Completion Criteria
  2. 2 Interpretation of Completion Criteria under Construction Contract and Project Agreement
  3. 3 Effect of disputes between Project Co and Trust on certification

Ratio Decidendi

The Independent Tester is to consider only the Completion Criteria in Schedule 12, Part 2, when deciding whether to issue a Phase Certificate of Practical Completion. Minor breaches or nonconformities that do not materially affect the amenity or functional use of the building do not prevent certification. Disputes between Project Co and the Trust are irrelevant to the Independent Tester's judgment. The Trust retains remedies for defects post-completion.

Court Disposition

Application granted in part; declaration made as to the role of the Independent Tester; other declarations refused.

Orders

  • Declaration that the Independent Tester should consider completion against the Completion Criteria in Schedule 12, Part 2, without influence from disputes between Project Co and the Trust.
  • Refusal of declarations relating to third party certifiers, hypothetical situations, and matters of fact and degree.