Cleveland Bridge UK Ltd & Anor v Multiplex Constructions (UK) Ltd [2010] EWCA Civ 139 (19 February 2010)

Cleveland Bridge UK Ltd & Anor v Multiplex Constructions (UK) Ltd [2010] EWCA Civ 139 (19 February 2010)

Preliminaries under the subcontract and supplemental agreement are to be valued in accordance with the payment programme and neutral cashflow procedure, with fixed elements paid on a time elapsed basis and variable elements by deliverables. Sumpter v Hedges remains binding, precluding restitutionary claims for work done after repudiation except for materials supplied and retained by the employer. Site welding of rakers is fabrication, not erection, regardless of location. The quantum of variation payments is determined by prior findings and the contract terms.

Citation
[2010] EWCA Civ 139
Parties
Appellant/respondent: Cleveland Bridge UK Ltd; Appellant/respondent: Cleveland Bridge Dorman Long Engineering Ltd; Respondent/appellant: Multiplex Constructions (UK) Ltd
Jurisdiction
England and Wales
Judgment Date
19 February 2010
Procedural Posture
Civil Appeal / Court of Appeal Judgment on Quantum and Contractual Interpretation Following Prior Liability and Preliminary Issue Rulings
Outcome
Cleveland Bridge's appeal on valuation of preliminaries allowed; appeals on restitutionary claims and classification of site welding dismissed; Multiplex's appeal on variation payment quantum dismissed.
Legal Topics
Valuation of Construction Works, Repudiation of Contract, Restitution for Work/materials Supplied, Interpretation of Supplemental Agreements, Interim Payments and Certification, Variation Orders
Construction Law Contract Law Restitution Valuation of Construction Works Repudiation of Contract Restitution for Work/materials Supplied Interpretation of Supplemental Agreements Interim Payments and Certification +1 more

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Parties

Cleveland Bridge UK Ltd

Appellant/respondent

Cleveland Bridge Dorman Long Engineering Ltd

Appellant/respondent

Multiplex Constructions (UK) Ltd

Respondent/appellant

Procedural Posture

Civil Appeal / Court of Appeal Judgment on Quantum and Contractual Interpretation Following Prior Liability and Preliminary Issue Rulings

Legal Issues

  1. 1 Proper method for valuing preliminaries under the subcontract and supplemental agreement
  2. 2 Entitlement to restitutionary payment for work/materials supplied after repudiation
  3. 3 Applicability and scope of Sumpter v Hedges in modern restitution law

Ratio Decidendi

Preliminaries under the subcontract and supplemental agreement are to be valued in accordance with the payment programme and neutral cashflow procedure, with fixed elements paid on a time elapsed basis and variable elements by deliverables. Sumpter v Hedges remains binding, precluding restitutionary claims for work done after repudiation except for materials supplied and retained by the employer. Site welding of rakers is fabrication, not erection, regardless of location. The quantum of variation payments is determined by prior findings and the contract terms.

Court Disposition

Cleveland Bridge's appeal on valuation of preliminaries allowed; appeals on restitutionary claims and classification of site welding dismissed; Multiplex's appeal on variation payment quantum dismissed.

Orders

  • Valuation of preliminaries to be conducted on a time elapsed basis for fixed elements and by deliverables for variable elements as per payment programme and neutral cashflow procedure.
  • No restitutionary payment to Cleveland Bridge for work done after last certificate except for materials supplied and retained by Multiplex.