Larkfleet Ltd v Allison Homes Eastern Ltd

Larkfleet Ltd v Allison Homes Eastern Ltd

Clause 2.5.5 does not operate as a limitation provision. It is a contractual assumption of responsibility by Swallow (now the defendant) for defects and related expenses arising within the 10-year NHBC warranty period. The cause of action accrues when the defendant refuses or fails to accept responsibility after being asked. There is only one cause of action under clause 2.5.5, not two. The clause does not preclude claims after expiry of the 10-year NHBC warranty period, nor does it affect claims in tort.

Parties
Claimant: Larkfleet Limited; Defendant: Allison Homes Eastern Limited
Jurisdiction
England and Wales
Judgment Date
05 February 2016
Procedural Posture
Civil Construction/contract / Preliminary Issues Hearing on Limitation and Contractual Construction
Outcome
Preliminary issues determined in favour of the claimant on construction; clause 2.5.5 does not bar claims after the 10-year NHBC period and does not operate as a limitation provision.
Legal Topics
Limitation of Actions, Contractual Interpretation, Building Contracts, NHBC Scheme
Contract Law Construction Law Limitation of Actions Contractual Interpretation Building Contracts NHBC Scheme

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Parties

Larkfleet Limited

Claimant

Allison Homes Eastern Limited

Defendant

Procedural Posture

Civil Construction/contract / Preliminary Issues Hearing on Limitation and Contractual Construction

Legal Issues

  1. 1 When does the claimant’s cause of action under clause 2.5.5 for breach of the obligation to accept responsibility for defects accrue?
  2. 2 When does the claimant’s cause of action under clause 2.5.5 for expense incurred due to defective work accrue?
  3. 3 Does clause 2.5.5 of the Building Contract operate to preclude claims for defects (whether in contract or in tort) from being brought against the defendant after expiry of the 10 year NHBC warranty period?

Ratio Decidendi

Clause 2.5.5 does not operate as a limitation provision. It is a contractual assumption of responsibility by Swallow (now the defendant) for defects and related expenses arising within the 10-year NHBC warranty period. The cause of action accrues when the defendant refuses or fails to accept responsibility after being asked. There is only one cause of action under clause 2.5.5, not two. The clause does not preclude claims after expiry of the 10-year NHBC warranty period, nor does it affect claims in tort.

Court Disposition

Preliminary issues determined in favour of the claimant on construction; clause 2.5.5 does not bar claims after the 10-year NHBC period and does not operate as a limitation provision.