Birmingham City Council v Amey Birmingham Highways Ltd [2018] EWHC 2875 (QB) (02 November 2018)

Birmingham City Council v Amey Birmingham Highways Ltd [2018] EWHC 2875 (QB) (02 November 2018)

BCC was entitled to repayment of the £20,593,490.24 because the payments were made expressly on condition of repayment if BCC succeeded on appeal, and ABHL's silence and retention of the sums amounted to acceptance of that condition. Under the contract, milestone payments can only be increased from the date of actual certification, not retrospectively; there is no contractual basis for backdating milestone step-ups based on when criteria were met.

Citation
[2018] EWHC 2875
Parties
Claimant: Birmingham City Council; Defendant: Amey Birmingham Highways Limited
Jurisdiction
England and Wales
Judgment Date
02 November 2018
Procedural Posture
Summary Judgment Application / Reserved Judgment on Issues 4 and 5 Following Summary Judgment on Repayment of Overpaid Sums
Outcome
Judgment for the claimant on both issues 4 and 5.
Legal Topics
Summary Judgment, Restitution of Payments, Interpretation of Payment Mechanisms in PFI Contracts, Effect of Setting Aside Certificates, Declaratory Relief
Contract Law Construction Law Public Procurement Summary Judgment Restitution of Payments Interpretation of Payment Mechanisms in PFI Contracts Effect of Setting Aside Certificates Declaratory Relief

Case Brief

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Parties

Birmingham City Council

Claimant

Amey Birmingham Highways Limited

Defendant

Procedural Posture

Summary Judgment Application / Reserved Judgment on Issues 4 and 5 Following Summary Judgment on Repayment of Overpaid Sums

Legal Issues

  1. 1 Whether BCC is entitled to repayment of £20,593,490.24 paid under protest and on condition of repayment if successful on appeal
  2. 2 Whether ABHL is entitled to retrospective recalculation of milestone payments based on when milestones could have been achieved, rather than when certified

Ratio Decidendi

BCC was entitled to repayment of the £20,593,490.24 because the payments were made expressly on condition of repayment if BCC succeeded on appeal, and ABHL's silence and retention of the sums amounted to acceptance of that condition. Under the contract, milestone payments can only be increased from the date of actual certification, not retrospectively; there is no contractual basis for backdating milestone step-ups based on when criteria were met.

Court Disposition

Judgment for the claimant on both issues 4 and 5.

Orders

  • ABHL to repay BCC the sum of £20,593,490.24 plus interest.
  • Declaration that ABHL is only entitled to increased milestone payments from the date of actual certification, not retrospectively.