Clarke & Sons v Act Construction [2002] EWCA Civ 972 (16 July 2002)

Clarke & Sons v Act Construction [2002] EWCA Civ 972 (16 July 2002)

There was a contract between Clarke & Sons and ACT Construction for the redevelopment works, but not on the terms contended by either party. The contract was for reasonable remuneration (quantum meruit), not subject to a cap or express mark-up terms. The reasonable mark-up is 15% on all costs from April 1992, not limited to the last two applications. Previous payments are not to be re-opened except as necessary for recalculation. Clarke cannot challenge the labour cost figures at this stage.

Citation
[2002] EWCA Civ 972
Parties
Appellant: Clarke & Sons; Respondent: ACT Construction
Jurisdiction
England and Wales
Judgment Date
16 July 2002
Procedural Posture
Civil Appeal / Appeal From Technology & Construction Court Judgment
Outcome
Appeal and cross-appeal allowed in part
Legal Topics
Quantum Meruit, Building Contracts, Implied Terms, Mark Up on Costs, Interim Payments, Course of Dealing
Contract Law Construction Law Quantum Meruit Building Contracts Implied Terms Mark Up on Costs Interim Payments Course of Dealing

Case Brief

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Parties

Clarke & Sons

Appellant

ACT Construction

Respondent

Procedural Posture

Civil Appeal / Appeal From Technology & Construction Court Judgment

Legal Issues

  1. 1 Whether a contract existed between Clarke & Sons and ACT Construction for redevelopment works
  2. 2 If so, what were the terms regarding payment, cap on recovery, scope of work, and contract period
  3. 3 Whether ACT was entitled to claimed mark-ups or only reasonable mark-ups

Ratio Decidendi

There was a contract between Clarke & Sons and ACT Construction for the redevelopment works, but not on the terms contended by either party. The contract was for reasonable remuneration (quantum meruit), not subject to a cap or express mark-up terms. The reasonable mark-up is 15% on all costs from April 1992, not limited to the last two applications. Previous payments are not to be re-opened except as necessary for recalculation. Clarke cannot challenge the labour cost figures at this stage.

Court Disposition

Appeal and cross-appeal allowed in part

Orders

  • Matter remitted to the Technology & Construction Court for recalculation of sums due applying a 15% mark-up to all costs from April 1992
  • If counsel cannot agree the calculation, the matter to be restored before Ward LJ