Doosan Enpure Ltd v Interserve Construction Ltd

Doosan Enpure Ltd v Interserve Construction Ltd

On the proper construction of the JVA, interim payments to JV partners are to be made in the amount of their certified costs as shown in their Interim Cost Statements, without deduction for internal changes, delay damages, or other adjustments, unless and until the JV Committee unanimously agrees to suspend or reduce payments. The pain/gain sharing and adjustments for internal changes or damages are to be dealt with at the final reckoning, not on an interim basis. Interserve had no defence to Doosan's claim for declaratory relief and payment from the JV Account.

Parties
Claimant: Doosan Enpure Limited; Defendant: Interserve Construction Limited
Jurisdiction
England and Wales
Judgment Date
25 September 2019
Procedural Posture
Civil (commercial Construction Dispute) / Summary Judgment Application
Outcome
Summary judgment granted for the claimant (Doosan) on the declarations and entitlement to payment from the JV Account.
Legal Topics
Joint Venture Agreements, Interim Payments, Contract Interpretation, Pain/gain Sharing Mechanisms, Summary Judgment
Contract Law Commercial Law Construction Law Joint Venture Agreements Interim Payments Contract Interpretation Pain/gain Sharing Mechanisms Summary Judgment

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Parties

Doosan Enpure Limited

Claimant

Interserve Construction Limited

Defendant

Procedural Posture

Civil (commercial Construction Dispute) / Summary Judgment Application

Legal Issues

  1. 1 Whether interim payments under the JVA can be suspended unilaterally by one JV partner or only by unanimous agreement of the JV Committee
  2. 2 Whether the JVA entitles a party to interim payments in the amount of its certified costs or subject to deductions for internal changes, delay damages, or other adjustments prior to final reckoning
  3. 3 Whether Interserve can set off or withhold interim payments based on alleged cross-claims or indemnities under the JVA

Ratio Decidendi

On the proper construction of the JVA, interim payments to JV partners are to be made in the amount of their certified costs as shown in their Interim Cost Statements, without deduction for internal changes, delay damages, or other adjustments, unless and until the JV Committee unanimously agrees to suspend or reduce payments. The pain/gain sharing and adjustments for internal changes or damages are to be dealt with at the final reckoning, not on an interim basis. Interserve had no defence to Doosan's claim for declaratory relief and payment from the JV Account.

Court Disposition

Summary judgment granted for the claimant (Doosan) on the declarations and entitlement to payment from the JV Account.

Orders

  • Declaration that interim payments can only be suspended with the unanimous agreement of the JV Committee.
  • Declaration that Interserve is in breach of the JVA by refusing to authorise the release of interim payments to Doosan.