AMW PLUMBING AND HEATING LTD v. ZOOM DEVELOPMENTS LIMITED [2010] ScotSC 173 (21 October 2010)

AMW PLUMBING AND HEATING LTD v. ZOOM DEVELOPMENTS LIMITED [2010] ScotSC 173 (21 October 2010)

The contract did not provide an adequate mechanism for determining when retention payments became due, as payment was entirely within the defenders' control and could be postponed indefinitely. Therefore, the Scheme for Construction Contracts applied, making payment due within 7 days of the relevant period or the making of a claim, whichever was later.

Citation
[2010] ScotSC 173
Parties
Pursuer/respondent: AMW Plumbing & Heating Limited; Defender/appellant: Zoom Developments Limited
Jurisdiction
Scotland
Judgment Date
21 October 2010
Procedural Posture
Civil Appeal / Appeal From Sheriff's Decision
Outcome
appeal allowed in part; payment of retention monies ordered per the Scheme for Construction Contracts
Legal Topics
Retention Payments, Adequate Payment Mechanism, Construction Contracts, Interpretation of Contract Clauses
Construction Law Contract Law Retention Payments Adequate Payment Mechanism Construction Contracts Interpretation of Contract Clauses

Case Brief

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Parties

AMW Plumbing & Heating Limited

Pursuer/respondent

Zoom Developments Limited

Defender/appellant

Procedural Posture

Civil Appeal / Appeal From Sheriff's Decision

Legal Issues

  1. 1 Whether the contract provided an adequate mechanism for determining when retention payments became due under the Housing Grants, Construction & Regeneration Act 1996
  2. 2 Whether the defenders could indefinitely postpone payment of retention monies by not proceeding with the third block
  3. 3 Interpretation of 'suspension' in contract clauses 2.3 and 3.1

Ratio Decidendi

The contract did not provide an adequate mechanism for determining when retention payments became due, as payment was entirely within the defenders' control and could be postponed indefinitely. Therefore, the Scheme for Construction Contracts applied, making payment due within 7 days of the relevant period or the making of a claim, whichever was later.

Court Disposition

appeal allowed in part; payment of retention monies ordered per the Scheme for Construction Contracts

Orders

  • Defenders to pay retention monies to pursuers within 7 days of the raising of the action or expiry of the relevant period, whichever is later.
  • Pursuers awarded expenses.