Cubitt Building & Interiors Ltd v Richardson Roofing (Industrial) Ltd

In a battle of standard terms, the court determines incorporation objectively from the parties’ communications and conduct. Specifically identified contractual documents may prevail over inconsistent printed terms, particularly where the printed terms were not supplied and contain onerous provisions. A letter of intent may create a binding contract where its wording evidences offer and acceptance, despite an intention to execute a formal contract later. A contractual or statutory right to adjudicate does not, without clearer language, make adjudication a precondition to arbitration or court proceedings. A discretionary right to adjudicate does not ordinarily justify a stay of legitimately commenced final proceedings.

Cubitt engaged Richardson as roofing subcontractor. The parties exchanged tenders, meeting minutes, a letter of intent and a subcontract order. They disputed whether the subcontract incorporated Cubitt’s standard terms or the DOM/1 conditions.

Cubitt also sought to restrain an arbitration commenced by Richardson and argued that any dispute should first proceed to adjudication under the contract and Housing Grants, Construction and Regeneration Act 1996. Richardson sought declarations that DOM/1 governed and that the arbitration could proceed. The central issues were incorporation of terms and whether adjudication was a mandatory precondition or merely an available right.

1. The subcontract incorporated the DOM/1 conditions. The parties had agreed at the 12 May 2003 meeting that Richardson’s standard terms would be waived in favour of DOM/1. The remaining details were ascertainable from the agreed materials and DOM/1’s default provisions.

2. The 29 May letter of intent was capable of contractual effect. Its operative wording accepted the revised quotation and instructed Richardson to proceed. The stated intention to enter into a later formal subcontract did not deprive the letter of present legal effect. The subsequent order and Richardson’s commencement of work provided further contractual evidence.

3. Cubitt’s standard terms were not incorporated. The order specifically referred to the numbered documents, which included the meeting minutes recording agreement on DOM/1. Those specific terms were inconsistent with Cubitt’s standard terms. The written and specifically selected provisions therefore prevailed over printed wording. In addition, the standard terms were not attached, and reasonable notice had not been given of their onerous provisions.

4. The DOM/1 adjudication provisions were optional. The language that either party “may” refer a dispute to adjudication did not impose a precondition to arbitration. Section 108 of the Housing Grants, Construction and Regeneration Act 1996 conferred a right to adjudicate, not an obligation.

5. There was no automatic entitlement to stay the arbitration merely because a right to adjudicate existed. The question of any stay was for the arbitrator as part of the dispute and procedural timetable. Cubitt’s claims failed in their entirety. Richardson’s claim for declaratory relief was upheld.