Integrated Power Technologies -Powertech SAL v Hits Telecom Holding Co KSG

On an application for summary judgment, the court must determine whether a claim or defence has a real prospect of success. The application is not a summary trial and the court must avoid conducting a mini-trial or resolving disputed factual issues prematurely. A defence may nevertheless lack reality where the evidence is manifestly deficient, unparticularised or incapable of identifying an arguable case. Contractual payment obligations are construed by reference to the language and structure of the agreement. Accrued debts remain recoverable after termination unless the contract provides otherwise. Conditional judgment may be ordered where success is highly improbable but still arguable.

The claimant supplied telecommunications equipment and installation services under a purchase agreement and sought payment of outstanding sums from the defendant guarantor under a deed of guarantee and indemnity. The claimant applied for summary judgment under CPR Part 24. The defendant disputed liability, relied on the alleged termination of the purchase agreement, challenged the construction of payment provisions, and advanced various cross-claims and set-offs.

The court considered which claims could properly be determined summarily, which required trial, and whether conditional orders requiring payment into court were appropriate.

1. Summary judgment. The applicable test under CPR Part 24 was whether the claim or defence had a real prospect of success. The court could not conduct a mini-trial, but could reject a case which lacked evidential reality. The defendant’s unquantified and unparticularised claims concerning credits, demolition and delay had no real prospect of success.
2. Termination and accrued liabilities. Assuming for present purposes that the purchase agreement had been validly terminated, sums which had accrued due before termination remained recoverable. A postponed payment date did not prevent the debt from having accrued.
3. Equipment payments. The payment provisions for equipment were not conditional upon complete installation or the issue of a final acceptance certificate. That condition applied to service payments, but the parallel equipment provision contained no equivalent requirement.
4. Services and extra works. Issues concerning whether provisional or final acceptance certificates were prerequisites to the accrual of service debts, and claims relating to incomplete or cancelled sites, required trial. Signed bills of quantities supported the recoverability in principle of extra-work claims under the contractual remeasurement provision.
5. Disposition. Summary judgment was entered for US $4,514,514.11 and €271,675.24, together with interest subject to recalculation on a simple-interest basis. A conditional order required payment into court of US $1,364,713.19 and €43,396.17. Hits had unconditional leave to defend all other claims. Costs and the final order were to be agreed or determined by the court.

This was a first-instance decision in the High Court (Commercial Court). No appellate history was stated.