Affinity Water Limited v High Speed Two (HS2) Limited

Summary judgment is unavailable where the defendant has a real, rather than fanciful, prospect of succeeding on a contractual construction issue. A detailed works schedule must be read with the agreement as a whole. Provisions requiring further design, assessment, approval, co-operation and change may make it realistically arguable that a listed work is not an absolute obligation.

Even where the contractual issue appears capable of resolution, summary disposal is inappropriate if the relief depends on disputed factual or expert evidence, including risk assessment, the necessity and reasonableness of proposed works, and third-party consents. A unilateral amended proposal cannot readily justify a final injunction or an order requiring the other party to pay for it.

Affinity Water Limited sought summary judgment against High Speed Two (HS2) Limited concerning tunnelling works expected to pass beneath a large water main. It claimed that the parties’ Protective Provisions Agreement, Asset Protection and Monitoring Agreement and Design and Construction Agreement obliged HS2 to procure and pay for diversion works, and sought declarations, an injunction stopping tunnelling and an indemnity for the costs of temporary overland bypass works.

HS2 disputed the contractual construction and relied on the agreements’ work-order, design and assessment procedures. It also disputed the necessity and safety of the proposed amended works. The central questions were whether HS2’s obligation to divert was clear and whether the claim and requested relief were suitable for summary determination.

1. Application dismissed. On a summary judgment application, the relevant question was whether HS2 had a real, rather than fanciful, prospect of success. If so, the application had to fail.
2. There was a realistic argument that Schedule 4 did not impose an absolute obligation to divert the Main. The Schedule distinguished APA Works from DCA Works, and the DCA contemplated Work Order Requests, approvals, repeated iterations and changes. The agreements also required further design and technical analysis, compliance with Design Principles and the exercise of reasonable skill and care. Schedule 4 was not a dead letter, but it did not provide an absolute answer when read in the context of the contractual scheme.
3. The factual matrix reinforced that conclusion. When the agreements were made, detailed design and technical analysis had not been completed and the Schedule 4 categorisations were arguably indicative and based on high-level assumptions. Those disputed matters could not be resolved summarily.
4. Even if an obligation to divert had been established, the application remained unsuitable for summary disposal. The proposed Amended Works were not the original works identified in the contractual documents and were not agreed. Their contractual appropriateness, necessity, reasonableness, relative risks, technical merits and required consents raised issues requiring factual and expert evidence.
5. The court therefore declined to grant a final injunction stopping tunnelling or an order authorising the Amended Works with recovery of their costs from HS2.

The judgment records that O’Farrell J directed an expedited hearing of the summary judgment application. No appellate history is stated.