ISG Retail Limited v FK Construction Limited

Part 8 proceedings are appropriate only where the claim is unlikely to involve a substantial dispute of fact. A claim concerning compliance with contractual notice conditions may be unsuitable where notification was allegedly given through several forms of communication and the relevant context is disputed. Disputed allegations of waiver or estoppel will ordinarily also make Part 8 inappropriate, unless the factual background is substantially agreed or the case is clearly incapable of success. The court may determine one part of an adjudicator’s decision under Part 8, but only where that issue independently satisfies the procedural test.

ISG Retail Limited, the main contractor, sought declarations concerning FK Construction Limited’s entitlement to an extension of time and prolongation costs under a roofing and cladding sub-contract. The claims followed an adjudicator’s decision awarding FK an extension of time and prolongation costs.

ISG contended that contractual notice requirements were conditions precedent and that FK had failed to comply with them. FK disputed the construction and alleged compliance, waiver and estoppel. FK also argued that the issues were unsuitable for Part 8 because they involved substantial factual disputes. The central issue was whether the claims could properly be determined under Part 8.

1. Part 8 suitability. Under Civil Procedure Rules 1998, rule 8.1(2), Part 8 is available where the claimant seeks the court’s decision on a question unlikely to involve a substantial dispute of fact. A pure question of contractual construction may in principle be suitable.
2. Compliance with the notice provision. The question whether FK complied with clause 9(5) was unsuitable for Part 8. The evidence raised factual issues as to whether notification was given through early warning notices, correspondence, progress reports, meeting minutes or discussions, and as to how those communications should be understood in their factual context. The parties’ cases also required proper pleading.
3. Waiver and estoppel. FK had an arguable case that ISG engaged with repeated early warnings without alleging non-compliance, and that FK may have relied on that conduct. The allegations were likely to involve substantial factual disputes. The approach in ING Bank NV v Ros Roca SA, concerning the ordinary unsuitability of disputed estoppel claims for Part 8, applied. The requirements of estoppel by convention and waiver were adopted from Jawaby Property Investment Limited v Interiors Group Ltd and Westbrook Resources Ltd v Globe Metallurgical Inc.
4. Partial determination. The judge expressed the view, although the point did not strictly arise, that one part of an adjudicator’s decision could be finally determined under Part 8 where that issue was otherwise suitable. The conclusion accorded with Geoffrey Osbourne Ltd v Atkins Rail Ltd.
5. Disposition. The proceedings were unsuitable for Part 8. The court declined to determine whether clause 9(5) was a condition precedent and made no declarations. The parties were invited to agree consequential directions, including whether the claim should continue under Part 7 pursuant to Civil Procedure Rules 1998, rule 8.1(4).