TClarke Contracting Ltd v Bell Build Ltd

The Part 8 procedure is appropriate where the court is asked to decide a precise question that is unlikely to involve a substantial dispute of fact. Contract construction may ordinarily qualify where the contractual terms are agreed. It is inappropriate where the court must determine whether a contract was varied, identify the terms of an alleged variation evidenced by writing, or decide estoppel issues requiring witness evidence and proof of reliance. The court determines the parties’ rights for itself; it does not review or hear an appeal from an adjudicator’s decision. Where the pleaded issues cannot be finally and properly determined on agreed facts, the court may direct that the claim proceed under Part 7.

TClarke sought declarations concerning the validity of a Pay Less notice and an adjudicator’s decision requiring payment to Bell. The dispute arose under a construction subcontract incorporating the 2016 JCT Design & Build Subcontract Conditions. The parties disagreed about whether a later agreement had varied the payment procedure and, if so, what its terms were. Bell also relied on estoppel based on the parties’ conduct and alleged detrimental reliance. Bell objected to the use of Part 8. The central issue was whether the claim involved questions suitable for determination without a substantial dispute of fact.

1. The court ruled that the Part 8 procedure was plainly inappropriate and directed that the claim proceed under Part 7.
2. Under Civil Procedure Rules 1998, r.8.1(2), Part 8 is available where the question for decision is unlikely to involve a substantial dispute of fact. The question should also be framed with sufficient precision and be capable of a precise answer. The procedure is unsuitable where it risks producing an ill-formulated or ill-informed decision.
3. The court does not review or hear an appeal from the adjudicator’s decision. It must finally determine the parties’ rights for itself. Adjudication decisions are ordinarily enforced as temporarily binding pending that final determination, but this was not an enforcement claim.
4. Contract construction can be suitable for Part 8 where the contractual terms are undisputed. Before construing a contract, however, the court must establish that a binding agreement existed and identify its terms.
5. Here, the existence of the alleged contractual variation and its terms were disputed. Since the alleged variation was evidenced by, rather than contained in, writing, those issues required witness evidence. The estoppel argument also required evidence of the alleged conduct and detrimental reliance. TClarke’s attempt to proceed on Bell’s factual case did not ensure final determination, because it might later dispute the existence or terms of the variation.
6. The court was therefore not satisfied that any precise legal question, tried on clearly agreed facts, would determine the dispute. The claim was to continue under Part 7 pursuant to the court’s power under Civil Procedure Rules 1998, r.8.1(4).