Henia Investments Inc v Beck Interiors Ltd

Ratio Decidendi

Facts

Henia Investments Inc, the employer under a JCT building contract with Beck Interiors Ltd for fitting-out works in London, brought Part 8 proceedings for declarations after a dispute over the contractor's Interim Application for Payment No. 18, which was submitted six days late and was ambiguous as to which monthly payment cycle it related to. The employer had also served a Pay Less Notice relying on its own valuation to withhold payment and to claim liquidated damages for delay, and the parties disputed whether the contract administrator's failure to decide an extension-of-time application affected the employer's right to deduct those damages.

Judgment Summary

Akenhead J held that a document relied upon as an Interim Application for Payment must be, in substance, form and intent, an application stating the sum considered due at the relevant due date, and must be free from ambiguity; because Application No. 18 was ambiguous as to whether it related to the missed April due date or the following May due date, it could not stand as a valid payment notice for May. He further held that the employer's Pay Less Notice, which relied on the contract administrator's own valuation, was validly served, and that the contract administrator's failure to decide the contractor's extension-of-time application did not, absent an express condition precedent, prevent the employer from deducting liquidated damages.

Subsequent Treatment