Adam Architecture Ltd v Halsbury Homes Ltd17

The respondent employer (“Halsbury”) was a property developer and appointed the
appellant architectural practice (“Adam”) to provide the design for 200 homes in Norfolk. The
appointment incorporated the RIBA conditions of appointment and provided for interim
payment notices and pay less notices. The appointment also provided that the employer could
terminate on reasonable notice and for the architect to submit a termination account. A dispute
arose and Halsbury ended the appointment. Adam submitted a termination account for the
work done. Halsbury did not pay the account nor did it serve a pay less notice. In
an adjudication claiming payment, the adjudicator decided that in the absence of a pay less notice
Halsbury was obliged to pay the sum applied for by Adam.

At first instance in Part 8 proceedings by Halsbury and upon application by Adam to
enforce the adjudicator’s decision, Edwards-Stuart J in the TCC held there was no contractual
requirement to serve a pay less notice against the termination account. Further, as the contract
had been repudiated by Halsbury it had discharged itself from the obligation to serve a pay less notice.

The Court of Appeal decided that irrespective of the terms of the appointment, sections 110 and 111
of the Act attached to all payments which are “provided for by a construction contract”. The
Court also considered previous authority and concluded that section 111 of the Act applied to
both interim and final payment applications.

Even assuming that a repudiatory breach occurred, there was no acceptance by Adam. The
submission of a claim for payment was simply pursuing a contractual entitlement. Their claim was
one for payment for work done, and not a claim for damages for breach of contract, it was subject
to the provisions of section 111 of the Act and in the absence of a pay less notice Adam had “a
cast iron case” to recover payment of both its invoices.

 

This article was originally written and published on the internet by Slater Heelis in June 2018.

 

This document (and any information accessed through links in this document) is provided for information purposes only and does not constitute legal advice. Professional legal advice should be obtained before taking or refraining from any action as a result of the contents of this document.

 

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