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You are here: BAILII >> Databases >> England and Wales High Court (Technology and Construction Court) Decisions >> Vinci Construction UK Ltd v Beumer Group UK Ltd [2017] EWHC 2196 (TCC) (30 August 2017) URL: http://www.bailii.org/ew/cases/EWHC/TCC/2017/2196.html Cite as: 174 Con LR 178, [2017] CILL 4037, [2017] BLR 547, [2017] EWHC 2196 (TCC) |
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QUEEN'S BENCH DIVISION
TECHNOLOGY AND CONSTRUCTION COURT
Strand, London, WC2A 2LL |
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B e f o r e :
____________________
VINCI CONSTRUCTION UK LIMITED |
Claimant |
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- and - |
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BEUMER GROUP UK LIMITED |
Defendant |
____________________
David Sears QC (instructed by Silver Shemmings LLP) for the Defendant
Hearing dates: 22nd May 2017, 23rd May 2017
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Crown Copyright ©
Mrs Justice O'Farrell:
i) Section 5 Baggage Subcontract completion date: 12 May 2015;
ii) Section 6 Remaining Works Subcontract completion date: 27 May 2015.
i) Section 5 Baggage revised Subcontract completion date: 17 November 2015;
ii) Section 6 Remaining Works revised Subcontract completion date: 14 December 2015.
The Subcontract
i) the Agreement dated 8 November 2012;
ii) the NEC 3 Engineering and Construction Subcontract, Option A, priced subcontract with activity schedule, with Option W2 (Dispute Resolution procedure) and Options X2, X5, X7, X13, X16, X17, Y(UK)3 and Z, all as amended by Schedule 3 to the Agreement;
iii) Schedules 1 12 of the Agreement.
"5.1 The Subcontractor shall be deemed to have full knowledge of the provisions of the Main Contract (other than the details of the Contractor's prices referred to therein), and the Contractor shall, if so requested by the Sub-Contractor, provide the Sub-Contractor with a true copy of the Main Contract less such details.
5.2 Save where the provisions of the Subcontract otherwise require, the Subcontractor shall so design, execute, complete and maintain the Subcontract Works so that no act or omission of his in relation thereto shall constitute, cause or contribute to any breach by the Contractor of any of his obligations under the Main contract and the Subcontractor shall, save as aforesaid, assume and perform hereunder all the obligations and liabilities of the Contractor under the Main Contract in relation to the subcontract works "
"The Subcontractor Provides the Subcontract Works in accordance with the Subcontract Works Information and any accepted Subcontractor's proposals "
"the Subcontractor's proposed design (which differs from the Employer's design as contained in the Works Information) for the following elements of the works:
- Baggage
As more particularly described in paragraphs D.1.12.1.5.3 of the Works Information and upon which the Prices and Completion Date are based."
"In these conditions of subcontract, unless stated as the whole of the subcontract works, each reference and clause relevant to
- The subcontract works,
- Completion and
- Subcontract Completion Date
applies, as the case may be, to either the whole of the subcontract works or any section of the subcontract works."
"The Subcontractor does not start work on the Site until the first subcontract access date and does the work so that Completion is on or before the Subcontract Completion Date."
"The Contractor decides the date of Completion. The Contractor certifies Completion within one week of Completion."
"The Subcontractor shall execute the subcontract works regularly and diligently so that the condition stated for each Key Date is met the by Key Date and the subcontract works are completed by the Subcontract Completion Date."
"If a programme is not identified in the Subcontract Data, the Subcontractor submits a first programme to the Contractor for acceptance within the period stated in the Subcontract Data."
"The Subcontractor shows on each programme which he submits for acceptance
- the subcontract starting date, subcontract access dates, Key Dates and Subcontract Completion Date "
"Part of the Site | Date |
Virgin Buildings Removal of redundant High Risk Carousel, feed conveyor and plough | 28 January 2013 |
Main Works new Baggage Hall Grid Lines 10-15 | 04 April 2014 |
Main Works new Baggage hall Grid Lines 03-10 | 27 May 2014 |
Access Stand 11 (This related to disconnection of equipment only) | 13 May 2015" |
"the date by which work is to meet the Condition stated. The Key Date is the key date stated in the Subcontract Data and the Condition is the condition stated in the Subcontract Data unless later changed in accordance with this subcontract."
"2.0 ELEVEN WEEKS prior to the Baggage sectional completion date the works forming part of this section shall achieve Completion excepting Airport Operational Readiness trials and attendance on same. Completion will not be achieved until the completion of Airport Operational Readiness trials."
"Section | "description | subcontract completion date |
1 | Design submission A | 14 December 2012 |
2 | Design submission B | 16 September 2013 |
3 | Temporary Stand Provision | N/A |
4 | Pier & Airfield | N/A |
5 | Baggage | 12 May 2015 |
6 | Remaining Works | 27 May 2015" |
"The subcontract completion date for the whole of the subcontract works is 27 May 2015."
"X7.1 The Subcontractor pays delay damages at the rate stated in the Subcontract Data from the Subcontract Completion Date for each day until the earlier of
- Completion and
- the date on which the Contractor takes over the subcontract works."
"Section | Description | Amount per day |
1 | Design submission A | £19,000 / calendar day |
2 | Design submission B | £25,000 / calendar day |
3 | Temporary Stand Provision | N/A |
4 | Pier & Airfield | N/A |
5 | Baggage | £22,500 / calendar day |
6 | Remaining Works | £17,000 / calendar day" |
"The Contractor need not take over the subcontract works before the Subcontract Completion Date if it is stated in the Subcontract Data that he is not willing to do so. Otherwise the Contractor takes over the subcontract works not later than two weeks after Completion."
"The Subcontract Works Information is contained within schedule 12 to the Subcontract Agreement in two parts as follows:
Part a Package specific Subcontract Works Information detailing the package scope of works and
Part b Project specific Subcontract Works Information detailing the remaining Contractors Works Information (where relevant). Part b includes documents that describe how the Contractor should carry out the works and the administration, process and procedures that should be followed. The Subcontractor is reminded that it shall so design, execute, complete and maintain the Subcontract Works and assume and perform hereunder all the obligations and liabilities of the Contractor under the Main Contract in relation to the Subcontract Works.
In summary, the scope of works includes for the detailed design, manufacture, fabrication, supply, delivery, offloading, installation, testing, commissioning and end user training and including:
- Departures baggage equipment and systems, incl. controls and monitoring, Transnorm bends and SEW permanent magnet motors (PMM) for conveyors;
- 2 new Logan baggage sorters with manual coding facilities 108 new baggage make up positions;
- Minimum 2600 position automated bag store including Warehouse Management System;
- SICK Scanner Arrays;
- Baggage Sortation & Distribution;
- Removal of temporary carousels in Stand 11 on completion of new baggage system;
- Removal of redundant baggage equipment from existing baggage hall on completion of new baggage system (Disconnection by Subcontractor, removal by Contractor);
- Modification of Baggage System including integration of existing system into new prior to Stand 11 building removal;
- Provision of test bags (including HBS test bags) required to complete the required testing and commissioning requirements;
- Provision of baggage labels to enable full system testing & commissioning."
"The Subcontractor shall be entirely responsible for the design, integration, installation, commissioning, testing and handover of all baggage system works associated with this contract and the changes and integration and performance of the existing South Terminal baggage system where modified or impacted under this contract."
"The Confidence Trial shall not commence until completion of all Reliability Periods to the satisfaction of the Contractor.
Based on a Reliability Period of 20 days the performance requirement level is as follows "
i) The first flowchart is entitled "Break-in Sectional Completion Handover Sequence." The description above the flowchart states:
"The Subcontractor shall provide a programme for acceptance by the Contractor based on the Baggage Break-in Sectional Handover Sequence detailed below "
The sequence shown in the diagram includes:
a) testing and commissioning;
b) operational trials (1 day minimum);
c) "TG5" handover for beneficial use;
d) reliability trials (20 days minimum);
e) Sectional Completion;
f) TG6 (14 days maximum after sectional completion).
ii) The second flowchart is entitled "Baggage Sectional Completion - Handover Sequence." The description above the flowchart states:
"The Subcontractor shall provide a programme for acceptance by the Contractor based on the Baggage Sectional Completion Handover Sequence detailed below "
The sequence includes:
a) "TG5" final section handover for beneficial use;
b) reliability trials (7 days);
c) final sectional completion;
d) whole system confidence trial;
e) TG6 final section (14 days maximum after final sectional completion);
f) Completion of the whole of the works (30 days minimum after final sectional completion);
g) trials snagging completion;
h) final PA3 Stage 2 handover.
"The Contractor shall meet the requirements of the Works Information but the Employer accepts that the Contractor's proposal for the baggage system is based upon the layouts and solution as detailed in document 11945-CP-00108 included in Schedule K."
"
- Decommissioning and removal of the Domestic Arrivals baggage equipment.
- Decommissioning & removal of existing baggage equipment within existing baggage hall & stand 11 building, made redundant by the completion of these works and make areas good.
- Decommissioning and Demolition of Stand 11 building on completion of the main works ..."
"
- Departures baggage equipment and systems
- Baggage Sortation & Distribution;
- Removal of temporary carousels in Stand 11 on completion of new baggage system;
- Removal of redundant baggage equipment from existing baggage hall on completion of new baggage system;
- Modification of Baggage system including integration of existing system into new prior to Stand 11 building removal;
- Provision of test bags required to complete the required testing and commissioning requirements "
"The Contractor shall ensure that an equivalent number of make-up positions that have been tested, commissioned and handed over post AOR are available within the new baggage factory prior to the de-commissioning of any baggage make-up positions within the Stand 11 building."
" Beumer proposes the following sequence to achieve Airport Operational Readiness (AOR)
1. End to End Acceptance Test for the new baggage system (stand alone but fully commissioned)
2. Acceptance and Handover in 2
3. Reliability Period and PA3 part 1
4. Confidence Period
5. PA3 Part 2
3.7.3 Reliability and Confidence Trials
Due to the system phasing and the migration of airlines from Stand 11 the intention is to put the system into beneficial use after the third break in to the existing system. During this period BEUMER will be responsible for all maintenance aspects.
The twenty day reliability period will only commence after the fourth and final connection has been completed and tested
The confidence trial will commence for a thirty day period upon signed off completion of the Reliability period "
"D.1.12.5.5
Section 5: Baggage
To achieve this sectional completion the following deliverables shall be completed:
- All works detailed in the Works Information in the area of the pier building in the shaded areas of drawings 20209-00-A-200-GA-000003-sectional & 20209-10-A-200-GA-000003-sectional.
- All works detailed in the Works Information within the existing building required to make the baggage system operational.
- AOR as required by D.1.12.19 for all baggage works.
"D.1.12.5.6
Section 6: Remaining Works
To achieve this sectional completion the following deliverables shall be completed:
- Demolition of Stand 11 building.
- Formation of North East entrance to baggage hall including all associated roadways.
- Strip out & disposal of the baggage equipment in the existing baggage hall as detailed in the Works Information."
Subcontract Access Dates | Date | |
1 | Virgin High risk Buildings | 29.04.13 |
2 | Main Works New Baggage Hall GL 10-15 |
10.10.14 |
3 | Main Works New Baggage Hall GL 3-10 |
19.11.14 |
4 | Access Stand 11 | 22.09.15 |
Subcontract Completion Dates X5 | ||
3 | Baggage Works | 17.11.15 |
4 | Remaining Works | 14.12.15 |
Subcontract Key Dates | ||
2 | Baggage works 11 weeks prior to baggage completion | 01.09.15 |
The Issue
i) the baggage handling system works within the new pier building;
ii) the baggage handling system works within the existing building required to make the new baggage system operational;
iii) Beumer's works in connection with the AOR trials; and
iv) disconnection of the redundant baggage equipment (including temporary carousels for Stand 11) but not including strip out and removal of the same.
Legal principles
" the Court will strive if possible not to find a contract or contractual provision uncertain; indeed such a conclusion has been graphically described as a "counsel of despair" (Nea Agrex SA v Baltic Shipping Co Ltd., [1976] 2 Lloyd's Rep. 47 at p.50; [1976] 1 QB 933, at p.943, per Lord Denning, MR).
An important and well-recognised distinction must be drawn between conceptual uncertainty on the one hand, which invalidates the instrument, and evidential uncertainty, which merely means that a party may on a given set of facts be unable to establish that he comes within a particular aspect of the provision in question "
See also: Whitecap v John H Rundle [2008] EWCA Civ 429 per Moore-Bick LJ at para.21:
"The conclusion that a contractual provision is so uncertain that it is incapable of being given a meaning of any kind is one which the courts have always been reluctant to accept, since they recognise that the very fact that it was included demonstrates that the parties intended it to have some effect."
" it is simply a non sequitur to argue from a disagreement about the meaning and effect of a contract to its legal uncertainty. Parties are always disagreeing about the contracts which they make. They take those arguments, if necessary, to the courts, or to arbitration, for their resolution: and sometimes the resolution is very difficult indeed to arrive at. That is equally true of disputes as to the meaning of contracts and of disputes as to the application of contracts to the facts and of disputes as to the proper understanding of the facts. None of that makes a contract uncertain. For that to occur and it very rarely occurs it has to be legally or practically impossible to give to the parties' agreement any sensible content
that is certain which can be rendered certain "
Discussion
Conclusion