O'Rourke Construction Ltd v Healthcare Support (Newcastle) Ltd & Ors
2014
TECHNOLOGY AND CONSTRUCTION COURT
UK
CORAM
- MR. JUSTICE EDWARDS-STUART
Areas of Law
- Construction Law
- Contract Law
- Civil Procedure
2014
TECHNOLOGY AND CONSTRUCTION COURT
UK
CORAM
AI Generated Summary
The case revolves around the dispute over the certification of practical completion of hospital facilities in Newcastle under a PFI scheme. The core issue is the definition and application of completion criteria by the Independent Tester, who must decide whether to issue the completion certificate based on narrowly defined criteria in the Project Agreement or broader construction standards. The court held that the Independent Tester should issue the certificate if the specified Completion Criteria are met, regardless of contract disputes or broader standards, emphasizing the material impact on the building's use.
Judgment
Mr. Justice Edwards-Stuart:
Introduction
The parties’ arguments on costs in this case are almost as far apart as they could be.
The Claimant’s position is that it was the effective winner and that it should it have its costs paid by the Trust.
The Trust, by contrast, submits that the Claimant sought seven declarations and only succeeded on one, and then only in a form that was modified - in the Trust’s favour - by the court.
HSN submits that it was the party that came closest to adopting the position at which the court arrived and that accordingly its costs should be paid by the Trust, alternatively by the Claimant.
Considerations and discussion
There is no doubt in my mind that the Trust’s construction of the contract, as summarised in paragraphs 33-34 of the judgment, was fundamentally different from the construction arrived at by the court. The description of the Trust’s submissions as “bold” was no understatement.
I am quite satisfied that, as between the Claimant and the Trust, the outcome was far closer to the position contended for by the Claimant than that contended for by the Trust.
However, the Claimant’s declarations 6 and 7 were essentially fact-based and introduced an inquiry into matters of fact that was potentially inappropriate on a Part 8 claim. This, in my view, provoked the Trust into serving fairly extensive evidence on matters of fact, although that evidence was, I felt, somewhat tainted because in two or three places it was more partisan than it should have been.
I consider that there is some force in the Trust’s submission that the Claimant did not really retreat from its position on declarations 6 and 7 until fairly early on during the course of its submissions at the hearing and that, as a result, much time was spent during the preparation for the hearing that should have been avoided.
My attention was drawn to the decision of Jackson J in Multiplex Construction v Cleveland and Bridge UK Ltd [2008] EWHC 2280, at paragraph 72, and to my own judgment in M T Højgaard A/S v E.ON Climate and Renewables UK (5 June 2014), in which I considered that and other authorities. At paragraphs 9-11 of the latter I illustrated, by reference to the parties’ estimates of their costs in that case, the consequences of an issue-based costs order when it is simplified and translated into an order making one party pay a proportion of the other side’s costs. I bear those authorities in mind and propose to apply the principles set out