HT-2024-LDS-000014 - [2024] EWHC 3067 (TCC)

The Defendant relies upon the Adjudicator’s decision dated 29 May 2024. In that decision, the Adjudicator determined that the email of 24 October 2023 was not a variation, as defined in the contract but rather was a cancellation of the Work Order.

The Adjudicator set out his reasoning on this issue between paragraphs 78 and 86 of his decision. I do not propose to rehearse the whole of those reasons. However, whilst the Adjudicator correctly set out the definition of “Variation” as set out in schedule D of the framework agreement, he then appears to concentrate on the fact that the definition permitted the Claimants to make “omissions… in the works”. He decided that in order to omit the whole of the works, careful wording would be required in any instruction to achieve that objective.

His conclusion on the issue is as follows:

“84.

However, I do not consider that under the definition of a Variation in this Contract that GCL can cancel the commencement of the whole of the Works, or postpone the commencement of the whole of the Works without clear words which would convey to the reasonable recipient that that is what was intended so that the Contractor would know that the Variation mechanism had been triggered under the Contract.

85.

In my opinion, the reasonable recipient of the email issued by GCL on 24th

October 2023 (12:13) would not understand that it was being issued either as a Variation to the Work Order, under clause 11.1, or as confirmation of an oral variation to the Work Order, under clause 11.2, for the simple reason that it does not make any mention of the fact that it is being issued either as a Variation, or as a confirmation of any oral variation that may have been given in the telephone conversation held on Monday 23rd October 2023.

86.

As it seems to me that GCL’s email seeks to cancel the commencement of the Works under the Work Order and is not labelled in any respect as a Variation I do not consider that it can be interpreted as something that in my opinion it was not intended to be.”

Whilst I accept that the email did not specifically state it was a variation, I disagree with the interpretation by the Adjudicator of the definition of “Variation”. The Claimant was entitled to make omissions from a Work Order and also to vary the period in which works were to be performed. The Claimant stated in the email that its intention was to continue with all of the Work Orders which had been signed. The Claimant noted the present position as being that it was unlikely that works would be able to commence before the end of 2023. However, it also stated specifically that it would keep in touch with the Defendant concerning the programme for works.

In my judgment, the wording of the contract as agreed between the parties permitted the Claimant to postpone commencement of the works. I accept the submission made by Mr Beaumont that the discussions which all parties agree took place on 23 October followed up by the email on 24 October was all that was required to satisfy clause