“49. I wish to add a few words to deprecate the practice which was adopted in this case of counsel writing to the judge, after a draft judgment has been provided, to ask him to reconsider his conclusions. It is a growing practice and in my view it should happen only in exceptional circumstances. 50. The purpose of the judge providing a draft of the judgment before hand-down is to enable the parties to spot typographical, spelling and minor factual errors which have escaped the judge’s eye. It is also to give the parties the opportunity to attempt to reach agreement on costs and to consider whether they wish to appeal. Consideration of such matters before hand-down can save costs. Circulation of the draft is not intended to provide counsel with an opportunity to reargue the issues in the case. 51. Only in the most exceptional circumstances is it appropriate to ask the judge to reconsider a point of substance. Those circumstances might be, for example, where counsel feels that the judge had not given adequate reasons for some aspect of his/her decision. Then it may be appropriate to send a courteous note to the judge asking him/her to explain the reasons more fully. By way of further example, if the judge has decided the case on a point which was not properly argued or has relied on an authority which was not considered, the appropriate course will be to ask him/her either to reconvene for further argument or to receive written submissions from both sides. Letters such as the one sent in this case, which sought to reopen the argument on a wide variety of points, should not be sent.”
“Very careful consideration must be given to such applications, and litigants should not be given the ability to have a second bite at the cherry. The distribution of a draft judgment under CPR Pt 40 should not be seen (as it seems to be, by many legal advisers currently) simply as an open invitation to embark upon an additional round of the litigation, remedying lacunae in their own evidence and raising further arguments. If a matter could have been raised at the first hearing, then it should be. If time is needed to deal with something, then the court must be asked for time – this will not always be given, but the matter must be dealt with then.”
“… it is clear that the court has jurisdiction to correct an error of material fact before the order is drawn (see for example Stewart v. Engel, The Times,26 May 2000 ; Pittalis v. Sherefettin [1986] Q.B. 868; Charlesworth v. Relay Roads Ltd [2000] 1 W.L.R. 230). It inevitably happens with complex cases that from time to time a fact which is material is overlooked. But the jurisdiction to correct an error is to be exercised cautiously and sparingly, and the question of review should be raised as promptly as possible. An application to the court to vary a finding of fact is not to be encouraged as it may lead to groundless applications. In this instance, as I have said, Mr Mill’s approach was not to apply to the court to review its finding of fact but rather to use it as a basis for seeking permission to appeal. In my judgment, an appeal is not the appropriate course where there are errors in judgments which can be corrected by the court which conducted the trial. To leave such matters to an appeal means further delay, uncertainty and costs, which is not in the interests of the litigants. The trial judge is in a strong position to consider the effect of the error in the context of the entire case.”
“If an application for permission to appeal on the ground of lack of reasons is made to the trial judge, the judge should consider whether his judgment is defective for lack of reasons, adjourning for that purpose should he find this necessary. If he concludes that it is, he should set out to remedy the defect by the provision of additional reasons refusing permission to appeal on the basis that he has adopted that course. If he concludes that he has given adequate reasons, he will no doubt refuse permission to appeal.”
“… the best approach for a judge to adopt in the trial of a commercial case is, in my view, to place little if any reliance at all on witnesses’ recollections of what was said in meetings and conversations, and to base factual findings on inferences drawn from the documentary evidence and known or probable facts. This does not mean that oral testimony serves no useful purpose – though its utility is often disproportionate to its length. But its value lies largely, as I see it, in the opportunity which cross-examination affords to subject the documentary record to critical scrutiny and to gauge the personality, motivations and working practices of a witness, rather than in testimony of what the witness recalls of particular conversations and events. Above all, it is important to avoid the fallacy of supposing that, because a witness has confidence in his or her recollection and is honest, evidence based on that recollection provides any reliable guide to the truth.”
“My basic approach always to pleaded issues is that if somebody wants to amend, they must make an application. If something is shown to be within the current pleadings such that that’s not necessary, then so be it. If it’s outwith the current pleading, then it seems to me that the pleadings both define and confine the issues in a case, and therefore, absent being persuaded that something is within the current pleaded case or a successful application to amend, then it’s out.”
“As I said right at the beginning, if it’s right that something falls outwith the pleadings, then the mere fact of having presented the argument or having asked the questions doesn’t imply any amendment to your pleadings.”
“When interpreting a written contract, the court is concerned to identify the intention of the parties by reference to ‘what a reasonable person having all the background knowledge which would have been available to the parties would have understood them to be using the language in the contract to mean’, to quote Lord Hoffmann in Chartbrook Ltd v. Persimmon Homes Ltd [2009] A.C. 1101, para. 14. And it does so by focussing on the meaning of the relevant words …. in their documentary, factual and commercial context. That meaning has to be assessed in the light of (i) the natural and ordinary meaning of the clause, (ii) any other relevant provisions of the lease, (iii) the overall purpose of the clause and the lease, (iv) the facts and circumstances known or assumed by the parties at the time that the document was executed, and (v) commercial common sense, but (vi) disregarding subjective evidence of any party’s intentions.”
“a different and altogether more ambitious undertaking: the interpolation of terms to deal with matters for which, ex hypothesi, the parties themselves have made no provision.”
“for a term to be implied, the following conditions (which may overlap) must be satisfied: (1) it must be reasonable and equitable; (2) it must be necessary to give business efficacy to the contract, so that no term will be implied if the contract is effective without it; (3) it must be so obvious that ‘it goes without saying’; (4) it must be capable of clear expression; (5) it must not contradict any express term of the contract.”
“The question of whether a term should be implied, and if so what, almost inevitably arises after a crisis has been reached in the performance of the contract. So the court comes to the task of implication with the benefit of hindsight, and it is tempting for the court then to fashion a term which will reflect the merits of the situation as they then appear. Tempting, but wrong … … it is not enough to show that had the parties foreseen the eventuality which in fact occurred they would have wished to make provision for it, unless it can also be shown either that there was only one contractual solution or that one of several possible solutions would without doubt have been preferred.”
“First, in Equitable Life Assurance Society v. Hyman [2002] 1 A.C. 408, 459, Lord Steyn rightly observed that the implication of a term was ‘not critically dependent on proof of an actual intention of the parties’ when negotiating the contract. If one approaches the question by reference to what the parties would have agreed, one is not strictly concerned with the hypothetical answer of the actual parties, but with that of notional reasonable people in the position of the parties at the time at which they were contracting. Secondly, a term should not be implied into a detailed commercial contract merely because it appears fair or merely because one considers that the parties would have agreed it if it had been suggested to them. Those are necessary but not sufficient grounds for including a term. However, and thirdly, it is questionable whether Lord Simon’s first requirement, reasonableness and equitableness, will usually, if ever, add anything: if a term satisfies the other requirements, it is hard to think that it would not be reasonable and equitable. Fourthly, …. although Lord Simon’s requirements are otherwise cumulative, I would accept that business necessity and obviousness, his second and third requirements, can be alternatives in the sense that only one of them needs to be satisfied, although I suspect that in practice it would be a rare case where only one of those two requirements would be satisfied. Fifthly, if one approaches the issue by reference to the officious bystander, it is ‘vital to formulate the question to be posed by [him] with the utmost care’, to quote from Lewison, The Interpretation of Contracts … Sixthly, necessity for business efficacy involves a value judgment. It is rightly common ground on this appeal that the test is not one of ‘absolute necessity’, not least because the necessity is judged by reference to business efficacy. It may well be that a more helpful way of putting Lord Simon’s second requirement is, as suggested by Lord Sumption in argument, that a term can only be implied if, without the term, the contract would lack commercial or practical coherence.”
“If: … (c) (subject to clause 15B.1), the Contractor having paid or allowed or becoming liable for a sum or sums in aggregate equal to or greater than the Delay Damages Cap; … then, without prejudice to any other rights or remedies, the Purchaser may forthwith issue a Notice terminating the employment of the Contractor under the Contract with immediate effect.”
“(a) an extension shall only be granted when the [breach of contract causing the delay] affects achieving the completion of the Plant or the Works or any part of the Plant or the Works by any date or by the end of any period stated in the Contract; (b) all the information currently available to the Project Manager; (c) the amount of any extension in respect of a particular cause of delay shall be fair and reasonable; and (d) in the event of extension for a cause which occurs at a time when the Contractor is already in delay for which no extension is allowable, the delay accrued prior to the allowable extension shall not be excused.”
“14.8.1.1 The Contractor shall notify the Purchaser of RDF requirements as set out in 14.8.2 and manage RDF receipt and off-loading process. The Purchaser shall set up supply contracts. For a period of a maximum 9 weeks from the first RDF delivery on site, the Purchaser will be responsible for the delivery of up to 25,000 tonnes of RDF, the disposal of up to 22,000 tonnes of any Fuel and out of specification Fuel produced, and the disposal of up to 2,250 tonnes of inerts from the MPT plant. The Contactor will be responsible for the costs associated with the disposal of any Fuel and inerts from the MPT plant exceeding the quantities and/or exceeding the period from the first RDF delivery on site stated above… 14.8.2 At least 6 months prior to the start of commissioning, the Contractor shall provide an outline schedule of the quantities and dates of the RDF required to successfully complete the commissioning and Take-Over procedures. As part of the Commissioning Protocol issued to the Purchaser prior to starting commissioning, these dates and quantities shall be confirmed. In the month before RDF deliveries are due to commence and subsequently two weeks prior to commencement, any changes to the Commissioning Protocol which affect RDF deliveries shall be immediately identified to the Purchaser so that alternative arrangements can be made. The Contractor shall notify the Purchaser 48 hours prior to any changes to the commissioning tonnages notified in accordance with the paragraph. Failure to do so will result in the Contractor being responsible for any Purchaser costs associated with storing, handling, transporting and disposal of the RDF.”
“The material supply to the facility will be refuse derived fuel (RDF). RDF may be derived from either municipal solid waste (MSW) or commercial and industrial waste (CIW) ...”
“The Contractor shall design, manufacture and deliver a mechanical pre-treatment (MPT) plant to treat the incoming RDF as defined in clause 1.3.2 and Table 22A.2.0 above and to: - reduce the size of the RDF to meet the requirements in Table 22A.2. - reduce the percentage of non-combustible ferrous and non-ferrous metals, non-combustible glass and non-combustible inert materials in the incoming RDF to produce a fuel to the gasifier as defined for these parameters in Table 22A.2.2 and 22A.2.3 below.”
“No other performance guarantees or obligations provided under this Contract shall be diminished or negated by the plastic film or sanitary waste limits.”
“Bulk density of the incoming RDF will be calculated according to BS EN 15401 2011: Solid Recovered Fuels – Determination of Bulk Density, using a 220-litre container. 3 measurements of bulk density will be made as required by BS EN 15401, which will be averaged to give a single daily value. The [net calorific value] of the Incoming RDF will be laboratory tested and reported as set out in BS EN 15400:2011, Solid Recovered Fuels – Determination of calorific value. Baled inputs will have a maximum bale size of 1100mm x 1100mm x 1700mm, with non-metallic binding and plastic wrapping. Unless stated otherwise, and excluding bulk density and net calorific value (NCV), the limits stated in table 22A.2.0 above are based upon daily averages of the RDF delivered to the RDF reception, sampled before the pre-shredders and mixed to provide representative samples. Unacceptable RDF is defined in appendix C and indicates those materials that if passed through the MPT, may cause damage to plant or equipment, cause excessive wear and tear, and adversely affect Plant performance.”
“1. Any item greater than 600 mm in any dimension. This does not apply to the external dimensions of whole bales. 2. Any oversized item or items above 10kg that has damaged the shredder. 3. Radioactive materials or substances. 4. Inflammable liquids. 5. Hazardous materials or substances. 6. Paint or varnish of any type. 7. Kevlar materials of any type. 8. Automotive batteries of any size and type 9. Vehicle tyres of any size and type 10. Explosives and explosive materials or substances. It is acknowledged that there may be traces of the above materials in RDF derived from municipal waste.”
“… The Purchaser shall have an appropriate quality management system in place to ensure that the RDF is in accordance with Table 22A.2.0 – Incoming RDF Specification.”
“The design point for the gasifier is provided in Table 22A.2.1, and the design fuel parameters given in Table 22A.2.1 shall be assumed for the purpose of performance guarantees.”
“Bulk density of fuel will be calculated according to BS EN 15401 2011: Solid Recovered Fuels – Determination of Bulk Density, using a 220-litre container. 3 measurements of bulk density will be made as required by BS EN 15401, which will be averaged to give a single daily value. Unless stated otherwise, the limits stated in Tables 22A.2.2 and 22A.2.3 above refer to the fuel fed to the gasifier, sampled from a conveyor belt between the fuel store and the gasifier and mixed to provide representative samples.”
“The gasification stream … shall be designed to be capable throughout its Design Life of maintaining full-load operation in accordance with the Firing Diagram for a minimum of 8,000 hours without the need to shut down for manual cleaning.”
“The performance guarantees are quoted against a set of reference conditions (such as ambient air temperatures) which may differ significantly from the actual conditions during operation and when the Performance Tests are conducted. It is therefore an essential requirement that the performance guarantees are supported by defined reference conditions and correction curves or formulae to enable the performance as measured against actual conditions to be corrected back to the reference conditions. These correction curves and formulae shall be provided by the Contractor and form part of the Contract … The final correction curves shall be approved by the Project Manager.”
“The correct legal position is that where the contract is silent, M+W is unconstrained in how it reacts to [EWH’s alleged breaches of contract]. The only practical limit is that if M+W’s reaction is so unreasonable as to break the chain of causation, it will likely be unable to recover the time and/or cost consequences of responding in that manner. Otherwise, M+W is entitled to respond to the breach as it sees fit and EWH is obliged to underwrite the time and money consequences of the same under Clauses 14 and 19.”
“There is no third choice, as a sort of via media, to affirm the contract and yet to be absolved from tendering further performance unless and until A gives reasonable notice that he is once again able and willing to perform.”
“A contract remains in force until it has been terminated for breach so that a contracting party who has not elected to terminate the contract remains bound to perform his obligations unless the effect of the other party’s breach is to prevent performance of the innocent party’s obligation becoming due.”
“The contractors maintain that they are entitled to suspend work on the cooling system, although they have not yet done so, by reason of Eurotunnel’s breaches of contract described above. If it were solely a question of English law, this argument would face some difficulty. It is well established that if one party is in serious breach, the other can treat the contract as altogether at an end; but there is not yet any established doctrine of English law that the other party may suspend performance, keeping the contract alive.”
“Generally, a breach of contract will only give rise to a claim for damages, and the innocent party will be obliged to continue its outstanding performance of the contract notwithstanding that breach.”
“Every breach of contract entitles the other party to damages to compensate for the loss sustained in consequence of the breach. But, with the exceptions discussed below [in which the innocent party is entitled to treat the contract at an end] and subject to express contractual rights of determination, breach of contract by one party does not discharge the other party from performance of its unperformed obligations.”
“Although particular contracts may give the contractor express rights if certificates are not paid, there is no general right at common law to suspend work if payment is wrongly withheld. This is consistent with the principle that, except where there is a breach of a condition or fundamental breach of contract, breach of contract by one party does not discharge the other party from performance of its unperformed obligations.”
“Given the obligation on M+W to design the Plant based on the RDF parameters, the requirement that the RDF is within specification is fundamental to the whole delivery of the Plant. Therefore, it is not unreasonable for M+W to seek assurance that the RDF will be within the required parameters. It is beneficial for both EWH and M+W to be satisfied that the RDF complies with the Contract requirements, because M+W is under no obligation to accept and process it in the MPT plant if it is not. Given that you have confirmed that EWH has the appropriate quality management system in place in accordance with section 1.3.1 of schedule 22A, and that the RDF will be delivered in accordance with the requirements under section 1.3.2 of schedule 22A, we do not understand your reluctance to provide the requested information or explain how you intend to demonstrate this by sampling and testing in the Plant’s reception hall. M+W is not willing to insert RDF into the MPT plant (which has been specifically designed on the basis of the RDF specification in Table 22A.2.0) unless it is certain that it is in accordance with the required specification such that it will not damage the MPT plant.”
“With respect, the issues of the delivery of RDF for Take Over and commissioning are intrinsically linked to EWH demonstrating to the reasonable satisfaction of M+W that its deliveries will comply with EWH’s obligations under the Contract. M+W can confirm the date of the first delivery of RDF provided EWH can confirm the RDF is within specification by proving the above have been satisfactorily answered so that M+W can be assured that the RDF can be placed into the MPT Plant and will have no detrimental effect on the MPT equipment or the output fuel specification. It is not possible for EWH to arbitrarily separate the questions of quantity, quality and time of delivery for its convenience.”
“For the avoidance of any doubt whatsoever, M+W is not obliged to and will not process or put into the MPT plant RDF which does not comply with the parameters of Schedule 22, Table 22A.”
“... to allow the Contractor to proceed with commissioning activities we require the Project Managers (sic) assurances and guarantee, that in all respects each delivery of RDF provided by the Purchaser will meet, in perpetuity, the Incoming Fuel Specification and will be provided complete with all necessary supporting documents to satisfy the contractual and statutory obligations and duties, including but not limited to, those requirements set out in the Contractors (sic) letter dated11 May 2018 . Subject to these assurances the Contractor will be able to consider accepting RDF to part of the Plant and recommence commissioning of the MPT plant. We look forward to receiving such assurances and necessary supporting documentation to accompany each delivery to permit RDF into the Plant.”
“Until valid and extensive data, that as a minimum evidences that the incoming RDF has been properly analysed and assessed as compliant with the Specification and satisfies the schedule included in our letter of11 May 2018 , is provided by the Purchaser, the Contractor cannot plan or advise the revised date for RDF deliveries in accordance with clause 14.8.2 of Schedule 14, and the delay to completion continues to escalate as previously notified.” 97.3 By a letter of28 June 2018 , Mr Meakin asserted: “1. Until such time as the Purchaser provides evidence that specification compliant RDF will be provided, the Contractor cannot provide an update of the Construction Programme ... 4. The quantities of RDF on a weekly basis have been provided, contrary to your statement, the commencement of deliveries is conditional on the Purchaser’s provision of specification compliant RDF. See item (1).” 97.4 By a letter dated16 July 2018 , Mr Meakin again asserted that M+W’s inability to provide an updated RDF delivery schedule was a consequence of EWH’s alleged inability to confirm and or ensure that compliant RDF would be delivered. 97.5 On24 July 2018 , Mr Meakin wrote: “The Purchaser’s continued intransigence in failing to comply with a reasonable request that is entirely in accordance with the Contract can only lead the Contractor to the conclusion that the Purchaser does not have the documentation available, and is thereby in danger of providing material that may damage or affect the Plant’s performance …. Unless and until the Purchaser adequately demonstrates that the RDF to be delivered will be compliant with Schedule 22A, Table 22A.2.0, the Contractor is unable to provide an RDF delivery schedule or accept potentially uncompliant material onto site.”
“1.3.2 Bulk density of the incoming RDF will be calculated according to BS EN 15401 2011: Solid Recovered Fuels – Determination of Bulk Density, using a 220-litre container. 3 measurements of bulk density will be made as required by BS EN 15401, which will be averaged to give a single daily value … 1.4.3 Bulk density of fuel will be calculated according to BS EN 15401 2011: Solid Recovered Fuels – Determination of Bulk Density, using a 220-litre container. 3 measurements of bulk density will be made as required by BS EN 15401, which will be averaged to give a single daily value.”
“In the absence of any British Standard for sampling of RDF, the principles of BS EN 15442:2011 Solid Recovered Fuels – Methods of Sampling is followed as far as practical for the sampling of RDF.”
“Only if the nominal top size is more than 40 mm the effective sample size may be reduced in order to downscale the sample size to realistic proportions. The reduction of the particle size and the sample size shall be done according to EN 15443, but the sampling report and the analyses report shall clearly mention this deviation and state that therefore the testing results are less representative.”
“For RDF with a nominal top size of 100 mm, the required increment size is 27 litres … Therefore, an actual increment of 50 litres is compliant with this requirement. Furthermore, 10 samples per day of 24 increments of 50 litres gives a daily sample volume of 12 m 3. For a nominal top size of material of 250 mm, the required increment size is 421 litres …, and 24 increments of 421 litres gives a sample size of 10.1 m 3. Therefore 10 samples of 24 increments of 50 litres from a Lot gives a greater sample volume than the Standard requires for a nominal top size of 250 mm. For material with a nominal top size of 300 mm, the required increments size is 729 litres …, and 24 increments gives a sample size of 17.49 m 3. Therefore, by taking 15 samples of 24 increments of 50 litres from a Lot gives a greater sample volume than the Standard requires for a nominal top size of 300 mm. Therefore, the minimum increment size is 50 litres.”
“2.1 The parties and the Project Manager shall each co-operate with each other in the discharge of their respective obligations under the Contract with the aim of satisfactorily completing the Plant and the Works in accordance with the Contract. 2.2 The parties shall deal fairly, openly and in good faith with each other. Each party shall disclose information which the other might reasonably need in order to exercise his rights and to perform his obligations under the Contract. In particular, each party shall promptly disclose full information to the other concerning any matter which will or may prevent the Plant or the Works being completed in accordance with the Contract. The parties shall work together in a manner consistent with their respective obligations under the Contract to resolve or mitigate the effect of any such matter.”
“Further or alternatively, insofar as [M+W] required EWH’s co-operation to discharge its own obligations, it was an implied term of the Contract, to give it business efficacy and/or to reflect the obvious intention of the parties, that EWH would provide the necessary co-operation.”
“In the context of this contractual-based approach to extension, one cannot therefore do a purely retrospective exercise. What one cannot do is to identify the last of a number of events which delayed completion and then say it was that last event at the end which caused the overall delay to the Works. One needs to consider what critically delayed the works as they went along.”
“Does M+W let the [Outotec] technology fail during the commissioning and testing phase prior to implementing the process improvement works? And then implement the process improvement works? Or does M+W implement the process improvement works prior to commissioning and testing in order to avoid severe difficulties and possible rejection? Which would result in [Outotec] walking away from any of their guarantees?” 180.3 In a report dated7 July 2017 , the team recorded that there was no evidence of alternative feed systems having been assessed and considered at the design stage, or that the system had been tested using a representative fuel. Further, it was noted that Outotec’s design had not been tested at any waste treatment plant before despite there being clear evidence from other plants that similar systems had suffered severe functionality problems. M+W also expressed concern that compression of a fuel plug had been shown to be sensitive to variations in fuel composition, and yet there could be variability in composition of the RDF while nevertheless remaining within the specification. Any jamming of the plug screw conveyor which could not be freed by reversing the screw direction would require a complete shutdown in order to strip down the system and clear the blockage. Further, M+W noted that the last section of the feeding screw pipe would be exposed to the very high temperatures of the fluidised bed such that when the system stops feeding waste, material inside the pipe would melt and lead to blockages. It added that the fuel-feeding screw was vulnerable to jamming due to hard objects lodging between the screw and the outer casing. This was said not to be opinion, but a conclusion based on empirical evidence from other plants where similar mechanisms had been used. 180.4 The report concluded: “There are a significant number of concerns attached to the plug screw conveyor … which cannot be dismissed on the basis of opinion, since there are no working examples against which to demonstrate compliance with the specification. There should be a design rationale which deals with each of the possible scenarios, in order to ensure smooth working of a critical item of plant. These concerns are greatly magnified because any lack of functionality will make it extremely difficult to test the rest of the plant, due to the knock-on effects on every part of the downstream process. The plug screw conveyor also has the capacity to cause uneven processing within the gasifier, thus making it more difficult to fault-find and correct other process issues in the gasifier, boiler, economizer and flue gas treatment plant.” 180.5 The notes of a risk assessment meeting recorded that Outotec had openly acknowledged that the fuel-feed system had been a “voyage into the unknown.”
“A loss of functionality … will be extremely serious for the process and the continued operation of the plant, which includes the ability to perform as a gasification plant (and not as a combustion plant). If this issue is not dealt with in advance of any commissioning process, it could cause significant delay to commissioning and Take Over of the plant to the Purchaser, with the consequent impact on both M+W and [Outotec].”
“Waiting for the problem to become visible to the customer and the rest of the industry, then hiding behind a fuel specification, is not good business. [Outotec] needs to be proactive and stay under the radar on this one.”
“However, as M+W are in the process of commissioning the Subcontract Plant there is now no time available to implement Outotec’s proposed changes before Taking Over and consequently this will delay the Main Contract Works entitling the Purchaser to liquidated damages for the delay caused.”
“If your statement is to be believed that would mean that Outotec expected the flights of the plug screw to strip off in this way when using RDF (the fuel which it should have been designed for) … For the avoidance of any doubt the work being undertaken by Outotec at Levenseat (followed by Hull & Suez) is not a variation, it is Outotec attempting to implement a new unproven design to fix a major defect in the fuel-feed equipment they have supplied.”
“I have reduced the PSC installation period to 12 days, which is still inside the RDF delay timescale (by 4 days).”
“We need to respond with a legal letter and back charge M+W for breaking these screws. They ran it at over 100% torque, against our advice and ran it backward and bent screws that we weren’t going to reinforce. Erin had conversations with people on site that may help our case too. I just don’t understand why M+W is so intent NOT getting this plant up and running. When will the customer fire them so we can finish the job???”
“This is following our request (to EWH) to provide sampling and analysis information before we re‐start. To be clear this is not the strongest claim, but it has been made. We can (and will) keep this claim running.”
“14.1 If the Contractor suffers any delay in the execution of the Works, or has reason to expect to suffer any such delay, he shall as soon as it is reasonably practicable to do so, notify the Project Manager of the delay or expected delay and the cause of the delay or expected delay. As soon as reasonably possible after that, the Contractor shall notify the Project Manager of any extension to any date or period specified in the Contract for the completion of such obligations as he considers would be fair and reasonable in the circumstances. The Contractor shall keep records made at the time of the circumstances, extent and effect of such delay … 14.1A The notification of delay by the Contractor in accordance with the first paragraph of Sub-clause 14.1 is a condition precedent to any entitlement of the Contractor to an extension under this Clause 14.”
“1. The Purchaser refused to provide the qualitative data in respect of deliveries as set out in the Contractor’s letters noted above. 2. The Purchaser refused to provide the legislatively mandated data in respect of deliveries and rejects as set out in the Contractor’s letters above. 3. The Purchaser had not provided evidence of the Quality and Environmental Management Systems. The Contractor was therefore unable to accept delivery of the RDF, despite awaiting the requested data for the day before issuing this Notice as it fails to meet the Contract and legislative requirements. As an aside, the Contractor records that no sampling/analysis personnel were present to undertake evaluation of the incoming RDF. In the circumstances, the Contractor has no choice but to issue this letter as notice of delay in accordance with clause 14.1.”
“As such the delay in RDF remains to the Purchaser’s account.”
“The upshot is that since14 May 2018 to the date of this letter, the Purchaser has not been in a position to meet the contractual commitments in respect of the supply of RDF. Our letter dated15 May 2018 gave Notice of delay in accordance with Clause 14.1. Our submissions in respect of the extent of the delay and associated extension of time for completion together with assessment of additional payment due under Clause 19 will follow once the delaying events are ended.”
“6. The Purchaser has been unable or unwilling to provide the Contractor with documentation validating the acceptability of RDF to be supplied by the Purchaser, the consequence of which is that the Contractor cannot accept Purchaser provided RDF on to the site; 6.1 this accordingly requires an extension to the Take Over in respect of the Works under the EPC Contract, 6.2 In light of the above material circumstances we consider a matter(s) entitling M+W to an extension of time to any date or period specified under the EPC Contract has occurred under clause 14.4, being 14.4(d). 6.3 Accordingly, we give you notice, pursuant to clause 14.1 of the EPC Contract, that the progress of the Works will be delayed and an extension of time Take Over in respect of the Works is required …” 6.1 this accordingly requires an extension to the Take Over in respect of the Works under the EPC Contract, 6.2 In light of the above material circumstances we consider a matter(s) entitling M+W to an extension of time to any date or period specified under the EPC Contract has occurred under clause 14.4, being 14.4(d). 6.3 Accordingly, we give you notice, pursuant to clause 14.1 of the EPC Contract, that the progress of the Works will be delayed and an extension of time Take Over in respect of the Works is required …”
“The Purchaser’s breach is the failure to provide the qualitative data in respect of the [RDF] that is required to be provided to the Contractor for use in commissioning and testing the Facility.”
“Absent the provision of valid sampling results that demonstrate compliance of the Incoming RDF with Schedule 22A Table 22A.2.0, the Contractor has no duty to process the material delivered and is prevented from completing the commissioning and Take Over testing of the Works. From the foregoing, it is clear that the failure of the Purchaser to comply with the Contract has impacted upon the Contractor’s ability to comply with the Contract, and the Contractor repeats the Notices in accordance with Clauses 14.1 and 19.1 in respect of delays and additional costs provided in the above noted correspondence. The failure to provide compliant RDF continues, and the Contractor has requested the Purchaser’s action to rectify the non-compliant fuel currently stored in the bunker. The delay occasioned by the Purchaser’s failure continues, however, as advised by the Contractor in his submission dated22 June 2018 …, the delay to the works at that time was noted as 50 days. The Purchaser is still (at the date of this letter) unable to evidence deliveries in compliance with Schedule 22A, Table 22A.2.0, and indeed the Purchaser’s own results demonstrate that the material is not in compliance. The period since the submission of22 June 2018 to the date of this letter is a further 228 calendar days, the total impact of the Purchaser’s failure to demonstrate RDF compliance is 278 calendar days and the Contractor is entitled to relief from damages and his associated cost for this period.”
“1. RDF deliveries not in accordance with the Contractor’s Schedule of Delivery Requirements both in timing and quantities 2. Additional RDF Fire Management activities imposed by the EA Guidance (imposed subsequent to Contract Execution) 3. Failure by the Operating Contractor to manage loading of the MPT plant to meet the desired throughputs 4. Failure by the Purchaser to provide correct offtake skips”
“The advised extension of time of 91 days is credited to the existing LD account. However, it is assumed that LD’s are settled in November, and then paid (at the lower 50% rate) on a monthly basis thereafter until Take Over is achieved. This is an optimistic assumption as, so far, the Contractor has shown no appetite to settle its LD account on time.”
“If the issue by the Purchaser of any Notice terminating or purporting to terminate the employment of the Contractor under this Clause 44 is subsequently determined to have been invalid, such Notice shall not constitute a repudiation of the Contract by the Purchaser but shall be deemed to have been a Notice of Termination issued in accordance with Sub-clause 43.1 and thereupon the rights and obligations of the parties shall be as stated in Clause 43 (Termination by the Purchaser for convenience) and not as stated in this Clause 44.”
“Except in the case of termination of the Contractor’s employment under Clause 44 (Termination for Contractor’s default), or Clause 44B or a repudiation of the Contract by either party, the liability of either party to the other arising out of or in connection with the Contract or the Works, whether by reason of any breach of contract or of statutory duty or tortious or negligent act or omission shall be limited to the damages, remedies and reimbursements expressly provided in the Contract.”
“However, they have also agreed that there comes a point at which the delay or deficiency is so serious that it should entitle Gearbulk to terminate the contract. In my view they must be taken to have agreed that at that point the breach is to be treated as going to the root of the contract. In those circumstances the right to terminate the contract cannot sensibly be understood as anything other than embodying the parties’ agreement that Gearbulk has the right to treat the contract as repudiated with … the usual consequences.”
“If the Contractor fails to satisfy the requirements under Clause 33 and Schedule 15 in accordance with Schedule 11 (Times of completion) to enable the Project Manager to issue the Take Over Certificate or the Contractor fails to do any other thing in accordance with Schedule 11 (Times of completion), the Contractor shall pay the Purchaser liquidated damages as specified in Schedule 12 (Liquidated damages for delay) (subject to Sub-clause 15A), but shall have no liability to pay damages in excess of the Delay Damages Cap.”
“The Liquidated Damages payable for delay in accordance with Sub-clause 15.1 of the Contract shall be calculated by multiplying the daily rate set out in Table 12.1 by the number of days by which completion of the construction of the Plant and the satisfaction of all the requirements under Clause 33 and Schedule 15 to enable the Project Manager to issue the Take Over Certificate is later than the permitted period for the same as stated in Schedule 11.”
“When the court is required to interpret a similar clause today, it will have to decide the issue in the same way as any other question of interpretation and not by treating Glanzstoff as having created some special rule applying to liquidated damages clauses.”
“35. The difficulty about this approach is that it is inconsistent with commercial reality and the accepted function of liquidated damages. Parties agree a liquidated damages clause so as to provide a remedy that is predictable and certain for a particular event (here, as often, that event is a delay in completion). The employer does not then have to quantify its loss, which may be difficult and time-consuming for it to do. Parties must be taken to know the general law, namely that the accrual of liquidated damages comes to an end on termination of the contract (see Photo Production Ltd v. Securicor Transport Ltd [1980] A.C. 827, 844 and 849). After that event, the parties’ contract is at an end and the parties must seek damages for breach of contract under the general law. That is well understood: see per Mr Recorder Michael Harvey QC in Gibbs v. Tomlinson (1992) 35 Con LR 86, 116. Parties do not have to provide specifically for the effect of the termination of their contract. They can take that consequence as read. I do not, therefore, agree with Sir Rupert Jackson when he holds in the second sentence of paragraph 110 of his judgment that ‘If a construction contract is abandoned or terminated, the employer is in new territory for which the liquidated damages clause may not have made provision.’ The territory is well trodden, and the liquidated damages clause does not need to provide for it. 36. Of course, the parties may out of prudence provide for liquidated damages to terminate on completion and acceptance of the works so as to remove any question of their being payable thereafter. But if they do, it is in my judgment unrealistic to interpret the clause as meaning that if that event does not occur the contractor is free from all liability for liquidated damages, and that the employer’s accrued right to liquidated damages simply disappears. It is much more probable that they will have intended the provision for liquidated damages to cease on completion and acceptance of the works to stand in addition to and not in substitution for the right to liquidated damages down to termination.”
“In principle, therefore, where at the time of termination delay for which liquidated damages are payable has already occurred, there is no reason - in law or in justice - why termination of the contract should deprive the employer of its right to recover such damages, unless the contract clearly provides for this.”
“In short, the purpose of agreeing in advance on a sum payable as liquidated damages for each day of delay caused by the contractor would be defeated if the stipulated sum was payable only if and when the contractor chose to complete the contract.”
“Unless otherwise stated in the Contract, Liquidated Damages for Delay shall be paid by the Contractor to the Purchaser against a weekly certificate issued by the Project Manager to the Contractor. The Contractor shall pay the amount of each certificate by a date which shall be fourteen days after the date of issue of the certificate.” 314.2 Clause 15B.1 makes provision for the possible suspension in certain circumstances of the right to terminate the contract “as a consequence of the Contractor having paid or allowed or becoming liable for a sum or sums in aggregate equal to or greater than the Delay Damages Cap.”
“Where the sufferer from a breach of contract finds himself in consequence of that breach placed in a position of embarrassment the measures which he may be driven to adopt in order to extricate himself ought not to be weighed in nice scales at the instance of the party whose breach of contract has occasioned the difficulty. It is often easy after an emergency has passed to criticise the steps which have been taken to meet it, but such criticism does not come well from those who have themselves created the emergency. The law is satisfied if the party placed in a difficult situation by reason of the breach of a duty owed to him has acted reasonably in the adoption of remedial measures, and he will not be held disentitled to recover the cost of such measures merely because the party in breach can suggest that other measures less burdensome to him might have been taken.”
“Notwithstanding any other provision of the Contract and subject to Sub-Clause 45.1A neither the Contractor nor the Purchaser shall be liable to the other for: … (b) loss or deferment of anticipated or actual profit, loss of revenue, loss of use, loss of production, business interruption or any similar damage or for any consequential or indirect losses of any kind resulting from or arising out of or in connection with the Works or the performance of them or any act or omission relating to them howsoever caused; except in respect of …: (ii) any sum included within the liquidated damages for delay under Sub-clause 15.1, Clause 15B or in lieu of liquidated damages under Clause 15A …” (ii) any sum included within the liquidated damages for delay under Sub-clause 15.1, Clause 15B or in lieu of liquidated damages under Clause 15A …”
“Subject to Sub-clause 45.3A, the total aggregate liability of the Contractor to the Purchaser arising out of or in connection with the Contract and the Works shall not exceed [£153,897,518 ].”
“The limitation of liability referred to within Sub-clause 45.3 shall not apply and the Contractor does not exclude or restrict liability for any of the following (and which shall not be taken into account in determining whether the limit of liability under Sub-clause 45.3 has been reached): (a) liability arising under Sub-clauses 30.10 or 30.15 and Clause 31 (Insurance); (b) liabilities arising or payments made by the Contractor to the extent corresponding payments are received or receivable by the Contractor pursuant to insurance policies required to be effected and maintained in accordance with this Contract (with the exception of professional indemnity insurance under Clause A6) or to the extent that corresponding payments would have been received or receivable by the Contractor pursuant to such insurance policies but for the Contractor’s failure to effect and maintain such policies or comply with the terms of such insurance policies (including a failure to diligently pursue insurance claims or causing such insurance policies to become void, unenforceable or impaired); (c) the wilful default of the Contractor and/or any person for whom the Contractor is responsible; (d) fraud or fraudulent misrepresentation or a breach of theBribery Act 2010 in each case by the Contractor and/or any person for whom the Contractor is responsible.”
“(i) M+W’s failure properly to report on the nature and extent of the defects in the fuel feed system, the extent of the remedial works that would be required to remediate those defects, and the impact that those works would have on the completion of the Contract works, and (ii) M+W’s failure and/or refusal to continue commissioning works from mid-January 2019 onwards.”
“a person is not guilty of wilful neglect or default unless he is conscious that in doing the act which is complained of, or in omitting to do the act which it is said he ought to have done, he is committing a breach of his duty, and also, as he said recklessly careless whether it is a breach of duty or not.”
“… for wilful misconduct to be proved there must be either (1) an intention to do something which the actor knows to be wrong or (2) a reckless act in the sense that the actor is aware that any loss may result from his act and yet does not care whether loss will result or not or, to use Barry J’s words in Horobin’s Case, ‘he took a risk which he knew he ought not to take’: [1952] 2 Lloyd’s Rep. at 460.”
“To establish wilful misconduct within the meaning of the [Convention], it is not enough to show that the carrier was at fault in failing to take proper care of the goods and that the carrier’s conduct was the product of a conscious decision. It has to be shown that the actor knew that his conduct was wrong or was recklessly indifferent whether it was right or wrong; and, as part of that requirement, he must have appreciated that his conduct created or might create additional risk to the goods.”
“Fraudulent misrepresentation obviously involves dishonesty. Wilful misconduct refers to conduct by a person who knows that he is committing and intends to commit a breach of duty, or is reckless in the sense of not caring whether or not he commits a breach of duty (see Romer J in Re City Equitable Fire Insurance Co Ltd …) Deliberate default means, in my view, a default that is deliberate, in the sense that the person committing the relevant act knew that it was a default (i.e. in this case a breach of contract). I consider that it does not extend to recklessness and is therefore narrower than wilful misconduct (although the latter will embrace deliberate default).”
“Sub-clauses 45.1 and 45.3 shall apply whether or not either party shall be held to have repudiated the Contract.”
“Programme attached shows Take Over at 8th May – based upon Outotec tests being successful, which is not likely; 2nd programme shows impact of the Outotec PSC Programme (issued by Outotec, 27th January)”
“To be clear this is not the strongest claim, but it has been made. We can (and will) keep this claim running.”
“You should also know that we have written to the Purchaser, to claim delay due to the fuel in the bunker being out of specification. This claim (we allege) prevents us from re-firing. This should give us concurrency of delay.”
“In short, if the costs that are not recoverable cannot be disentangled from costs which may be recoverable, that ought to be fatal to the entire head of cost subject to the problem.”
“In the potential pursuit of option (2), the potential replacement contractor will:- - Have experience in the construction of similar plants - Have the technical and financial resources available to complete the works in the required timescales - Be known to the project teams (due to the hit the ground running nature of the completion works) - Be attracted to the project for reasons other than fee if possible. Two organisations present themselves as candidates here, MBV Energy (the JV between MWH and B&V), who undertook the Ince Park project and Outotec, the technology provider at EWH and an experienced EPC contractor worldwide with ambitions in the UK market. Of the two, Outotec have significant vested interest in stepping into the contract. They are believed to be in significant dispute with M+W and are exceptionally keen to establish their UK credentials. Any arrangement would need to protect both sides from the dispute under their existing contract. It is recommended that very discrete (sic) enquiries are made to both organisations. Should the need to formalise discussions arise, it will be important to ideally introduce a little competitive tension into the discussions, but also have a fall-back option if the preferred option does not crystallise.”
“Plan for the worst – M+W default Hope for the best – M+W fall into line and deliver the project.”
“The Contractor continues to apply pressure to the Purchaser relating to the consequences of supplying out of specification fuel, not accepting of the fact that the fuel is waste derived, and therefore some variance is to be expected. Energy Works has countered this risk by supplying an enhanced RDF at a cost of£35 /tonne. This discount has been applied to all fuel where revenue has been recognised.”
“EWH was also aware that it would not get a replacement EPC contractor at a reasonable price or on acceptable terms. We did not believe that any contractor would be keen to take on a part-finished plant on a standard EPC basis because they would never have a perfect knowledge of the completion status of the plant. The idea that anyone would accept responsibility for M+W’s work, liquidated damages and performance guarantees was untenable. Even if we could find a contractor who would, there would be a massive uncertainty premium. A full procurement process with a fixed scope of work would not lead us to an agreement with the level of protection or guarantee that the original EPC contract did. M+W had the benefit of a clean site and could control all of the design, procurement, construction and commissioning activities. A replacement contractor would be in a completely different position and would not be willing to give us a full wrap at a sensible cost. Whoever we contracted with would be expensive and the likelihood of a fixed-price arrangement was very slim. Consequently, there was little benefit in spending months on a procurement process that would not take us to a particularly good position. At this point, we believed that simply comparing rates would not help us and that we would do better to focus on quality.”
“In the end, the B&V Contract was far from perfect, but EWH could not obtain better terms from B&V. Bringing in an alternative was not an option at that stage as it would have led to significant further delay and, even if that had been a possibility, we would have faced similar challenges as we did with B&V. In the end, the Board decided that it was better to get on with it and complete the Plant.”
“It would have been entirely possible for EWH to go to a B&V competitor and request equivalent rates for comparison. Option 2 did not preclude EWH from market testing what B&V were offering.”
“Based on the apparent fact that EWH did not approach any other contractors, but spent over nine months planning its ‘Plan B’, B&V would clearly adopt high rates because presumably they knew there were no other bidders and they (B&V) had become preferred bidders without having to agree commercial terms. I could understand this as an outcome if any engagement was after termination and had EWH not started planning in June the year previously. Planning for so long, with only one contractor will inevitably give that contractor leeway to use excessively high rates and EWH backed itself in a corner in this respect.”
“As a capital-intensive project, EWH was (and remains) particularly sensitive to timing issues. It is imperative that the Plant starts generating revenue as soon as possible to cover the cost of financing. Any prolonged delay critically impairs the ability of any project to service its borrowing or cost of capital. M+W’s [delay] has caused EWH to incur additional financing charges because the Plant is not generating energy or revenue.”
“(a) all sums due to the Purchaser from the Contractor including any cost incurred by the Purchaser in completing the Works in accordance with sub-clause 44.3(b) which is in addition to that which the Purchaser would have incurred if the Contractor had completed the Works in accordance with the Contract; and (b) all sums due to the Contractor in respect of work completed by the Contractor prior to termination of his employment other than any such work of a temporary nature necessitated by such termination … Having allowed for all previous payments made to the Contractor and any sum due to the Purchaser from the Contractor, the Default Certificate shall state the balance due to or from the Contractor.”
“Except in the case of termination of the Contractor’s employment under clause 44 (Termination for Contractor’s default) … or a repudiation of the Contract by either party, the liability of either party to the other arising out of or in connection with the Contract or the Works … by reason of any breach of contract … shall be limited to the damages, remedies and reimbursements expressly provided in the Contract …”
“EWH is required to prove: (i) The subcontractors it engaged to complete the works; (ii) The works which they carried out; (iii) That this work was within the scope of M+W contract prior to termination and did not include variations or betterment; and (iv) That the amounts which it has paid, or says it will be liable to pay in the future, are properly payable to the subcontractors for carrying out said work.”
“In the circumstances, EWH is required to prove that it reasonably mitigated its loss by taking the following steps: (i) Insofar as any of the subcontractor’s work was defective, it should have required the subcontractor to remedy that work at no extra cost; and (ii) Insofar as the subcontractor sought additional payment directly from EWH, it should have insisted that any such payment would be solely in accordance with the payment terms found in the original subcontract between M+W and the subcontractor. (iii) Generally, insofar as any of the subcontractor (sic) have been paid in excess of the negotiated subcontract sum between M+W and the subcontractor, EWH is required to prove why such additional payments have been made and that they flow from reasonable behaviour on the part of EWH.”
“Time was crucially important. Post-termination, the walk-downs, investigations and [Outstanding Work Lists] made it clear that the works were not as close to completion as M+W had reported and the prospect of losing the benefits of the funding arrangements was thrown into sharp focus. The need to meet conditions precedent, and preserve the funding provided by the [Contract for Difference] and the EU grant, was a significant influence on EWH’s drive to complete the works without delay.”
“Fichtner has inspected the works being completed on Site during this period including external fuel feed conveyors, gasifier train, and BOP. Fichtner considers that the quality of the construction works carried out on Site is in general to a reasonable standard.”
“467. I would typically expect costs to be higher following a termination due to various factors such as the supply chain’s appetite for risk, the piecemeal nature of the work remaining and the lack of commercial tension in the supply chain when a project is knowingly in distress. Whilst my calculation is rudimentary it does provide an indication as to the order of magnitude of costs EWHL has incurred in completing the post termination works as compared to what it may have incurred. 468. I am unable to explain the reasons for such a significant difference. It is a matter for the Court to decide whether such reasons are related to a difference in scope or other issues for which M+W is not liable.”
“EWH is required to prove: (i) The parties it engaged for commissioning support; (ii) The works which they carried out; (iii) That this work was within the scope of M+W contract prior to termination and did not include variations or betterment; and (iv) That the amounts paid were properly payable to the subcontractors for carrying out said work.”
“In the circumstances, EWH is required to prove that it reasonably mitigated its loss by taking the following steps: (i) Insofar as the subcontractor sought additional payment directly from EWH, it should have insisted that any such payment would be solely in accordance with the payment terms found in the original subcontract between M+W and the subcontractor. (iii) Generally, insofar as any of the subcontractor (sic) have been paid in excess of the negotiated subcontract sum between M+W and the subcontractor, EWH is required to prove why such additional payments have been made and that they flow from reasonable behaviour on the part of EWH.”
“The Purchaser and Contractor agree that any losses, expenses or other liabilities of the Purchaser in respect of … the O&M Contract arising from a breach of the Contractor’s obligations provided elsewhere under this Contract are direct losses.”
“3.1 In consideration of payment by the Purchaser, the Contractor shall regularly and diligently carry out and complete the Works in accordance with the Contract and ensure that the Plant as constructed and completed shall comply with the Contract, including (without limitation) meeting any performance specifications set out the Specification and/or the Schedules and/or the Contractor’s Proposals. 3.1A The Contractor shall be responsible for the design of the whole of the Plant. Any design provided by or on behalf of the Purchaser (whether contained in a Contract Document or provided in a Variation Order or otherwise) shall be verified by the Contractor. 3.2 All work carried out by the Contractor shall be carried out with sound workmanship and materials, safely and in accordance with good engineering practice and Legislation and shall be to the reasonable satisfaction of the Project Manager. 3.4 Without derogation from any other provision, and as a separate and independent obligation, the Contractor shall design the Works and every part of the Works: (a) using all the skill and care reasonably to be expected of duly qualified and experienced designers undertaking the design of works similar in scope, size, complexity and character to the Works or such part of the Works; and (b) in accordance with Good Industry Practice.” (a) using all the skill and care reasonably to be expected of duly qualified and experienced designers undertaking the design of works similar in scope, size, complexity and character to the Works or such part of the Works; and (b) in accordance with Good Industry Practice.”
“We consider that continuing to operate the ACCs and the Stack without appropriate noise mitigation measures to prevent, or where that is not practicable, to minimise noise risks causing further serious pollution in the form of noise to nearby sensitive receptors.”
“Noise abnormal and prolonged enough to cause significant effect on human senses. This includes mild noise that occurs so frequently as to cause a greater degree of disturbance than would otherwise be expected. • The noise would be disturbing or annoying by way of volume, duration, or characteristics. • Abnormal means that the noise that is significantly louder or more intrusive and offensive than the normal operational noise climate, affecting people either inside or outside noise sensitive premises.”
“i) … the noise levels at the plant and/or at the relevant NSR locations failed to comply with the requirements prescribed by the Planning Consent, the Environmental Permit application, the Environmental Permit and/or all relevant legislation and industry standards; (ii) … the noise levels at the plant and/or at the relevant NSR locations do not enable EWH to obtain the necessary approvals and/or to operate the plant in accordance with the Planning Consent, the Environmental Permit application, the Environmental Permit and/or all relevant legislation and industry standards; (iii) … M+W has failed to provide all the silencers, acoustic equipment, louvers and/or other systems necessary to ensure that the design and operation of the plant comply with the Planning Consent, the Environmental Permit application, the Environmental Permit and/or all relevant legislation and industry standards.”
“(iv) Generally, the level of noise emitted from the plant, its instrumentation, equipment and/or components fails to comply with all the relevant contractual requirements as set out above or otherwise.”
“The Contractor shall ensure that on completion, the Plant, as proposed to be operated (as stated in or to be deduced from the Contract) complies with: (a) all relevant Legislation; (b) the Environmental Permit; (c) the Environmental Permit Application, but only to the extent compliance is required by the Environmental Permit; and (d) (subject to … the following paragraph), the Planning Consent … For the avoidance of any doubt, and notwithstanding any other provision of this Contract, the Contractor gives no warranty nor guarantee in respect of the noise levels at the noise receptors identified as ‘E’ and ‘F’ in the Parsons Brinckerhoff Report. The foregoing shall not derogate from the Contractor's obligations in respect of noise levels as set out in sections 15.3.2 paragraph (14), 15.3.2.1 and 15.3.2.2 of Schedule 15.”
“For noise sources that are not located inside a building (outdoor noise sources): (1) the Contractor shall demonstrate compliance with the sound pressure levels listed in Schedule 15 Appendix A; and (2) the Contractor shall design and build the Plant in accordance with the drawing appended at Schedule 15 Appendix A. For noise sources that are located inside a building (indoor noise sources): (1) the Contractor shall demonstrate compliance with the sound pressure levels listed in Schedule 15 Appendix B; (2) the Contractor shall not be allowed to increase the number of indoor noise sources by more than 10% compared to the number of indoor noise sources listed in Schedule 15 Appendix B. Additional indoor noise sources shall have a guaranteed maximum sound pressure level of 85 dBA or less; and (3) in any case, the Contractor shall keep the Project Manager informed of any change in location and number of indoor noise sources. Moreover, the Contractor shall demonstrate compliance with the sound pressure levels listed in Table 15.2 below.”
“1.2 The Plant shall comply in all respects with all the latest … relevant legislation including but not limited to: • the Environmental Permit and the associated conditions; • the Planning Consent; … • Control of Noise atWork Regulations 2005 … 2.4.3 Noise The Contractor shall demonstrate that the noise limits set out in Schedule 15 have been fully complied with.” • the Environmental Permit and the associated conditions; • the Planning Consent; … • Control of Noise atWork Regulations 2005 … The Contractor shall demonstrate that the noise limits set out in Schedule 15 have been fully complied with.”
“The development hereby approved shall be carried out and operated in accordance with Parsons Brinckerhoff report dated July 2015 or as subsequently amended and approved ...”
“Emissions from the activities shall be free from noise and vibration at levels likely to cause pollution outside the site, as perceived by an authorised officer of the Environment Agency, unless the operator has used appropriate measures, including, but not limited to, those specified in any approved noise and vibration management plan to prevent or where that is not practicable to minimise the noise and vibration.”
“With regard to noise emissions from the Plant, Drawing T00365-90001 – ‘External Noise Emitters Provisional’ at Schedule 15 (Appendix A) has been based upon the Contractor’s outline design. The Parties acknowledge that following detailed design the location or quantity of plant and equipment may differ from Drawing T00365-90001. The Contractor shall submit details of such deviations to the Purchaser and the Purchaser shall re-run its noise model (the noise model to be re-run shall be based upon the scope of the Contractor’s express obligations under the Contract as at the date of the Contract and specifically, the external noise emitter data and location plan appended to Schedule 15 (Drawing T00365-90001). In the event that the deviations from Drawing T00365-90001 have a negative impact upon the noise model and additional localised noise attenuation is required the Project Manager shall issue a Variation Order for the addition of such localised noise attenuation measures as are required to the Works or the Plant and the time and cost consequences of such Variation Order shall be determined pursuant to the Contract provided that the maximum addition to the Contract Price shall be£205,000 and the Contractor shall bear any Cost in excess of£205,000 .”
“There is a modern tendency in the law to break down the divisions in the rules on the interpretation of different kinds of document, both private and public, and to look for more general rules on how to ascertain the meaning of words. In particular, there has been a harmonisation of the interpretation of contracts, unilateral notices, patents and also testamentary documents … Differences in the nature of documents will influence the extent to which the court may look at the factual background to assist interpretation. Thus third parties may have an interest in a public document, such as a planning permission or a consent under s.36 of the 1989 Act, in contrast with many contracts. As a result, the shared knowledge of the applicant for permission and the drafter of the condition does not have the relevance to the process of interpretation that the shared knowledge of parties to a contract, in which there is no third-party interest, has. There is only limited scope for the use of extrinsic material in the interpretation of a public document, such as a planning permission or a s.36 consent: R v. Ashford Borough Council, Ex p Shepway District Council [1999] PLCR 12, per Keene J at pp.19C-20B; Carter Commercial Developments Ltd v. Secretary of State for Transport, Local Government & the Regions [2003] JPL 1048, per Buxton LJ at [13] and Arden LJ at [27]. It is also relevant to the process of interpretation that a failure to comply with a condition in a public law consent may give rise to criminal liability… This calls for clarity and precision in the drafting of conditions.”
“When the court is concerned with the interpretation of words in a condition in a public document such as a s.36 consent, it asks itself what a reasonable reader would understand the words to mean when reading the condition in the context of the other conditions and of the consent as a whole. This is an objective exercise in which the court will have regard to the natural and ordinary meaning of the relevant words, the overall purpose of the consent, any other conditions which cast light on the purpose of the relevant words, and common sense. Whether the court may also look at other documents that are connected with the application for the consent or are referred to in the consent will depend on the circumstances of the case, in particular the wording of the document that it is interpreting. Other documents may be relevant if they are incorporated into the consent by reference … or there is an ambiguity in the consent, which can be resolved, for example, by considering the application for consent.”
“In summary, whatever the legal character of the document in question, the starting point – and usually the end point – is to find ‘the natural and ordinary meaning’ of the words there used, viewed in their particular context (statutory or otherwise) and in the light of common sense.”
“The Purchaser shall not be responsible for (and gives no warranty as to the completeness, accuracy or suitability of) any Documentation or information provided by him or on his behalf (whether before or after the entering into of this Contract …”
“Whilst I agree that it would have been desirable to introduce noise control in an even more staged approach, it is my opinion that the heightened sensitivity and time pressures due to the threat to the permit meant that it was not sensible to wait longer in between installation of each mitigation measure.”
“We consider Scope A to be unreasonably wide in scope, containing twenty-five noise control measures, while Scope B includes five and Scope C includes just one noise control measure. It would seem that the single greatest benefit has come about from installing the ID fan silencer. The majority of complaints reference a jet/helicopter noise which is attributed to the pre-mitigation operation of the ID fan. The noise survey method used by Sol Acoustics in determining the sound emissions from equipment is susceptible to influence from other nearby or dominant noise sources, and it is likely that the noise emissions from some of the middle-ranking noise sources in their noise model are overestimated, leading to noise control where it may not have been necessary.”
“The gasification stream (fuel inlet to stack discharge) shall be designed to be capable throughout its Design Life of maintaining full-load operation in accordance with the Firing Diagram for a minimum of 8,000 hours without the need to shut down for manual cleaning.”
“The boiler operating campaign life shall be not less than 7,500 hours of operation within normal operating parameters and without requiring a shut-down for manual cleaning.”
“All refractory materials and their means of support shall be designed to achieve a long operating life (as specified in Schedule 10) whilst protecting the tubes from erosion and corrosion and minimising the build-up of slag.”
“Nature of Defect In breach of paragraph 2.2 of Schedule 22A and/or paragraph 6.4.5 of Schedule 22B of the Contract, the design of the gasifier does not allow for stable combustion of fuel. As a result, combustion of fuel while in operation will result in the accumulation of slag, which will likely require manual cleaning before 8,000 hours of operation of the gasification stream has been achieved. This is due to, inter alia, the following issues: i) The ongoing and excessive agglomeration of ash, slag and tramp on the bed, shelf and walls of the gasifier due to the inability of the gasifier to maintain stable gasification/combustion temperatures at an appropriate level; ii) Blockages of the bed cones caused by falling pieces of slag; iii) Damage to the bed thermocouples caused by falling pieces of slag; and/or iv) Damage to the syngas probes and protection frame caused by falling pieces of slag.”
“Nearly half of the fuel data shows [net calorific value] exceeding the design range for the plant (reflecting the findings of the Site Survey report). The design range assumed for the [flue gas recirculation] installation will need to account for this. The data suggests a design value of 16 MJ/kg, with a range of 12.5-20 MJ/kg would be appropriate for the [flue gas recirculation] retrofit design.”
“Calorific volatile matter (plastics), rapidly released from the fuel bed contributes to the corresponding reactions to the heat release in the combustion zone. This means that with an increasing calorific value (exceeding the specification), the amount of high calorific value volatile components increases, these are rapidly released from the fuel (bed) and enter the combustion zone where the energy is released, contributing to a corresponding temperature increase.”
“In fact the Outotec Control Philosophy allows for such a load reduction automatically since the rotational speed of the feed plug screws can be controlled by the steam production (although so far as I am aware this particular loop has not yet been taken into service).”
“The boiler operating campaign life shall be not less than 7,500 hours of operation within normal operating parameters and without requiring a shut-down for manual cleaning.” 561.2 Mr Higman agreed that the “normal operating parameters” referred to firing the gasifier with compliant Fuel in accordance with the Firing Diagram. While matters of contractual construction are for me, his own construction of the expression is important to understanding his subsequent answer in cross-examination. In fact, Mr Higman was right to make such concession at least in respect of the net calorific value of the Fuel and the firing diagram. Indeed, paragraph 1.3.3 of Appendix B to the subcontract repeated the familiar requirement that the net calorific value should be between 10-16 MJ/kg and added that the consequence of exceeding such limit would be that the Fuel would lie outside the firing diagram for which operations are guaranteed. 561.3 Mr Higman accepted in cross-examination that while the net calorific value of the Fuel had “sometimes” been below 16 MJ/kg, that had not occurred “very often.”
“Mr Williamson KC: Is it your opinion that the boiler operating campaign life is less than 7,500 hours within normal operating parameters? Mr Higman: At this present time, that’s not really determinable.”
“The consequence of all these impacts of non-compliant RDF and Fuel indicate to me that it would have been near impossible for M+W to demonstrate compliance with Schedule 22A section 2.2 that required a minimum operation time of 8,000 hours between a shutdown for cleaning.”
“Certainly, a technical plant such as the gasifier in Hull will not experience significant difficulties because of a slight excess of one value, but the excess of several values, and among them some with significant deviations, will lead to performance losses and problems in operation …”
“The Contractor is responsible for providing the Fuel to the gasifier in accordance with Table 22A.2.3 provided that the incoming RDF is in accordance with Table 22A.2.0.”
“Presently, the temperatures in the OFA zone are higher than ideal, approaching averages of almost 1,300°C at the second OFA level. Some of the CoMate itself will start to become slag as temperatures begin to go higher than this. As we have not previously added CoMate to a furnace with temperatures quite as high as those at EWH, we cannot predict how much of the CoMate may become molten itself. There is a possibility that enough of the CoMate will remain in its activated form and render deposits more friable and less sticky. This will require some experimentation on the unit at EWH. In addition, we are beginning to do some of our own testing in house to see what we can learn that may be of help. We maintain that the ideal would be to get the OFA temperatures lower, and based on your engineering team’s assessment, it appears the best route to do that is via furnace gas recirculation. This would likely set up the most ideal situation for applying CoMate, and one in which EWH will be able to enjoy much longer operating cycles.”
“Each fuel feed line shall be automatically controlled to allow the fuel feed rate to be adjusted to each line independently. The whole system shall be integrated so that the fuel flow throughout each system is controlled to prevent build ups … The Contractor shall include for sufficient equipment, and describe the methods adopted, to ensure consistency of feed to the bed in order to minimise the fluctuations in combustion conditions. Sufficient fuel distribution points shall be provided to ensure that relatively even gasification and temperatures are achieved across the bed.”
“Nature of Defect M+W failed to provide a fuel feed system that complied with paragraph 6.4.2 of Schedule 22B. Specifically, the system provided by M+W failed to prevent build ups and failed to prevent even gasification and temperatures across the bed. In particular: i) In breach of paragraph 6.4.3 of Schedule 22B of the Contract, M+W has failed to install functional metering bin switches. The contractor engaged by EWH after termination of the Contract has been required to re-configure the metering bin switches in order to allow sustained hot commissioning to proceed. ii) In breach of paragraph 6.4.3 of Schedule 22B of the Contract, M+W did not position the feeder screw bin level transmitters in locations that allow the transmitters to provide reliable readings. As a result, the fuel feed system is not functional without remedial work to the transmitters. iii) In breach of paragraph 6.4.3 of Schedule 22B and/or clause 3.2 of the Contract, the quad screw welds on the upper feed bin are defective. Upon investigation, these quad screw welds were found to have cracks of various depths and sizes. iv) In breach of paragraph 6.4.3 of Schedule 22B and/or clause 3.2 of the Contract, moisture damage has been found in the four metering bin motor gear boxes. This was due to water ingress through the breather. v) In breach of paragraph 6.4.3 of Schedule 22B and/or clause 3.2 of the Contract the quad screws are defective as they were found to be shearing. M+W carried out modification works on the fuel feed system between November 2018 and around February 2019, although the works carried out by M+W were not sufficient to enable sustained hot commissioning to proceed. M+W has therefore been well aware of the defective design and/or installation of the fuel feed system, and it is also aware of the ineffectiveness of the modifications works carried out in 2018 and 2019. In particular: i) M+W issued Defect Notices to Outotec on23 November 2018 and26 November 2018 , which recorded the ongoing issues and outages despite Outotec’s previous attempts to modify the fuel feed system. ii) Further, M+W’s letter dated7 January 2019 recorded Outotec’s delay in completing its modification works to the fuel feed system and in providing the revised design details for the air cannons and the electrical design. In the event, notwithstanding the modifications to the fuel feed system in 2018 and 2019, M+W failed to proceed with sustained hot commissioning as a matter of fact, and the design and/or installation of the fuel feed system remained defective as at the date of M+W’s termination. As a result of the trips and outages of the plant caused by this defect, the gasifier has been rendered unavailable with consequential delays to the commissioning and testing activities.”
“For the purpose of Defect 17, the crux of EWH’s claim is based on the damaged quad screws and gearboxes in the metering bin at the top and, above all, the defective design of the plug screw conveyor at the bottom (as supplied by Thomas & Muller Systems Ltd) which has resulted in significant bridging and blockages and disrupted the flow of fuel into the gasifier.” 593.2 Defect 17 is covered in detail over 26 pages of Appendix 1 to EWH’s closing submissions. EWH sets out its case on liability between paragraphs 67 and 69. It focuses on the geometry of the plug screws which was said to be “the predominant cause of the persistent and severe bridging and blockages at Hull.”
“16.1(i) At all material times, M+W and/or Outotec (as the specialist designer-contractors under the Contract) were responsible for ensuring that the design and installation of the fuel feed system fully complied with all relevant requirements of the Contract. Therefore, the details of a proper and contractually compliant design for the fuel feed system are matters strictly within the knowledge and experience of M+W and/or Outotec … 16.3 Without prejudice to the foregoing and without intending to be exhaustive, EWH maintains that M+W and/or Outotec were under a contractual obligation at all material times to design and install the fuel feed system in a manner which complies with, amongst other things, paragraph 6.4.2 of Schedule 22B of the Contract, such that the system is able to ensure consistency of feed to the bed in order to minimise fluctuations in combustion conditions.”
“There is no evidence to evaluate whether this failure was due to a design/ manufacturing issue or caused by out-of-spec (i.e. oversize) Fuel.”
“If there had been material slipping from the MPT sufficient to block the quad screws then one would have expected that to have been observed and noted in the damage report. This was not the case, so the conclusion is that outsize items in the fuel were not the cause of the failure. In any case the quad screws should have been fitted with torque-limiting switches (with time delay for start-up under load if necessary) to prevent self-destruction.”
“As the torque of such screws is significantly increased by tramp material, causing blockages between screw and housing, but this tramp material was according to the contract not possible because of the mechanical pre-treatment, this seems not to be necessary. In several applications, it is common use not to have torque limiters in order to allow extremely high torques in case of restarting atter emergency stop. If the screws are controlled by frequency inverters, the electric current and thus the torque can be limited without the use of mechanical torque limiters.”
“The demineralisation plant shall be designed to satisfy the main functional requirements, which include the following: … (2) A demineralisation system capacity to operate the Plant continuously at MCR with maximum water consumption with only one demineralisation stream in operation … (7) Each stream shall be of at least 5 m 3/hr (net) capacity … The demineralised water system shall supply the water/steam system directly and shall be automatically controlled to maintain the water level in the system. A control panel shall be provided which shall indicate the status of all of the equipment within the water treatment facility. The demineralisation plant shall be designed for full automatic operation.”
“The demineralised water plant shall be dimensioned to allow for all continuous operation with all consumers operating at peak demand.”
“In the premises, the demineralised water plant as supplied, installed and commissioned by M+W prior to the termination of the Contract is therefore defective in that: a) In breach of clause 3.2, clause 3.4 and/or paragraph 13.3.1 of Schedule 22B of the Contract, defects in the controls system and/or the demineralised water plant generally have resulted in frequent trips and outages of the demineralised water plant when attempts were made to fill it; and/or b) In breach of clause 3.4, paragraph 13.3.1 and/or paragraph 13.3.5 of Schedule 22B of the Contract, the demineralised water plant as designed and installed by M+W does not achieve the specified functional capacity of 5 m 3/hour per stream (either at all or with adequate availability) and/or does not otherwise sufficiently soften the water supply to a level which is compatible with the operation of the plant. Further, in breach of clause 3.4 of the Contract, there were errors and/or deficiencies in the design of the demineralised water plant, such that the necessary remedial solution will probably involve softening the water supplied (for instance, by means of a water softening plant) before further processing.”
“The adequacy of the service supplies are (sic) not the responsibility of the Purchaser. It is the Contractor’s responsibility to ensure that the service supplies are sufficient for his requirements or provide alternative arrangements at the Contractor’s expense.”
“Given that the reverse osmosis membranes in the demineralisation plant were commissioned around late 2018 / early 2019 but were not put into regular operation immediately thereafter, the membranes had in fact been left idle by M+W for an extended period without any preservation by the time the EPC contract was terminated (bearing in mind that chemical preservation should have been carried out for breaks in production lasting more than 48 hours in order to prevent microbiological growth).”
“On the other hand, I am of the view that the smaller temporary trailer from Veolia from January 2020 onwards (which, according to paragraph 369 of Mr Roberts’ witness statement, provides up to 25 m 3/h of treated water either in isolation or in conjunction with the existing demineralisation system) is the result of the inadequate capacity of the demineralised water plant installed by M+W, and it is a reasonable mitigation measure pending a permanent solution for this defect.”
“All paint systems shall ensure a minimum time to first maintenance of 15 years … Paint systems for the different plant areas shall be selected in accordance with the following classification according to BS EN ISO 12944 and, where local atmospheric conditions dictate, the use of a higher classification may be required to satisfy the minimum time to first maintenance. Atmospheric category Durability General exterior: C4 high High Interior: C3 medium High”
“It has been assumed in compiling the tables in Annex A that the first major maintenance painting would normally need to be carried out for reasons of corrosion protection once the coating has reached Ri 3 as defined in ISO 4628-3. Based on this precondition, durability has been indicated in this part of ISO 12944 in terms of three ranges: a) low (L): 2 years to 5 years; b) medium (M): 5 years to 15 years; c) high (H): more than 15 years. The durability range is not a ‘guarantee time.’ Durability is a technical consideration that can help the owner set up a maintenance programme. A guarantee time is the subject of clauses in the contract and is not within the scope of this part of ISO 12944. There are no rules that link the two periods of time … The guarantee time is usually shorter than the durability range.”
“c) Surface corrosion on external galvanised steelwork (structural steelwork, handrails, floor gratings, etc.); … i) Paint chips / corrosion on equipment (mainly motors and manual isolating valves); j) Incomplete painting of some piping systems (e.g. compressed air, vacuum piping around ACC); k) Rusty carbon steel bolts on flanged connections. Also isolating flange kits not provided on bolt sets joining carbon and stainless-steel flanges; …”
“It is important to emphasise that in terms of corrosion, the fact that pipework or equipment is lagged does not remove the risk. This is widely recognised and indeed is discussed in HSE Technical Guidance SPC/TECH/GEN/18 ‘Corrosion under insulation of plant and pipework v3.’”
“9 I plan to get the inspection completed as soon as possible and then I will plan the high priority rectification works as soon as possible in 2021 (hopefully in the dry months – i.e. Spring/Summer 2021) but with lower priority work pushed back to later in 2021 or early 2022, given budget constraints. 10 As a result of the above, I no longer consider that the estimates I gave at paragraph 202 of my First Witness Statement are accurate; I anticipate the cost of rectifying this defect being substantially more. I anticipate that EWH will need to spend the following in order to address this defect: 10.1 Cost of commissioning inspection / survey to determine extent and location of non-compliances: in the region of£22,779 plus VAT based on the quotation from RSG Industrial Services I refer to above. 10.2 Cost of providing access by way of scaffolding and mobile plant for the inspection: based on experience I would estimate this would require spend of approximately£20k . 10.3 Cost of carrying out works to ensure appropriate corrosion protection to pipework: Exact costs are unknown at this stage and will be dependent on the results of the inspection. However, as a ballpark figure, I would anticipate initial outlay of£250 -300k to cover this work to ensure that the required standards are complied with in respect to corrosion protection. 10.4 Cost of annual touch-ups: I would still anticipate the need for annual touch-ups and consider that my previous estimate of£15k a year from 2023 onwards remains reasonable.” 10.1 Cost of commissioning inspection / survey to determine extent and location of non-compliances: in the region of£22,779 plus VAT based on the quotation from RSG Industrial Services I refer to above. 10.2 Cost of providing access by way of scaffolding and mobile plant for the inspection: based on experience I would estimate this would require spend of approximately£20k . 10.3 Cost of carrying out works to ensure appropriate corrosion protection to pipework: Exact costs are unknown at this stage and will be dependent on the results of the inspection. However, as a ballpark figure, I would anticipate initial outlay of£250 -300k to cover this work to ensure that the required standards are complied with in respect to corrosion protection. 10.4 Cost of annual touch-ups: I would still anticipate the need for annual touch-ups and consider that my previous estimate of£15k a year from 2023 onwards remains reasonable.”
“The report will inform what works EWH needs to do and then we can go out to suppliers for quotations.”
“The court will hardly award a party£300,000 in damages just because one of that party’s employees thinks, without carrying out a proper factual investigation, there might be a need to carry out works which might cost that much.”
“i) fails to enable the effective removal of all material/tramp from the bed either manually or via the automated bed recycling system, without the need to shut down the plant and access the gasifier bed; and/or ii) fails to allow for sufficient cooling of the bed resulting in the bed cones reaching excessive temperatures. This causes the gate valves to interlock and the bed level to increase including the accumulation of material/tramp in the bed.”
“Based on EWH’s investigations to this date, the likely causes identified by EWH include, inter alia, the following: i) M+W’s defective design of the gasifier and bed cones as set out above; ii) M+W’s failure adequately to commission the MPT (… Defect No. 24) such that it fails to meet the separation efficiencies (especially relating to non-combustible ferrous and inert materials), contrary to clause 3.4, paragraph 1.3.3 and/or paragraph 2.2 of Schedule 22A of the Contract; and/or iii) The ongoing and excessive agglomeration of ash, slag and tramp in the gasifier (… Defect No. 23), contrary to clause 3.4, paragraph 2.2 of Schedule 22A and/or paragraph 6.4.5 of Schedule 22B of the Contract.”
“While the bed cone blockage has been the immediate cause of shutdown, it has not always been the root cause. For instance, the shutdown on11 September 2019 was caused by pieces of damaged refractory blocking the cones (defect 25). On other occasions the blockage is caused by falling slag caused by defect 23.”
“342. The cooling device was clearly designed with a loose ash in mind and not lumps of slag as currently being experienced. The residence time of the particulate matter in the cooling zone is very short and this technique can only be expected to be effective if the particles are small (e.g. dry ash) or thermally conducting (i.e. metallic). Larger non-conducting material may experience some cooling on the outside, but there is no time in the cool air for the cooling to penetrate into the core of the particle, which will therefore remain hot … 344. The slagging problems discussed under defect 23 create a situation where the cooling system cannot be expected to perform as designed. A conclusive judgment on whether the cooling system is in itself defective or not cannot be made until the slagging problem is solved.”
“… until we’ve sorted out the incoming material from the MPT where there have been also problems, it is difficult to distinguish between problems caused by the slag, problems caused by performance of the MPT and then to see what is left over in terms of any possible malperformance which may or may not be there once those problems have been solved.”
“The Bed Cones may not be designed and cannot be designed, in my view, for unpredictable sizes and quantities of slag. The pragmatic route in my view to resolving this is to minimise the slag formation so that the gasifier may operate for a longer period. For this reason, I believe that performance of the Bed Cones ought not to be assessed on its ability to remove large pieces of slag.”
“I am of the opinion that the bed and bed cone system has been designed to discharge ash and tramp material that would normally collect in the gasifier bed when using a fuel feed in compliance with the specification requirements. The bed and bed cone system is not designed to discharge the quantity and size of slag and ash agglomerated materials that are collecting in the bed. The cause of this additional bed burden is the subject of separate alleged defect investigation.”
“The Contractor shall design, manufacture and deliver a mechanical pre-treatment (MPT) plant to treat the incoming RDF as defined in clause 1.3.2 and Table 22A.2.0 above and to: - reduce the size of the RDF to meet the requirements in Table 22A.2.2 - reduce the percentage of non-combustible ferrous and non-ferrous metals, non-combustible glass and non-combustible inert materials in the incoming RDF to produce a fuel to the gasifier as defined for these parameters in Table 22A.2.2 and 22A.2.3 below.”
“5.3.5 Magnetic separators Magnetic separators shall be supplied to remove ferrous metals from the flow of material as it passes under the magnet on the conveyor. The efficiency of the magnetic separators shall be minimum 90% and shall be tested using a number of M20 x 120 mm ferrous bolts lying at the bottom of a bed of suitable material. 5.3.6 Eddy current separators Eddy current separators shall be supplied to remove non-ferrous metals from the flow of material as it passes on the conveyor. The efficiency of the eddy current separators shall be minimum 85% and shall be tested using aluminium plates 80x80x3 mm lying at the bottom of a bed of suitable material.”
“347. EWH’s initial try-out of the test on the12 May 2020 did not include the Schedule 22B specified target objects, which were still being painted I believe. The Schedule 22B targets are large targets which only report to the >75mm half of the plant, and don’t roll. They are easy to separate, specified to make the test easy to pass. We also wanted to optimise the separation performance with smaller targets with less easy shapes, which were already painted and ready on the 12th May, as in the draft Protocol. 348. So we went ahead with the initial try-out without the Schedule 22B targets as we wanted to assess whether the method in the Protocol worked as a trial run. In the event, some hatches had to be removed to execute the test, and a revised permit was required, so the test was re-scheduled for the next day. 349. The results record EWH undertook the test using the same set up as M+W on13 May 2020 . Schedule 22B Targets were painted and ready, so EWH carried out the first test with the smaller more difficult targets, all on the13 May 2020 . For the Schedule 22B test, the ferrous separation failed and the non-ferrous separation passed. The result was similar for the smaller more difficult targets. 350. The ferrous separation plant was then modified, and the ferrous separation part of the Schedule 22B test was repeated on the21 May 2020 and this repeat test was passed. The result was similar for the smaller more difficult targets.”
“[The parent company] (as a primary obligor and not merely as surety) hereby irrevocably guarantees to [EWH] the due and punctual performance and observance of, and compliance with, all agreements, obligations, liabilities, representations and warranties of [M+W] arising under or in connection with the Contract, including all addenda, exhibits and documents referenced in the Contract, and all future amendments, supplements, variations, change orders and other modifications to the Contract.”
“Neither the Contractor nor the Subcontractor shall without the previous consent of the other transfer any benefit or obligation under the Subcontract to any other person in whole or in part, except that: (a) the Subcontractor may without such consent transfer the right to receive any money which is or may become due to him under the Subcontract; and (b) if so required by the Purchaser under the Main Contract the Contractor may assign the Subcontract to the Purchaser.”
“the Contractor shall, if so required by the Purchaser and to the extent permitted by the subcontract, assign any subcontract to the Purchaser.”
“Subject to the following provisions of this section, any person liable in respect of any damage suffered by another person may recover contribution from any other person liable in respect of the same damage (whether jointly with him or otherwise).”
“A person is liable in respect of any damage for the purposes of this Act if the person who suffered it (or anyone representing his estate or dependants) is entitled to recover compensation from him in respect of that damage (whatever the legal basis of his liability, whether tort, breach of contract, breach of trust or otherwise).”
“When any claim for contribution falls to be decided the following questions in my opinion arise: (1) What damage has A suffered? (2) Is B liable to A in respect of that damage? (3) Is C also liable to A in respect of that damage or some of it? … I do not think it matters greatly whether, in phrasing these questions, one speaks (as the 1978 Act does) of ‘damage’ or of ‘loss’ or ‘harm’, provided it is borne in mind that ‘damage’ does not mean ‘damages’ (as pointed out by Roch LJ in Birse Construction Ltd v. Haiste Ltd [1996] 1 W.L.R. 675, at p.682) and that B's right to contribution by C depends on the damage, loss or harm for which B is liable to A corresponding (even if in part only) with the damage, loss or harm for which C is liable to A. This seems to me to accord with the underlying equity of the situation: it is obviously fair that C contributes to B a fair share of what both B and C owe in law to A, but obviously unfair that C should contribute to B any share of what B may owe in law to A but C does not.”
“The legislative technique of limiting the contribution principle under the 1978 Act to the same damage was a considered policy decision. The context does not therefore justify an expansive interpretation of the words ‘the same damage’ so as to mean substantially or materially similar damage. Such solutions could have been adopted but considerations of unfairness to parties who did not in truth cause or contribute to the same damage would have militated against them. Moreover, the adoption of such solutions would have led to uncertainty in the application of the law. That is the context of s.1(1) and the phrase ‘the same damage’. It must be interpreted and applied on a correct evaluation and comparison of claims alleged to qualify for contribution under s.1(1). No glosses, extensive or restrictive, are warranted. The natural and ordinary meaning of ‘the same damage’ is controlling.”
“… the liability of either party to the other arising out of or in connection with the Subcontract or the Subcontract Works, whether by reason of any breach of contract or of statutory duty or tortious or negligent act or omission shall be limited to the damages, remedies and reimbursements expressly provided in the Subcontract.”
“The fact that there are two possible meanings is the beginning of the inquiry, not its end. It is then necessary for the court to apply ‘all its tools of linguistic, contextual, purposive and common-sense analysis to discern what the clause really means’: per Briggs LJ in Nobahar-Cookson v. The Hut Group Ltd[2016] EWCA Civ 128 , at [19]. If as a result of so doing the answer becomes clear the court should give effect to it even though the interpretation may deprive a party of a right at law which he might otherwise have had. It is open to parties to make an agreement which has that effect.”
“1.1 ‘Defect’ means any work done or any Subcontract Materials or the Subcontract Plant or any part of it which does not comply with the Subcontract, provided that such matter shall not be a Defect if it is caused by: (a) normal wear and tear; (b) a failure by the Contractor or the Purchaser to operate and maintain the Subcontract Plant in accordance with any operating and maintenance manuals provided by the Subcontractor and/or with good engineering practice; and/or (c) a failure by the Contractor to comply with any of his obligations under the Subcontract. 37.2 If at any time before the Subcontract Plant is Taken Over in accordance with Clause 33 (Taking Over) or during the Defects Liability Period, the Contract Manager: (a) decides that any matter is a Defect; and (b) as soon as reasonably practicable notifies the Subcontractor of the particulars of the Defect; the Subcontractor shall as soon as reasonably practicable make good the Defect so notified and the Contractor shall so far as may be necessary place the Subcontract Plant at the Subcontractor’s disposal for this purpose. The Subcontractor shall, if so required by the Contract Manager, submit his proposals for making good any Defect to the Contract Manager for his approval which shall not be unreasonably withheld. 37.6 If the Subcontractor does not make good within a reasonable time any Defect which he is liable to make good under Sub-clause 37.2 … then the Contractor may, in addition to any other remedies or relief available to him under the Subcontract, proceed to do the work in such a manner as the Contract Manager may decide, including the employment of a third party, provided that the Contractor gives at least ten days’ notice of his intention. 37.7 If the Purchaser or the Contractor reasonably requires that any Defect notified to the Subcontractor under Sub-clause 37.2 which arises during the Defects Liability Period be made good urgently and the Subcontractor is unable or fails to comply within a reasonable time, the Purchaser or the Contractor may, in addition to any other remedies or relief available to him under the Subcontract and without further notification, proceed to do the work in such a manner as the Project Manager or the Contract Manager may decide, including the employment of a third party. 37.8 If the Contractor, or as applicable the Purchaser, has made good a Defect in accordance with Sub-clause 37.6 or 37.7, the Subcontractor shall reimburse the Contractor his reasonable costs, or as applicable pay to the Contractor the Purchaser's reasonable costs, of so doing provided that the Contractor complies with Sub-clause 4.3 and submits a claim in accordance with Sub-clause 19.5. The Contract Manager and the Subcontractor may agree the amount to be paid by the Subcontractor, or in the absence of agreement the Contract Manager shall determine such amount as may be reasonable. Such amount shall be: (a) deducted from any money that would otherwise be payable under the Subcontract; or (b) paid by the Subcontractor to the Contractor. Any disagreement arising under this Sub-clause 37.8 which is not settled in accordance with Clause 46 (Disputes) may be referred to an Expert in accordance with Clause 48 (Reference to an Expert).” (a) normal wear and tear; (b) a failure by the Contractor or the Purchaser to operate and maintain the Subcontract Plant in accordance with any operating and maintenance manuals provided by the Subcontractor and/or with good engineering practice; and/or (c) a failure by the Contractor to comply with any of his obligations under the Subcontract. (a) decides that any matter is a Defect; and (b) as soon as reasonably practicable notifies the Subcontractor of the particulars of the Defect; the Subcontractor shall as soon as reasonably practicable make good the Defect so notified and the Contractor shall so far as may be necessary place the Subcontract Plant at the Subcontractor’s disposal for this purpose. The Subcontractor shall, if so required by the Contract Manager, submit his proposals for making good any Defect to the Contract Manager for his approval which shall not be unreasonably withheld. (a) deducted from any money that would otherwise be payable under the Subcontract; or (b) paid by the Subcontractor to the Contractor. Any disagreement arising under this Sub-clause 37.8 which is not settled in accordance with Clause 46 (Disputes) may be referred to an Expert in accordance with Clause 48 (Reference to an Expert).”
“M+W was first informed of this claim in the Particulars of Claim and Outotec was first informed by way of the Additional Claim. There was no prior notification.” 723.2 By paragraph 6B of its Re-Amended Reply and Defence to the Third Party’s Counterclaim dated30 October 2020 , M+W repeated the April particulars in respect of defects 7, 9 and 10, and pleaded new particulars in respect of defects 14 and 17. 723.3 By paragraph 6C, it asserted no positive case as to notification in respect of defects 23, 25, 28, 32, 33, 35 and 37: “The alleged defects numbered 23 and above were only notified to M+W subsequent to termination. It is assumed that EWH has notified Outotec of these defects.”
“In any claim under this Deed for breach of clause 1 (Duty of care) there shall be available to the Subcontractor any defence that: (a) arises from or in connection with the Subcontract; and (b) would have been available if the claim had been brought by the Beneficiary had the Beneficiary been the contractor under the Subcontract, excluding any set-off or counterclaim available against the Contractor.” excluding any set-off or counterclaim available against the Contractor.”
“The works shall be designed to take account of all relevant regulations, standards and codes of practices as updated by the latest editions and amendments, including but not limited to: …. (10) the Environmental Permit and the associated conditions; (11) the Planning Consent; ….” (10) the Environmental Permit and the associated conditions; (11) the Planning Consent; ….”
“The plant shall comply in all respect (sic) with all the latest (unless otherwise indicated) relevant legislation including, but not limited to: …. the Environmental Permit and the associated conditions; the Planning Consent; …” the Planning Consent; …”
“To establish appropriate off-site noise limits that could have been used as design criteria would have required further studies. Importantly, the design criteria would apply to the cumulative noise levels from the operation of the whole plant, not just those items designed and supplied by Outotec. As setting appropriate off-site noise limits would affect all equipment including that in M+W’s scope of supply, and potentially the operation of the plant by EWH, in my view establishing off-site noise design criteria was incumbent on M+W or EWH, rather than the supplier of discrete part of the overall equipment (such as Outotec).”
“At 2.1.1.4 of Mr Williams’ evidence he explains the difficulty in Outotec being held responsible for an alleged breach relating to cumulative noise emissions due to the operation of the whole plant, of which Outotec only supplied a certain amount of the equipment. Although there is some logic to this statement, the primary sources of off-site noise pollution agreed by the experts to be problematic were within Outotec’s package and would have required mitigation even if all of the other sources were silent. To that extent, Outotec is solely responsible for the excess noise impact of at least the ID fan and the Air Pollution Control Residue incline conveyor.”
“… each fuel line shall be automatically controlled to allow independent adjustment of fuel to each line. The whole system shall be integrated so that build-ups can be prevented.” 746.2 Paragraph 1.3.4.3 of Schedule 1 to the subcontract provides: “The Subcontractor shall include for sufficient equipment, and describe the methods adopted, to ensure consistency of feed to the bed in order to minimise fluctuations in combustion conditions. Sufficient fuel distribution points shall be provided to ensure that relatively even gasification and temperatures are achieved across the bed.”
“M+W has previously notified Outotec about defective paintwork across the entire gasification chain spanning from the gasifier to the baghouse. Twenty-five separate Quality Observation Reports … (“QARs”) and six non-conformance reports (“NCRs”) have been raised notifying Outotec of defective paintwork and corrosion. Despite this Outotec has carried out limited paintwork repairs leaving it down to M+W to take responsibility for the rectification of these works. The widespread extent of the defects has led M+W to issue NCR 45055_QAM_NCR_0055 (dated14 August 2017 ) which records that the paint system across Outotec’s Subcontract Works generally fails to comply with the Subcontract Specification and is defective. In particular the dry film thickness does not comply with environment class C4H as described in BS 12944 and corrosion is visible on the surface of painted areas.”
“41.1 The Contractor shall pay the Subcontractor the Subcontract Price in instalments as provided in Schedule 19 (Subcontract Price and Payment). 41.2 If any instalment is to be paid upon the completion of a specified task or milestone, the Subcontractor shall only be entitled to apply for payment for that instalment when he can provide evidence of completion of the task or milestone as stated in Schedule 19 … 41.3 The Subcontractor shall submit a request for payment to the Contract Manager at intervals of not less than one calendar month showing: (a) the Subcontractor’s assessment of the amount to be paid for Subcontract Works carried out up to the end of the period for which it is submitted, together with any other scheduled payments as may have become payable; plus (b) the amounts to which the Subcontractor considers himself entitled in connection with all other matters for which provision is made under the Subcontract; less (c) the total of all sums previously certified by the Contract Manager for payment. The Subcontractor’s requests for payment shall be supported by all relevant documentary evidence appropriately itemised. 41.4 Within fourteen days of the receipt of an interim request for payment, ... the Contract Manager shall issue a certificate to the Subcontractor and the Contractor for the instalment to which the request for payment relates. The certificate shall show the sum which the Contract Manager considers to be due at the payment due date determined in accordance with Sub-clause 41.5, and the basis on which it has been calculated. The total certified shall comprise all sums listed in the Subcontractor’s statement which, in the opinion of the Contract Manager are properly payable under the Subcontract and shall show separately any elements within the sums certified in respect of nominated Sub-subcontractors. The Contract Manager may in any certificate delete, correct or modify any sum previously certified by him as he shall consider proper.” (a) the Subcontractor’s assessment of the amount to be paid for Subcontract Works carried out up to the end of the period for which it is submitted, together with any other scheduled payments as may have become payable; plus (b) the amounts to which the Subcontractor considers himself entitled in connection with all other matters for which provision is made under the Subcontract; less (c) the total of all sums previously certified by the Contract Manager for payment. The Subcontractor’s requests for payment shall be supported by all relevant documentary evidence appropriately itemised. The Contract Manager may in any certificate delete, correct or modify any sum previously certified by him as he shall consider proper.”
“This is becoming increasingly difficult due to a number of payment milestones that are likely to become due in March.”
“73. Towards the end of my time on the Gasification Project, the list of outstanding components was getting shorter. However, there were still significant components that were still outstanding. For example, as per M+W’s letter of5 December 2018 , there were missing handrail and walkway components ... 74. Outotec had been on notice since20 June 2018 regarding some of these components ... M+W had instructed Outotec to carry out remedial works to the walkway gratings and flooring penetrations but Outotec refused arguing that M+W had agreed to do this on Outotec’s behalf. These are some of the components, listed in ALS’s survey as included in the5 December 2018 letter …, that were still outstanding at the time that I left the Project ... As per my First Statement, there were also other materials that were outstanding.”
“96. Milestone 8 was ‘Approval of Final O&M manuals and other documentation’. I recall that Outotec submitted a number of different versions of the O&M Manuals. The first submission was received on a USB thumb-drive on or around10 January 2018 . 97. M+W wrote to Outotec on18 January 2018 listing a series of issues that needed to be addressed before the manuals would be accepted. I know that some of these issues had still not been addressed by15 November 2018 because I recall seeing meeting minutes from a meeting held on Site, on that date, which stated that many sections of the manuals were empty. The same minutes also record that various types of documentation had still not been received …”
“As confirmed by Carey in his statement, Outotec provided updated O&M Manuals on20 February 2019 . The O&M Manuals have therefore moved on since November 2018 and the comments made in the November 2018 meeting are not relevant.”
“Fabricom are due to complete the Gasifier in March and hence we cannot resist payment of this milestone much longer. We could argue that the installation is not complete until Outotec has provided all of the Documentation listed in Schedule 2 (but this would not be very convincing).”
“Take Over – not to exceed 28 months from shipment”
“Pursuant to the Conditions of Subcontract, Milestone Event 11 (Take Over) shall not be certified for payment until the Take Over Certificate has been issued and the Retention Bonds have been received by the Contractor.”
“The obvious meaning of this provision is that Outotec is not to be kept out of its payment for longer than 28 months in the event that Take Over of the Plant as a whole (over which it, as a supplier only, has no control) has not been achieved.”
“As soon as any minor items referred to in Sub-clause 32.6 have been completed and, subject to Sub-clause 33.10, all the procedures specified in Schedule 15 have been successfully carried out, including any which affect the operability or safety of the Subcontract Plant, the Contract Manager shall issue a certificate (a Take Over Certificate) for the Subcontract Plant to the Subcontractor with a copy to the Contractor stating that the Subcontractor has satisfied the requirements of the Subcontract Specification and Schedule 15, whereupon the Subcontract Plant, apart from any parts that are excluded from the Taking Over by the terms of the Certificate, shall be at the risk of the Contractor. The Contractor shall thereupon be responsible for the care, safety, operation, servicing and maintenance of the Subcontract Plant so certified and shall have the right to operate the Subcontract Plant. The Take Over Certificate may include a list of minor items still to be completed by the Subcontractor, and a list of take over procedures omitted by operation of Sub- clause 33.10. Any disagreement arising under this Sub-clause 33.7 concerning the issue of a Take Over Certificate which is not settled in accordance with the provisions of Clause 46 (Disputes) may be referred to an Expert in accordance with Clause 48 (Reference to an Expert).”
“A1.1 Upon the execution of this Subcontract, the subcontractor shall deliver to the Contractor a performance bond in an amount equal to 10 per cent of the Contract Price, [reducing to 5 percent on Taking Over, to expire on the issue of the Final Certificate and in terms of the draft contained in appendix 1 (or such other terms as the Contractor shall have approved) executed as a deed and delivered by a bank or insurance company previously approved by the Contractor. A1.2 Unless a performance bond is provided in terms of clause A1.1 then the Contractor shall be entitled to retain out of any payment due to the Subcontractor a sum equal to 10 per cent of the Subcontract Price. Any amount so retained shall become due for release to the Subcontractor only when such performance bond is provided, or, if none is provided, on the date on which a bond in terms of the draft contained in Appendix 1 would have lapsed.”
“The Subcontract Agreement comprises the design, manufacture, factory testing, painting, and advice on the following: installation and erection, commissioning, putting into normal operation, testing for performance, certification, reliability on completion, instruction of the operator's personnel in the operation and maintenance of the Works.”
“This is a remedy which the common law provides for breaches of warranty in contracts for sale of goods and for work and labour. It is restricted to contracts of these types. It is available as of right to a party to such a contract. It does not lie within the discretion of the court to withhold it. It is independent of the doctrine of ‘equitable set off’ developed by the Court of Chancery to afford similar relief in appropriate cases to parties to other types of contracts ... That it was no mere procedural rule designed to avoid circuity of action but a substantive defence at common law was the very point decided in Mondel v. Steel.”
“In every such case it is plain that the plaintiff, not having completed the agreed work in accordance with the contract, is not entitled to the whole of the agreed sum. He ought not, therefore, to recover judgment for that sum, but only for the lesser sum. When the defendant says: ‘You have not done the work to the agreed standard, and you are, therefore, not entitled to the agreed price’ that is a matter of defence in law and not of set-off or counterclaim.”
“Thus where there is a claim on a lump-sum contract and the defendant alleges that there are defects it may either set-off its loss in diminution of the claim, or it may counterclaim for damages. An employer, whose repudiation of the contract is accepted by the contractor before completion, is nevertheless entitled to abatement of the contractor’s entitlement to be paid at contractual rates for work completed, if the incomplete work is defective. The measure of an abatement is ‘how much less the subject-matter of the action [is] worth by reason of the breach’. By definition, the measure of an abatement cannot exceed the total of the sum to which it is applied. Since an abatement applies only to matters that go to reduce the value of the work performed or of the goods sold, it cannot apply to a cross-claim for delay in the execution of the works, which would be a matter of equitable set-off.”
“The rights of the parties to this subcontract in respect of set-off are fully set out in these conditions and no other rights whatsoever shall be implied as terms of this subcontract relating to set-off.”
“It is trite law that it is, in any event, impossible to assign ‘the contract’ as a whole, i.e. including both burden and benefit. The burden of a contract can never be assigned without the consent of the other party to the contract in which event such consent will give rise to a novation … Although it is true that the phrase ‘assign this contract’ is not strictly accurate, lawyers frequently use those words inaccurately to describe an assignment of the benefit of a contract since every lawyer knows that the burden of a contract cannot be assigned …”
“(i) Subject to any express contractual restrictions, a party to a contract can assign the benefit of a contract, but not the burden, without the consent of the other party to the contract. (ii) In the absence of any clear contrary intention, reference to assignment of the contract by the parties is understood to mean assignment of the benefit, that is, accrued and future rights. (iii) It is possible to assign future rights under a contract without the accrued rights but clear words are needed to give effect to such intention.”
“Now it is important to notice that a claim to rescission is a right of action but can in no way be described as a chose in action or part of a chose in action. It is a claim to be relieved of a mortgage, and such a claim can be made only by the owner of the mortgaged property. The owner cannot assign a right to rescission separately from his property because it would make no sense to acquire a right to have someone else’s property relieved of a mortgage. Likewise, the possibility of an abatement of the debt as part of the process of rescission is not a chose in action which can be assigned. It is simply part of the process of rescission, which is a right attached to the ownership of the house itself.”
“Just as it would make no sense to acquire a right to have someone else’s property relieved of a mortgage, so too would it make no sense to acquire a right to have someone else’s liability in debt reduced.”
“Until the assignment in 2019, that liability was a benefit under the subcontract enjoyed by M+W. In particular, that then entitled them to deduct liquidated damages under the subcontract against interim payments due to Outotec, subject to serving a pay less notice: see clause 41.6. That benefit was assigned to EWH in 2019, and at that point the right to deduct was lost.”
“Insofar as any claims against Outotec were fully discharged prior to the assignment, they were not subject to the assignment because no further right in respect of such claims existed at the time of the assignment. In this regard: (a) The last interim payment certificate prior to assignment of the Outotec Sub-Contract related to31 August 2018 and was issued on or around7 September 2018 . (b) In that certificate, M+W valued Outotec’s milestone entitlement at$32,697,341.24 and its variation entitlement at$32,687.40 , giving a total of$32,730,028.64 . (c) M+W had only paid$28,956,341.25 previously. (d) In the premises, but for counterclaims,$3,773,687.39 would have been due to Outotec. (e) However, no sum was paid to Outotec because M+W made deductions of:$3,987,480.64 in relation to liquidated damages and$7,434,792.35 in relation to recharges. (f) The deduction for liquidated damages was properly made. M+W’s entitlement in this respect is pleaded at paragraphs 16 to 18 of the Particulars of Additional Claim. (g) By withholding$3,773,687.39 which would otherwise have been paid to Outotec on this basis, M+W effectively received reimbursement for liquidated damages in or around September 2018. (h) In the premises, prior to termination M+W had already recovered the liquidated damages to which it was entitled. There was no remaining right to levy further liquidated damages which could be assigned to EWH. There is no legal reason why M+W must disgorge such properly levied liquidated damages to Outotec.”
“If the Subcontractor fails to fulfil any of its obligations under this Subcontract, and or to do any other thing in accordance with Schedule 11 (Times of completion), the Subcontractor shall pay the Contractor liquidated damages as specified in Schedule 12 (Liquidated damages for delay), but shall have no liability to pay damages in excess of the maximum (if any) stated in Schedule 12.”
“Within fourteen days of the receipt of an interim request for payment, or in the case of the final request for payment within fifty-six days of its receipt, the Contract Manager shall issue a certificate to the Subcontractor and the Contractor for the instalment to which the request for payment relates. The certificate shall show the sum which the Contract Manager considers to be due at the payment due date determined in accordance with Sub-clause 41.5, and the basis on which it has been calculated. The total certified shall comprise all sums listed in the Subcontractor’s statement which, in the opinion of the Contract Manager, are properly payable under the Subcontract and shall show separately any elements within the sums certified in respect of nominated Sub-subcontractors. The Contract Manager may in any certificate delete, correct or modify any sum previously certified by him as he shall consider proper.”
“If for any reason the Contractor, or the Contract Manager on his behalf, fails to notify the sum due in accordance with Sub-clause 41.4 by the payment due date determined in accordance with Sub-clause 41.5 the sum notified by the Subcontractor in his request for payment in accordance with Sub-clause 41.3 shall be due for payment by the Final Date for Payment.”
“If the Contractor intends to pay less than the sum due in accordance with Sub-clause 41.4 or 41.6 for any reason including any sum that may be due from the Subcontractor to the Contractor under the Subcontract or any sum not payable in accordance with Sub-clause 44.5, the Contractor shall notify the Subcontractor not later than one day before the Final Date for Payment, specifying the amount he considers to be due on the date the notice is given and the basis on which that sum is calculated.”
“In point of principle, when applying the law of limitation, a distinction must be drawn between a matter which is in the nature of a defence and one which is in the nature of a cross-claim. When a defendant is sued, he can raise any matter which is properly in the nature of a defence, without fear of being met by a period of limitation, No defence, properly so called, is subject to a time-bar. But the defendant cannot raise a matter which is properly the subject of a cross-claim, except within the period of limitation allowed for such a claim. A cross-claim may be made in a separate action, or it may be made by way of set off or counterclaim. But on principle it is always subject to a time-bar. The period allowable to the defendant depends on the steps which he takes to enforce his cross-claim. If he brings it by a separate action or arbitration, he must start his proceedings within the prescribed time or else he will be barred. If he raises it as a ‘claim’ by way of set off or counterclaim the law is governed bysection 28 of the Limitation Act 1939 , which says: ‘For the purposes of this Act, any claim by way of set off or counterclaim shall be deemed to be a separate action and to have been commenced on the same date as the action in which the set off or counterclaim is pleaded.’” ‘For the purposes of this Act, any claim by way of set off or counterclaim shall be deemed to be a separate action and to have been commenced on the same date as the action in which the set off or counterclaim is pleaded.’”
“All this is when the set off or counterclaim arises out of a separate transaction. When it does not arise out of a separate transaction, but out of the same transaction, then it is not within section 28 at all. It can be raised, as I will soon show, as matter of defence, either legal or equitable, so as to reduce or extinguish the claim and, being matter of defence, it is not subject to a time-bar.”
“96. It does not matter that in 2018, prior to the assignment occurring, M+W had deducted or withheld the [liquidated damages]. The correct analysis is that the effect of the assignment is that the [liquidated damages] (if applicable) are now owed solely to EWH and Outotec could not obtain a good discharge by paying M+W. The fact that, in the past, M+W purported to deduct such [liquidated damages] from sums otherwise due to Outotec is irrelevant. If M+W’s contention were correct, EWH would not, in fact, have obtained by the assignment all accrued and future rights under the Subcontract and/or the sole legal right to that debt, together with all attendant remedies. “97. Moreover, the accident of time as to when sums are paid and/or deducted cannot affect the above analysis. M+W’s new case would only be correct if the debtor (Outotec) could say that payment to the assignor (M+W) was good discharge of a debt owed to the assignee (EWH), but the above authorities do not provide any support for such a proposition. On the contrary, payment by Outotec to M+W will not give it good discharge, and it would remain liable to pay the debt as against EWH.”
“Until notice of any assignment, a contracting party is entitled to regard himself as party to obligations towards the assignor alone. Thus in the case of a monetary obligation he may until notice pay the assignor.”
“The debtor is liable, at law, to the assignor of the debt, and at law must pay the assignor if the assignor sues in respect of it. If so, it follows that he may pay without suit. The payment of the debtor to the assignor discharges the debt at law. The assignee has no legal right, and can only sue in the assignor's name. How can he sue if the debt has been paid?”
“Thus the case stands considered as a question of payment. Is there, then, any distinction between actual payment and a bona fide settlement of accounts between a debtor and his creditor without notice of any assignment. I see no substantial ground of distinction between actual payment and a release to the debtor founded upon a fair and bona fide arrangement. I take the true question to be whether there is evidence of there having been a fair and bona fide arrangement between the debtor and the only creditor of whose title the debtor had notice. Is there evidence that the arrangement between them in 1848 was a fair bona fide arrangement for settlement and discharge of the debt?”
“… cannot proceed to award or allow any sum at all to M+W, absent an application to amend to set out M+W’s case as to the effect of the Settlement Agreement upon their Part 20 Claim.”