Understanding the Impact of the Triple Point Case on Construction Contracts

The recent decision in the Court of Appeal case of Triple Point Technology, Inc. v PTT Public Company Ltd [2019] EWCA Civ 230 challenges certain assumptions typically made in relation to liquidated damages clauses, and is of considerable relevance to the construction industry. The decision related to the interpretation of a liquidated damages clause for delay where the supplier never achieved completion and the contract was terminated. The Court of Appeal held that, given the wording of the clause, it was engaged only where the work was completed by the contractor but not where it was left incomplete, and that in the latter scenario the employer was entitled only to general damages.

We have previously written about this decision here on our Litigation Notes blog. In this e-bulletin, we reflect in further detail on the potential implications of the decision for construction and engineering contracts.

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Construction Case Law Digest 2018/2019

Over the last 12 months, there have been a number of notable cases with significant implications for construction law and practice.

As well as several adjudication cases, such as the widely discussed Grove Developments, which untangled the conflicting authorities around true value adjudications, there were a number of cases that considered fundamental issues of contract law, the findings of which will be relevant to anyone involved in the preparation and/or management of construction contracts.

There were also cases that addressed core construction law issues, such as design liability, construction insurance, liquidated damages, and the prevention principle which the courts have clarified is not an overriding rule of law.

Important lessons were also learnt in respect of the role of experts in construction disputes, as Fraser J’s judgment in the long-running ICI dispute highlighted the importance of independent expert evidence.

In this construction case law digest, we have selected some of the most noteworthy cases from the past year, which will be of interest to the construction and engineering industry. Each case includes a summary of the factual background, decision(s), and the key practice points of each case.

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The rule on penalties in Makdessi applied to EPC contracts

The decision in (1) GPP Big Field LLP and (2) GPP Langstone LLP v Solar EPC Solutions SL (formerly known as Prosolia Siglio XXI) [2018] EWHC 2866 (Comm) has applied the Supreme Court’s recast penalties test from Makdessi1. The decision is one of the few construction cases that have applied Makdessi in determining whether liquidated damages for delay are unenforceable as a penalty. The court also considered the validity of a force majeure notice and liability of a parent company under an indemnity/guarantee.

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