A Question of Construction

A point of principle arising in the recent case of Melville Dundas v Wimpey was sought to be addressed by the court in Pierce Design International Ltd v Mark Johnston and Another. In Pierce, the debate essentially turned on the interpretation of the proviso to Clause 27.6.5.1 of the relevant JCT contract, and whether an Employer, who has failed to pay sums due to the Contractor under the contract, can resist a Contractor’s claim for payment by relying on its subsequent determination of the Contractor’s employment.

Pierce entered into a contract with Mr and Mrs Johnston to carry out construction works at their property in London. The contract incorporated the JCT Standard Form of Building Contract (With Contractor’s Design), 1998 edition, incorporating certain Amendments. The Johnstons failed to make interim payments to Pierce and no withholding notices were served. Pierce therefore sought payment of the outstanding sums, together with interest. Works, however, were not