AMEC Group Ltd v Secretary of State for Defence
Citation: EWHC 110 (TCC)
Nature of case:
AMEC Group sought permission to appeal against the ruling of a disputes review board that, under a contract entered into with the Secretary of State for the construction of a nuclear submarine facility, overrun costs incurred by AMEC, where they exceeded a cap of £50 million, were only recoverable where they were reasonably and properly incurred.
Coulson J refused permission to appeal, affirming that the appropriate test was whether the decision of the review board was obviously wrong. Far from being wrong, he held that the decision of the review board was not open to serious doubt, and was plainly right. The majority had taken the correct approach to construing the capping clause, and conclusively demonstrated that the entire pricing and payment regime of this contract depended on the ascertainment of actual costs, rather than all costs howsoever incurred.
