PC Partitions v Canary Wharf Contractors Limited

Citation: EWHC 1766 (TCC) (contract/no contract issues)

Nature of case:
Canary Wharf Contractors (“CWC”) had engaged IES to undertake refurbishment works, which had then been subcontracted in part to PC Partitions.  PC had experienced difficulties in receiving payments from IES, and a meeting was convened between the parties, following which CWC issued a purchase order to PC in the sum of £25,000.  Later, a direct purchase agreement was made under which CWC agreed to pay PC directly the sums due under that agreement.  The present hearing was to determine preliminary issues.  PC argued that, at the meeting between the parties, CWC had agreed to engage PC directly to complete works on the project, and that this was evidenced by the purchase order.  Further, PC argued that the terms of the direct payment agreement, including those limiting PC’s causes of action against CWC, did not regulate work on which PC had been directly engaged by CWC.  In the alternative, PC argued that terms relating to reasonableness and good faith ought to be implied into the direct payment agreement, and the limits on PC’s causes of actions should be unenforceable.

HHJ Seymour QC dismissed these arguments.  The evidence did not support PC’s contention that it had been directly engaged by CWC.  As to the alternative argument, the only relevant terms were the express written terms; none of the terms suggested by PC satisfied the relevant test for implication.  Further, a term would only be unenforceable if to enforce it would be contrary to law, and that was not the case here.

Link to Judgment

Counsel

Simon Hughes QC

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