Citation: EWHC 2707 (TCC)
James Frampton (instructed by Andrew Crawford on a licenced access basis) acted for the defendant (‘Gypcraft’) in this Part 8 claim in which judgment was handed down on 8 October 2025. The claimant (‘VCL’) sought declarations in relation to the proper construction of a contract payment mechanism used by the parties under their subcontract dated 12 November 2020 (‘the Sub-Contract’). Gypcraft resisted the grant of these declarations.
The Part 8 claim followed an adjudication in which the adjudicator had decided that VCL had failed to issue a valid payment notice, meaning Gypcraft was entitled to the sums sought in its Payment Application 23 as a notified sum.
Adrian Williamson KC, sitting as Deputy Judge of the High Court, held that VCL was not entitled to the Part 8 declarations it sought.
There were 3 issues:
- Firstly, VCL argued principally that a Payment Schedule agreed during the works did not fit with the provisions of clause 4 of the JCT conditions because the payment schedule did not specify an “Interim Valuation Date” which was required under clause 4. VCL’s case, therefore, was that the Sub-Contract did not contain an adequate mechanism for payment and was replaced by the Scheme for Construction Contracts, under which Gypcraft’s Payment Application 23 could not be a valid payee’s notice in default. The judge rejected this argument on the grounds that the Payment Schedule clearly set out the relevant dates and that it would be uncommercial to suggest the system failed simply because it used the term “Sub-Contractor Submission Valuation Date” instead of “Interim Valuation Date”. This confirms that where parties agree bespoke payment provisions, the Court will strive to give effect to them.
- Secondly, VCL argued that a course of conduct established an estoppel by convention under which Gypcraft accepted late Payment Notices,. The judge rejected this, finding that (a) Gypcraft made no relevant representation beyond a statement of fact, (b) there was no evidence of any shared convention permitting late notices, and (c) there was no evidence of reliance by VCL. The Court’s approach shows that parties seeking to rely on an estoppel in respect of a payment application or notice must still establish the necessary elements by evidence, and it may not be suitable for Part 8.
- Finally, VCL argued that the late payment notice it issued on 7 February 2023 could still be a valid Pay Less Notice. The judge found that the notice was plainly intended to be a Payment Notice as stated. Any other interpretation would be artificial and would undermine both the Act and the Sub-Contract. A party cannot, therefore, rely on an invalid payment notice as a valid pay less notice. They are separate documents.
