Abbey Healthcare v Simply Construct
29 June 2022
29 June 2022
Last year we reported on a case in the TCC that considered whether a collateral warranty was a construction contract in accordance with s.104(1) of the Housing Grants (Construction and Regeneration Act) Act 1996 (the "Act"). You can find our summary here.
At first instance, the court found that Abbey's collateral warranty was not a construction contract. The judge concluded that 'where the works have already been completed, and as in this case even latent defects have been remedied by other contractors, a construction contract is unlikely to arise'. Abbey appealed the decision, and the Court of Appeal handed down its decision on 21 June 2022.1
Here, we summarise the Court of Appeal's judgment in five points:
Closing Comment: The Court of Appeal's judgment has underlined the importance placed on maintaining the widest possible interpretation of the Act, as well as safeguarding access to the adjudication procedure provided by the Act. As Coulson LJ observed, adjudication remains a "popular and cost-effective dispute resolution process" and therefore clarity as to when it is available under the Act is crucial. This decision provides that clarity for the beneficiaries of collateral warranties.
Authors: Sadia McEvoy, Matthew Bool and Ben Patton