Citation: [2015] EWCA Civ 1030
Court of Appeal rule in Wilson & Sharp on new insolvency provisions in HGCRA and disapprove of winding up based on valid interim payment certificates
Wilson & Sharp (W&S) were employers under JCT Contracts. They failed to pay 4 interim certificates or to serve pay less notices. The Contractor (HVD) threatened to wind W&S up. W&S sought an injunction to restrain the petition on grounds that they disputed the valuations in the interim certificates and had claims for damages for repudiatory breach. HVD resisted the application on the grounds that W&S had historically admitted the sums were due and their cross claims were raised too late and were a “put up job” to avoid liquidation. At first instance the Judge agreed with HVD. Shortly after, HVD went into liquidation. W&S appealed.
The Court of Appeal allowed the appeal. The Court of Appeal found that although the interim payments had been due and payable, W&S’ cross claims, supported by a quantity surveyor, were sufficient to grant the injunction. W&S’ failure to issue pay less notices did not prevent them from now challenging the valuations. Furthermore, HVD was in liquidation. Thus under the JCT contract, W&S “need not pay any sum that has already become due”. The JCT clause applied notwithstanding that the contracts had been terminated 7 months prior to HVD’s insolvency, for reasons unrelated to HVD’s insolvency. This is the first case on s111(10) of the HGCRA 1996.
Counsel: Krista Lee appeared on behalf of the successful Appellant.
