Contract Determination – Who gets the documents?

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Alstom –v- Somi [2011] CILL TCC

Alstom was the main contractor on the EPC of a new power station in Pembrokshire.  It sub-contracted Somi of Italy to carry out mechanical piping erection under sub-contract conditions including a clause prohibiting removal from site of the “sub-contractor’s equipment”.  The clause was widely defined to cover handover information called “Turn Over Packages”.  Alstom sacked Somi under the clauses of the contract for breaches of contract. Somi subsequently refused to hand over the TOP’s and Alstom applied for an injunction.

HELD:

Damages would not be an adequate remedy because Somi would probably not be able to afford to compensate Alstom for the damage done if it was delayed in achieving the main contract handover and obliged to recreate all the TOP documentation.  Somi had already lost an adjudication and been ordered to pay over £3m in liquidated damages for delays for which it was found to be responsible.  Clearly the merits of the dispute would not be in Somi’s favour.  If the contact had been silent as to owner of the paperwork then this judgment might have possibly have gone the other way but the clause vesting title in the TOP’s was decisive.

NB: Somi subsequently refused to obey the injunction.  The Court fined the company £40,000 for contempt of court.