Objective Duty to Certify Completion

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Laing O’Rourke v Healthcare Support (Newcastle) Limited

Facts

This was a 3-way dispute between Laing O’Rourke (LOR) as Contractor, HCS which employed Laing O’Rourke, and Newcastle upon Tyne NHS Foundation Trust which was paying HCS to provide facilities to 2 hospitals including the Royal Victoria Infirmary, Newcastle. The parties fell out over phase 8 of the project, 2 clinical office blocks. LOR said that the blocks had been completed in May 2012, and the Trust disagreed. An Independent Tester was appointed under the building contract with LOR. His function was to certify completion against the criteria set out in the contract.

The Independent Tester was reluctant to certify because he had previously been the subject of proceedings by the Trust. LOR went to court for a Declaration as to what the Independent Tester should do.

Held

  1. The Tester should apply the criteria objectively and by reference to contractual terms.
  2. Although the Trust had concerns about the future implications of certifying completion, these were not relevant to the process of contractual administration, and should be disregarded by the Independent Tester.

Comment

The Judge (Edwards-Stuart J) took a robust line; he was impatient with the Trust’s concerns about various minor issues, and was not prepared to allow the Employer to hold up certification just because they had found things they were concerned about. It was up to the Independent Tester to comply with the contract, whatever the subsequent consequences.

For more information, help or advice please contact Rob Langley on 0191 211 7975 or [email protected]