Key takeaways
Clear contracts prevent risk confusion
Ambiguity can shift liability unexpectedly
Courts can overturn adjudicator decisions
Judges may correct misinterpreted contract terms
Part 8 offers efficient dispute resolution
Use when facts are agreed but terms disputed
In the case of John Sisk & Son Limited -v- Capital & Centric (Rose) Limited, the question of allocation of risk and the enduring issue between contractor (in this case Sisk) and employer (in this case C&C) as to responsibility for existing site conditions came before the Technology and Construction Court.
On this occasion, on the facts of the case, Sisk was successful.
We examine in this article the reasons behind the decision.
Background facts
The parties entered into a JCT Design and Build 2016 form of contract, with substantial amendments (“Contract”). The unamended JCT Design and Build 2016 form, is silent on the allocation of risk for site conditions and the usual starting point at common law is that the risk for ground conditions lies with the Contractor. On this basis, the parties usually deal with this risk in specific amendments to the contract.
Pursuant to the Contract, specifically amended clauses 2.42.1 to 2.42.3, Sisk was responsible for all risks in relation to the existing site, including the risk as to the condition of the existing structure.
However, clause 2.42.4 provided:
"this clause 2.42 shall be subject to item 2 of the Clarifications”.
Clarifications was defined as:
"The clarifications headed “Contract Clarifications” contained within Volume 2, Appendix 2.9 of the Employer’s Requirements”
Item 2 of the Contract Clarifications document indicated that existing structures were an Employer risk (reproduced below):
Sisk ClarificationComments/Risk OwnerExisting Structures Risk including ability to support/facilitate proposed worksThe Employer is to insure the Existing buildings/works. Employer also to obtain warranty from Arup with regard to the suitability of the proposed works. Employer Risk
While the Contract included a definition of Clarifications, a dispute arose between the parties as to what fell within the definition because there were two clarifications documents, one being a worksheet headed “Contract Clarifications” and the other being a worksheet headed “tender submission clarifications”.
The “Contract Clarifications” document allocated risk to C&C whereas, on C&Cs case, the “tender submission clarifications” document allocated risk to Sisk.
Adjudication
The dispute proceeded to adjudication. In finding in favour of C&C, the adjudicator declared that:
"On a proper interpretation of the Contract and in particular clause 2.42 of the Contract and items 1 and 2 of the Contract Clarifications schedule, the responsibility for ground conditions …. was solely Sisk’s risk”.
Part 8 Proceedings
Sisk commenced Part 8 proceedings seeking court declarations as to the interpretation of clause 2.42 and item 2 of the clarifications, and in consequence, that the risk of the unsuitability of the existing structures C&C lie solely with C&C. Part 8 proceedings are used when the courts are asked for a declaration on a question which is unlikely to involve a substantial dispute of fact. In certain circumstances, and subject to certain conditions, the Court will intervene and make determinations which prevent the enforcement of an adjudicator’s decision which is plainly wrong.
The decision
The key finding was that the “Clarifications” document referred to at clause 2.42.4 was the document headed “Contract Clarifications”. In this regard, the judge concluded, contrary to the Adjudicator’s decision, that:
“It is plain in my judgment that this can only be referring to the specific contract clarifications worksheet which is “within” the Clarifications Document, rather than to the whole workbook.”
that clause 2.42.4 referred to “item 2” of the Clarifications document and that could, therefore, only be the “Contract Clarifications” document; and
having concluded that the “Contract Clarifications” document was the relevant document for the purposes of clause 2.42.4; the meaning of item 2, in particular “Employer Risk”, was that the existing structures was a C&C risk.
Key takeaways
This case very much turns on its own facts and the specific amendments to the contract. It highlights the dangers of incorporating ‘clarifications documents’ which may contradict what is in the contract terms.
The case is also of interest as it is a further erosion into the utility of adjudication. It supports our experience of the trend towards challenging adjudication decisions via Part 8 court intervention. Indeed, it raises the question as to whether in cases such as payment applications or interpretation of “the contract” or “contract terms”, is Part 8 the more cost effective and speedy option? The answer to that question will be fact sensitive but it is perhaps a question that should be considered in all cases – insofar as it is not already being considered.
John Sisk and Son Ltd -v- Capital & Centric (Rose) Ltd [2025] EWHC 594 (TCC)
