Galliford Try has clinched a legal victory in a dispute over its obligations to the long-term condition of a local authority sheltered-housing project in North Tyneside.
The judgment, delivered by the Technology and Construction Court on 21 September, addressed whether the contractor was liable for the condition of refurbished properties when they are handed back to North Tyneside council in 2042.
The project involved the demolition of 10 buildings that each contained between 24 and 45 flats to house elderly people, as well as the refurbishment of a further 16 buildings.
Solutions 4 North Tyneside, a special purpose vehicle contracted to deliver the project under a private finance initiative deal with the council, claimed at a hearing in March that Galliford Try was liable for defects that emerged in the roofs of refurbished blocks four years ago.
It said that, under the contract, timber roof structures should have a design life of 60 years from the date of the certificate of availability.
Galliford Try argued that its obligation was to ensure the refurbished housing met the stated requirements at the date the certificate was issued, highlighting that there was no obligation as to the future life expectancy of the properties.
Justice Eyre said he was satisfied that Galliford Try’s interpretation of the contract was “substantially correct” and that the claimant’s understanding would have meant that the construction company had to carry out significant refurbishment works well in advance of the date they would otherwise have been due.
“That would be an unusual arrangement – not to say a wasteful one – and if such were the parties’ intention, one would have expected it to be set out in clear terms,” he said.
The obligation with regards to life expectancy applied to the new builds and properties that involved elements of new building, but not to the refurbished homes, the judge added.
“Bringing an existing building up to a sound standard is different from putting it into a condition such that it will not need further significant refurbishment and potentially replacement as it ages during the lifetime of the project,” said Justice Eyre.
“A building and its structural components can be in a sound condition in 2017 even if it can confidently be predicted that it or some of those components will have come to the end of its or their life at some point between 2017 and 2042,” he added.
Galliford Try, North Tyneside Council and legal representatives for both sides were approached for comment.
