Permission to appeal denied in Walter Lilly v Mackay

29 January 2013

Permission to appeal was refused on 24 January 2013 in the case of Walter Lilly and Company Limited v (1) Giles Patrick Cyril Mackay (2) DMW Developments Limited.

RPC represented the successful Claimant in the main action, with Mr Justice Akenhead handing down a landmark judgment covering extension of time and concurrency, loss and expense and global claims. His findings, summarised briefly below, are now set to shape this important area of construction law.

Extension of time and concurrency: Mr Justice Akenhead found that where there is an extension of time clause, and delay is caused by two or more effective causes, one of which entitles the contractor to an extension of time as being a Relevant Event, the contractor is entitled to a full extension of time.

Loss and expense: The court took a pragmatic and commercial approach to the loss and expense clause in question, which required the contractor to submit details which were "reasonably necessary" to the calculation of loss and expense. The court found that entitlement to loss and expense will not be lost if some of the loss details are not provided. Further, "reasonably necessary" detail did not necessarily give rise to an obligation to provide all of the backup accounting information. Finally, it concluded that the loss and expense clause should be construed in a "sensible and commercial way that would resonate with commercial parties in the real world".

Global claims: The Judgment stated that contractors do not have to show that it would be impossible to plead and prove cause and effect in the usual way, in order to bring a global claim. A global claim will not necessarily fail by reason of factors for which the claimant contractor is responsible or which cannot be proved not to have contributed to the global loss. The consequence would simply be that the claim would be reduced by the value of the event or series of events in question.


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