Savoye and Savoye Limited v Spicers Limited [2014] EWHC 4195 (TCC)

This summary was provided by CMS Cameron McKenna LLP.

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The installation of a conveyer system in a factory building fell within the meaning of “construction operations” in section 105(1) of the Housing Grants, Construction and Regeneration Act 1996 (“HGCRA”) and in particular “form[ed] part of the land”. An Adjudicator therefore had jurisdiction to decide on a dispute in relation to these works. Whether something forms or is to form part of the land is ultimately a question of fact and degree. In coming to a decision on whether or not works under a contract “form part of the land”, one of the criteria for “construction operations” as defined in sections 150(1)(a) to (c), the Court is to have reference to the principles of law relating to real property and fixtures. These principles inform (but do not circumscribe) the factual test as to whether the building, structure, works and fittings were forming or to form part of the land.


On 3 January 2013 Spicers Ltd (“Spicers”), Savoye (a French company) and Savoye Ltd (a related British company) (together “Savoye”) concluded a contract under which Savoye was to design, supply, supervise and commission a new conveyor system at Spicers’ existing factory site in Dartmouth Road, Smethwick, West Midlands.

Savoye completed the installation towards the end of 2013 but there were increasing disputes between the parties, from Savoye’s side in relation to sums of money said to be outstanding and, from Spicers’ standpoint, in relation to the quality and performance of the installation.

Savoye gave notice of adjudication on 30 June 2014 under the adjudication clause in the contract seeking payment of amounts it alleged to outstanding. Spicers lodged an objection to the jurisdiction of the adjudicator on the basis that the works which Savoye was engaged to carry out were not “construction operations” within the meaning of section 105 of the HGCRA. The adjudicator made a non-binding ruling on his own jurisdiction and accepted Savoye’s argument that he did have jurisdiction. He proceeded to issue his decision on 11 August 2014, finding that Spicers was to pay Savoye £827,780.35 plus VAT of £34,050.92, £11041.01 as interest and adjudicator’s fees of £16,440 (inclusive of VAT).

Although issues had been raised as to the quality and performance of the conveyor system installed by Savoye, the adjudicator decided that, by operation of the payment provisions of the HGCRA, Savoye was entitled to be paid what it had invoiced as Spicers had not served the requisite notices such as would have permitted it to reduce or withhold payment.

Spicers did not pay and Savoye issued proceedings on 5 September 2014 and applied for summary judgment to enforce the adjudicator’s decision. The summary judgment application was refused on the basis that there were triable factual issues and Court considered that a site visit was necessary. The trial took place on 3 December 2014.

Counsel for Savoye argued that sections 105(1)(a) to (c) of the HGCRA were applicable and that, as a matter of fact and degree, the overall conveyor system formed part of the land. Counsel for Spicers argued that section 105(1) was not engaged at all but, if it was, the conveyor system did not and was not intended to form part of the land.


Whether the underlying contract between the parties was a construction contract involving “construction operations” within the meaning of the term in section 105(1)(a) to (c) of the HGCRA and therefore whether the Adjudicator had jurisdiction to the decide on the dispute.


The Court found in favour of Savoye and held that:

  • Sections 105(1)(a) to (c) of the HGCRA were engaged, in principle, where substantial plant or machinery is to be installed within a building or structure. Subsections (b) and (c) made reference to “industrial plant”, which were capable of encompassing industrial conveyor systems, such as this example, and “fittings which are clearly to include or be things which are fitted in to buildings”. In principle, the word “structure” could also include an industrial conveyor system if, as here, it comprised itself a substantial steel structure.
  • The conveyor system did “form part of the land” for the purposes of section 105. This was a question of whether the conveyor system taken as a whole and as a matter of fact and degree was sufficiently attached to the floors and underside of the mezzanine floor of the building as to give rise to a proper conclusion that it was forming or to form part of the land.
  • The conveyor system formed part of the land for the following reasons:
    • Substantial and extensive fixings bolted the system to the body of the building. The bolts numbered in the thousands, were substantial and could not readily be removed;
    • The conveyor system itself was substantial and large, covering a large section of the floor of the building and the conveyor extending to almost a kilometre in length;
    • The system was clearly intended, both subjectively and objectively, to be relatively permanent and to perform a key role in the warehouse. Furthermore, it was installed to enhance the value and utility of the premises;
    • Whilst part of the system was bolted to the ground only by one bolt on each of the column legs those bolts were substantial and were there to provide in effect a structural type fixing to ensure stability, durability, alignment, protection and health and safety, the combined purpose of which can be said to be a firm attachment to the ground;
      Although some of the elements of the system were not as such mechanically attached to the floor, these elements were all important parts of an integrated system, connected together by a computer system and integrated compressed air and electrical systems, and further, these elements were large and heavy, the movement of which would not be undertaken lightly; and
    • Whilst parts of the system could be removed relatively easily, this is analogous to the removal of a radiator (considered part of the land) and it would take substantial effort to remove the whole conveyor system.
  • The work carried out by Savoye under the contract therefore fell within the meaning of “construction operations” in section 105(1) and consequently the Adjudicator had jurisdiction to decide on the dispute and his decision should be enforced by the Court.

 This summary was provided by CMS Cameron McKenna LLP.

For more information visit


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