Aceramais Holdings Limited v Hadleigh Partnerships Limited [2009] EWHC 1664

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The court held, on the facts of this case, that there was a “contract in writing” for the purposes of s. 107(2) of the Housing Grants, Construction and Regeneration Act 1996 (“the Act”).  In relation to an ongoing adjudication, the Court will only make a declaration that a contract is not “in writing” where the case is so clear-cut that it can act quickly and in effect stop the adjudication by way of the declaration.

Technology and Construction Court, HHJ Frances Kirkham


Aceramais Holdings Ltd (“AHL”) entered into discussions with Coventry Timber Frame Company (CTF) to undertake a project whereby AHL would purchase a property and CTF would develop it; the companies were to split the profits on the venture.  CTF was one of a number of companies owned or controlled by a certain Mr and Mrs Grant (“the Grants”).  During the course of the works CTF ceased trading and the project was continued by Hadleigh Partnerships Ltd (“HPL”), another of the Grants’ companies.

The purchase and development of the property were funded by a bank, which required the parties to execute a JCT standard form contract.  The bank’s quantity surveyors also advised that a JCT standard form should be in place.  AHL requested that CTF make the necessary arrangements.  CTF executed a contract, but, despite numerous reminders, it was neither dated nor signed by AHL, and the contract documents were subsequently lost.  After HPL took over the works it engaged another firm of quantity surveyors, which recommended that a replacement JCT contract should be executed.  HPL signed a replacement JCT and sent it to the bank’s quantity surveyors asking them to arrange for it to be signed.  AHL did not sign the replacement JCT, and subsequently denied ever having received it.

Disputes arose in relation to the works.  HPL served notice of adjudication pursuant to the Act.  AHL claimed that there was no contract in writing (as required by s. 107 of the Act) and applied for an injunction to prevent the adjudication from proceeding. The Court declined to grant the injunction, gave directions for a speedy trial on the issue of whether there was a contract in writing and ordered that pending trial HPL could not seek to enforce the adjudicator’s decision.  Meanwhile, notwithstanding AHL’s protests, the adjudication went ahead and HPL was awarded £800,000 by the adjudicator.


AHL sought a declaration that its agreement with CTF/HPL was not reduced to writing for the purposes of s.107 of the Act.  Section 107 of the Act provides:

(1) The provisions of this Part apply only where the construction contract is in writing, and any other agreement between the parties as to any matter is effective for the purposes of this Part only if in writing.

The expressions “agreement”, “agree” and “agreed” shall be construed accordingly.

(2) There is an agreement in writing—

 (a) if the agreement is made in writing (whether or not it is signed by the parties),

 (b) if the agreement is made by exchange of communications in writing, or

 (c) if the agreement is evidenced in writing.

The issues were:

  • whether there was a contract in writing for the purposes of Section 107; and
  • whether this was an appropriate case for the grant of a declaration


HHJ Kirkham held that there was a written contract for the purposes of s.107(2) of the Act for the following reasons:

  • the evidence provided by AHL was unpersuasive, especially in relation to never having received the second JCT contract;
  • the parties were aware that the bank funding the project had required a formal contract to be in place;
  • the QSs had taken steps to ensure that a JCT contract was put in place;
  • on numerous occasions AHL and its solicitor had acted as though a JCT contract was in place - AHL’s solicitor had acknowledged possession of a copy of the JCT contract between AHL and CTF, and this was also included in AHL’s disclosure list; 
  • AHL had received numerous reports from the project QSs containing various reminders in relation to executing a formal contract, which AHL had never queried;
  • there were various emails from the bank’s QSs  regarding the signing of the contract, which again were never queried;
  • solicitors for AHL dealt with matters on the assumption that there was a JCT contract in place; and
  • by asking CTF to take the necessary steps to meet the funder’s requirements for an executed JCT contract, AHL had given its tacit agreement to the JCT contract.

The Court therefore found that there was an agreement made in writing and not signed by the parties (falling within section 107(2)(a) of the Act) and that the agreement was evidenced in writing (falling under section 107(2)(c) of the Act).

With regard to declarations the Court found:

  • Declarations should only be made in the exceptional circumstances referred to in Dorchester Hotel Ltd v Vivid Interiors Ltd [2009] EWHC 70 (TCC)
  • Declaratory relief should only be granted where the case is so clear-cut that it can act quickly and in effect stop the adjudication by way of a declaration.  If the case is not clear-cut then the Court should not intervene and there should be an argument at the enforcement stage.
  • The question of whether or not there was a contract in writing and thus whether the adjudicator had jurisdiction is commonplace, and therefore not one of the exceptional cases in which declaratory relief will be given.
  • The factual basis of the issues in dispute was not so clear-cut that the Court could act quickly to grant a declaration.
  • On the facts of the case it would be disproportionate to grant a declaration, as giving a declaration on such a narrow issue would serve only to muddy the waters and would result in no saving in costs.

This summary was provided by CMS Cameron McKenna LLP.

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