In making their judgement on the recent case of MY Contracts Ltd v 74 Hamilton Terrace Freehold Ltd [2024] EWHC 2896, the Technology and Construction Court (“TCC”) provided helpful guidance on the applicability of holidays and weekends to the service of notices.
On 2 March 2023, the parties entered into a JCT Design and Build Contract 2016 with amends, relating to a project at Hamilton Terrace, London (“the Contract”). During the course of the Works, Hamilton Terrace Freehold Ltd (“the Employer”) served a Notification of Façade Costs on 3 July 2023. However, My Contracts Limited (“the Contractor”) disputed its validity, claiming it was not served in time under the Contract.
The parties issued an adjudication, which found in favour of the Employer, and the Contractor subsequently commenced Part 8 proceedings in the TCC. Both parties sought declarations as to the proper construction of the contractual provision by which a notice had to be served in accordance with the Contract.
This particular dispute concerned bespoke amendments to Paragraph 6 of Article 12 (“Paragraph 6”) which stated:
“The contractor shall have no liability to the Employer in respect of any monetary amount that is not included in the Notification of Façade Costs or an update of the Notification of Façade Costs received by the Contractor not later than 4 (four) months after the date of this Contract.”
The Claimant’s argument was simply that the Defendant should have served the notice 4 months after the date of the contract (on or before Sunday 2 July 2023), and therefore the notice served by the Defendant on Monday 3 July 2023 was prima facie out of time.
The first argument raised by the Defendant, by reference to clause 1.5 of the Contract, was that the deadline for service must be extended, to allow for the four public holidays which fell during that four-month time period. The second was that a notice can only be deemed received on a working day; therefore, it follows that a notice cannot be served on a non-working day.
The Judge rejected this first argument, on the basis that clause 1.5 only applied to acts ‘required to be done within a specified period of days’, while paragraph 6 deals with a period of ‘four months’. In drawing this distinction, the Judge stressed that the parties could have provided that the period of four months was to exclude public holidays, but they did not choose to do so, and clause 1.5 cannot be used to re-write clauses which have been agreed between the parties.
The second strain of argument was dependent on the words “or upon the next Business Day thereafter” being added to Paragraph 6. In making his decision, the Judge noted that the term “Business Day” was already defined within the contract at clause 1.1, and used within Article 12 Paragraph 4, and therefore it was an active choice by the parties not to include it within Paragraph 6. The Judge made clear that the Court does not make contracts for the parties, and its role is limited to interpreting the wording which the parties have agreed.
What should we take from this?
Employers and Contractors alike should make note of when notices fall due under the contract, and if they may fall on a weekend, take the proper precautions to ensure the notice is served, to prevent questions about its validity. Careful consideration is advised when agreeing contractual terms, to make sure notice provisions are consistent, achievable and understood by both parties.
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