Water and Sewerage Authority of Trinidad and Tobago (Respondent) v Waterworks Ltd (Appellant) (Trinidad and Tobago)
Case ID: JCPC 2021/0066
Jurisdiction:Court of Appeal of the Republic of Trinidad and Tobago
Case summary
Issue
The case concerns the interpretation of a clause in two design and construction contracts entitling a contractor to obtain reimbursement for reasonable expenses incurred prior to termination. The issue is whether charges incurred by the appellant, due to the cancellation of purchase orders for the supply of equipment made with a third party, were 'a cost or liability which in the circumstances was reasonably incurred in the expectation of completing works'?
Facts
The appellant and respondent entered into two contracts for the design and construction of two water treatment plants.
The contracts provided for termination before completion for convenience upon notice by the respondent, pursuant to clause 15.5 of the General Conditions of Contract.
Clause 19.6(c) of the contracts provided: "[U]pon such termination the Engineer shall determine the value of the work done and issue a Payment Certificate which shall include: [...] (c) any other Cost or liability which in the circumstances was reasonably incurred by the Contractor in the expectation of completing the Works."
In 2009, prior to the commencement of the construction phase of the plants, the respondent exercised its right to terminate the contracts. The appellant claimed inter alia reimbursement for cancellation charges incurred under two purchase orders for the supply of equipment that they had made with a third party prior to termination. The respondent refused to reimburse the appellant on the basis that the cancellation charges had not been reasonably incurred in the circumstances in expectation of completing the works. The Trial Judge upheld the appellant's claims under cl.19.6(c). The Court of Appeal allowed an appeal. The appellant now appeals to the Board.
Parties
Appellant
Waterworks Ltd
Respondent
Water and Sewerage Authority of Trinidad and Tobago
Appeal
Justices
Lord Lloyd-Jones, Lord Sales, Lord Leggatt, Lord Burrows, Lady Rose
Hearing start date
31 October 2024
Hearing finish date
31 October 2024