| Date | 26 February 2003 |
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| Judgment | Baldwins Industrial Services plc v Barr Limited, TCC 6 December 2002 |
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| The Issue | Whether a contract for the hire of plant is a construction contract within the meaning of the HGCRA. |
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| Implication |
Generally, where the hire of plant includes a provision of labour, such as a driver in connection with that plant, the contract will be treated as a construction contract for all purposes of the Construction Act. |
printThe recent case of Baldwins Industrial Services v Barr considered whether statutory adjudication was available to parties in the event of a dispute arising out of a contract for the hire of plant. The HGCRA of 1996 provided that parties to "construction contracts" would be entitled to refer disputes to adjudication in accordance with the provisions of the Act. Section 104(1) of the Act defined the term "construction contract" to mean an agreement for the carrying out of "construction operations" or for the arranging of construction operations by others. Section 105(1) defined construction operations to mean construction, alteration, repair, maintenance, extension, demolition or dismantling of buildings or structures. Section 105(2) listed certain operations which were to be excluded from the definition of construction operations. Reading these provisions carefully, it is not immediately obvious whether a contract for the hire of plant would be caught by the provisions of the Act, and perhaps it is for this reason that in 2001, the Construction Plant Hire Association (the CPA) revised their model conditions for hiring of plant by adding a paragraph 35, which now provides that the Scheme for Construction Contracts (England & Wales) Regulations shall apply. This paragraph was not available in the earlier CPA Model Conditions which had been included in the contract between Baldwins and Barr, but despite this the parties found themselves referring disputes to an adjudicator, and subsequently putting arguments before the court as to whether that adjudicator properly had jurisdiction to deal with the matters in dispute. In November 2000, Baldwins had hired to Barr a 50-tonne crane together with driver to be used by Barr for the erection of precast concrete beams for the construction of a new stadium for Southampton FC. An incident occurred on 19 December 2000 in which the crane was said to have been damaged. Baldwins sought from Barr the cost of repairs and the lost hire charges. A dispute between the parties concerning those matters was referred to adjudication in July 2002. The adjudicator rejected Barr's contention that he lacked jurisdiction. He then decided in favour of Baldwins that they should be paid approximately £150,000 in respect of repairs to the crane and £35,000 in respect of lost hire charges. Before these monies were paid to them, Baldwins went into administrative receivership. The matter than proceeded to court, with the receiver acting on behalf of Baldwins seeking to enforce the adjudicator's decision in its favour. For the purpose of the proceedings for enforcement, Barr conceded that there was a contract between the parties, which incorporated the Construction Plant Hire Association's Model Conditions for the hiring of plant. Neither Baldwins' booking form, the CPA Model Conditions, Baldwins' own model conditions, nor Barr's purchase order made any mention of the Construction Act. Nevertheless, what was clear to the court was that Barr had hired the crane plus operator in order to undertake construction work at the football stadium. The parties accepted that, if the contract had been for mere plant hire, without the incorporation of an operator, it would not be a Construction Contract within the meaning of the HGCRA. Baldwins contended however that the labour element in the contract was crucial. The crane plus the labour provided by Baldwins was an intrinsic part of the building works being carried out by Barr in the construction of the football stadium. Baldwins contended that the supply of a mobile crane plus driver was clearly an operation within the scope of Section 105 of the Construction Act because it was an activity which formed an intrinsic part of construction works as defined by the Act. Barr's position was that this was a contract for hire and this remained the case whether or not a driver was included. According to Barr, there was nothing in the contract which specified that Barr intended to use the crane in connection with the construction of a new stadium. The contract for hire did not specify the carrying out of any operations at all, still less building or engineering operations. The crane could have been used in a location other than the football ground, and for a purpose other than a construction project. Alternatively, Barr contended that the contract fell within the exceptions in subsection 105(2) of the Act, since the contract was merely for the delivery of equipment, plant or machinery and involved no construction operations. However, Judge Frances Kirkham rejected Barr's submissions. In her opinion the contract which was for the supply of a mobile crane plus driver was a contract for an operation which formed an integral part of, or was preparatory to, the construction works being carried out by Barr. Moreover, the contract was not one for the mere delivery of plant to site. It was for the supply of plant and labour for use in construction operations on a building site. Accordingly, the contract was a construction contract within the meaning Section 104 of the Construction Act. This meant that the adjudicator had jurisdiction to make the decision he had made, and his decision was therefore capable of being enforced by the Court by summary judgment.
CJ-0307
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