Octoesse LLP v Trak Special Projects Ltd
The case of Octoesse LLP v Trak Special Projects Ltd. [2016] set an important precedent in ensuring the correct contractual procedures are adhered to when deducting liquidated damages.
Octoesse LLP (the claimant) entered into an amended JCT Intermediate Building Contract with Trak Special Projects Ltd. (the defendant) for the construction of residential units. Practical completion was significantly later than the original completion date, and the defendant submitted a claim for an 18-week extension of time. They were awarded 9.5 weeks by the contract administrator. No further certificate of non completion was issued.
When the defendant issued a final certificate for payment, the claimant issued a pay less notice which deducted liquidated damages. An adjudication was begun by the defendant on the grounds that the pay less notice was invalid.
The case focused on the interpretation of clauses 2.22 and 2.23 which are constructed such that:
'If the Contractor fails to complete the Works or a Section by the relevant Completion Date, the Architect/Contract administrator shall issue a certificate to that effect. If an extension of time is made after the issue of such certificate, the extension shall cancel that certificate and the Architect/Contract Administrator shall where necessary issue a further certificate.'
The defendant argued that it was an express condition of the claimant’s entitlement to deduct liquidated damages that the contract administrator issued a certificate of non completion. Further, the effect of clause 2.22 was that when the extension of time had been given, it had cancelled the certificate of non completion.
Justice Jefford held that the claimant was not entitled to deduct liquidated damages as they had agreed to an extension of time after a certificate of non completion had been issued.
If, on the other hand, the claimant had given notice of their intention to deduct damages, but an extension of time had then been made and a further certificate of non completion issued, then they would not need to give notice of the intention to deduct again.
[edit] Find out more
[edit] Related articles on Designing Buildings Wiki
Featured articles and news
Professional practical experience for Architects in training
The long process to transform the nature of education and professional practical experience in the Architecture profession following recent reports.
A people-first approach to retrofit
Moving away from the destructive paradigm of fabric-first.
International Electrician Day, 10 June 2025
Celebrating the role of electrical engineers from André-Marie Amperè, today and for the future.
New guide for clients launched at Houses of Parliament
'There has never been a more important time for clients to step up and ...ask the right questions'
The impact of recycled slate tiles
Innovation across the decades.
EPC changes for existing buildings
Changes and their context as the new RdSAP methodology comes into use from 15 June.
Skills England publishes Sector skills needs assessments
Priority areas relating to the built environment highlighted and described in brief.
BSRIA HVAC Market Watch - May 2025 Edition
Heat Pump Market Outlook: Policy, Performance & Refrigerant Trends for 2025–2028.
Committing to EDI in construction with CIOB
Built Environment professional bodies deepen commitment to EDI with two new signatories: CIAT and CICES.
Government Grenfell progress report at a glance
Line by line recomendation overview, with links to more details.
An engaging and lively review of his professional life.
Sustainable heating for listed buildings
A problem that needs to be approached intelligently.
50th Golden anniversary ECA Edmundson apprentice award
Deadline for entries has been extended to Friday 27 June, so don't miss out!
CIAT at the London Festival of Architecture
Designing for Everyone: Breaking Barriers in Inclusive Architecture.
Mixed reactions to apprenticeship and skills reform 2025
A 'welcome shift' for some and a 'backwards step' for others.