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Contractual interpretation and commercial common sense—Inner House dismisses appeal (Network Rail and the Scottish Ministers v Fern and McLaughlin & Harvey)

Published on: 29 July 2022
Published by: LexisPSL
  • Contractual interpretation and commercial common sense—Inner House dismisses appeal (Network Rail and the Scottish Ministers v Fern and McLaughlin & Harvey)
  • What are the practical implications of this case?
  • What was the background?
  • What did the court decide?
  • Outer House decision [2021] CSOH 107
  • Inner House decision [2022] CSIH 32
  • Case details

Article summary

Construction analysis: This case concerns a multi-story office block in Glasgow. Following defects becoming apparent in the works, a court action was raised. Following negotiations, settlement agreements were entered into. These provided for the contractor to undertake remedial works. The parties then entered into a Remedial Works Agreement (RWA). This appeal from the decision of the Commercial Court concerns the interpretation of the RWA. The issue was whether, under the RWA, the owner, Fern, was entitled to take and intimate to the contractor a decision that remedial works were satisfactorily complete when it was the tenants’ contention that they were not. The tenants asserted that they had a right to have their complaints, so far as reasonable, that the remedial works had not been satisfactorily completed included in the Owner’s Completion Notice. The commercial judge at first instance had found that the tenants had no right to challenge the owner’s decision to accept that the works were satisfactorily completed. The court upheld the first instance decision and dismissed the appeal. In doing so, the court restated principles of contractual interpretation. Written by Shona Frame, partner, and Rachel Todd, associate, at CMS Cameron McKenna Nabarro Olswang LLP. or take a trial to read the full analysis.

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