In a short Scottish judgment, the Outer House of the Court of Session has ordered "specific implement" (the Scottish equivalent of specific performance) of a requirement by a consultant to provide a collateral warranty. The case in question arose from construction of a new leisure centre in Dumfries in 2006.
Main contractor Kier appointed Saunders as a consultant providing architectural, civil and structural engineering services to the project which completed in May 2008. The appointment document contained an undertaking to provide the local authority with a warranty within 14 days of a request. For a lengthy period following completion, no warranty was requested. However, defects were subsequently discovered and the leisure centre was closed for a period whilst remedial works were carried out. Proceedings were issued against Kier for GBP 5.6 million damages.
Kier joined Saunders as a third party. In early 2015 Kier requested the warranty from Saunders, which Saunders agreed to provide if it received fees it claimed were outstanding, but ultimately it failed to provide the warranty. Kier sought specific implement of the obligation to provide the warranty. Saunders raised many arguments in defence, for instance arguing that the level of PI cover, and the parties benefiting from the net contribution clause were left blank meaning the document could not be completed. The court did not find this an obstacle to ordering performance of the obligation to provide the warranty. It also dismissed an argument that Saunders couldn't give the warranty required after the event, and that the draft did not comply with the appointment.
This decision follows similar decisions in two TCC cases involving Liberty Mercian v Cuddy Civil Engineering where the court ordered specific performance of provision of bonds and warranties, and equivalent specific performance by way of payment into court.
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