EWHC 493 (TCC)
The Shaws engaged Massey to carry out building works to their property. They lived in a large country house. The works were carried out to a building known as the East Lodge, a separate building some distance away from the main house. Disputes arose, which were referred to adjudication. The Shaws argued that they were residential occupiers. The adjudicator disagreed, the Shaws refused to pay and the matter ended up before Mr Justice Coulson. Pursuant to s106, the adjudication provisions of the HGCRA, do not apply to a construction contract with a residential occupier. However, that construction contract must principally relate to operations on a dwelling which one of the parties to the contract occupies or intends to occupy as his residence.
Here, it was found that the East Lodge was a separate building. It was not lived in by either of the Shaws. At best, at a date sometime after the contract, one of them may have intended to live there. However, what mattered was the parties' intentions at the time of the contract. The Shaws noted that, in the relevant Land Registry entry, the entirety of the property, including the main house and the East Lodge was referred to as one building. However, what mattered, was not how the Land Registry had registered the Title, but whether the Shaws were residential occupiers of East Lodge. They were not.
Mr Justice Coulson commented that if someone could no longer afford to live in a terraced house, but spent money on a conversion of the house into three small flats, one of which they intended to live in, with the other two being sold or rented, the s106 exemption would not apply here either, because of the commercial element of the works. S106 refers to a single dwelling house or flat and the specific intention to occupy that dwelling or flat as one's residence.