Here the claimant building contractor, Lilly, had entered into a JCT SBC 2005 incorporating CDP and bespoke amendments, with Clin, the owner of a substantial property in Palace Gardens Terrace, Kensington in the Royal Borough of Kensington and Chelsea (RKBC) but the parties had made no detailed provisions in relation to planning consent.
Lilly were to carry out demolition, refurbishment and reconstruction works. The contract was entered into in September 2012, but whilst the works were underway in July 2013, RKBC contacted Lilly and Clin's architect to notify them that the scale of the demolition contemplated was substantial and required conservation area consent. Lilly suspended demolition work on receipt of RKBC's letter, and this was not resumed until a year later. Lilly claimed an EOT for the delay caused. Clin meanwhile said that numerous planning permissions had been obtained, and the conservation area consent was only required because Lilly had given RKBC the impression that the demolition works were more extensive than those covered by the existing consents. Clin eventually submitted a revised planning application in December 2013 with reduced demolition work and permission for the revised scheme was granted in June 2014.
The parties agreed to certain preliminary issues being heard, and in particular whether RBKC's letter required the works to be halted, and whether Clin was responsible for ensuring all necessary consents were obtained. The contract, although heavily amended, did not contain any express references to planning permission or conservation area consent. The judge concluded that, in spite of the lack of provision in the contract, the parties must have intended that planning permission should be obtained to allow the development to go ahead, and that the party best placed to obtain it was the employer. The central question was whether the employer was obliged to ensure planning permission was obtained.
The judge found that Clin did not assume the risk that planning permission would be given. The judge went on to note that his answers to the preliminary issues were likely to be of only limited use to the parties as the underlying facts had not been established. The judgment highlights the problems where planning permission is not expressly dealt with in a contract, particularly where the works are in a conservation area or other area with specific requirements. It also illustrates the problems of dealing with preliminary issues where a factual matrix has not been established or agreed.
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