A Northern Ireland sludge treatment upgrade project agreement had a clause dealing with claims. Notification of a compensation event had to be given within 21 days of the contractor becoming aware of the event causing, or likely to cause, delay, breach of the agreement or cost. It was agreed that notification was a condition precedent and the contractor said that it had given notification of a £4.4 million claim in a letter which was part of a chain of correspondence relating to a separate claim. But could notification be inferred from that letter; could it be a hybrid?
The Northern Ireland High Court said that notification has to have certainty. There must be clarity and that was absent. The contractor had not convinced the court that there was a valid notification. The letter relied on had not even been referred to in the preceding adjudication about the same issue. The judge had sympathy for the plaintiff’s position because failure to notify prevented a claim being made. That might seem harsh when commercial parties anticipated that there might be a claim but he had to decide the case within the parameters of commercial and contract law. The contract terms were clear, commercial certainty is an overarching consideration and the evidence as to the commercial context and surrounding circumstances had not remedied the defect in the letter. It seemed to him likely that the notification requirement was overlooked in a mass of claims and ongoing discussions.