Engineering services company AMEC has been ordered to submit to arbitration in a £52m dispute over repair works at the Thelwall Viaduct.
The Court of Appeal has ruled that arbitrator Robert Akenhead QC, who was appointed at the Department of Transport’s request, has jurisdiction to determine the damages claim in respect of AMEC’s allegedly defective viaduct refurbishment in 1996.
May LJ dismissed arguments by AMEC that before the dispute was referred to arbitration in December 2002, it had not been validly considered by the project’s engineer Pell Frischmann Consultants, as required by the arbitration clause in the Institution of Civil Engineers’ standard conditions of contract.
The judge said that although the engineer was the subject of a parallel lawsuit brought by the DTI in relation to the defects, this was an “unavoidable potential incidence of the contractual relationship between the parties” and was not a “basis for disqualification”.
He said that the DTI had been able to refer the dispute to arbitration following AMEC’s refusal to submit to Pell Frischmann’s findings that it was liable for breach of contract.
AMEC completed the project at the 1.4km-long viaduct, which carries the M6 motorway over the Manchester ship canal and the River Mersey near Warrington, in December 1996. In June 2002, the Highways Agency became aware of several defects, including cracks in the metal roller bearings supporting the bridge beams.
John Martin Construction and consultant Atkins have since been contracted to carry out repair works estimated to be £52m.
AMEC Civil Engineering Ltd v Secretary of State for Transport Court of Appeal (May, Rix and Hooper LJJ) 17 March 2005.
Vivian Ramsey QC and Simon Hughes (instructed by Wragge & Co, of Birmingham) appeared for the appellant; John Marrin QC and Sarah Hannaford (instructed by the Treasury Solicitor) appeared for the respondent.
References: EGi Legal News 17/3/05
