Cases - British Steel Corp v Cleveland Bridge & Engineering (1981)

Record details

Name

British Steel Corp v Cleveland Bridge & Engineering

Date

[1981]

Citation

24 BLR 94

Keywords

Construction claim - time for completion - reasonable time - no contract - quantum meruit - circumstances at time of performance

Summary

This dispute arose out of the manufacture and supply of steel castings required for the formation of the roof nodes at Sama Bank in Damann, Saudi Arabia, pursuant to a letter of intent. At the time, the official form of subcontract had not yet been issued to the claimant manufacturers, but the defendants requested that preparatory works should proceed 'immediately' in any event. The letter of intent contained no delivery date. Procurement and manufacture of the steel was affected by industrial action and various changes to the specification. The claimants sued for the cost of manufacturing the steel. The defendants alleged that the steel was delivered late and out of sequence and counterclaimed accordingly. Whilst the Court concluded that no binding contract was entered into between the parties, Robert Goff J went on to consider the 'reasonableness of the time for performance' in the event that the claimants had been under a duty to complete the works and effect delivery of the steel within a reasonable time.

The Court followed the reasoning in Hick v Raymond & Reid, and envisaged a 2-stage test, as Robert Goff J put it:

'As I understand it, I have first to consider what would, in ordinary circumstances, be a reasonable time for the performance of the relevant services [i.e. the manufacture and delivery of the nodes to the required specification]; and I have then to consider to what extent the time for performance by BSC was in fact extended by extraordinary circumstances outside their control.'

In other words, it is clearly not sufficient to look to the 'ordinary time' for the performance of works without regard to the circumstances at the time of performance.