Cases - Tersons Ltd v Stevenage Development Corporation [1965]

Record details

Name

Tersons Ltd v Stevenage Development Corporation

Date

[1965]

Citation

1 QB 37

Keywords

Construction contracts - liquidated damages - payment in event of ordering additional work - whether contra proferentem rule applies to standard form contracts

Summary

The claimant contractors entered into a contract to furnish and lay certain pipe sewers pursuant to the General Conditions of Contract and Forms of Tender, Agreement and Bond for use in connection with Works of Civil Engineering Construction (2nd edition, January, 1950). The claimant contended that clause 52 of that contract, which dealt with payment in the event of the ordering of additional work, should be construed against the corporation. Pearson LJ confirmed that the contra preferentem maxim did not automatically apply to industry-wide standard form contracts:

'Mr Kerr has contended that the maxim verba accipiuntur fortius contra proferentem should be applied in this case in favour of the contractor against the Corporation on the ground that the General Conditions were included in the invitation to tender sent by the Corporation to the contractor. In my view, the maxim has little, if any, application in this case. The General Conditions are not a partisan document or an "imposed standard contract" as that phrase is sometimes used. It was not drawn up by one party in its own interests and imposed on the other party. It is a general form, evidently in common use, and prepared and revised jointly by several representative bodies including the Federation of Civil Engineering Contractors. It would naturally be incorporated in a contract of this kind, and should have the same meaning whether the one party or the other happens to have made the first mention of it in the negotiations.'