Failure to meet the deadline in a Remediation Order is not sufficient to terminate a contract

This was the implication of a judgement handed down by the High Court on 30th July in the case of Durkan Estates Limited v Wallace Estates Limited.  Wallace, the freeholder, had terminated an agreement with Durkan for the remediation of building safety defects arising from the contractor's construction of the building, after the deadline in the Remediation Order had passed and little progress had been made with the works.  Wallace then sought £13.5million via a Remediation Contribution Order to meet the cost of the works.  However, its application for summary judgement in this case was dismissed, with the High Court finding that the developer's case had a real prospect of success and required a full trial.  This case has the following implications for housing associations:

• A Building Safety Act deadline does not lower the bar for contract termination
• Terminating a contract while the contractor is still working is risky
• Statements made to the courts at any time during proceedings may be used against you
• It would be better to link contractual deadlines to a period of time after Gateway 2 approval, since this is not within the contractor's control
• Meeting minutes should capture statements of intent, acknowledgments of delay, responsibility for outstanding tasks, and whether either party is reserving rights.