Mace Construct Limited v Baltic Investment Holdings Limited

Summary

After an adjudicator reduced to zero an extension of time the employer's agent had granted, the contractor used Part 8 proceedings to settle the construction of a heavily amended JCT Design and Build contract.

Mace sought six declarations. Baltic argued that most were unnecessary or wrong, that the contractor bore full design responsibility for listed items from a fixed date, and that a granted extension of time could not later be reviewed.

Adrian Williamson KC granted declarations 1, 2, 4 and 5 and refused 6 and 7. He gave effect to the whole contract, including a bespoke Schedule of Derogations that deferred the contractor's design responsibility until the employer instructed the design. He refused declarations that only recited express terms or turned on unheard facts. He held that an adjudicator may open up and review a prospectively granted extension of time, standing in the agent's shoes to redo the assessment as at the date of the contractor's notice.

Background and facts

Mace Construct was refurbishing the Baltic Exchange Building at 38 St Mary Axe in the City of London, a listed building, under a contract with Baltic Investment Holdings as employer.

The contract was dated 15 December 2023 and used an amended JCT Design and Build Contract 2016 form. It carried an extensive Schedule of Amendments, the Employer's Requirements, the Contractor's Proposals, a Schedule of Derogations and a Derogations Programme.

On 24 December 2024 the employer's agent granted extensions of time totalling seven weeks and five days for three events connected with design changes and the need for further planning approvals and listed building consents.

Baltic challenged that grant in adjudication. The adjudicator held that the extension was not binding on him, reviewed it, and reduced it to zero.

Mace did not accept much of the adjudicator's reasoning. Rather than re-run the facts, it brought Part 8 proceedings for declarations on the proper construction of the contract. Both parties accepted that the issues could be resolved without deciding the disputed facts.

The issue

The claim raised four groups of questions:

• whether the Tender Clarifications and the Schedule of Derogations had been incorporated into the contract (declarations 1 and 2);
• whether, and from what point, Mace carried design responsibility for the items listed in the Schedule of Derogations (declarations 3 to 5);
• whether Mace bore the risk of planning delays by the local authority (declaration 6);
• whether an adjudicator or the court can fix a completion date earlier than one previously fixed by the employer's agent, or review an extension of time granted under the prospective extension machinery (declaration 7).

The decision

The judge granted declarations 1 and 2. Incorporation of the two documents was by then common ground, but Baltic had argued throughout the adjudication that the Schedule of Derogations was not part of the contract.

Identifying the documents that make up the contract is the starting point for any analysis of the parties' rights, so the declarations were worth making.

The main construction dispute concerned design responsibility for the derogation items. Baltic argued that Mace took full and unqualified design responsibility for those items from 2 February 2024. Mace argued that responsibility passed only once it had received the necessary instruction for each item.

Adrian Williamson KC preferred Mace's reading. Applying the ordinary principles of contractual interpretation summarised in Wood v Capita Insurance Services Ltd [2017] UKSC 24, he gave effect to the whole of the agreement, including the Schedule of Derogations and the Derogations Programme, which set out a sequence of design steps for each item ending in an instruction to Mace.

The amended priority clause did not displace that result. On his reading the Schedule of Derogations did not override or modify the conditions but explained and supplemented them, and in any event the amendments gave the Schedule of Derogations priority. He granted declarations 3 to 5, subject to a reservation about the wording of declaration 3 so far as it touched planning consents.

Declaration 6 sought to allocate the risk of planning delay. The judge refused it. The wording was muddled, but the deeper problem was that planning delay is fact sensitive and the contract already dealt with it in detailed express terms. He would not grant a declaration that only paraphrased those terms:

"The parties must rely upon their express contractual rights and obligations."Adrian Williamson KC, paragraph 39

Declaration 7 raised a novel point. Mace argued that an extension of time granted under the prospective machinery of clause 2.25.1, however wrong, could not afterwards be reviewed by an adjudicator or the court, because any reviewer would be looking at events with hindsight.

The judge rejected that. The employer is fixed with a prospectively granted extension during the later review, save for relevant omissions. The adjudicator's power under paragraph 20 of the Scheme for Construction Contracts (England and Wales) Regulations 1998 to open up, revise and review a decision allows the adjudicator to stand in the agent's shoes and carry out the same prospective assessment:

"The Adjudicator can open up, revise and review the extension of time granted under clause 2.25.1, but, in so doing, he is to carry out the task which that clause requires, i.e. a prospective assessment in response to the notice and particulars submitted under clause 2.24."Adrian Williamson KC, paragraph 50

The difficulty of travelling back to the date of the contractor's notice and ignoring later events was a matter of evidence and procedure, not a reason of principle to shut out review. The judge declined declaration 7 and summarised the outcome:

"For these reasons I would grant declarations 1,2 4 and 5 as asked, but I would not grant declarations 6 and 7."Adrian Williamson KC, paragraph 53

Practical implications

Part 8 is a controlled way to settle contract construction after an adjudication has gone against you, provided the questions can be answered without resolving the facts. This case shows where the line falls.

The court will answer a clean question of construction, such as which documents form the contract or when a design obligation transfers. It will not grant a declaration that only recites express terms, nor one that depends on facts it has not heard, such as who caused a planning delay.

Draft declarations narrowly and tie each to a discrete point of construction. A muddled or fact-laden declaration invites refusal, as declarations 6 and 7 show.

For anyone pricing or administering design risk, the derogations point is the practical one. A bespoke schedule that defers design responsibility to the point of instruction can hold, even against a priority clause that says nothing may override or modify the conditions, where the schedule clarifies rather than cuts down the obligation.

The result turned on this contract's wording, the Schedule of Derogations and the Derogations Programme read together, so check the specific documents and the sequence of steps to see when responsibility, and the risk of design discrepancies, actually passes. Do not assume a standard override clause sweeps a supplementary schedule aside.

The extension of time ruling is the warning for claims practice. A prospectively granted extension is not beyond challenge. An adjudicator can open up and review it under paragraph 20 of the Scheme, standing in the agent's shoes and re-doing the prospective assessment as at the date of the contractor's notice.

That works both ways. An employer who thinks an extension was too generous can put it to an adjudicator, and a contractor holding a favourable grant should not treat it as final. The reviewer must perform the prospective exercise, not a hindsight one, so the contemporaneous notice, particulars and programme evidence are what decide the outcome.

Mace Construct Limited v Baltic Investment Holdings Limited [2026] EWHC 976 (TCC), Technology and Construction Court, Adrian Williamson KC sitting as a Deputy Judge of the High Court. Heard 15 April 2026, judgment handed down 28 April 2026.