Trollope & Colls Ltd v North West Metropolitan Regional Hospital Board

House of Lords

Citations: [1973] 1 WLR 601; [1973] 2 All ER 260; (1973) 117 SJ 355; [1973] CLY 270.

Facts

The parties entered into a contract with each other which incorporated the RIBA standard form conditions, with some changes. The contract specified that the work would be completed in three phases, each with a fixed completion date. The architect had the power to move these dates in response to specific events. The events allowing the architect to move the end date of phase III did not include the grant of extensions for the prior phases.

The first phase was significantly delayed. The architect extended the time to complete phase I. However, this ultimately only left around half the time expected to complete phase III. It was not possible to extend the completion date for phase III. By this stage, the claimant asserted that they could still complete on time. By contrast, the defendant said it was not possible for them to hire sub-contractors able to complete their part of the work on the proposed schedule.

The claimant sought a declaration that the contract did not allow the architect to extend the completion period for phrase III if there had been an extension to phase I. The defendant thought that the contract did allow this on a proper interpretation, or that there was an implied term to this effect.

Issue(s)

1. Properly construed, did the contract allow an extension to the phase III completion date if there had been an extension to phase I?
2. If not, should a term to this effect be implied?

Decision

The House of Lords held in favour of the claimant. The express terms were clear and unambiguous about the conditions under which an extension could be granted. There was no reason to believe that the parties must have intended to include a term allowing an extension in these circumstances.

This Case is Authority For…

The court should not make a contract for the parties nor improve upon the contract made. The role of the court in both implication and interpretation is to discover what the parties intended. Where the contract terms are clear and unambiguous, the court will normally assume that the parties intended the literal meaning of the contract.

In the case of implication, the court will only find an implied term if it is:

‘a term that went without saying, a term necessary to give business efficacy to the contract, a term which, though tacit, formed part of the contract which the parties made for themselves.’

This is unlikely to be the case where there is an express clause which appears to address the situation in question.