Jct Vesting Agreement

December 11, 2020

This case highlights the decisive role that vesting clauses and certificates can play in construction and engineering contracts in determining who-owner-what. In practice, there is some diversity in the details of these clauses. For example: (1) In a [relevant property transfer contract] that does not apply to paragraph 3 below, there is an implicit condition of the transfer that, in the event of the transfer of the assets in the goods, he has the right to transfer the property and, in the event of an agreement to transfer the assets to the goods, such a right at the time of the transfer of assets. IS SOGA s.25 isn`t that really an aid for the work contracts? Fortunately, case law has developed since Dawber Williamson Roofing Ltd v. Humberside CC in 1979. In a Scottish case after the adoption of SOGA, Archivent Sales – Development Ltd. against Strathclyde Regional Council 1985 S.L.T. 154, the Outer House of the Court of Session, Dawber Wiliamson refused to follow. Archivent had made documents available to the contractor on terms that contained a property reserve clause (see below). When the contractor went bankrupt, Archivent sued the Commission for delivery of materials or, failing that, for processing replacement. Instead of following Dawber Williamson, the court found that Law s.25 applied to the construction contract between the contractor and his employer, the Council. He therefore found that the Commission was a bona fide purchaser without notice of the title of Archivnt, so that it had acquired a good title in the documents and that the right to conversion had to fail.

The supplier has remained without recourse against the employer and should see what dividend comes from the contractor`s insolvency, if at all. Keating on Construction Contracts (9th Edn, paragraph 20-088) suggests that archival analysis is now preferable to Dawber Williamson`s analysis in England. P4 Limited v Unite (see above) says Keating is right. Mr. Justice Ramsey stated that although a construction contract is not a “sale” under SOGA, it is because it “… a construction and materials contract… “,” says SOGA s.25, goes beyond mere selling, “so I see that, where goods and materials become “delivered to the works, inside or annex,” the contract that leads to the surrender of ownership under paragraph 21.4.5.2 or 21.4.5.3 [of DOM 2] results in a sufficient “provision” within the meaning of Section 25 (1) of the Sale Act 1979. However, this “provision” is not sufficient to transfer the property unless the payment is made in accordance with clauses 21.4.5.2 or 21.4.5.3. I do not think this issue has been dealt with at the level of the Court of Appeal or the Supreme Court. Archivent and P4 v Unite, however, indicate that site delivery and combined payment will be a “provision” according to SOGA s.25, so employers` right to equipment is now safer.