The onslaught of litigation relating to interim payments due to contractors, as a result of a lack of payment notices from employers, continues. Unsurprisingly the courts are making it clear that this is not a free-for-all for contractors. There have been a number of instances where contractors have claimed that particular documents were applications or payment notices and that they accordingly set in train a course of events that should have led to them being paid often substantial sums.
In the most recent case reported from the TCC, Henia Investments Inc v Beck Interiors Limited, the court found that a contractor’s interpretation of one of its documents was too strained to allow it to constitute an effective interim application. In particular, the document did not sensibly relate to the relevant month that the contractor claimed it did; was not clearly stated as relating to that particular month and, to use the judge’s phrase, was not “free from substantial ambiguity”. The driver behind this is: "If there are to be potentially serious consequences flowing from it being an Interim Application, it must be clear that it is what it purports to be so that the parties know what to do about it and when."
So by all means contractors can operate the contract properly and seek ‘default’ payments when they have in fact arisen, but the courts are wary about potential ‘try-ons’ that seek to take advantage of any particular situation.