Injunction against call on performance bond refused

J Murphy & Sons Ltd v Beckton Energy Ltd [2016] BLR 448, [2016] EWHC 607 (TCC), 18 March 2016

Like London buses, decisions on performance bonds often come in two, if not three. In this decision, the High Court had to consider an interesting attempt by Murphy to prevent Beckton from calling on a performance bond. The contract in question was for the design and construction of a power plant, based on the FIDIC Yellow Book standard terms. Clause 2.5 of the contract provided for the employer to give notice (subject to two exceptions) if it considered itself entitled to any contractual payment in connection with the contract. Clause 3.5 provided for disputes to be determined by an engineer.