Validity of payment and pay less notices


In Kersfield Developments (Bridge Road) Ltd v Bray and Slaughter Ltd [2017] EWHC 15 (TCC) O’Farrell J held that the defendant contractor had submitted a valid interim application for payment. It was sufficiently clear and unambiguous in form, substance and intent. She also held that the claimant had failed to serve a valid payment notice or pay less notice so that it was obliged to pay the sum stated as due in the defendant’s interim application without any deduction. Finally she held that the claimant was not entitled to refer to a further adjudication the true value of the defendant’s application for payment. The defendant’s interim payment had been fixed by the default notice mechanism under the contract and there was no contractual basis on which to revise that payment by reference to a proper valuation of the works. There was therefore no relevant dispute that could be referred to adjudication.