Building Law Monthly
Collateral warranty held to be a construction contract
Abbey Healthcare (Mill Hill) Ltd v Simply Construct (UK) LLP  EWCA Civ 823, the Court of Appeal held, by a majority, that a collateral warranty was a construction contract for
the purposes of s104(1) of the Housing Grants, Construction and Regeneration Act 1996. However, it does not follow from this
decision that all collateral warranties will now fall within the scope of s104(1). In every case it will depend upon the wording
of the particular collateral warranty. Further, there are potentially significant differences between the reasoning of the
members of the court which may in future make it difficult in some cases to determine whether a particular collateral warranty
falls within the scope of s104(1). All that can be said at this point in time is that the effect of the decision will be to
increase the number of collateral warranties that may fall within its scope.
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