Liquidated damages clause held not to be void and unenforceable

Buckingham Group Contracting Ltd v Peel L&P Investments and Property Ltd [2022] EWHC 1842 (TCC)

In Buckingham Group Contracting Ltd v Peel L&P Investments and Property Ltd [2022] EWHC 1842 (TCC), the claimant sought a declaration that a liquidated damages clause in the contract between the parties was void and unenforceable and that the parties had agreed a cap on the general damages recoverable from the claimant. Mr Alexander Nissen QC, sitting as a Deputy High Court judge, held that the liquidated damages clause was certain and enforceable and so he declined to grant the claimant the declaration which it sought. In this respect the case illustrates the unwillingness of a court to reach the conclusion that a clause in a negotiated contract is so uncertain that it cannot be given effect. In relation to the submission that the contract contained a cap on general damages for delay, the present case acts as a reminder of the need to draft clearly if the intent is to place a cap on the liability of a contracting party. A cap expressed in terms of the maximum liquidated damages payable will not be extended by the courts to encompass a claim for general damages in the absence of clear words to that effect.