Certification - Scottish Construction Contracts - page 174

The reasoning behind the House of Lords' decision was that the parties to the
contract had conferred on the arbitrator the power to open up, review and revise
certificates. This illustrated that interim certificates were not intended to be binding
and conclusive at all and accordingly, could not be binding and conclusive before the
courts, see also Robins v. Goddard (1905). he House of Lords did stress that the posi-
tion would be different in respect of certificates which are expressly stipulated to be
binding and conclusive.
Unfortunately, it is not clear from the court's decision in Beaufort Developments
(NI) Ltd how the contractor's right to raise proceedings against the employer in the
absence of a certificate is to be analysed. In Beaufort Developments (NI) Ltd ,themost
helpful discussion of available remedies is found in the speech of Lord Hope of Craig-
head who stated:
On this approach the court will be able to exercise all its ordinary powers to decide
the issues of fact and law which may be brought before it and to give effect to the
rights and obligations of the parties in the usual way. It will have all the powers
which it needs to determine the extent to which, if at all, either party was in breach
of the contract and to determine what sums, if any, are due to be paid by one party
to the other whether by way of set-off or in addition to those sums which have been
certified by the architect. It will not be necessary for it to exercise the powers which
the parties have conferred upon the architect in order to provide the machinery for
workingoutthatcontract.hisisbecausethecourtdoesnotneedtomakeuseofthe
machinery under the contract to provide the parties with the appropriate remedies.
The ordinary powers of the court in regard to the examination of the facts and the
awarding of sums found due to or by either party are all that is required.
It was unclear, however, what effect the decision had on the authorities referred to
above in which it had already been held that a certificate was a condition precedent to
paymentofthecontractor,see Nicol Homeworld Contracts Ltd v. Charles Gray Builders
Ltd (1986) and Costain Building & Civil Engineering Ltd v. Scottish Rugby Union plc
(1994).
This issue has since been further considered by the English Court of Appeal in the
caseof Henry Boot Construction Ltd v. Alstom Combined Cycles Ltd (2005). In that case
the court confirmed that certificates were a condition precedent to the contractor's
entitlement to payment under the contract in question but that it did not follow that
the absence of a certificate was a bar to the right to payment. In particular, Lord Justice
Dyson stated that:
By 'condition precedent' I mean that the right to payment arises when a certificate
is issued or ought to be issued, and not earlier. It does not, however, follow from
thefactthatacertiicateisaconditionprecedentthattheabsenceofacertiicate
is a bar to the right to payment. This is because the decision of the engineer in
relation to certification is not conclusive of the rights of the parties, unless they have
clearly so provided. If the engineer's decision is not binding, it can be reviewed by
an arbitrator (if there is an arbitration clause which permits such a review) or by the
court. If the arbitrator or the court decides that the engineer ought to have issued a