The claimant, Amey Birmingham Highways Ltd (“Amey”), entered into the 25 year “project agreement” with the defendant, Birmingham City Council (“BCC”). The contract is said to have a value of £2.7 billion and to be the largest highways PFI in the UK.

The dispute arose between the parties over the proper meaning of the project agreement and its scope and was referred to adjudication. Amey, the unsuccessful party in the adjudication, partly complied with the adjudicator’s decision but subsequently applied to the court for declaratory relief under CPR 7.

With regards to proper interpretation of the project agreement, the court considered Arnold v Britton [2015] UKSC 36 (which was reported after the adjudicator's decision) and concluded that the particular wording the parties used was clear enough and fell within the dicta. HHJ Raeside QC concluded that this was not a case where the court had two possible constructions of the project agreement and was entitled to prefer the one with business common sense and reject the other and therefore, it could not be considered under the ratio of Rainy Sky SA and others v Kookmin Bank [2011] UKSC 50. Additionally, there was only one true and proper construction of the contract which is by taking the words actually used in their natural meaning and placed in context of the wording of the project agreement as a whole.

The court refused to grant the claimant the declarations it sought in respect of the proper interpretation of the project agreement on the basis that reviewing the adjudicator's decision as a matter of law on two specific questions selected by BCC is very different from reviewing the project agreement in the round and declare Amey’s obligations.

HHJ Raeside QC was not satisfied that Amey had a proper and full understanding of the complete workings of the project network model and the other models in operation under the project agreement. As a result, the court was unwilling to go any further as the dispute in effect was only concerned with construing the project agreement and not its performance. Thus the court was only prepared to make one declaration, finding that, as a matter of law, the adjudicator’s decision was wrong and was not binding on the Amey or BCC.

To conclude, the court was conscious of its limited jurisdiction in relation to the dispute. It described its jurisdiction as “exclusively contractual and contained in clause 70 of the project agreement”. The court could only consider questions of law and could not decide any facts in respect of the dispute that was the subject of the adjudicator’s decision.