Belong (Construction) v Seddon Construction: High Court rules pre-contract liabilities survive execution of JCT contract

The Technology and Construction Court has handed down a significant ruling on the relationship between a Pre-Construction Services Agreement and a subsequent JCT contract, finding that liabilities arising from breaches committed during the PCSA period survive the execution of the main contract even where the relevant obligation was omitted from the final form.

In Belong (Construction) Limited v Seddon Construction Limited [2026] EWHC 1275 (TCC), HHJ Stephen Davies, sitting as a High Court Judge in Manchester, overturned an adjudicator's decision and granted Belong a series of declarations confirming that Seddon was not entitled to a ten-week extension of time in relation to air sealing works.

Background

The dispute arose from a construction contract executed in December 2020 in the form of the JCT Standard Building Contract with Quantities, 2016 Edition. Seddon had been engaged to complete works at a care home following the insolvency of a previous contractor. Before the JCT contract was entered into, the parties concluded a PCSA dated May 2020, under which Seddon was required to visit the property and carry out an appraisal, including opening up and testing the existing air sealing works.

The Contract Administrator refused Seddon's application for an extension of time on the basis that the need for air sealing works to be instructed mid-contract was the result of Seddon's failure to discharge that earlier survey obligation. Seddon referred the dispute to adjudication, arguing successfully before the adjudicator that the open-up and testing obligation had not been carried through into the final JCT contract and that, by operation of clause 2.3 of the PCSA, all PCSA rights and liabilities had been subsumed into the JCT contract upon its execution.

The construction of clause 2.3

The central question for the court was the proper interpretation of clause 2.3 of the PCSA, which provided that upon execution of the JCT contract "the parties' respective rights and liabilities in respect of all matters with which this agreement is concerned... shall be subsumed into and be subject to the Contract."

Seddon contended that this wording operated to discharge any pre-existing PCSA liabilities, particularly where the obligation in question did not appear in the final contract. The judge disagreed.

Drawing on Lord Diplock's analysis of primary and secondary obligations in Photo Production Ltd v Securicor Transport Ltd [1980] AC 827, HHJ Davies held that the deliberate use of "liabilities" in clause 2.3, as opposed to "obligations" in clauses 2.1 and 2.2, was legally significant. Primary obligations under the PCSA ended on execution of the JCT contract; what survived were secondary obligations, that is, liabilities for pre-existing breaches of primary obligations.

The judge further held that the word "subsumed" did not connote extinction. Referring to the OED definition, he observed that a thing subsumed into another does not necessarily lose its independent existence. This reading was reinforced by clause 16 of the PCSA, which provided that Belong could not bring legal action under the PCSA more than twelve years after practical completion of the JCT contract works. That clause would be otiose if the PCSA ceased to have existence as an enforceable instrument upon execution of the JCT contract.

On the question of the extension of time clauses, the judge found that the adjudicator had applied too narrow a construction to the phrases "error, omission, negligence or default" in clauses 2.28.6.5 and 4.20.3 of the JCT contract. Those provisions were not confined to breaches of the JCT contract itself; they were capable of capturing non-compliance with obligations owed under the PCSA, given the close connection between the two instruments.

Relief

HHJ Davies granted all five declarations sought by Belong, confirming that the Contract Administrator's determination was correct, that the adjudicator's decision on interpretation was wrong, that Seddon had no entitlement to the extension of time, and that Belong was entitled to levy liquidated damages for the ten-week period in question. Consequential matters, including the precise terms of the order, were reserved for a further hearing.

The judgement is a timely reminder of the importance of precise drafting when negotiating PCSA subsumption clauses and of the risks contractors face when pre-contract survey obligations are not replicated in the main contract.