Serapid v Octavius: High Court refuses summary judgement in lift subcontract dispute

The High Court has dismissed Serapid Limited’s application for summary judgement to enforce an adjudicator’s decision awarding it £416,499 against Octavius Infrastructure Limited, finding that the contractor had a real prospect of establishing that no binding contract had been concluded.

In Serapid Limited v Octavius Infrastructure Limited [2026] EWHC 2695 (TCC), Mr Justice Moody held that disputed evidence concerning the parties’ negotiations and their continued references to a contract awaiting signature raised issues that could not properly be resolved through summary proceedings.

The dispute arose from negotiations in 2025 concerning the supply and installation of lifts at Chalkwell railway station in Essex. Octavius, the main contractor for Network Rail Infrastructure Limited’s Access for All scheme, sought to engage Serapid, a specialist lift manufacturer, under a proposed NEC3 Engineering and Construction Subcontract.

Although the parties had substantially negotiated the commercial terms by June 2025, they never executed the proposed subcontract. Serapid nevertheless began procuring and manufacturing lift components. Following a change in Network Rail’s preferred lift technology, Octavius notified Serapid in November 2025 that its services would no longer be required, maintaining that no contractual obligation existed.

Serapid referred the dispute to adjudication, claiming £667,526 for the consequences of termination. The adjudicator found that a binding contract had been formed on NEC3 terms and ordered Octavius to pay £416,499, together with adjudication fees and expenses of £29,250. Octavius paid the fees but withheld the substantive award, challenging the adjudicator’s jurisdiction on the basis that no contract existed.

Contract formation remained genuinely disputed

Serapid argued that the parties had agreed the NEC3 subcontract on or around 6 June 2025, with the remaining points resolved by 16 June. It relied on correspondence indicating that the commercial and legal issues had been settled, alongside evidence that Octavius had pressed for procurement to begin.

Octavius maintained that negotiations had not resulted in a binding agreement. The court considered communications referring to the need for a signed subcontract, subsequent efforts to finalise contractual documentation and Serapid’s decision to revisit its pricing. The proposed subcontract also expressly contemplated execution as a deed.

Mr Justice Moody concluded that Octavius had a real prospect of establishing that no contract had been formed. Serapid’s uncertainty over the precise date on which agreement was allegedly reached also weakened its position.

The judge considered that the evidence was consistent with the parties proceeding towards a formal contract rather than having already entered into one. He drew a parallel with British Steel Corporation v Cleveland Bridge and Engineering Co [1984] 1 All ER 504, where work undertaken pending a formal subcontract did not establish that a binding agreement had been concluded.

Nor did Serapid’s commencement of procurement establish contractual formation. The evidence indicated that procurement had begun before the date on which Serapid claimed the contract was agreed, and that the parties had previously discussed alternative arrangements to protect committed expenditure if the project was cancelled.

Alternative oral contract claim rejected

Serapid alternatively argued that, even if the NEC3 subcontract had not been concluded, the parties had entered into a simpler oral contract. The judge rejected this argument on both procedural and substantive grounds.

The alternative case had not been pleaded or referred to adjudication. The claim instead relied on the alleged NEC3 subcontract, and Serapid had not sought permission to amend its pleadings. Further, the evidence did not clearly establish when or how an oral agreement had been made, including its offer, acceptance, price and scope. Resolving those matters would require consideration of disputed witness evidence.

The ruling reflects the distinction between enforcing an adjudicator’s decision despite errors and refusing enforcement where a genuine jurisdictional issue arises. Under the principles in Carillion Construction Ltd v Devonport Royal Dockyard Ltd [2005] EWCA Civ 1358, adjudicators’ decisions are generally enforced, but not where jurisdictional limits or serious procedural defects justify intervention.

Mr Justice Moody held that Octavius had a real prospect of proving that no contract existed, bringing the dispute within the category in which the contractual basis of the adjudicator’s jurisdiction remained unresolved.

The application for summary judgement was therefore dismissed, leaving the underlying question of contract formation unresolved.