This was an appeal from Mr Recorder John Uff. The Appellant argued that the works were carried out on a quantum meruit basis, while the Respondents said that there was a lump sum contract. At first instance, the Recorder concluded that there was a lump sum contract.

The tender documents were based on the JCT Intermediate Form of Building Contract 1984. The amendments to the contract were set out in the tender documents. Work was commenced on the basis of a letter of intent dated 7 July 1998, which stated that the main contract documents were currently being prepared for signature.

The work continued but a formal contract was not prepared. During the course of the works the parties appeared to operate the provisions of the IFC84 contract. All of the calculations were based upon the original tender sum.

The contractor argued that in the absence of a formal contract they were entitled to bring a claim on a quantum meruit basis. The Recorder held that the term "failed to proceed and be formalised" was to be read conjunctively, such the builder's entitlement to quantum meruit would only arise if both conditions were fulfilled. The work proceeded, and regardless of the contract both parties knew precisely the terms upon which they were operating.

The Court of Appeal held that the letter could not be read in isolation, and the extent of the parties' detailed contract was clear. The claim for quantum meruit therefore failed, as both parties were bound by a lump sum contract containing the detailed provisions of the Intermediate Form of Contract.