What Does Warrant Mean?

As I am a construction lawyer, you will forgive the occasional foray into my specialist subject for clauses of interest.

In a collateral warranty for a leisure centre.

Warrants, acknowledges and undertakes

In a collateral warranty relating to the construction of a leisure centre, clause 1 stated:

“The Contractor warrants, acknowledges and undertakes that:

[1] it has carried out and shall carry out and complete the Works in accordance with the Contract”

The court had to interpret this clause and decide whether warrant was the same as acknowledge, and whether acknowledge was the same as undertake. And if they were not, what was the precise difference. Mr Justice Akenhead said (at paragragh 27):

“Clause 1 contains express wording whereby [the contractor] “warrants, acknowledges and undertakes”. One should assume that the parties understood that these three verbs, whilst intended to be mutually complementary, have different meanings.

A warranty often relates to a state of affairs (past or future); a warranty relating to a motor car will often be to the effect that it is fit for purpose.

An acknowledgement usually seeks to confirm something.

An undertaking often involves an obligation to do something.

It is difficult to say that the parties simply meant that these three words were absolutely synonymous.”

The issue was whether the warranty related to works to be carried out or works already completed. If the drafters had simply used ‘acknowledges’ then the decision of the court may have been different. As with others, lawyers should use one word if it is enough, not three [read more].

What should you do?

You can’t spot all the pitfalls, but you can get my critical questions for reviewing collateral warranties.

Case: Parkwood Leisure Ltd v Laing O’Rourke Wales and West Ltd [2013] EWHC 2665 (TCC)

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