This article reviews the case of Jaevee Homes Ltd v Fincham (t/a Fincham Demolition) [2025] EWHC 942 (TCC) regarding the contractual terms and payment provisions for demolition works carried out by Fincham on the old Mercy nightclub in Norwich. After the Adjudicator found for Fincham in a notified sum adjudication, Jaevee brought a Part 8 claim seeking declarations on the contract terms and the validity of the payment applications.

Contract Formation

A major point of contention was whether a binding contract was formed through a series of informal WhatsApp messages on 17 May 2023 or through the formal Subcontract emailed by the claimant on 26 May 2023. The court cited what it called the leading modern statement of the law on contract formation, the words of Dyson LJ in Tekdata Interconnections Ltd. V Amphenol Ltd [2009] EWCA Civ 1209:

“…But where the facts are no more complicated than that A makes an offer on its conditions and B accepts that offer and, without more, performance follows, it seems to me that the correct analysis is what Longmore LJ has described as the ‘traditional offer and acceptance analysis’, i.e. that there is a contract on B’s conditions …” [25]

The messages sent were very short. But for the original exchanges by email with the invite to tender and the subsequent quotation, it seems that the contract was formed with little more than the following WhatsApp messages and there is a distinct lack of contract provisions:

The court concluded that, even with the paucity of provisions, a binding contract was nevertheless formed through the WhatsApp exchange on 17 May 2023 and the informal nature of the communication did not preclude the formation of a concluded agreement. It follows that the formal Subcontract sent by the claimant on 26 May 2023 was not incorporated into the contract as the agreement had already been concluded on 17 May 2023 and no further acceptance took place.

Payment Terms

Further to the contract formation point, the court found that payment terms were agreed in the WhatsApp exchange on 17 May 2023. The court interpreted “Monthly applications” to mean only one application per month was permitted and that the Scheme would be implied piecemeal to fill the gaps. As Stuart-Smith J said in Grove v Balfour [2016]:

“It follows that where section 109 or section 110 is engaged, the provisions of the Scheme as to payment will only be imported and apply so as to govern the legal relations of the parties to the extent that they have not already concluded binding contractual arrangements that can remain operative.”

The court stated that the short WhatsApp agreement between the parties made no provision as to how monthly installments were to be calculated and, in those circumstances the statutory scheme steps in which is discussed further below.

Invoices as Payment Applications

The court considered whether the invoices submitted by the defendant constituted valid “applications for payment” and/or “default payment notices” under the Act. The court found that a reasonable recipient (the claimant) would have understood the defendant’s invoices as applications for payment, considering the context of their previous dealings and the WhatsApp discussions. The judge, Mr Roger Ter Haar KC, stated:

“It is clear that a reasonable recipient would have so understood (a relatively low threshold): … The invoices requested payment. … The Defendant had previously used invoices on earlier contracts/projects as its applications for payment. … In the WhatsApp discussions on 17 May 2023 the Defendant had expressly referred to payment after ‘invoice’.” [142]

The court accepted that in the context of a lump sum contract with no detailed breakdown, providing the lump sum and deducting previous payments in an invoice can be sufficient to specify the basis of the calculation for the purposes of a payment application under the Act. At paragraph 126, the judgment cited Everwarm Ltd v BN Rendering Ltd [2016]:

“Whether it is sufficient to refer to a lump sum in this context will depend on the pricing terms of the contract and other surrounding circumstances. For example, in the case of a lump sum price contract, it may suffice simply to give the lump sum and deduct previous payments because there is nothing else that can be stated in order to specify the basis on which the sum is calculated.”

Applying the finding that only one application per month was permitted, the court agreed with the defendant’ submission that three of the four contested invoices were valid based on a monthly period running from the contract date, but Invoice 1081 was invalid as it fell within the same monthly period as Invoice 1079 and therefore this part of the adjudicator’s decision was severed.

Conclusion

This judgment clarifies the principles of contract formation in informal contexts like WhatsApp exchanges and reinforces the idea that even informal agreements can constitute binding contracts and that the statutory Scheme will fill in necessary gaps in payment provisions. The ruling also provides guidance on the objective assessment of whether an invoice can serve as a valid payment application under the Act, particularly in the context of lump-sum contracts.