High Court: BAM succeeds in novel application in children’s hospital dispute

About this case:

• Citation:
  [2026] IEHC 443
• Judgment:
  External link
• Court:
  High Court
• Judge:
  Mr Justice Mark Sanfey

Delivering judgment for the High Court, Mr Justice Mark Sanfey opined: “If there is a fundamental issue, the determination of which will clarify the basis upon which such claims will be brought forward, so that extraneous issues may be excluded and clarity brought to the basis upon which each claim is to be made, in my view such an approach is to be welcomed.”

Background

In August 2017, the parties entered an agreement for the construction by the plaintiff, BAM, of the new children’s hospital at St James’s Hospital Campus, Dublin 8.

The contract divided the work into two phases – the civil engineering and underground work (Phase A) and the superstructure and building work (Phase B).

Clause 13.2 of the contract provided for a conciliation procedure in relation to disputed claims for payment. The clause specified that if a dispute referred to conciliation is not resolved by agreement within 42 days of referral, the conciliator would be required to produce a written recommendation.

Where the defendant rejects the recommendation, it is nonetheless required to make the recommended payment on the basis that BAM would provide a bond in the sum paid and would issue High Court proceedings to establish its entitlement to the claimed amount.

This provision obliged BAM to issue four separate sets of proceedings, one in respect of each recommendation of the conciliator.

Clause 9.1.3 of the contract provided inter alia that the contractor would start Phase B works when instructed by the employer’s representative, provided that the adjusted contract sum had first been ascertained by the parties or determined by an expert.

The defendant maintained that the instructed to commence Phase B works was issued on 8 January 2019 by Claire White of O’ Connell McMahon Architects, and that this instruction was valid and binding on the plaintiff.

In April 2020, the defendant issued proceedings against BAM seeking a declaration that the Phase B instruction was valid and binding, or alternatively a declaration that BAM was estopped from denying the validity of the instruction or had waived any right or entitlement to deny or dispute its validity, or had acquiesced to its validity.

In its defence and counterclaim (and subsequently, in its amended defences and counterclaims), BAM suggested that the defendant had failed to complete or coordinate the design to the level required to enable the works to commence, and that the Phase B instruction was not valid where Ms White had not been appointed as the employer’s representative for the contract.

The defendant issued a motion seeking a modular trial of the Phase B proceedings.

On consent, the High Court directed that module 1 should consist of the matters pleaded in the statement of claim and the defence.

Module 1 was also to contain one issue from the counterclaim, namely whether the mechanisms provided for in Clauses 10 and 13 of the contract applied to claims arising from alleged design changes or additions that the defendant contended ought to have been covered by the design in respect of the Phase B works provided by the plaintiff as at 8 January 2019 and were not provided as of that date or subsequently.

In its own proceedings, BAM then sought an order pursuant to the inherent jurisdiction of the court staying each of its cases pending the determination of module 1 of the defendant’s proceedings, on the basis that inter alia it was not possible for it to plead the all the permutations arising from the various possible ways in which the Phase B module could be determined and that the pleading of alternatives would incur significant sums, most of which would transpire to be unnecessary.

The High Court

Noting that BAM’s application was a novel one and that there was no authority on all fours with the situation in the case before him, Mr Justice Sanfey considered the principles applicable to staying proceedings pending the outcome of other proceedings and the power to make orders as to the conduct of proceedings under Order 63A, rule 5 of the Rules of the Superior Courts.

The judge highlighted that the order directing the hearing of module 1 of the Phase B proceedings was made on consent and that at that point, both parties had accepted that the hearing of some or all of the High Court disputes would depend on the determination of the issues in the Phase B module.

The court was satisfied that if BAM’s claims were pleaded in the alternative, the determination of the Phase B module would result in the costs of the options which are discarded having been incurred to no avail, which costs would be very substantial.

Mr Justice Sanfey explained: “While the ongoing and ultimate cost of this hospital project has given rise to much public comment and disquiet, this Court is bound to determine the dispute between the parties in accordance with the contractual provisions the parties have agreed, and to ensure that the parties bring those disputes before the court in the most just and expeditious way possible.”

Finding that the defendant itself recognised the benefit of achieving clarity in relation to whether or not the Phase B instruction was valid by initiating the Phase B proceedings, the court considered that the determination of the module would result in clarity as to the manner of calculation of the claims in BAM’s four High Court disputes and that resources would not be wasted by the parties having to brief experts on all possible permutations of BAM’s claims, or on the defendant’s response to them.

Mr Justice Sanfey concluded: “The parties will benefit from the concentration of effort rather than having to progress this module and at the same time engage in relation to the various different bases of claim in each of the High Court disputes.”

Conclusion

Accordingly, the High Court indicated that it was satisfied that it has jurisdiction to give a procedural direction that no further steps be taken in the disputes and indicated that the disputes should be stayed until the Phase B module is determined, or until further order of the court.

The matter was listed for 22 July 2026 for consideration of the terms of the order and any ancillary orders required, including in relation to costs.

BAM Building Limited v National Paediatric Hospital Development Board [2026] IEHC 443