Contract Means Contract: TCC Enforces Agreed Advance Payment Mechanism in Westgreen Construction Limited v Kiryukhina [2026] EWHC 2189 (TCC)

In Westgreen Construction Limited v Kiryukhina, the Technology and Construction Court took a robust approach to the enforcement of an adjudicator’s decision, confirming that express, bespoke, contractual terms are upheld as that is what the parties intended at the time of contracting. This article provides a summary of the judgment and highlights its key implications for the construction industry.

Background

The parties were Westgreen Construction Limited (“Westgreen”) and Irina Kiryukhina (“IK”). The contract in question was a JCT Standard Building Contract without Quantities 2016 Edition with bespoke amendments dated 24 June 2024 (“the Contract”). The Contract was for construction, and refurbishment works to a residential property in St John’s Wood, London, NW8, for a sum of £9,989,324.55 which was subject to adjustment (“the Works”).

The dispute concerned express advance payment terms under the Contract’s bespoke amendments for clause 4.7.

Advance Payments

IK was required to make two advance payments to Westgreen:

• £350,000 on appointment (the "First Payment");
• £300,000 at 25% contract duration (the "Second Payment")

Together, these totalled £650,000 (the "Advance Payments").

The First Payment was certified on 6 March 2024 (£350,000) and the Second Payment was certified on 19 August 2024 (£300,000). Both payments were included in the gross valuation of the Works and were made by IK.

Importantly, the bespoke amendments provided that the Advance Payments would only be reimbursed if three specified trigger events occurred:

1. Agreement of the final account and payment in full of the final account (subject to retention);
2. Issue of Making Goods Defects Certificate and the Final Certificate, together with payment of the sums due under the Final Certificate; or
3. Termination by either party, followed by formal agreement between the parties (or, failing agreement, a final and binding adjudication decision) as to the parties’ entitlements, valued in accordance with the Contract’s termination provisions.

Attempt to "Claw Back" Advance Payments

On 1 May 2025, the Contract Administrator asked Westgreen to agree an amendment to clause 4.7 that would let IK claw back the Advance Payments ahead of the final account, so that they would be “fully reclaimed by PC [practical completion] / final account agreement”. Westgreen refused.

Still, the Contract Administrator did not include the Second Payment from interim certificate 23 onwards which clawed back the Advance Payments and Westgreen’s refusal was ignored.

Practical completion of the Works was achieved on 27 March 2026.

The Adjudication

Westgreen issued a Notice of Adjudication on 7 April 2026. It related to whether the Contract Administrator was entitled to remove the Advance Payments from its gross valuation.

Westgreen’s position was that none of the criteria for reimbursement had been met, so the Advance Payments should have remained in the gross valuation.

IK’s position, as the employer, was that the parties intended for the Advance Payments to be “a ring-fenced escrow style arrangement” and that “they were intended to be dealt with outside of the contract valuation process”. IK argued that the Advance Payments had been correctly omitted.

On 7 May 2026, the Adjudicator found in favour of Westgreen.

IK did not pay the balance awarded.

Westgreen suspended the Works on 26 May 2026 due to IK’s non-payment.

Court Proceedings

On 20 May 2026 Westgreen raised summary enforcement proceedings to enforce the Adjudicator’s Decision.

IK defended on two grounds:

• The Adjudicator’s Decision was reached in excess of the Adjudicator’s jurisdiction (by deciding on matters not referred);
• Breaches of natural justice (that IK was not given an opportunity to deal with whether they were in breach of contract, and a new claim raised in Westgreen’s reply in the adjudication).

Jurisdictional Challenge

The Court rejected this challenge, finding that the Adjudicator addressed the essential dispute referred to him. Therefore, the Adjudicator was entitled to consider provisions of the Contract and how the parties operated the Contract.

Natural Justice Challenge

Again, the Court rejected this challenge, finding that the issues occurred naturally from the dispute that was referred to the Adjudicator, and in any event, IK was given a fair opportunity to address them.

The Court did note some sympathy for IK's argument that the Adjudicator strayed beyond what was necessary by finding a breach of clause 4.7 - but held this was not a breach of natural justice, since both parties had a chance to respond and the finding was not part of the operative decision or the relief awarded.

Stay of Enforcement

IK applied for stay of enforcement. This was refused by the Court on the basis that none of the conditions would entitle IK to reimbursement of the Advance Payments. There were no special circumstances which would justify departure from the usual enforcement principles.

Implications for Construction Industry

Firstly, this judgment shows yet another example where the courts took a robust approach to enforcement of an adjudicator’s decision.

Secondly, if a contract contains a bespoke repayment mechanism for advance payments (amending standard form wording), that mechanism must be followed: an employer is not entitled to claw back or offset advance payments simply because it believes the money should have been exhausted, or because practical completion is approaching. The courts will look at the precise, express, contractual language agreed between the parties, so it is prudent for parties to seek legal advice when negotiating bespoke terms to understand their obligations and liabilities under them.

Finally, it is a useful reminder that the costs of resisting enforcement can be significant: having failed on both the jurisdiction and natural justice grounds, IK was ordered to pay Westgreen's costs on an indemnity basis.