Netomnia Ltd v MJ Quinn Integrated Services Ltd

Netomnia was the operator of a fibre-optic network; MJQ was engaged in the construction and installation of the cabling and related infrastructure for Netomnia’s network. The parties entered into a framework agreement (the “MSA”) under which Netomnia was able to call off the services of MJQ to carry out works on the network.

The MSA provided for a system of interim payments. On 5 February 2026, MJQ sent an application for payment (the “AFP”) in the sum of £3,770.84. This was one of 168 applications for payment which were sent on that day in a similar format, in sums totalling just over £4.717 million. The AFP gave the reference of Work Order W0 0079, but it contained neither a purchase order number nor a relevant polygon identification number (Polygon ID) or relevant feature identification number (Feature ID). As a consequence, Netomnia said that the AFP was invalid.

An adjudicator disagreed and, holding that the payment notice which had been served in response was invalid by reason of being late, awarded MJQ £3.7 million. Netomnia issued Part 8 proceedings on the question of the validity of the AFP.

Referring to the decision of Smith J in Advance JV v Enisca Ltd (see Dispatch, Issue 264), Eyre J said that, in order “to qualify as a valid notice, any payment notice must comply with the statutory (and, if more restrictive, the contractual) requirements in substance and form“.

Netomnia said that the AFP did not comply with the requirements of the MSA and was accordingly not capable of being a payment notice notifying that sum as being due for the purposes of section 110B(4) of the HGCRA. Clause 6.5 of the MSA provided that MJQ should provide an invoice:

• 5.4 “accompanied by such documentation and other information with respect to the invoice as may reasonably be required in order to verify the accuracy of the invoice”; and
• 5.5 referencing the corresponding purchase order.

The failure to include the relevant Polygon ID and Feature ID meant that it was not accompanied by information, which was reasonably required to verify its accuracy, as per clause 6.5.4. Further, the absence of the purchase order number meant that the requirements of clause 6.5.5 were not satisfied. Eyre J considered that the nature and structure of the arrangements underlying the MSA were of particular significance. These included:

• A Polygon: a collection of premises within a geographically defined area. There were 12,396 polygons in Netomnia’s network; and
• Features: the particular parts of the infrastructure to be provided in a polygon. By way of example, the Aintree Exchange contained 33,104 features.

Each polygon and each feature had a unique ID. Works were called off from the MSA by means of work orders using the template appended to the MSA. The way the purchase order system was meant to work meant that it was always possible to identify the polygon where the relevant works were to be or had been performed.

MJQ said that the AFP provided all the information that was reasonably required. The Work Order related to a single polygon. It identified the Work Order. It also gave the location and then set out the details of how the sum claimed was calculated. The AFP only sought payment under two headings: permits and indexation. Further, the amounts claimed for indexation were calculated by way of an uplift to sums which had already been paid. Netomnia had therefore already accepted that the items of work in question had been completed, and nothing would be gained by providing the relevant Feature IDs.

The judge noted that if the AFP had been standing entirely alone, and if there had been only a very limited number of work orders, those were points that might have had some force. However, it was necessary to have regard to the overall context in which clause 6.5.4 was operating. With that in mind, it was apparent that the AFP did not provide the information which was reasonably required to verify the accuracy of the sums claimed. The judge highlighted that:

1. The MSA related to a nationwide operation, with other contractors as well as MJQ. The work done by MJQ related to multiple polygons and numerous features.
2. There were many work orders, in excess of 200, and most of these related to more than one polygon. This meant that searching against a work order number would not enable Netomnia to identify the polygon to which the sums claimed related and so Netomnia would not know whether the sums claimed were due.
3. There were numerous applications for payment, at least some of which were for low value amounts, and it was significant that Netomnia had to respond to the AFP quickly and issue a payment notice within five days of the due date.
4. Netomnia’s systems were set up in such a way that the Feature IDs were used to identify the relevant polygon, and then the Polygon ID was used to identify the relevant purchase order. The purchase order would then be used to authorise payment. In most cases, a search against the work order would not, without more, have led to identification of the items in question.

Netomnia was right to say that it was entitled to require the information which would normally be necessary to verify the sums claimed. MJQ knew the relevant Polygon ID for the permits and the Feature IDs for the sums to which the indexation uplift was being applied. Therefore, MJQ could have provided this information when submitting the AFP. It was information which was reasonably required to verify the AFP, and by referring solely to the Work Order, the AFP did not satisfy the requirements of clause 6.5.4.