NSV carried out work on the instructions of Consafe on heating, ventilation and air-conditioning equipment at a plutonium chemical waste plant at Drigg, in Cumberia. Consafe counter-claimed for liquidated damages. NSV said that liquidated damages could not be levied because they were a penalty. As the judge said, if the relevant clause was a penalty, Consafe would not be able to enforce it. However, the onus was on NSV to prove that it was a penalty.

Were the liquidated damages a penalty?