A contract for the construction of a house gave the building owner the right to determine the contract if the rate of progress, materials or workmanship proved unsatisfactory as certified by an independent third party and the building contractor failed to rectify them within a specified period. The building owner was dissatisfied with the work, but did not seek to invoke clause 2, but wrote to the contractor purporting to treat the contract as discharged and sought to recover damages.
Held: The clause was designed to deal with shortcomings of the very kind alleged and the common law right to treat the contract as discharged by reason of repudiation could arise only in a case where the breach was of a fundamental nature. The breaches alleged were not of that kind and so the building owner’s only right to terminate arose under clause 2, which he had not invoked. The court placed some emphasis on the fact that the clause was not expressed to be without prejudice to the building owner’s rights under the general law.
Citations:
[1995] 77 BLR 42
Jurisdiction:
England and Wales
Cited by:
Cited – Stocznia Gdynia Sa v Gearbulk Holdings Ltd CA 13-Feb-2009
Orders were placed for the construction of ships. They were not delivered. The buyer, the defendant, cancelled the orders. The defendants sought the loss of profit. The claimants said they were entitled only to the repayment of instalments. The . .
Lists of cited by and citing cases may be incomplete.
Contract
Updated: 15 May 2022; Ref: scu.282633
