Session 4 MSc/LLM
Today • Update • Law (!)
Cohort 1 student not yet online 2 students online, some passwords, not registered 6 Students online, have passwords, still need to register 37 28 Students registered, online, have passwords (3 more than last week)
Reminders Wiki profile Assessment practice
Time table For one night only – e-resource library session. Booking required – Sarah Ricketts. I will email you all about this. Coursework Submission 18 January 2009 Wiki publication 7 December 2008
Rest of year • Semester 2 – Feb – Apr Construction Contracts: Operation & Administration [choose electives this semester] • Semester 3 – May – Jul Liability and Complexity
Groups forming, storming, norming, performing First – focus on making contact… Bruce Tuckman, 1965
Learning Package 1 Baselining Out of sync…!
Contract What is a contract?
Contract Agreement Contractual Intention Consideration Felton Construction Limited v Liverpool City Council  EWHC 3049
Agreement Offer Acceptance Certainty – Essential terms?
Agreement Investors Compensation Scheme LTD. v West Bromwich Building Society  1 W.L.R. 896
Pre-contract/No Contract? Tender costs Commercial risk v Unjust enrichment
Lacey - Intro “… if a builder is invited to tender for certain work, either in competition or otherwise, there is no implication that he will be paid for the work — sometimes the very considerable amount of work — involved in arriving at his price: he undertakes this work as a gamble, and its cost is part of the overhead expenses of his business which he hopes will be met out of the profits of such contracts as are made as a result of tenders which prove to be successful.” William Lacey (Hounslow) Limited v Davis  1 WLR 932
Lacey - Overview • Claimant – lowest tender • Claimant prepared additional plans for Defendant to use • Claimant never intended to charge for cost of plans • Defendant then sold off the property William Lacey (Hounslow) Limited v Davis  1 WLR 932
Lacey – Result • Work “fell right outside the normal work which a builder, by custom and usage, normally performs gratuitously, when invited to tender for the erection of a building.” • Quasi contract – why “quasi”? William Lacey (Hounslow) Limited v Davis  1 WLR 932
Turriff v Regalia • Claimant won a D&B tender for factory construction • Defendant asked for accelerated design preparation, prior to contract • Claimant asked for Letter of Intent • Defendant wrote letter “subject to agreement on acceptable contract “ • Claimant did design • Defendant changed their mind Turriff Construction Ltd and Turriff Ltd v Regalia Knitting Mills Ltd  BLR Vol 9, 20
Turriff - Result • Claimant sought design costs • Such costs would never have been charged for separately • Not quasi contract, because the issue had been specifically discussed. Turriff Construction Ltd and Turriff Ltd v Regalia Knitting Mills Ltd  BLR Vol 9, 20
Marston v Kigass • Claimant won D&B tender to construct factory if Defendant’s insurance pay-out big enough to cover it. • Defendant indicated a tight start date but never expressly asked for any pre-contract design work • Claimant asked for, but did not receive indemnity re design costs • Claimant did the work anyway • Defendant did not proceed Marston Construction v Kigass  BLR Vol 46, p 109
Marston - Result • Implied request • Benefit • Doubts Marston Construction v Kigass  BLR Vol 46, p 109
Regalian Properties • Defendant public body accepted Claimant developer’s tender for large regeneration scheme “subject to contract” • Claimant did nearly £3m design development work, including changing architects to firm “suggested” by Defendant [who was also the relevant planning authority…” • Problems with public accountability, and then with property market meant that scheme did not proceed. Regalian Properties Plc v London Docklands Devpt Corporation  1 WLR 212
Regalian -Result • “subject to contract” • No benefit Regalian Properties Plc v London Docklands Devpt Corporation  1 WLR 212
Consideration of Facts • Court will look and try to analyse series of facts in terms of offer and acceptance, trying to establish agreement, intention and consideration.
British Steel Corporation v Cleveland Bridge British Steel Corporation v. Cleveland Bridge and Engineering Co. Ltd.  1 All E.R. 504
BSC – Facts etc • “it is the intention… to enter into a sub-contract with your company” • Specification kept changing – cast steel – many different shapes • Parties kept negotiating • BSC did not accept consequential loss liability • Ultimately delivered all bar 1 of 140 nodes without receiving any payment.
BSC – Outcome • No contract, but CBE had received major benefit • But what about defects liability? Etc • Courts quite pragmatic where work has been done
Next session • Implication of terms