Success for Litigation Team in building dispute case
Seeking legal advice at the earliest opportunity is paramount to any potential litigation case.
Recently, the litigation team have secured a settlement on behalf of a developer client in a dispute concerning the construction of four residential dwellings by a building contractor.
Under the terms of a written agreement between the parties, the contractor was to build the houses in two phases, with two houses to be built in each phase. The cost of the works was to be paid by a series of interim payments, with the final payment for the phase 1 works payable upon the completion of that phase. The works to phase 2 were then to commence once one of the phase 1 houses had been sold and the bungalow on the plot of land on which the phase 2 houses were to be built had been demolished.
When the contractor claimed to have completed the phase 1 houses, they raised a final invoice for that phase. The developer declined to pay the invoice on the basis that there were various defects in the work carried out by the contractor and therefore the houses were not complete, so the requirement to pay the final invoice had not been triggered.
Work to the development ceased and, although the developer provided the contractor with a list of defects to remedy and a timescale within which to do so, the contractor did not return to site, later claiming that this was due to our client denying his access. The contractor subsequently issued a claim against our client representing the balance allegedly owing under the invoice for the phase 1 houses and the loss of profit that the contractor claimed it would have made on the phase 2 houses had it been able to commence those works.
Our client denied any breach of the agreement on the grounds that that the phase 1 houses were not completed, or were not completed to a satisfactory standard and in accordance with the scope of works and specifications set out in the agreement, and so the contractor was never entitled to the final phase 1 payment. Our client also alleged that the contractor had abandoned site and had verbally stated its intention to not complete the phase 1 houses or commence the phase 2 houses and therefore the contractor was in repudiatory breach of the agreement, and this was accepted by our client. On that basis, the loss of profit claim was also defended.
Our client defended the claim and issued a counterclaim, representing the cost of the remedial works that had to be carried out as a result of the contractor’s failure to carry out the works to a satisfactory standard.
Despite attempts at settlement, including a formal mediation, the case did not settle before the trial date and a single joint expert was instructed to produce a report on the standard of the works and likely costs of any remedial works. The case was listed for a 4-day long trial.
The contractor’s Solicitors had, throughout the proceedings, been adamant that they would require a settlement of at least £100,000 to settle and that the amount they would require to settle would only increase as their costs increased. We had sought to agree a settlement on the basis that both parties walked away and bore their own costs, but the contractor’s Solicitors had remained consistent in their stance that any settlement would require our client making a payment to their client.
Despite the stance adopted by the contractor’s Solicitors, on the first day of the trial the parties continued to negotiate. Through those negotiations we were able to secure a settlement for our client, which offset a large proportion of their costs.
This case demonstrates the importance of seeking legal representation early on in a dispute to present your case at its very best and give your opponent an impetus to settle rather than risking trial.
The litigation team at Rogers & Norton are experienced in dealing with a wide range of disputes, examples of which can be found on our website. If you are currently involved in a dispute, or think that this is likely, please contact Peter Hastings at ph@rogers-norton.co.uk or Elizabeth Gibson at eg@rogers-norton.co.uk.