Snakes and ladders for claims victor

Article Abstract:

The case of McAlpine Hunberoak v McDermott International concerned a subsontract for part of an oil rig that became much more expensive than intended. The sub-contractor's claim for a new contract on a cost plus basis was granted in court and the sub-contractor was awarded three million pounds sterling. However, the Court of Appeal rejected the claim and awarded only the original 800,000 pounds sum. The claim was wrong, as was the method for calculating the excess claim. The sub-contractor should have claimed for Variations as the contract was signed after work had started.

Cases

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Contractors adore forward valuation

Article Abstract:

John Power, arbitrator and chartered surveyor, suggests the introduction of a forward valuation system for building contractors by which employers would predict what will be owing in future months and place the required funds in a trust account. The simple idea would prevent developers from being concerned about overdue payments for work that has already been carried out. Interest on funds borrowed by developers could be offset by interest earned on the stakeholder account. The scheme would also allow contractors to be paid even if developers become bankrupt.

Construction industry, Economic aspects

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Endeavouring to do your expensive best

Article Abstract:

'Best endeavour' clauses are found in most construction contracts. They state that the contractor should use his best endeavours to prevent construction work delay and complete before or on the completion date. The clause does not explain whether the contractor is supposed to spend extra money to prevent delay. In many occasions the extra money spent to prevent delay may be more expensive than the cost of the delay.

Interpretation and construction, Clauses (Law), Contract clauses

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