Cucon 1 TUT6 Roffey PDF

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Contract 1 Tutorial Week 7

First, read thoroughly the case of Williams v Roffey Bros & Nicholls (Contractors) Ltd [1990] 1 All ER 512 Roffey Bros was contracted by Shepherds Bush Housing Association Ltd to refurbish 27 flats at Twynholm Mansions, Lillie Road, London SW6. They subcontracted carpentry to Mr Lester Williams for £20,000 payable in instalments. Some work was done and £16,200 was paid. Then Williams ran into financial difficulty because the price was too low. Roffey Bros was going to be liable under a penalty clause for late completion, so they had a meeting on 9 April 1986 and promised an extra £575 per flat for on time completion. Williams did eight flats and stopped because he had only got £1,500. New carpenters were brought in. Williams claimed. (A practical benefit)

Mr Rupert Jackson QC held Williams should get the eight times £575 with a few deductions for defects and some of the £2,200 owing from the original sum. He said that they had agreed that the original price was too low, and that raising it to a reasonable level was in both sides’ interests.

if A has a contract to employ B for work before it is done, A has reason to doubt whether B will, or be able to complete his side of the bargain A promises B to pay more A ‘obtains in practice a benefit, or obviates a disbenefit’ from giving the promise there is no economic duress or fraud The practical benefit of timely completion, even though a pre-existing duty is performed, constitutes good consideration. The courts nowadays should be more ready to find [consideration’s] existence so as to reflect the intention of the parties to the contract where the bargaining powers are not unequal.

Performing a contractual duty to the promisor is not a consideration (a few of crew left) Three types of duty: legal duty or public duty, contractual duty Second, prepare an answer to the following questions: 1. Lo Fee Ltd have a major construction project with the Hong Kong Government to refit 2 apartment blocks in Shatin. Lo fee have been offered a HK$25 million bonus by the Government to complete the work before January 2, 2019. Lo Fee have subcontracted 转包 the carpentry and electrical work under contracts which require completion by December 15, 2018.

In October 2018, Lo Fee come to the conclusion that, although the electrical work is proceeding well, the carpentry work, subcontracted to Mr Woo Dee, is unlikely to be finished on time. This is largely because Woo Dee has accepted the work for a very low price and cannot afford to hire additional labour. Lo Fee’s representative, Mr So, offers Woo Dee an additional $150, 000 if he agrees to finish the work on time. Woo Dee agrees and does finish on time. Lai Tee Ltd, the electrical contractors, hear of the revised Woo Dee arrangement and contact Lo Fee to say: “We agree that you have offered us a very fair price but if you give more to one it should be more to all. Unless you promise us an additional $150,000 we will cease work and you will lose your bonus.” Lo Fee reluctantly 勉强 agree and Lai Tee finish on time. Once all the Government contract has been completed on time and Lo Fee qualify for the bonus, they pay Woo Dee and Lai Tee the originally agreed amount but refuse to pay the bonuses. Woo Dee and Lai Tee seek your advice as to any rights of action they may have in contract. Big bonus Practical benefit Economic duress(unfair economic pressure) (Lai Tee)example(Godfather) 2. A. Arthur’s friend Hannibal is about to marry Brian’s friend Clarice. Arthur agrees with Brian that each will pay $10,000 into Hannibal’s bank account to help the couple. Arthur does pay the money, but Brian changes his mind and refuses to pay as promised. Does Hannibal have any contractual rights against Brian? Hannibal will not be the party of the contract because he doesn’t offer any consideration. Ordinance (contract right on third party ordinance) What can Hannibal do? Was the contract intended to benefit the third party? Was the third party identified? Privity doctrine B. Xavier and Yasmin are at lunch together and Xavier says: “Yasmin, we have done very well in business and should give something back. If you pay $88,000 to a charity of your choice, I promise to do the same and match your payment”. Yasmin agrees and pays the money to the Hong Kong Cancer Research charity. Xavier has now changed his mind and refuses to pay the money. a) Under the reformed privity law in Hong Kong, does the charity have a right to sue Xavier? b) Does Yasmin have a right to sue Xavier? Yes because she(promisee) shows consideration but it shouldn’t be given to the promisor

c) If the answer to part b) is “Yes”, what is Yasmin’s loss? Nominal damages only Possible alternative...