Summary Williams v Roffey Bros PDF

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Compulsory first year module (contract law)...

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CASE: Williams v Roffey Brothers & Nicholls Ltd [1990] WHERE: Court of Appeal ISSUE: (i) Whether consideration was shown for D's admitted promise to pay an additional £10,300 (ii) Whether substantial completion entitled the plaintiff to payment, as additional payment was only payable as each flat was completed. PRINCIPLES: Consideration JUDGES:

Glidewell LJ Purchas LJ Russell LJ

MATERIAL FACTS:  D (RB&N contractors) contracted to refurbish block of 27 flats, w/ sub-contract of refurbishment carpentry work to P (W) for £20,000 in interim payments.  P found that he was experiencing financial difficulties - (i) agreed price of £20,000 too low to enable P to work satisfactorily & gain profit, and (ii) failure to supervise workmen adequately.  Penalty clause: work had to be completed within time limit, otherwise would be making losses. (Why not sue W for not finishing work? W underpaid to begin w/ couldn’t sue b/c W was small company & would go bankrupt)  D then employed P w/ extra payment of £10,3000 to finish refurbishment of 27 flats in time. (oral agreement) HELD: Wherever two parties, A and B, are engaged in a contract under which A is to supply goods or services to B and it becomes apparent to B that A will be unable to actually complete his contract, then if B promises A an additional payment for completing his contract, it will be enforceable providing that: - this later promise is not gained as the result of economic duress by A, and - B will gain a practical benefit by having the contract completed. A promise by A to carry out his existing contractual obligations to B may count as good consideration in relation to a promise by B to pay A an additional sum for the performance of those obligations...