
This post provides a brief overview of a defence prepared by Holden Smith Consultancy for a client who received a claim for damages arising from wrongful termination of a construction contract, and a claim for defective works rectified by the new contractors.
The Referral
The client received an Adjudication Notice and instructed Holden Smith Consultancy to receive the Referral notice, prepare a defence and represent the client in the Adjudication.
The Referral made a claim against the client for Damages quantified at £1.3M arising from a wrongful termination of the contract, and a claim for recovery of costs incurred at £240K for defective workmanship, rectified by other contractors.
The Response
Holden Smith Consultancy investigated and reviewed the available facts to interrogate the claim for damages, and to establish the true cost that would have been incurred by the claimant had the contract not been terminated. The true cost would then form the basis of the set-off claim to be applied in the defence.
Through investigating the various specifications for the works, providing delay analysis, and by comparing the defendants contract to the claimants contracts for its new contractors, Holden Smith arrived at a quantum for the true cost that would have been incurred by the claimant, had the contract not been terminated. The set-off claim based on the true cost would mean the claimants damages arising from the wrongful termination would be quantified at £Nil, and result in a significant reduction to the liability for the defective works rectified by others.
The Decision
In the Decision the Adjudicator decided the claim for £1.3M would be £Nil and a 60% reduction was decided to the actual amount payable to the claimant relating to the rectification of defects.
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