Read the full judgment text of HCCT 26/2014 on BabelCite. This 高等法院原訟法庭 judgment was delivered on 16 December 2016 before Hon Mimmie Chan J.
Construction contract dispute — Lump sum fixed price contract for repair and maintenance works — Obstruction by owners and suspension of works by IO’s Manager and Consultant — Whether IO had contractual power to suspend Works under clause 11.1.3 and whether suspension amounted to repudiation — Power to vary works and reduce Contract Sum under lump sum contract — Clause 4.7 of contract conditions allows variations but not clear power to omit essential works or reduce contract sum without contractor’s consent — Court adopted English authorities (Abbey Developments Ltd v PP Brickwork Ltd, Trustees of The Stratfield Saye Estate v AHL Construction Ltd) establishing requirement for clear language for variations involving omissions or reductions — IO’s indefinite suspension and attempts to reduce scope and sum without compensation amounted to repudiation — Contractor’s clear acceptance of repudiation by 19 July 2013 letter and NOA in September 2013 — Contractor’s refusal to resume works in January 2014 following termination lawful — IO’s counterclaim dismissed — Costs awarded to Contractor with liberty to apply for damages. Judges must carefully construe variation and termination clauses protecting contractor’s right to complete contracted works.
Legal issues: Power to suspend commencement of Works · Power to vary scope of Works and Contract Sum · Repudiation by IO and acceptance of repudiation by Contractor · Whether Contractor was in breach by refusing to commence works in January 2014
Outcome: IO was in repudiatory breach of the Contract; Contractor accepted repudiation. Contractor not in breach for refusing to resume works. IO’s counterclaim dismissed.
Cited by 3 cases