Read the full judgment text of HCCT 53/2006 on BabelCite. This 高等法院原訟法庭 judgment was delivered on 11 March 2008 before Hon Reyes J.
Construction contract dispute over payment for additional and variation works under an installation subcontract of split-type air conditioners. Plaintiff Sincere agreed to install Toshiba units for Fortress at $1,700 per unit based on an assumed 'back-to-back' installation. Subsequent design alterations resulted in greater work including longer pipework and repositioned units. Plaintiff performed additional works on oral instruction but lacked written variation orders as required by contract. Court held that oral instructions and acceptance of work waived written requirement, entitling plaintiff to payment for such works at agreed or reasonable rates. Defendant Fortress claimed contra charges for losses imposed by main contractor Chun Wo relating to plaintiff’s alleged negligence, most of which were disallowed due to insufficient evidence or absence of liability. Fortress also sought credits for direct payments to plaintiff’s subcontractors for repairs, all disallowed on grounds that defects were attributable to equipment supplied by Fortress. Resulted in judgment for plaintiff for $2,846,495.57 plus interest; Fortress ordered to pay costs. Appeal dismissed by CACV 84/2008. Relevant issues include contractual variations, waiver of written authorization, allocation of liabilities for contra charges, and crediting direct payments. The ruling affirmed the principle that a party receiving benefit of variation work after oral instruction cannot avoid payment due to lack of written variation, and requires clear evidence to support indemnity claims for contra-charges.
Legal issues: Entitlement to payment for additional or variation work · Whether Fortress entitled to claim contra-charges against Sincere · Validity of credit claimed by Fortress for direct payments to Sincere’s subcontractors
Outcome: Judgment for Sincere in the net amount of $2,846,495.57, including interest; Fortress ordered to pay costs to Sincere.
Cited by 1 case