Cases - Sir Lindsay Parkinson & Co. Ltd v Commissioners of Works

Record details

Sir Lindsay Parkinson & Co. Ltd v Commissioners of Works
2 KB 632
Contract administration

The claimant contractors were engaged by the defendants to construct an ordnance factory for a lump sum of £3.5m. The commissioners had an express power to vary the contract in order to modify the extent and/or character of the works and it was the duty of the contractors to comply with the architect's instructions in this regard.

During the course of the works, delays occurred for which the contractor was not responsible and an extension of time was granted. The employer ordered that the works be accelerated to meet the original deadline and undertook to pay further sums to the contractor as a result. As it happened, the original bills of quantities anticipated a further £500,000 worth of works in any event.

However, as the accelerated works progressed, further variations and alterations were ordered.

The court held that by accelerating the works, the parties entered into a varied contract, into which a term would be implied that if the work was to be materially varied in excess of £500,000, any works carried out over and above that sum were to be valued on a quantum meruit basis.

This demonstrates the need for the architect or contract administrator to exercise due caution when issuing variations; if the variation departs so far from the original scope of works that it cannot fairly be regarded as part of the original bargain, it will constitute a separate contract, which may not be subject to the same terms.