In Traditional Structures v HW Construction HW asked TS to quote for structural steelwork and roof cladding for a development it was bidding for. TS sent a fax and at the bottom of the page provided a price for each, with a total value of about £70,000. Crucially, on the fax transmission received by HW the price for the cladding element was missed off.
HW submitted a tender on the basis of the price quoted and was appointed as main contractor on the development. HW then sought to formally accept TS’s quotation.
Following a discussion about variations to the scope of the works, TS submitted a revised quotation by email which gave amended prices for both elements of the work. HW expressed extreme surprise given that it thought it had contracted with TS for about £38,000! Given the urgency of the development, HW said it had no alternative but to allow TS to carry out the work, but reserved its position in respect of price. TS claimed rectification of the contract and a “reasonable sum” for the cladding element of the works.
The Judge noted that TS’s original quotation referred to “our prices” and that in the context of the scope of works any reasonable reader would have appreciated that the price on the fax received by HW related only to the steelwork. The Judge also thought it unusual that HW had not specifically referred to the price in accepting the quotation, when it had done so when accepting other sub-contractors quotations. The Judge therefore found that HW must have been aware that their version of the fax omitted the price for the cladding, and had – to its own benefit – failed to clarify the situation with TS. TS’s claim therefore succeeded.
COMMENT: This decision demonstrates the importance of having clearly agreed contractual terms, and if you believe there has been a mistake, this should be drawn to the other’s party’s attention. If you do not, you will not be able to benefit from that mistake.
There was no suggestion that TS had done anything wrong, but this sends out a clear warning to ensure that faxes are properly transmitted, and should be followed by hard copies in the post and/or by email.
