Assignment Task: Write an essay to explain how the relevant law applies to the legal issues raised by the scenario below:
5th January 2023 - StudiAccom, a property company with an annual turnover of £80m buys derelict buildings and land to convert into environmentally friendly student halls of residence.
10th January 2023 - StudiAccom needs a construction company to actually do the building work for them. The company invites tenders by contacting five construction companies in the East Midlands. Key documents sent include:
60-page detailed specification document
A statement including the line, 'lowest tender complying with the full specification and deadline for completion will secure the contract for the work.' The deadline is 1st January 2024.
11th February 2023 - Two bids have been received within the deadline. They are:
ResiliantCo - '£950,000 or £50,000 below your lowest tender.'
Singh Construction - £850,000
The contract is awarded to ResiliantCo. because they have agreed to undercut Singh Construction by £50,000.
12th February 2023 - ResiliantCo needs to subcontract some of the work, it contacts BobTail Co. to hire diggers and other machinery. As it is a big project there are negotiations and BobTail agrees to a significantly reduced price for hire for the machines on the basis that 'payments will not be stopped in the event that work is suspended due to an archaeological find'. ResliantCo agrees to this requirement, but BobTail Co. also agree to remain as digger supplier for the entirety of the contract duration.
1st March 2023 - Construction work commences.
25th April 2023 - Human bones are discovered buried at the construction site. The police and archaeological experts are called in and work stops for two weeks. On day 14 the experts determine this is not an ancient burial site but that the bones are from about 40 years ago. The police will have to examine their cold cases which could take years. BobtailCo claims the full hire price for its diggers for a fortnight while they are idle. They say that it was implied that any stoppage of this broad nature would result in full payment per their agreement on 12th February. ResiliantCo refuses to pay.
1st June 2023 - ResiliantCo contacts StudiAccom to inform them that work is behind schedule and unlikely to be completed by 1st January 2024 as per the main contract. Without seeking advice from the company legal department, the StudiAccom Project Manager, Mr B. Builder offers an extra £50,000 'bonus' to ResiliantCo to finish on time. Unknown to Mr Builder, ResiliantCo have previously used this tactic on other jobs to extract extra payment. The payment is made.
22nd June - ResilientCo had previously ordered 150 pallets of roof tiles from Regalroof, an enormous building supply company worth over £1Billion, which supplies builders internationally. These tiles arrive and on inspection are found to be much too bright a colour to pass planning regulations. Regalroof refuse to refund or replace the tiles because of a clause posted in their terms and conditions on their website - 'Any liability for any defects is hereby excluded'. A whole new batch has to be purchased from another company at considerable extra cost.
30th June - BobTail Co. informs ResilientCo. that all of their diggers on site have broken down and there are no more available in their fleet to replace them. This is because the diggers each have microchips in them which have to be replaced when the vehicle is serviced. Import of replacement electronic parts has now all but stopped as almost all of the manufacture of them is based in the Republic of Tintin an island nation in the Pacific. This country is now being blockaded by the navy of its much larger neighbour, The People's Republic of Ceramica over a territorial dispute. The two countries are on the brink of all-out war. Resiliant Co. have to bring in another digger subcontractor at a much higher price. The total loss to the company is £40,000.
1st July 2023 - One of the detailed specifications written by StudiAccom is that the solar panels on the roof produce 50% of the building's electricity. ResilientCo had ordered these from Regalroofing as well as the tiles mentioned earlier. On installation however, it was discovered that they could only produce 47% of the required electricity. StudiAccom's CEO is furious and demands they are replaced by Regalroofing. The cost of doing so would be £95,000 and Regalroofing refuses. StudiAccom threatens to sue Regalroofing.
December 23rd 2023 - Construction is complete and the building is opened.
5th January 2024 - You are a lawyer and your advice is sought as to:
1. Whether ResilientCo should have won the tender competition or whether Singh Construction should have been awarded the contract.
2. Whether BobTailCo. are entitled to the money for the two weeks their machines were idle.
3. Whether ResiliantCo. are entitled to the £50,000 bonus paid by StudiAccom on Mr B. Builder's instructions.
4. Whether Regalroof are required by law to refund ResliantCo. for the roof tiles.
5. Whether Bobtail Co. owe ResliantCo. £40,000 for the necessity to replace BobTail Co with another digger contractor.
6. Whether StudiAccom are likely to succeed in the proposed legal action over the solar panels.