Lester Williams v Roffey Brothers & Nicholls (Contractors) Ltd (1989)
In the case of Lester Williams v Roffey Brothers & Nicholls (Contractors) Ltd (1989) Roffey was the main contractor for the refurbishment of an apartment block called Twynholm Mansions. Williams was a subcontractor providing labour for the roof and first and second fix carpentry works to the apartments with a total price of GBP 20,000. The price was too low and a reasonable price should have been 23,783. This was further aggravated by Williams failing to supervise his men adequately, which reduced productivity. Williams therefore were experiencing financial difficulties.
Early in 1989 Roffey agreed to pay Williams an additional 10,300 at the rate of 575 for each completed apartment so as to allow Williams to continue with the works and complete on time. The works were on the critical path of Roffey’s programme so if Williams were to fail to complete the sub-contract this would lead to Roffey being liable for liquidated damages under the main contract. The payments agreed by Roffey were not made, so in May 1989 Williams ceased work and Roffey engaged others to complete the work.
It was argued that the agreement to make additional payments was not legally binding on Roffey, since they had agreed to pay for work which Williams was already bound to carry out under the sub-contract. Thus claiming there was no consideration.
There was some difficulty in finding consideration. It was held that in this case a benefit was gained from the agreement by each party and that was sufficient consideration for the promise to pay additional sums to be binding.
Although not referred to as such, it is suggested that the agreement was in the form of an acceleration agreement, the delay in this case having been caused by Williams own default.