Williams Versus Roffey Bros & Nicholls Ltd - Report Example

The Impact of the Decision in Williams v. Roffey Bros & Nicholls (Contractors) Ltd [1991 QB on the Doctrine of Consideration [Institution’s Name] The Impact of the Decision in Williams v. Roffey Bros & Nicholls (Contractors) Ltd [1991] 1 QB 1 on the Doctrine of Consideration. Introduction The carpenter who made an agreement with the builder to perform his part of work especially on the top structure in 27 flats, which were being refurbished, by the builder brought the case in the court of Law. The agreement was verbally made between the two parties but later on compact to one written agreement. An agreement made by the carpenter made an obligation to complete carpentry works on the roof and fix-outs of all the flats. The obligation comprises of two stages that the beginning work will be completed in all the flats and after few days the work of the flats would be completed. The amount agreed to be the consideration of this work was £20,000. The trial judge found that the agreement did not include details of periodic payments, so the judge based on implied terms suggested the terms of period of payments. The builder was agreed to pay a sum of £10,300 because all the work was completed by the subcontractor except the finishing work was required in 18 flats. The builder also communicated to the carpenter that if he did not the work at the time, he would be liable to pay damages. The carpenter completed his part of the work in 8 flats and was entitled to receive £575 each flat as agreed, but the builder paid him only £1,500 at that time. The subcontractor ceased the work and left. The builder hired other labors to complete the work. Unfortunately, the work was completed by the builder after the week of the due date, and he became liable to pay the damages. The case was initially stronger to the side of subcontractor. Overview of the Decision of the Court The English Court of Appeal that although the carpenter had faced difficulties during the contract. The price agreed at the time of the beginning agreement was insufficient, and he had faced difficulties in the completion of the contract because of his weak financial position. The Builder without transferring the liability of damages caused to him agreed to pay an additional amount on the completion of work at the promised date. The court decided that the promise of an additional amount is not binding because the subcontractor had no to do anything in return of that extra amount. The completion of the work was liable on the subcontractor in the initial promise. The additional amount promise is a gratuitous consideration. But the court detained that if the promisor had derived any benefit in practice this would amount a sufficient consideration. But there is a flexibility of the approach because there was a law regarding gratuitous consideration (Andrews, 2011). The Impact of the Decision on Doctrine of Consideration The decision and observation of court had caused a great impact of the doctrine of consideration. The consideration was considered to derive legal benefits, but the case has revealed the consideration may be of practical benefit. Although the subcontractor has fulfilled the promise of the original contract, but a promise made by the builder to pay an additional amount had raised the issue. The subcontractor was entitled to get that actual amount mentioned in the original agreement, but he was entitled to receive an additional amount (Wilken & Ghaly, 2012). The problem was to find out the consideration for the promise, which was made during the completion of work. The judges were trying to observe that if they could find any consideration in the additional promise so reach the result on the evidence basis. It was found that the builder told the subcontractor to complete the work quickly so that he could be free from paying the damages to owners of the flat. The builder had made a contract with the owners of the flats that if he were not able to give the possession before the due date, he would pay the damages and compensation. The action of preventing the builder to pay the damages to owners was a sufficient consideration for the promise of paying an additional amount to the carpenter on the completion of work. It was not a legal benefit, which was derived by the builder, but a practical benefit. The court revealed that this practical benefit seems to be a consideration for the promise (Merkin, 2013). The decision had raised a question in the mind of the people that this is enough to observe the practical benefits and ignore legal benefits. The practical benefits seem not to enough for the observation of any case, but there might be a situation comes in which legal benefits are not derived by the other party as an amount of consideration. The situation in this case is also complicated where the consideration is not legal but the subcontractor had saved builder from being liable to pay damages to the owners because of the completion of the work (Wilken & Ghaly, 2012). The case of Williams has spread the concept of consideration. The benefits derived by the party can be amounted to consideration irrespective of the legal facts. Practical benefits would amount to be sufficient consideration. The existing contract can be set aside if the sensible benefit could be found in the new promise. It would be harsh for the other party to defend the argument that if he derived any benefit from the new promise. The complainant can easily get a chance to make the case stronger from his side because he has to prove any practical benefit which the other party had derived from the new promise and put the ball in the court of that person that if he had not derived any kind of benefit from it (Wilson & Kenny, 2010). The practical benefits are acceptable when there is no actual or commercial benefit found in the consideration. The case of modified promise supports this kind of benefits where the possibility of the actual consideration is not shown. The practical benefits can be take in account to prove that the promise contain a valuable consideration. To accept the practical benefit as consideration is supported by the book, “Anson’s Law of Contract” states that the practical benefit can be seems in the case of family and not in the case of business contracts. It seems to be unusual that one cannot find the consideration as regard to the professional life. Law of contract included this benefit in the detail of benefits of consideration but the author of the book criticizes this because it is not a good decision to bind the future court decisions (Anson et al., 2010). The case discussed above was an important case for the doctrine of the consideration that most of the writers had involved the case in their books. The writer of the book, “Contract Law: Text, Case, and Materials” had also criticized the decision of the case that to save another from damages claimed by the third party is not sufficient consideration for the contracting parties to enact on it. In the case of Williams the same thing happens that the subcontractor bring a case to sue for the promised amount collateral to the original contract (McKendrick, 2014). It was the duty of the subcontractor to fulfill the work agreed in the initial contract to claim for the agreed amount. The subcontractor had not the right to claim the amount that was promised by the builder later on when he found that it was difficult to complete the work at due date. The builder offered new package to the subcontractor and gave him an opportunity of earning additional amount, but he had not to do any additional work. Conclusion From the review of the case study it can be concluded that practical benefits could be observed for the consideration in some cases where the real and monetary consideration could not be found. Builder had confessed that he promised to pay an additional amount on the completion of work. The work completion was due at the time when he made the original agreement. Later on, he found that the completion would be impossible before the due date so he used this trick to motivate the subcontractor. On seeking another aspect of the case, the subcontractor is entitled to receive any compensation because the builder had appointed other labor to fulfill the work. Subcontractor was not paid enough so that he could finalize his part of the work. The payment was not properly paid to the carpenter so that he could purchase some raw material required for the finishing purpose of his work. There was another perception that the subcontractor delayed the work of the contractor due to the part of the work left. The time was required to hire new labor to accomplish the work. If the contractor had given the payment to the carpenter, he would be able to hand over the work to the contractor. The perception of this case should be seen from both sides. The practical benefits have importance in the fact but as well as the contract is concerned practical benefits could be taken along with the legal benefits. List Of References Andrews, N., 2011. Contract Law. New York: Cambridge University Press. Anson, S.W.R., Beatson, J., Burrows, A.S. & Cartwright, J., 2010. Ansons Law Of Contract. New York: Oxford University Press. McKendrick, E., 2014. Contract Law: Text, Cases, and Materials. annotated ed. New York: Oxford University Press. Merkin, R., 2013. Privity of Contract: The Impact of the Contracts (Right of Third Parties) Act 1999. New York: Taylor & Francis. Wilken, S. & Ghaly, K., 2012. The Law of Waiver, Variation and Estoppel. New York: Oxford University Press. Wilson, S. & Kenny, P., 2010. The Law Students Handbook. illustrated ed. New York: Oxford University Press. Read More