Problem: I need some advice concerning whether it is possible to invoice a sub-contractor for failing to arrive on site on a set date which in turn not only held-up the job, but cost my company quite a bit of money.
I own and manage a small construction company, turning over around £1.1 million, and in 2020 my company was working on a project for a private landlord (refurbishing 2 houses), and the project required scaffolding. I subsequently contacted a local scaffolding company, the owner who came out to see the work involved and then submitted a price, which I accepted. After I accepted the price, I then discussed with the owner of the scaffolding company a date for it to start, which was agreed. I also received the RAMs prior to the scaffolding company starting.
However, two days before the agreed start date, the owner of the scaffolding company asked that the start date be delayed by several days. I was not too pleased, but I re-programmed the works and agreed on a different erection date, which was now to be over a weekend.
Neither the site, nor generally my company, work on a weekend, but because of the delayed start of the scaffolding, I decided to meet whatever the costs would be for weekend working, which included two of my operatives being on site for both Saturday and Sunday. Surprise, surprise, the scaffolding company failed to turn up! My operatives tried ringing scaffolding company from site and even I got involved and tried ringing the owner, but to no avail.
I have since sent the scaffolding company an invoice for the wages incurred over the abortive weekend (I had guaranteed both operatives work on Saturday and Sunday at time and a half), my time and travel expenses. Included in the invoice was also the additional amount of monies that my company ended up having to pay to get another scaffolding company, the cost of which was almost double.
The invoice has not been paid and I wanted to know if I could take this further. There was no formal contract, but the price and revised start date is evidenced in writing.
From the details that you have provided, the expenses and losses that you have incurred probably do not amount to more than £10,000 (4 operative days at time and a half plus the additional expense on employing an alternative scaffolding company), and if this is the case then if you were to issue county court proceedings, your case would fall into the small claims, which is important as the risk for either party regarding legal costs in small claims is nominal (the costs that a successful party can claim back from the other side is nominal).
That said, although no formal contract was entered into (oral contracts are binding on parties as well, but it is much more difficult to evidence what the parties actually agreed if not in writing), if the scaffolding company has wrongly repudiated the contract (which will be at common law), and you have accepted that wrongful repudiation, you are entitled to claim for your losses and / or expenses incurred, caused by the breach.
Because you are claiming damages for breach of contract, there was no requirement for you to issue an invoice; this is because you are claiming damages (which would not attract VAT), as opposed to supplying goods and / or services (which would attract VAT on the supply). You could therefore simply had made a claim.
So, the simple answer to your question is yes, you can take the matter further, which will be via the county court (but going through the Pre-Action Protocol first), or you could consider adjudication (but under the Construction Industry Council’s low value disputes model adjudication procedure). However, before you embark on your next stage, I would recommend that you speak to a solicitor beforehand.
© Michael Gerard 2021
The advice provided is intended to be of a general guide only and should not be viewed as providing a definitive legal analysis.
Michael is a Solicitor, Chartered Builder & Registered Construction Adjudicator, and is a director at Michael Gerard Law Limited, a solicitors practice regulated by the SRA.