Q&As

Can an employer omit work from the building contract in order to give it to another contractor?

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Published on LexisPSL on 22/12/2014

The following Construction Q&A provides comprehensive and up to date legal information covering:

  • Can an employer omit work from the building contract in order to give it to another contractor?

Omissions are a category of variation. Although most building contracts will contain provisions giving the employer the power to vary the works instructed under the contract, whether an employer can use the variation provisions to instruct any omissions from the original work will depend on the wording of the contract. For more about variations generally, see Practice Note: What is a variation on a construction project?.

Sometimes, variation provisions in a building contract will expressly permit the employer to instruct the contractor to omit part of the works but this is not very common. Where a building contract does permit the employer to use the variation provisions to omit works, the extent of its right to do so will depend on the terms of that particular building contract. A right to omit work will not be implied in any variation clause—it must be expressly set out in the contract, where it is not, any omission of work will be a breach of contract by the employer (Amec Building Company v Cadmus Investment Company).

The employer may want to omit work and award it to another contractor. This may, for example, be to obtain a better price for the work, avoid delays or if it has developed concerns about the contractor’s ability to deliver that element of the works. However, it is generally accepted that a contractor

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