Contract rectification

9 August, 2010

A recent Technology and Construction Court case (Traditional Structures Ltd v HW Construction Ltd [2010] EWHC 1530 (TCC)) has demonstrated that a party to a contract should not turn a blind eye if it believes that the other party has made a mistake in a contract.

 

In this case a sub-contractor submitted a tender for steelwork and cladding but mistakenly omitted the price for the cladding works. When this mistake came to light the sub-contractor argued that the contractor was aware of the mistake and that the price in the contract should be amended to include the cost of the cladding works. The contractor rejected this argument and stated that the sub-contractor should be bound by the price in the tender.

 

The sub-contractor applied to the court for rectification of the contract. The judge rejected the contractor’s evidence and held that the managing director of the contractor had:

  • wilfully and recklessly failed to enquire whether the tender price included the price of the cladding works;
  • shut his eyes to the fact that the price quoted was self evidently a price that related only to steelwork; and
  • known or appreciated that the sub-contractor had made a mistake.

The judge therefore ordered that the contract be rectified to amend the price as requested by the subcontractor.

 

 

Reviewed in 2015