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Going slow

Does a contractor have a right to withhold payment if a subcontractor is proceeding slowly?  What if the contractor has an express right to terminate the subcontract for subcontractor delay?  Could this be sufficient to withhold payment?  This situation was considered in the recent decision of Leander Construction Ltd v Mulalley.

Leander was employed by Mulalley, the contractor, to carry out groundworks, drainage, concrete framework and associated works at a development site in Lewisham.  Leander was required to complete the subcontract works by 8 August 2011 and an activity schedule set out the elements of the works, their commencement dates, the periods for carrying out the works and completion dates.  The schedule was stated to be for indicative purposes only and subject to change. More…