Boyack & McKenzie Ltd v Lock Joint American (Trinidad) Ltd

• Jurisdiction: Trinidad & Tobago
• Judge: Rees, J.
• Judgment Date: 12 September 1966
• Neutral Citation: TT 1966 HC 12
• Docket Number: No. 1557 of 1963
• Court: High Court (Trinidad and Tobago)
• Date: 12 September 1966

High Court of Justice

Rees, J.

No. 1557 of 1963

Boyack & McKenzie Ltd

and

Lock Joint American (Trinidad) Ltd

Appearances:

Hosein Q.C. & Seemungal for plaintiffs;

Procope Q.C., Hudson-Phillips jnr.

Davis with him for defendants.

Contract - Sub-contract — Whether breached — In 1961 the Government of Trinidad and Tobago contracted with a Venezuelan firm “Ofisa” for the execution and construction of a sewer system. Ofisa later asked the Government to conduct all further negotiations with the defendant. In accordance with this request the Government negotiated with and subsequently entered into, an agreement with the defendant to execute and complete the said work which had to be done by Ofisa. The defendant sub-let to the plaintiff all road re-instatement work which it had agreed with the Government to perform. Sometime later the plaintiff complained to the defendant that in breach of its contract with the plaintiff the defendant had been carrying out reinstatement work on roads in the areas set out in the sub-contract. Plaintiff accordingly brought an action for breach of contract. — The defendants as reasonable persons, would know, in the ordinary course of things, that if they prevented the plaintiffs from carrying out the reinstatement work and did it themselves, the plaintiffs would lose the profits which they would have made if they had been permitted to do the work. In addition the language of the sub-contract clearly indicates that the defendants were under an obligation to give all the reinstatement work to the plaintiffs. If it were intended that the defendants could at any time stop the work and do it themselves, then they ought to have inserted in clear and precise language in the sub-contract, a clause to that effect. There was therefore a breach by the defendant of the sub-contract between the plaintiff and the defendant which entitled the plaintiff to damages in the sum of $57,627.46. Counter-claim by the defendant will also be dismissed. Judgment for the plaintiff with costs to be taxed.

Rees, J.

1 This is an action brought by the plaintiffs, Boyacka & Mackenzie Ltd., against the defendants, Lock Joint American (Trinidad) Ltd., for damages for breach of a contract dated September 14th, 1962, and made between the parties. The defendants deny that they were in breach of the agreement and have counterclaimed for damages for defects in the performance of the work which the plaintiffs had undertaken to perform by the said agreement. The circumstances leading up to the filing of the writ are as follows:

2 In the year 1961, the Government of Trinidad and Tobago was desirous of constructing a modern sanitation system in Port of Spain. San Fernando and Arima. As a consequence they entered into negotiations with a Venezuelan firm under the name of Oficinia de Inginiera Sociedad Anonima (hereinafter referred to as Ofisa) for the execution of the work. At a certain stage of these negotiations Ofisa requested the Government to conduct all further negotiations with the defendants, a company duly incorporated under the Companies Ordinance of Trinidad and Tobago, with the object ‘inter alia’ of constructing sewers and sewerage disposal plants, subaequeous pipe lines and other projects which might be conveniently carried on therewith. In accordance with this request Government negotiated with, and subsequently entered into an agreement with the defendants wherein they undertook to execute and complete the construction of the system for a consideration. This agreement, which I will call the first agreement, was subject to certain drawings and specifications, showing and describing the work to be done, but which were then under preparation by Metcalf and Eddy Ltd., of Boston, in the U.S.A., Consultant Engineers who had been retained by Ofisa for that purpose. These drawings and specifications were completed certified on January 17th, 1962, but the scope of the work contemplated been increased with the approval of Government. It, therefore, became necessary for the latter and the defendants to enter into a second agreement which was substituted for and took the place of the first agreement. Incorporated with this second agreement are the conditions, drawings and specifications showing and describing the works to be executed in accordance with the contract (hereinafter called “the works”). This agreement, together with the conditions, drawings and specifications are hereinafter collectively referred to as the “General Contract” and marked Exhibit ‘A’ in these proceedings. Metcalf and Eddy Ltd. were elected as the Engineer vested with the supervision of the works and Anders B. Sandquist was their Resident Manager in Trinidad. As the defendants, by clause 4 of the general contract (Exhibit ‘A’) were not permitted to sub-let any part of the work without consent of the Engineer, they sought and obtained permission to sub-let to Boyack & Mackenzie Ltd, all road reinstatement and were thus enabled to enter into contractual relations with the plaintiffs. On September 14th, 1962, the sub-contract was signed by Raymond Lucas, the Managing Director of the defendant company, on behalf of the defendants, and Malcolm Mendes a director of the plaintiff company, on behalf of the plaintiffs. The nature of the work described as reinstatement was such that it required persons of skill, competence, and experience for its execution, but the plaintiffs are a firm with competent and qualified staff, widely experienced in earth removing and road building in Trinidad, well equipped and with ready access to material for that purpose. The building of the extensions of the North Coast Road, from Maracas to Las Cuevas, and the South Trunk Road, from San Fernando to St. Mary's Village, are some of the more extensive assignments successfully undertaken by them. They have actually been engaged in road reinstatement with similar techniques as that called for under this sub-contract, e.g.: paving operations for the Trinidad and Tobago Telephone Company, the Central Water Distribution Authority and the Trinidad and Tobago Electricity Commission. The plaintiffs commenced the work of reinstatement in August, 1962, before signing the sub-contract. As is reasonably to be expected in a project this magnitude there were minor disagreements and occasional set backs one kind or another. As early as October, 1962, there was a continuous flow of complaints from residents, merchants and Government officials. One complaint in particular related to the speeding up of the reinstatement. The substance of Lucas' reply to this is set out in an internal memorandum and is to the effect that they would repave as soon as they had installed the pipes, manholes and house connections and there was optimum settlement. That they mere trying to do this as soon as possible, but that broken services, tight streets and severe ground-water conditions were holding them back. A copy of the memorandum was sent to Mendes — see Exhibit D.1. On March 8th, 1963, Lucas wrote to Mendes, enclosing a copy of the following letter from the Engineer which is dated March 4th, 1963.

“Dear Sirs,

Our client, the Government, of Trinidad and Tobago, and ourselves, are becoming quite concerned about progress on the paving portion of your construction project.

The progress of construction, as of the end of February, shows that approximately eighty (80) riles of pipe are in place. This represents about one third of the estimated mileage of pipe to be placed.

Only about ten miles of paving was accomplished as of the end of February which represents a little over five per cent of the estimated paving to be done.

Complaints about road conditions from individuals and the Road Safety Association of Trinidad and Tobago are increasing. The press is also becoming quite critical of the situation.

A study of the progress of paving indicates that this phase of the work should be accelerated in order to minimise complaints and also assure completion within the time limit of your contract.

The general overall progress of the project is excellent, but may cue again urge you to explore the possibilities of improving progress on paving.

Very truly yours,

Anders B. Sandquist

Resident Manager.”

3 On March 11th Lucas wrote another letter (D.23) in which after making certain suggestions he stated in the last paragraph:

“I would like to have your agreement on these suggestions so that we could concentrate on getting the paving work up to a speed that will match pipe installations.” (Exhibit D 23.)

4 On March 25th, 1963 Mendes replied to the letter of March 8th, 1963, (See exhibit E. 13) and this is what he says:

“Dear Ray,

We have for acknowledgement your letter of 11th inst., in connection with our quotation for the extra work involved in the Class “B” Reinstatement and our price for the actual increased cost on the Class “C” Reinstatement following your Hydra Hammer in the Barataria area.

As indicated to you on the telephone, we are unable to understand your estimate of cost, inasmuch as under Class “B” you state that you are prepared to pay 4¢ per inch per sq. yd., for the excavation and removal of excavated earth, whereas under Class “C” where we have to give you credit for identical work, you estimate this to be 14¢ per inch per sq. yd. We however, agreed with you on the telephone that in order to avoid any further discussions on the subject we would be prepared to accept your offer of 25¢ per sq. yd. for the increased work in Class “B”.

In view of your statement that it is your opinion that the cost of stone transported to the site, laid and rolled, is identical to the cost of excavating and hauling away common earth from the trench, we would require that in future you leave all the trenches which we have to reinstate level with the existing road, and not, as we have hitherto been accepting, with a crown 2” to 3” high. It would be obvious to you that...