Are schedules to your agreement less important than the body of the agreement?

Are schedules to your agreement less important than the body of the agreement?

Think that the schedules to your agreements are less important than the body of the agreement? Think again.

 

Each Annexure and schedule in your contract is vital and a failure to ensure consistency or an understanding of the schedules to a contract, could lead to unexpected losses on a project and a business.   It is especially true when bespoke amendments are made.

This was demonstrated in the case of Dynniq UK Limited v Lancashire Council [2017] EWHC 3173 (TCC).

Dynniq believed it was entitled to claim for certain items measured separately and outside the general items contained in the pricing schedule, attached to the NEC3 Term Services Contract. The TCC, however, found that the items claimed were part of the “all-inclusive” price set out in the pricing schedule. The TCC was definitive: the bespoke amendment to the pricing schedule expressly stated that Dynniq were not entitled to payment. A simple but costly lessoned learned.

A careful review of the contract, together with the technical specifications and pricing documents by the legal, commercial and technical teams will save unnecessary future hassles. The time spent interfacing with these teams will ensure that:

  • all parties are on the same page,
  • a closer alignment is achieved between what the parties intend and what’s placed in the contract
  • A critical element to avoiding disputes and potential losses once the contract is in operation is take care of.

 

We encourage clients to refrain from assuming that the standard form provisions apply or that what is discussed in negotiations is what is included in contracts, particularly when making bespoke amendments.

 

Authors

Nikita Lalla, Chief Executive, LNP Attorneys Inc

Ricardo Pillay, Director, LNP Attorneys Inc

Bongani Memani, Candidate Attorney, LNP Attorneys Inc