CONTRACTOR Emile Elias has been ordered to pay $1.2 million to a land developer for delays in the construction of 92 townhouses in the Westmoorings by the Sea neighbourhood in 1983.
In a ruling last week, Justices Peter Jamadar, Gregory Smith and Andre des Vignes dismissed the appeal of Elias’ company Emile Elias and Company Limited (EECL) against developer Westmoorings Ltd (WL).
In a written 24-page judgment, Smith, who delivered the ruling, found little fault with Justice Devindra Rampersad’s ruling —which Elias appealed — and upheld the finding of the validity and enforceability of a liquidated damages clause in the contract between the parties.
In outlining the facts of the case, Smith pointed out that the lawsuit commenced in 1988, before the introduction of the new Civil Proceedings Rules in 2005, and before proper case-management provisions. He credited Rampersad’s effective management and disposition of the “bulky building contract dispute” which “languished in the system.”
After three months of negotiations between EECL and WL, the contract was signed in August 1983 to construct 92 townhouses in 23 blocks for $11,586,812.
Each block contained about four to six townhouses and various time periods were stipulated for the completion of each block. The time periods varied between 27 to 49 weeks.
Clause 5 of the contract provided for the payment of $1,000 per townhouse by EECL for every week of unauthorised delay in the completion of any portion of the works, while clause 6 provided for payment of a bonus of $500 by WL for each week that any townhouse was completed in advance of its due date for completion.
The townhouses were not completed within the time provided for in the contract and relying on clause 5 — the liquidated damages clause — WL sued EECL.
The land developer claimed EECL was liable to pay $2,636,000 in damages for the unauthorised delays in completion of the townhouses and had paid $9,513,400.55 for work done and still owed a balance of $1,380,995.58.
WL agreed that the sum owed should be deducted from the amount that was owed by EECL, leaving $1,255.004.42, plus interest, to be paid by Elias’ company.
EECL defended the lawsuit and filed a counter-claim for losses alleged incurred, arguing that it was WL was responsible for the delays and it should be the land developer to pay for EECL’s losses. The contractor claimed compensation exceeding $3 million for excess costs and losses it incurred for all variations, increases and tardiness in issuing directions and also for increases in taxes and duties on materials for the project.
Rampersad upheld WL’s case, dismissed EECL’s counter-claim and gave judgement to WL in the sum of $1,273,966 with interest.