It seems my post on bidding for public contrcts in the construction industry missed one element – bid-rigging.
Who, in the name of goodness, does the UK Roads Authority use to write its contracts?
In truth, neither the contractors nor the public authorities seeking tenders genuinely know what the costs of such projects are; the tenders are guesses.
These contracts are very valuable. They allow the person to whom the contract is awarded to, at the very least, pay the wages of the staff of the successful tendering company, say, during slack industry trading periods.
The judgment did not deal with the liability of the insolvent contractor, who, the evidence showed, had entered into a loan agreement with the architects, following the awarding of the work to the contractor, for the loan of £10,000 to them, without the knowledge of the Employer/Plaintiff.
It is important to recognize that the expense of construction (which is considerable) carries the hidden reciprocal cost of the dispute and that the parties should budget for spending that money if and when the dispute breaks out. If that is budgeted for there will be a minimized loss of momentum in driving the dispute resolution process to an early conclusion.