Williams v Roffey Bros & Nicholls (Contractors) Ltd

A promise to pay extra for performance of an existing contractual duty can be supported by consideration where the promisor obtains a practical benefit, or avoids a practical disbenefit, from the continued performance. The promise is enforceable if it is not procured by economic duress or fraud.

The rule that performance of an existing duty is ordinarily insufficient consideration remains valid, but its application is limited by the practical benefits which a commercial variation may secure. A contractor who has substantially performed work is ordinarily entitled to the agreed payment less a proper deduction for defects or incomplete items, unless the contract makes complete performance a condition precedent to payment.

The claimant carpenter agreed to carry out carpentry work for the defendants’ refurbishment project for a lump sum of £20,000. As the original price was too low and the claimant was in financial difficulty, the defendants promised an additional £10,300, payable at £575 for each flat completed. The claimant continued working but the defendants made only one further payment.

Mr Assistant Recorder Rupert Jackson Q.C., sitting in Kingston-upon-Thames County Court, held that the variation was enforceable, that eight further flats had been substantially completed, and that the defendants’ failure to pay entitled the claimant to cease work. The defendants appealed, contending that the additional payment lacked consideration and that no payment fell due absent complete, rather than substantial, completion.

1. The appeal was dismissed unanimously. The County Court was entitled to find that the claimant was due further payment and that the defendants’ non-payment was a breach which entitled him to stop work.

2. On the payment issue, Lord Justice Glidewell held that the principle in Hoenig v Isaacs [1952] 2 All ER 176 supported payment for substantial performance, subject to a deduction for defective or incomplete items. Lord Justice Russell expressly agreed. The arrangement did not make exact completion of each flat an absolute condition precedent to payment.

3. On consideration, Lord Justice Glidewell held that an additional-payment variation is enforceable where a party has reason to doubt completion, promises extra payment to secure timely performance, thereby obtains a practical benefit or avoids a disbenefit, and the promise is not induced by economic duress or fraud. The defendants obtained practical advantages: continued work, reduced exposure to delay penalties, and avoidance of the expense and disruption of engaging replacement carpenters.

   This approach refined but did not displace Stilk v Myrick (1809) 2 Camp. 317. A gratuitous promise remains unenforceable, but performance of an existing duty may constitute consideration where the promisor receives the identified practical benefit. Lord Justices Russell and Purchas reached the same result by emphasising the commercial advantages of the revised bargain and the absence of duress.

4. The court treated the practical-benefit reasoning in Ward v Byham [1956] 1 WLR 496, Williams v Williams [1957] 1 WLR 148, and Pao On v Lau Yiu Long [1989] AC 614 as supporting that conclusion. Promissory estoppel was not relied upon, since it had not been properly developed or argued on the facts.

• Court of Appeal (Civil Division) Dismissed the defendants’ appeal, affirming judgment for the claimant.
• Kingston-upon-Thames County Court On 31 January 1989, Mr Assistant Recorder Rupert Jackson Q.C. awarded the claimant £3,500 damages, £1,400 interest and costs, and dismissed the defendants’ counterclaim.