Anticipation - ANTICIPATION A sub is in the midst of a...

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ANTICIPATION A sub is in the midst of a terrible contract with a general. As far as the sub is concerned, the general has been breaching the contract throughout. The sub is slated to start a second contract with the same general. Can it refuse the work on the second contract without being in breach? This scenario arose in The Roofing Systems Inc. v. Atlas Corp. , a 2004 Ontario Superior Court of Justice decision. Miscommunication The sub had two roofing contracts with the general, each for $117,000 plus GST. The sub progress billed based on 80% completion for job #1 and the general paid the amount billed. The sub then progress billed for 95% completion. The architect actually certified and the general was paid 85% for the first draw. The general therefore paid 5% less than the general received. The general withheld the remaining 20% of the contract because it alleged that there were deficiencies in the sub's work. Indeed, it seems that the architect reported some deficiencies. In the meantime, the general instructed the sub to start job # 2. The sub did not want to start because it said that the job was not totally ready for it to start. The general alleged that the job was either completely ready or, if it was not, it was sufficiently ready for the sub to start and proceed without interruption. The sub did not move quickly to start the job and the general, without further notice, hired another sub to perform the work. This cost the general an additional $17,000. Ultimately, the general and sub agreed that the sub had completed
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This note was uploaded on 04/13/2011 for the course FINANCE 101 taught by Professor Richard during the Spring '11 term at UCLA.

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Anticipation - ANTICIPATION A sub is in the midst of a...

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