Advance schemes are used in construction contracts to support the contractor, i.e. so that the contractor does not have to finance the work from its own budget. A question that arose in a recent case is: can a contractor terminate the contract and claim an advance payment that should have been paid even if the contractor did not do any work? Failure to pay a necessary down payment under a construction contract can lead to unusual risks and opportunities. In Mirimskaya v Evans, the TCC clarified that non-payment of a deposit (if a contract requires advance payment) could give a contractor the right to terminate the work, interrupt it and continue the advance payment that should have been made. In this case, the contractor has applied for payment of an agreed deposit. This occurred after the owner had terminated the contract and the contractor had decided to terminate the contract without having performed any of the relevant work. In most cases, obtaining a down payment after a work release would overcompensates a contractor. If the Contractor has not commenced any of the work relating to the deposit, a legal rule, known as „total default of consideration“, prevents a Contractor from recovering the advance. Mirimskaya vs. Evans proposes, however, that when a contractor has performed certain work related to a down payment (even if only a small part) he can recover the entire advance. For example, a contractor involved in an advance dispute could perform 10% of the work related to an unpaid down payment and then attempt to terminate and recover 100% of the advance. There could be some leeway for mirmskaya against Evans to be challenged legally.
However, pending clarification of the law, there are a number of practical points that will be removed from the decision: none of the parties to the credit will conclude an advance contract with regard to real estate or will be a contracting party. Not to enter into or agree on a down payment contract with a person affecting the mortgaged property. Unless Annex 7.16 or the latest certificate provided in accordance with point 8.11(c) is issued or otherwise transmitted in writing to the administrative agent, the borrower and its limited subsidiaries are not parties to a down payment agreement and none of their assets are subject to this contract. . This guide provides an overview of EU public procurement rules. These were EU rules that require publication and tendering for works contracts, goods or services by public authorities and certain public service companies. . . .