The main obligation of the employer is to pay the contractor for work and material supplied, and the contractor to pay its subcontractor and suppliers. It used to be said that the contractor’s right to payment depended on the wording of the contract, and that within the limits of legality the parties were free to make arrangements they chose. These could be grouped under three broad heads (Keating, 2012, p. 104), as further explained below: 1 A lump sum contract (the right to payment only arises after the work has been properly carried out). 2 An express contract other than a lump sum (common under the standard form contracts which make provision for interim payments as work proceeds). 3 A claim for a reasonable sum frequently called quantum meruit. This arises in two situations: (a) either under an informal contract where it is classified as a ‘contractual’ quantum meruit: see Clarke (2002) in Chapter 3, pp. 69–75. (b) or where a variation is made outside the contract: for an example see Costain (1996) in Chapter 3, pp. 71–2.
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