Bolton v Mahadeva
Court of Appeal
Citations:  1 WLR 1009;  2 All ER 1322; (1972) 116 SJ 564;  CLY 502.
The claimant agreed to install a heating and hot water system into the defendant’s house for £560. He then claimed that he had completed the work, but the defendant refused to pay. The defendant argued that the claimant had not completed the work because there were numerous defects in the system. For example, the system did not properly heat the house and let off fumes.
The claimant sued the defendant for the contract price. The defendant counterclaimed for the cost of fixing the defects (around £174.50).
- Was the claimant entitled to the contract price, given that he had rendered defective performance?
The Court of Appeal held in favour of the defendant. The contract was a lump-sum contract. This meant that it required the entirety of the contract to be performed before the obligation to pay became due.
This Case is Authority For…
Under a entire obligations contract, the party performing the work must complete it in its entirety before he is entitled to the price.
There is an exception where the contract has been substantially performed. However, this exception only applies where the amount of work yet to be carried out is very minor in relation to the whole contract. Relevant factors include:
- The nature of the defects;
- The impact of the defects on the purpose of the work;
- The contract price;
- The cost of remedying any defects or otherwise completing the work.