Does the following Z clause amendment would you say (within section 5) provide a mechanism for an Employer to attribute consequential damages to a Contractor for delays:
“50.8 Notwithstanding any other provision of this contract or otherwise, subject to the service of a relevant notice in accordance with Clause Y2.3 confirming his intention to pay less than a relevant notified sum,the Employer shall be entitled but not obliged at any time or times without notice to the Contractor to set off any liability of the Contractor to the Employer against any liability of the Employer to the Contractor (in either case howsoever arising and whether any such liability is present or future, liquidated or unliquidated). Any exercise by the Employer of its rights under this clause shall be without prejudice to any other rights or remedies available to the Employer under this agreement or otherwise howsoever at law or in equity.”
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I personally don’t think this clause, despite all its legalistic words, changes the contractual risk allocation under the contract.
In that respect, IF the option X7 : delay damages has been specified, then I think the damages specified under this clause would cap the Contractor’s liability for direct and consequential damages.
I agree with Jon.
This clause is attempting to set out a specific set-off provision rather than creating or changing liability. This makes sense as it is placed in Section 5 of the contract all about payment mechanics. There are a number of apparent problems with this clause, for example it confirms that notice is necessary under Y2.3 but then suggests that set-off can be made without notice.
On your specific question, I don’t think it makes the recovery of consequential loss any more or less achievable. The clause only operates to allow the Employer to “set off any liability of the Contractor” so you still have to demonstrate teh liability first.