Letters of Intent, breach of contract and copyright (This is a big-un)

Longish story but I have got 3 questions. Would really appreciate any advice and any cases I could cite.

3 years ago Property developer built a small development of 10 houses, hiring contractor using standard JCT.

They used a new tubular design designed by architectural firm

The developer is now building another development using the same design, using the same contractor and JCT contract. This contract has been drafted and signed in the correct manner.

Contractor brings in electrical company using the following email:

From: Contractor
To: Electrical
Date 4th Oct
Hi …,
It was good to see you this morning. I am glad you are available to do this electrical
work for us. Electricians are a nightmare to get hold of these days.
The plans I gave you are very detailed, so we won’t need a contract just do the work
from the plans and we’ll pay a day rate of £175 up to a max of £20,000.
I confirm our agreed start date on 20th Oct.

Electrical start work on 20th Oct and on 30th Oct submit their first invoice for 25 man days at £175 =
£4375 plus £1500 for materials. Total £5875.

Contractor then finds faulty/dangerous wiring. Contractor refuses to pay the electrical company and
threaten to sue them for breach of contract, claiming £3000 to fix the wiring.

Electrical company say they cannot be in breach of contract because they never had a contract and say their demand for payment is made as a quantum meruit claim.

Is there a contract there?

Afterwards, the contractor and electrition agree to treat email as contract but there is a dispute about claim amount. This is split into 3 parts

1 Contractor is claiming £3000 to put the faulty wiring right, £2000 for the extra plant hire
charges they have incurred through having to keep the site open while the rewiring work is

2 Contractor also claims that because word got around that their houses are not safe they lost
out on a lucrative contract to build 4 more houses on which they would have made a profit of

3 A local newspaper wrote up the story about how unsafe the contractors houses are and as a result the contractor says that fewer good skilled workmen are applying to work for them and they cannot employ enough workers and instead have to take on agency workers which costs the
company more. The additional agency fees have cost them a further £2500.

For each claim part (1, 2 & 3), can the contractor actually claim these from electrition?

Thanks again for any help.


I suspect a law student asking for help with an exam but ignoring that here we go.

  1. Yes, there was an agreed contract to undertake electrical works and the claims for putting right faulty wiring and extra plant hire are foreseeable losses within the rule in Hadley v Baxendale.

  2. Probably yes on the basis of the HvB forseebility test.

  3. Probably no on the same basis.