2 South West Building & Construction SOUTH WEST


October-November 2011


BUILDING & CONSTRUCTION


Tavistock Newspapers Ltd, 14 Brook Street, Tavistock, Devon, PL19 0HE. Tel: 01822 613666 Fax: 01822 618222


INSIDE THIS ISSUE


■ Newton Abbot businesses - Page 4 ■ Sands Consultants - Page 5 ■ Castle Ham Lodge - Page 8 ■ Bradfords’ new showrooms - Page 10 ■ Hayman Construction - Page 12 ■ Green building proposed - Page 16 ■ Environment Topics - Page 19 ■ Spotlight on Cornwall - Page 26


CAPTION FOR FRONT PAGE PICTURES: News and information from the businesses on the front cover is featured in this issue of South West Building & Construction magazine.


Quote of the month


‘


It would have been great if we could have gone on forever - Sir Paul McCartney talking about the Beatles


STEPHEN HOMER


Valid guarantees


Stephen Homer, a former chairman of the CIC South West (Devon & Cornwall), highlights a recent case.


GUARANTEES are becoming all the more important in light of the economic downturn, as we see a number of contracting firms becoming insolvent and employers may want to look to claim from a third party who has guaranteed the contractor’s performance. With small firms which are limited companies, the employer may insist on a personal guarantee from the directors.


A piece of 1677 legislation, the Statute of Frauds, laid down the rule that there are two requirements for a valid guarantee agreement: 1. It must be in writing 2. It must be signed by the guarantor.


How you can contact us


EDITORIAL Editor: Paul White


Main contributor: Andrew Townsend Paul White Communications


PO Box 40, Callington, PL18 9WB ADVERTISING:


Judith Jewell Tel/Fax 01837 658941 E-mail judithjewell@btinternet.com


MAILING LIST


If you have a change for our mailing list Tel 01822 615007 Fax 01822 618971


E-mail swbmail@internet-today.co.uk ’


In the recent case of Golden Ocean Group Ltd v Scalgaocar Mining Industries PVT Ltd, the court addressed the question of how this should apply where terms have been negotiated by email. Parties in the case negotiated a charterparty agreement by email and consistently referred to the charterers as ‘fully guaranteed by SMI’.


The charterers refused to honour the agreement and so the owner called on the guarantee.


The court decided: a) As to the ‘in writing’ requirement, the email chain was not too disjointed to


constitute a binding guarantee agreement. There existed a sequence of ‘offer, counter offer and final acceptance’ and there was no limit to the number of documents that could be included in that sequence. b) On the matter of a signature, an electronic signature (such as those commonly inserted automatically into business emails) was sufficient. The court stated that it merely required ‘something which can be regarded as a form of signature, which is voluntarily affixed to the document by way of authentication thereof’. The court has clearly made it easier to establish that a guarantee obligation exists where terms have been negotiated by email, and parties to commercial negotiations must be careful not to inadvertently enter agreements using email correspondence. It is important to state clearly which negotiations are intended to be binding and which are subject to contract. A court or tribunal is unlikely to override a clear intention that no contract has been created, even in light of the broad interpretation seen in this case. If anyone has any queries arising from this article, I can be contacted via email at s.homer@ashfords.co.uk.


South West Building & Construction Magazine


The magazine is now available to read on the world wide web


Visit: www.tavistock-today.co.uk and click on Special Publications


to view the magazine on line. Tel: Judith on 01837 658941 Email: judithjewell@btinternet.com


DISCLAIMER: The CIC SW will not accept any responsibility for any loss occasional to any person acting or refraining from action as a result of the material included in this publication.


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