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Oak Ridge Constr. Co. V. Tolley (1985)

Decent Essays

Rick: There appears to be no language in your sub-contract that affirmatively requires you to keep working the event of a dispute or a material breach. In HDR’s contract with WGJV, however, HDR agreed not to “slow down, not diligently prosecute, suspend or cease its Services or work, notwithstanding the existence of any dispute between the Parties.” This language, however, is not enforceable against Century because Century is not a party to that agreement. Moreover, there appears to be no instance in the sub-contract that incorporates HDR’s obligation to WGJV by reference. Accordingly, Century has no affirmative obligation to continue working in the event that HDR’s breach of the sub-contract. Although there is no affirmative obligation …show more content…

Co. v. Tolley, 351 Pa. Super. 32, 41 (1985) (internal quotations omitted). If a court found that the failure to render payment under these factors constituted an immaterial breach, then the caseation of work would then constitute a breach. This analysis is a fact-intensive analysis, and accordingly, I cannot definitely opine on how a court interpret these factors in this case. Nevertheless, I strongly suspect that HDR’s failure to render payment in accordance with the contract would constitute a material breach. So long as 1) HDR did—in fact—breach the contract; and 2) that breach was material, Century is justified in stopping work under the project. Nevertheless, I must bring to your attention these risks associated with stopping work. Alternatively, you could continue work and file a declaratory judgement action to obtain a judgment for the damages resulting from HDR’s breach. This course of action eliminates the risk that you may latter be found to be in breach for ceasing work. See Harrison v. Cabot Oil & Gas Corp., 110 A.3d 178, 185 (2015) (“[F]iling of declaratory judgment action merely contesting the validity or scope of an agreement does not entail such an unequivocal refusal to perform.”). This alternative, however, creates the risk that the performance you render from the point of HDR’s breach forward may be

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