Yulchon Represented Dongyang Engineering & Construction Corporation in Preliminary Injunction Claims to Prevent Alleged Business Interference, and Successfully Defended against All Claims
2023.03.17.
Yulchon represented Dongyang Engineering & Construction Corporation (“Dongyang”) in preliminary injunction claims by a housing reconstruction business union (the “Union”) to prevent alleged business interference by Dongyang, and successfully defended against all claims.
Dongyang had exercised a lien on the completed houses based on the Union’s failure to pay additional construction costs, which the parties agreed to adjust in the event of inflation. The construction contract vaguely provided that construction costs would be adjusted for inflation through mutual discussion, but no specific agreement or amendment had been made regarding the adjustment of construction costs. The Union filed preliminary injunction claims to stop Dongyang from withholding the completed housing units from purchasers, arguing that Dongyang’s additional cost claim was not valid because there had been no discussion, agreement, amendment or resolution by the Union regarding such adjustments. The Union also claimed that the performance time of the construction contract had not yet arrived due to a deferred payment condition, meaning that payments would be made based on the sale of housing units.
Yulchon, relying on the provisions of the construction contract, the parties’ intent, and analysis of relevant case law, argued that even if a client rejects a contractor’s legitimate request to account for inflation in construction costs, the contractor’s claim for additional costs is valid and the performance time of the construction contract is due. The court dismissed all claims of the Union, fully accepting Yulchon’s arguments.
This case is significant as it addresses the establishment of a contractor’s claim for additional costs and the performance time of a construction contract where the contract only vaguely states that construction costs will be adjusted through consultation.
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