THE IMPORTANCE OF DISTINGUISHING BETWEEN PAID AND UNPAID INVOICES

Furmans Electrical Contractors v Elecref Ltd [2009] EWCA Civ 170; [2009] All ER (D) 97 (Mar)

In Furmans Electrical Contractors v Elecref Ltd [2009] EWCA Civ 170; [2009] All ER (D) 97 (Mar), the Court of Appeal held that, when deciding whether or not contracting parties were entitled to bring claims against one another in respect of work done, it was important to distinguish between invoices which had been paid and invoices which remained unpaid. In relation to the paid invoices, it was held that the defendants had not established any basis on which they were entitled to re-open the invoices. They had paid a substantial sum of money to the claimants after they knew of the complaint in respect of which they now brought their claim. In making this payment it was held that the defendants had waived their right to recover the sums paid. However, in relation to the unpaid invoices, the question which the recorder ought to have asked himself was: what is the reasonable sum which the claimants are entitled to receive in respect of these invoices?