Contract cancelled due to budget cuts but it has been given to another contractor?

[LJL]

Good afternoon,

We tendered on and were successful in winning a social housing contract. We are 10 months in to the 12 month contract and things have gone great our side (not so much there's, due to poor management) and everything is within the acceptable margins outlined in our original contract. We were told 3 months ago that we would be given a 12 month extension as part of the offer within the original contract and tender. Due to governement budget cuts (or so we were told) we were offered a reduced overall contract value (but no written offer has ever been given).

Things started feeling a little strange when the association held off from giving actual written confirmation. They were also struggling to provide enough properties for us to fullfill our 1st years contract which has made our office management's workload double due to fighting to be given these properties to keep us going.
Then we were contacted by the association and informed that due to budget cuts to the sector we are currently undertaking, we would not be offered any further contract.

My issue is that there is another contractor undertaking works to a similar sector to ours but has been allowed by the association to carry out works that were offered to us under our contract. We feel now that due to the lack of properties the association can give us, they will just combine the two sectors together and give it to the other contractor (which is why we have not been given another contract).

My question/s are these:
If both contractors have been given contracts to carry out works on two seperate sectors (for example; one is gardening and the other is roofing), can these be combined by the association so that the gardening contractor is now carrying out the roofing contractors work and the roofing contractor told the budget has been cut for roofing and therefore has no further contract?

The reason we have an issue with this is that the contract has been a real struggle from start to finish dealing with incompetent social housing management staff and as a result has cost our company more in the overall management of the contract. Now this would have been slightly acceptible if we had been given another contract (as promised) but as this has been given to another contractor we now feel cheated.

I know this may be a little strange but i cannot disclose all information as not sure who may read this.

[Openlaw15]

Re: Contract cancelled due to budget cuts but it has been given to another contractor

Good afternoon,

We tendered on and were successful in winning a social housing contract. We are 10 months in to the 12 month contract and things have gone great our side (not so much there's, due to poor management) and everything is within the acceptable margins outlined in our original contract. We were told 3 months ago that we would be given a 12 month extension as part of the offer within the original contract and tender. Due to governement budget cuts (or so we were told) we were offered a reduced overall contract value (but no written offer has ever been given).

Things started feeling a little strange when the association held off from giving actual written confirmation. They were also struggling to provide enough properties for us to fullfill our 1st years contract which has made our office management's workload double due to fighting to be given these properties to keep us going.
Then we were contacted by the association and informed that due to budget cuts to the sector we are currently undertaking, we would not be offered any further contract.

My issue is that there is another contractor undertaking works to a similar sector to ours but has been allowed by the association to carry out works that were offered to us under our contract. We feel now that due to the lack of properties the association can give us, they will just combine the two sectors together and give it to the other contractor (which is why we have not been given another contract).

My question/s are these:
If both contractors have been given contracts to carry out works on two seperate sectors (for example; one is gardening and the other is roofing), can these be combined by the association so that the gardening contractor is now carrying out the roofing contractors work and the roofing contractor told the budget has been cut for roofing and therefore has no further contract?

The reason we have an issue with this is that the contract has been a real struggle from start to finish dealing with incompetent social housing management staff and as a result has cost our company more in the overall management of the contract. Now this would have been slightly acceptible if we had been given another contract (as promised) but as this has been given to another contractor we now feel cheated.

I know this may be a little strange but i cannot disclose all information as not sure who may read this.

If you were promised a year's extension, these are additional terms of the original. The Housing Association cannot offer with one hand and take away with the other. Can you prove you were offered a year extension. What are the terms to the original contract, ie how long was the contract intended? You say 12 months, but had you previously contracted with them before? Were there any terms for extensions at the time in the contract? Was the company (other contractor) providing cheaper tenders?

[wales01man]

Re: Contract cancelled due to budget cuts but it has been given to another contractor

Did the contract guarantee a set amount of work? The exact wording would help LB advisors to halp you some Council contracts I was part of many years ago stated we would from time to time be called upon to carry out work during the contract period

[LJL]

Re: Contract cancelled due to budget cuts but it has been given to another contractor

Hi,

I have emails stating that they were offering an extension to contract and the intended value. It was minuted within a contract meeting but the phrase 'subject to board approval' was added to the meeting minutes. We were chasing written confirmation (only had verbal) as they delayed and delayed in giving us any confidence of this offer as time went on.
We have found out that the other contractor has been carrying out work that we were contracted to do (just added to their original contract). It just seems quite obvious that if the other contractor can do our work whilst doing theirs (we can do the same but have not been given this opportunity) and they have had to suffer budget cuts then it would make sense for the association to offer them our contract to boost the other contractors downfall in budget and get rid of us? There seems to be an obvious favourtism to the other contractor (who has been carrying out work for the past few years) which we do not have the correct amount of proof as to why at this stage so it would be unfair for us to add anything than what we actually know.

[Openlaw15]

Re: Contract cancelled due to budget cuts but it has been given to another contractor

Hi,

I have emails stating that they were offering an extension to contract and the intended value. It was minuted within a contract meeting but the phrase 'subject to board approval' was added to the meeting minutes. We were chasing written confirmation (only had verbal) as they delayed and delayed in giving us any confidence of this offer as time went on.
We have found out that the other contractor has been carrying out work that we were contracted to do (just added to their original contract). It just seems quite obvious that if the other contractor can do our work whilst doing theirs (we can do the same but have not been given this opportunity) and they have had to suffer budget cuts then it would make sense for the association to offer them our contract to boost the other contractors downfall in budget and get rid of us? There seems to be an obvious favourtism to the other contractor (who has been carrying out work for the past few years) which we do not have the correct amount of proof as to why at this stage so it would be unfair for us to add anything than what we actually know.

Copy and paste the actual words of the email, you can omit names if you want to. I just want to understand whether it is an offer or an invitation to treat, the first is binding whereas the second is not.

[LJL]

Re: Contract cancelled due to budget cuts but it has been given to another contractor

Just to add:

All contracts/tenders go out at the same time each year unless your contract is extended (the tender stated that it was a 3 year contract but the contract was offered out on a 12 month contract which can be extended for a further 12 month period to a maximum period of 3 years) We have worked with this association in the past.
The extension offered was for a set amount of work up to a contract value (i.e. depending on any cost increases the value will amount to a proportion of work)
The government budget cuts seems to have had an effect on the contract as the contract clearly states a 12 month extension period but the value offered was half the first years contract value (therefore we would actually be getting around 5 months worth of work instead of 12).

[LJL]

Re: Contract cancelled due to budget cuts but it has been given to another contractor

Hi,

I have just read through the emails and they all state that it is subject to board approval. The project manager confirmed in 2 contract meetings that they were extending and confirmed the value but nothing with a firm offer of extension. It seems the offer is no longer there due to them only now becoming aware that they cannot provide us with the amount of properties to keep the contract runnig at the speed they requested, not down to budget cuts.