Anthony hi The short answer is there are no remedies for you in the unamended form; A Collateral Warranty is a separate contract to the JCT D&B Sub-Contract, so unless the said Sub-Contract includes an amendment that (a) requires the Sub-Contractor to execute the warranty within a specified period and (b) failure to do so, the Contractor may invoke such condition expressly worded in the Sub-Contract such as, the sum of 10% of the valuation of the Sub-Contract works will be withheld from each and every payment until the Collateral Warranty is executed, then there is very little that can be done. If the Sub-Contract does require the Sub-Contractor to execute the Collateral Warranty, but no sanctioned is specified and they fail to execute the Warranty, then all you have is a breach of the Sub-Contract, but what is the loss at that stage? That is the problem. There is invariably, at an early stage, no loss. However, if a sale falls through due to non-receipt of the Collateral Warranty or the Contractor suffers some other sort of loss directly as a result of the Sub-Contractor not executing the Collateral Warranty, then perhaps there maybe a case to answer, but this does not solve the problem as you will still need a Collateral Warranty. The best way to avoid this scenario, is to amend the Sub-Contract to oblige the Sub-Contractor that they shall execute the Collateral Warranty and failure to do so, will permit the Contractor to withhold 10% or whatever % for each and every payment that is due to the Sub-Contractor, until the Collateral Warranty is executed by them. Or, you make payment a condition precedent to execution of the Collateral Warranty. In both cases, such amendments is best expressed as an Article in the Agreement.

Under a JCT 2011 D&B Sub-Contract what remedies are available to me if a sub-contractor is not providing a Collateral Warranty as required

Asked 3 years ago

JCT

Anthony McSharry

Asked on Tue, Jan 12, 2021 3:00 PM

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