This is a topic where contracting parties have an agreement or when one party has performed services and/or works but there has been no agreement on the price or payment terms. Such situations frequently occur in the construction industry where the Contractor often commences the works on the basis of a letter in intent or verbal or even written instruction issued by the Employer or S.O./Architect/Engineer/ Project Director (depending on the forms of construction contract used). In some cases, the Contractor is required by the Employer or S.O./ Architect/Engineer/Project Director to carry out additional works on an existing contract as a variation to the contract, however the existing contract prices/rates do not cater for the said variation works. Thus, the Contractor will have to claim on a fair and/or reasonable basis, commonly known as quantum meruit.
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