Please support all postings with the relevant back up cases from the case law.

Halfway through the completion of a building contract for Mr. and Mrs. Simpson, the builder (a large proprietary company) realised that he had forgotten to include a 'price variation clause' in the agreement. Such a clause would have enabled the builder to pass on any significant increases in material costs during the course of the contract. The price of bricks increased during the course of the agreement due to the exit of two major competitors in the market, and the builder now wishes to pass on the costs to the Simpsons.

Knowing that he has no legal right to demand the money, the builder nevertheless calls the Simpsons and demands an extra $ 20,000 on top of the agreed purchase price and states that if the money is not forthcoming, he 'can't guarantee that the house will be finished on time, if at all'.

The Simpsons were shocked by the request but signed an agreement to increase the purchase price by $20,000 because they felt they had no choice. The house was finished on time. The Simpsons have paid the originally agreed purchase price but the builder is demanding the extra $ 20,000 as agreed in writing by the Simpsons. The Simpsons seek your advice.