Third parties left to foot the dispute settlement bill

In brief - Biggin principle still mostly followed by Australian courts

Subcontractors may find themselves worse off in a claim against them if it is made after a settlement between the other parties. It would therefore be prudent, when parties are working towards settlements, to consider if any of the parties have direct claims against you and what actions you may need to take.

Biggin principle and the concept of reasonable settlement

A run-of-the-mill construction dispute may see a Principal sue a Head Contractor for loss actually caused, in whole or in part, by a Subcontractor or Consultant.

For commercial (or other) reasons it may be in the best interests of the Head Contractor to settle the dispute and seek to recover the amount paid to settle the claim from the Subcontractor as damages.