IN THE SUPREME COURT OF THE DEMOCRATIC SOCIALIST REPUBLIC OF SRI LANKA In the matter of an Appeal from the Judgment dated 3^rd March 2015 of the High Court [Civil Appeal] of the Western Province (Holden in Colombo) made under and in terms of Section 5 (c) of High Court of the Provinces (Special Provisions)

(Amendment) Act No. 54 of 2006.

Daya Constructions (Private)

Limited, No. 362, Colombo Road, Pepiliyana, Boralesgamuwa.

Plaintiff SC APPEAL 64/2019 SC/HC/CALA/131/15 WP/HCCA/COL/13/2009(F)

District Court of Colombo Case No.37756/MR Vs.

Hovael Constructions (Private)

Limited, No. 245/55, Old Avissawella Road, Orugodawatta Defendant AND BETWEEN Hovael Constructions (Private)

Limited, No. 245/55, Old Avissawella Road, Orugodawatta.

Defendant-Appellant Daya Constructions (Private)

Limited, No. 362, Colombo Road, Pepiliyana, Boralesgamuwa.

Plaintiff-Respondent AND NOW BETWEEN Olympus Constructions (Private)

Limited, No.445/1/2, Colombo Road, Pepiliyana.

Formerly knowns as;

Daya Constructions (Private)

Limited, No. 362, Colombo Road, Pepiliyana, Boralesgamuwa.

Plaintiff-Respondent-Appellant Hovael Constructions (Private)

Limited, No. 245/55, Old Avissawella Road, Orugodawatta.

Defendant-Appellant-Respondent Before : P. Padman Surasena, J Achala Wengappuli, J K. Priyantha Fernando, J Counsel :

Nihal Fernando, PC with Rehan Dunuwile for the Plaintiff-

Respondent-Appellant.

Dr. Sunil Cooray for the Defendant-

Appellant-Respondent.

Argued on : 20.09.2023 Decided on : 22.11.2023 K. PRIYANTHA FERNANDO, J

1. On 15.09.2003, the company named Olympus Constructions (Private) Limited (formerly known as Daya Constructions (Private) Limited) (hereinafter referred to as the ‘plaintiff’) instituted an action against the company named Hovael Constructions (Private) Limited (hereinafter referred to as the ‘defendant’) in the District Court of Colombo praying, inter alia, for the recovery of an additional sum of Rs. 2,704,178.94 in respect of asphalt supplied and laid on a public road in Negombo.

2. After trial, the learned Additional District Judge pronounced judgment on 18.02.2009 in favour of the plaintiff. Thereafter, the respondents filed an appeal against the judgment of the learned trial Judge, upon which the learned Judges of the High Court of Civil Appeal of Colombo by their judgment dated 03.03.2015, allowed the appeal setting aside the District Court judgment which was entered in favour of the plaintiff.

3. Being aggrieved by the decision of the learned Judges of the Civil Appellate High Court, the plaintiff preferred the instant appeal, whereby this Court on 20.02.2019, granted leave to appeal on the questions of law set out in paragraph 13(a), (b) and (c) of the petition dated

02.04.2015.

The said questions of law are as follows, (a) Have the learned Judges of the High Court of Civil Appeal erred in law in failing to take cognisance of and/or appreciate the difference between a “Measure and Pay Contract” and a “Lump Sum Contract”?

(b) Have the learned Judges of the High Court of Civil Appeal erred in law in concluding that in a “Measure and Pay Contract”, the Respondent was not contractually obliged to pay on the actual material used by the Petitioner?

(c) Have the learned Judges of the High Court of Civil Appeal erred in law in concluding that in a “Measure and Pay Contract”, there is a requirement for the parties to have a further agreement to pay for the utilization for over and above the minimum requirement stated in the contract?

In addition, further leave was granted on the following question of law raised by the learned Counsel for the respondent, “Has the Plaintiff-Respondent-Petitioner proved that extra tonnage reflected in P17 (1) to P17 (139) was used under the contract?”

Facts in Brief:

4. The plaintiff company entered into an agreement with the defendant company to lay and compact an asphalt wearing course with 50mm thickness, on a 7m wide road of approximately 5.5km long, leading from Kurana Junction to Browns Beach Hotel Junction, according to RDA speci