Their set-off clause reaches into our other contracts
A deduction earned on one job can land on this one, and we signed it.
What's happening?
Cross-contract set-off makes every job with that counterparty one account: a dispute on site A becomes a deduction on site B's certificate, and the healthy job funds the argument on the sick one. The clause is usually short, buried in the amendments, and signed without anyone pricing what it does - which is to turn each contract's risk into every contract's risk.
Caught at review, it is negotiable: struck out, capped, or confined to sums actually agreed or decided rather than merely asserted. Signed, it changes how the portfolio has to be run - positions kept clean on every live job with that counterparty, because any of them can become the collection point. Whether a particular deduction was validly made is one for a solicitor; knowing the clause is there before pricing the next tender for the same employer is commercial self-defence.
The solution
The reach of their deductions known before the next tender.
