For there to be an agreement which is binding, (even verbal agreements are binding if the details are not in dispute) there needs to be an offer and an unqualified acceptance. If it’s not an unqualified acceptance (subject to something) then the qualified acceptance is account offer subject to the original party accepting.
It appears here but the was a binding agreement where you were to renovate the whole cottage. Presumably on that contract you would have made profit and had some labour costs and you would be entitled to recover from the property owner the profit and some of the labour cost. You would be able to recover all of the labour cost because you haven’t done all the work and to recover it all would be a windfall.
If the little extension was part of the original job, then you would be entitled to do the extension plus recover your profit on the original job.
If you had started the extension, in isolation the original job they can argue that you accepted the cancellation of the original full job in consideration of the small extension. If that were the case, but you are bound to finish it and to do so within a reasonable period of time under the provisions of the Consumer Rights Act 2015.
If you priced the whole of the big job together and there was economy of scale which makes it that you cannot proportionally do the extension by just having a pro rata price, then provided you have not agreed to do the extension for that price, then you would be entitled to be paid the correct price. If however you have already agreed to do the extension for a particular price you are bound to do it for that price provided you have not made manifest error such as quoted £1000 when it should have been £10,000.
From what you have said, I think you are bound by the agreement to do the extension. However they are bound also in respect of the original work and if they are not having the original work done, they are responsible for your loss of profit.
You should tell them that you will come back and do the work but if they are insisting on it, you want the profit that you lost of the original job which they cancelled. You can also tell them that if you don’t finish this job, and they take you to court, you will counterclaim for the loss of profit on the original job.
Can I clarify anything for you?
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