Get Paid Quick - Construction

In a previous newsletter we set out the usual ways of resolving construction disputes. Most disputes ultimately are about money, and usually for contractors and subcontractors it is about getting paid for work done.

In the present economic crisis, many companies and individuals are having difficulty in paying sums that they owe. This leads to them holding on to any money that they do have as long as possible, and trying to avoid payment.

We are instructed on many occasions by clients who have not been paid, where there is no reason for that non-payment. The amounts involved range from a few thousand pounds to several hundreds of thousands of pounds.

Taking court proceedings or arbitration proceedings gives the non-paying party an opportunity to defend claims which can take many months to be concluded. Even adjudication, although it is quick, can give an opportunity of defending the claim to the non-paying party and can take several months to be concluded. You may also then have to go through enforcement in the Technology and Construction Court.

A quicker way to get at least some pay- ment may be to serve a Statutory Demand. This gives the non-paying party 21 days in which to pay, failing which you can issue a Winding-up Petition or Bankruptcy Petition against them. This usually has the effect of bringing payment to our client to the top of the pile, rather than it languishing
at the bottom. It is the hardest-hitting step that can be taken and usually means that at least the vast majority of the monies owed are paid.

A Statutory Demand should be used only where there is no dispute over the debt. We usually serve these on the non-paying party on the same day as being instructed by our client. Service can be by electronic means as well as through the post. They are very effective and although there are risks involved, those risks are usually outweighed by the potential benefits.

If you have outstanding undisputed debts, why not contact us to use this efficient process at recovering payment?

The contents of this article are intended for general information purposes only and shall not be deemed to be, or constitute legal advice. We cannot accept responsibility for any loss as a result of acts or omissions taken in respect of this article.