Contractor “delighted” after winning appeal over late payments
Posted: Tuesday, August 20th, 2024
The boss of a West Sussex contractor won a Court of Appeal challenge over a late payments dispute with a housing association, Construction Management reported.
He says he is “delighted for the construction industry” over the unanimous decision.
East Grinstead-based Providence Building Services appealed a ruling that declared it was not allowed to terminate a contract with its employer following repeated late payments.
In this case, the contractor had entered a JCT contract with Hexagon Housing Association Ltd to construct some buildings at a site in Purley.
Under this contract, Hexagon was committed to paying a £260,000 bill related to this job by 15 December 2022 but failed to do so. Another invoice for £360,000 was also not paid on time. The issue escalated, and Providence issued a notice of termination and walked off the job.
Hexagon eventually paid the outstanding bills but challenged Providence’s contract termination. The housing association referred the dispute to the adjudicator, who ruled in its favour in November 2023.
Adrian Williamson KC, sitting as deputy high court judge, agreed with Hexagon’s counsel, who said the contractor had “a battery of weapons available to him to protect his cash flow position”, including the right to suspend the works, the payment of statutory interest and the right to refer disputes to adjudication.
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