Will Late Payment Claim mean stopping work or going to adjudication?
Not unless you choose it: the demand and negotiation come first, and we set out what suspension or adjudication would cost and risk.
Updated: . By Jack Butler-Kettle, Construction Claims Consultant.
The answer
The work starts with triage. We check which sum is due after the notices and whether the final date for payment has really passed. We check what the subcontract says about interest, suspension and any upstream condition. We also rate how strong each part of the debt is. Then we build the position: the sum due, with interest from the day after each final date, and any recovery costs. The demand goes in your name with a date for payment. If payment still does not come, we prepare the notice of intention to suspend for you to serve, and cost the suspension. Or we prepare the money side of an adjudication and work alongside whoever runs it. If it is unclear whether a remedy is open to you, that goes to your solicitor first. The fee is fixed and agreed in writing after we have reviewed the payment record. Where the work runs in stages, each stage has its own fixed fee, agreed before it starts.
Example
Illustrative example. The scenario and figures are invented.
The facts
A groundworks subcontractor is owed £48,000, 18 days past the final date for payment. It has two gangs on site that it does not want to stand down.
What happens
- The triage confirms from the notices that £48,000 is the sum due and that its final date has passed.
- The demand goes out in the subcontractor's name, with interest from the day after the final date and a date for payment.
- The options beyond the demand, suspension and adjudication, are set out with what each would cost and risk.
- The main contractor offers to pay in two instalments, and the subcontractor accepts.
The outcome
The debt is dealt with by the demand and the negotiation that followed, and the gangs stay at work because the subcontractor chose that route.
To have an overdue sum demanded with interest and the next steps set out, see our Late Payment Claim service.