Contractor wins dispute over immediate payment of £85,000
A contractor has won its claim for immediate payment of £85,000 that was awarded following a dispute over work it had carried out for a developer.
The case involved Granada Architectural Glazing Ltd and RGB P&C Ltd (2019).
RGB had appointed Granada to carry out the design, supply and installation of curtain walling, windows and doors for a hotel project.
RGB complained about Granada’s performance and gave notice to terminate the contract on the basis that it had failed to remedy its breaches. Granada referred the dispute to an adjudicator, who decided that it was entitled to £85,089 plus interest.
Granada then issued proceedings to enforce the adjudicator's decision immediately without the need for further proceedings.
RGB sought a declaration that it had lawfully terminated the contract. It asked for a stay of execution to delay payment in case Granada was unable to repay the £85,000 if RGB was successful in the legal action it was planning.
The court ruled in favour of Granada. There was no evidence that it would not be able to repay the money if future legal action went against it.
There were no recorded county court judgments against Granada and trade invoices were paid on time. It appeared to be trading profitably and was involved in several ongoing contracts.
The purpose of the adjudication scheme was to mitigate cash flow difficulties by making payments promptly. There should be no stay of execution.
Please contact Jon Alvarez if you would like more information about the issues raised in this article or any aspect of contract law.