Streetwise Answers

We have undertaken a £1.9M M&E COntract for a main builder and at Final account stage (after releiving the majority of the project team of their positions) the Main Contractor's Commercial Director has set about the Draft Final Account with a vengeance and is citing the Client and the M&E consultant as the reasons for the 'reductions'.
The work was a design and build contract with a performance specification.
It has dragged on for months and I would like to escalate the process but am not sure which way is best to proceed.
To make matters works, we offered an additional 2.5% discount for 30days payment and he has not once paid on 30days - Am I within my rights to remove this 'discount' on my draft final account.
(Regrettably I was not involved at the outset or during this project, just picking up the pieces!) - Any advice would be appreciated.
Joe Makepeace
M&E Contractor

Hi Joe

Your situation is not un-common I am afraid. Unfortunately it is all too easy for Contractors to pull this kind of stunt.

I need to break down your question into different parts so please bear with me;

1 Your contract is with the Contractor so in effect we are not bothered what the M&E Consultant or the Client think. Of course we might take their comments into account but it could easily be that you have a claim for the variation against the Contractor but he doesn't have a claim against the Client.

2 It might be appropriate to try and get a meeting between all parties but only if it can be done quickly and effectively.

3 The discount issue will depend on the terms and conditions which apply.

4 Last but not least - getting the matter resolved. I would agree with you that you need to escalate the matter. However, you need to consider the best way to do that and to check carefully what dispute resolution provisions are provided in the contract.

Depending on the nature of the site,the provisions of the Housing grants Construction and regeneration Act 1996 may apply.(i.e. if your works were "Construction Operations" as defined in the Act). If so you have certain rights under the Act.

It may be that an appropriate letter from one of our Registered Specialist Consultants will get the matter resolved quickly and easily for you so someone will be in touch soon to obtain more details.

Best regards

Barry

Posted by: barryashmore - Return

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