The Situation

Our client had completed a construction project in East Yorkshire comprising multiple apartments, external communal access, and associated external works. The contract administrator inspected the works, was satisfied they had been completed to specification, and issued an interim payment certificate for £44,000 with a final payment date of June 2022.

The debtor company did not pay. Instead, weeks after the payment deadline had passed, they raised complaints about the roofing works and claimed that defects in the installation would require the entire roof to be removed and replaced at a cost that would far exceed the certified amount. This was used as justification for withholding the full payment.

The difficulty for the debtor company was that none of this had been raised through the correct contractual channels. Under the terms of the JCT contract, if the paying party intends to pay less than the certified amount, they are required to issue a valid pay-less notice within a prescribed period before the final date for payment. The debtor had not done this. The complaints came after the deadline had passed, outside of the contractual mechanism, and without any formal basis for withholding funds.

By the time Turner Clifford was instructed in September 2022, the payment was three months overdue and no progress had been made towards resolution.

Our Approach

We started with the contract. Before writing a single letter, we reviewed the JCT agreement in detail, studied the payment mechanism, and identified the critical issue: the debtor had not followed the correct contractual process for withholding payment. Under the Construction Act and the Scheme for Construction Contracts, this meant they were obligated to pay the full certified amount regardless of any complaints raised after the fact.

Identifying the issue was one thing. Building a case around it that would hold up under formal scrutiny was another.

Construction payment disputes are a core part of what we do, and we knew immediately where the debtor's position fell down. The legislative framework around pay-less notices is well established, and previous court decisions have consistently upheld the principle that a failure to serve one on time means the certified amount is payable in full. We applied that knowledge to the specifics of this contract, verified the relevant timelines and clauses, and confirmed that the debtor's position was untenable before writing a single letter.

We then set about explaining this to the debtor in terms they could understand. Their belief was that raising defects gave them the right to withhold payment indefinitely. It did not, and we needed them to understand why. Over a series of detailed written communications, we walked them through the contractual clauses, explained the payment certification process, referenced the legislation and case law that supported our client's position, and made clear what the consequences of continued non-payment would be. Each communication was designed to close off another line of argument and narrow the debtor's options.

At the same time, we managed the broader commercial relationship. Our client had offered generous settlement terms, including waiving their right to claim a further billable works on top of the certified amount. We presented this offer and gave the debtor time to consider it. When they insisted on waiting for a roof survey by the material manufacturer before making any decision, we facilitated that process rather than escalating prematurely.

The survey confirmed what our client had maintained throughout: the issues were minor snagging items and design-related concerns, not installation defects. There was no need to remove and replace the roof. Despite this, the debtor still did not pay.

At that point, we moved to formal dispute resolution. We prepared the adjudication referral notice in-house, a detailed legal submission setting out the breach of contract, the relevant contractual clauses, the legislative framework, and the remedy sought. We filed this under the Housing Grants, Construction and Regeneration Act 1996 and coordinated the appointment of an adjudicator through the appropriate nominating body.

Within days of the adjudicator being appointed, the debtor confirmed they would pay in full. No hearing was required.

The Results

£51,405 recovered in full, comprising the original payment certificate, plus interest, fixed compensation under the Late Payment of Commercial Debts Act, recovery costs, and adjudicator appointment fees. Payment was made by January 2023.

This was achieved against a debtor who had withheld payment for over six months and whose position was that defects in the works justified withholding the full certified amount indefinitely. The moment the adjudication process began, they paid in full.

What This Demonstrates

Construction disputes have their own rules. Payment mechanisms under JCT contracts and the Construction Act exist to protect contractors from exactly this kind of situation: completed work, certified payment, and an employer who decides not to pay.

The debtor company in this case believed that raising defects gave them the right to withhold the full certified amount indefinitely. They were wrong, but it took detailed knowledge of the contractual framework and the confidence to enforce it to make that clear.

This is the kind of case that would typically be referred to a construction solicitor, and most contractors would have accepted that as the only option. Turner Clifford handled the entire process from first letter to adjudication referral without external legal representation. We identified the contractual weakness, built the case, managed months of correspondence, and prepared the formal legal submission that brought the matter to a close.

Over £50k recovered. Six months of refusal overturned in under a fortnight once adjudication began. No solicitor required.