Sam Bawden, Partner and Construction Law solicitor, acted for a main contractor which had been engaged by a high profile non-UK national billionaire and his wife, to carry out alterations and refurbishments at their high value London residence. A dispute had arisen in relation to the final account, which the parties had ultimately settled. The agreed final account figure was £2,725,000 plus VAT, of which the employers had not paid slightly short of £450,000.
By way of a settlement agreement, the employers agreed to pay the main contractor the remaining balance within 14 days. However, despite their obvious ability to make payment within that period, they subsequently failed to do so. No reason was given for the non-payment. The employers, through their PA, made repeated promises to pay. Approximately 2.5 months after the due date, the employers made a payment of just £125,000.
Given that the final account dispute had been settled, by agreement, and the employers had made numerous promises to pay, there could be no real defence to the contractor’s claim for payment.
Notwithstanding that the employers were regularly moving between different countries, Sam Bawden was able to arrange service of a statutory demand (the precursor to a bankruptcy petition) on the billionaire and his wife. This prompted a further payment of £75,000 and a further promise that the outstanding balance would be paid imminently. It was not.
Sam therefore issued a bankruptcy petition in the High Court, which ultimately prompted payment of the final balance of circa £0.25M.
Sam's belief throughout the matter was that the employers were deliberately stalling, merely to be difficult and perhaps in the hope that the contractor would give up (particularly given that litigating against parties in different countries can be slow and somewhat cumbersome). However, with a bit of determination and ingenuity, Sam was able to present the employers with a bankruptcy petition, to which they had no legitimate defence and which would have caused them significant difficulties, not to mention international embarrassment, if it had resulted in a bankruptcy order being made against them.