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Debt Recovery

How To Get Paid

Debt recovery for Specialist Contractors in the construction and engineering industries requires specialist expertise.

Your cash flow is all important for you as a Specialist Contractor. Whether it’s a few £thousand or several hundreds of £thousands.

Unfortunately, the complex nature of construction contracts means that it is all too easy for Contractors to pay less than you are entitled to and/or pay you later than you should be paid!

So, if the Contractor or the Quantity Surveyor is not paying you, or not valuing your application or variations properly or is making a set off or contra charge against you, or payment is delayed, and you want to know if you can suspend the works, walk off site, adjudicate, arbitrate, or litigate then Ashmore Consulting have the answer.

You will benefit from a cost effective but highly specialised debt recovery service, which gets results. At the heart of that service is 40 years of construction industry experience, and extensive commercial and contractual knowledge, backed by professional training and legal qualifications.

"Now that Barry runs his own contracts consultancy, he particularly likes to represent the downtrodden, smaller organisations which are suffering at the hands of the larger corporations. Again, he achieves exceptional results and the added value of always being there for his clients. I can highly recommend Barry both as a colleague and a friend."

Cynthia Rich - (Owner) Cynergy Marketing Ltd

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You Don’t Have To Go Legal

You don’t necessarily have to go legal in order to get paid and we use our many years of experience to secure the recovery of your outstanding accounts prior to using adjudication or the court system. We will work with you to quickly establish your entitlements, no matter what trade you specialise in, and no matter what the terms of the contract are.

You will get fast effective no nonsense advice.

Once we established where you stand, we will suggest the most effective collection strategy which will normally include a detailed letter and telephone contact with your debtor. Putting the right kind of pressure on your debtor means that we can often collect your outstanding debt promptly, and cost effectively without the need for formal process.

If pre-legal collection is not successful, or if that isn’t a suitable approach then with your agreement we can of course implement the most appropriate dispute resolution service on your behalf.

"Ashmore Consulting provide no nonsense contractual advice that’s easy to understand and their professional consultants have solved several difficult payment situations. It was thanks to them that we got paid, so I would wholeheartedly recommend them to all Specialist Contractors."

Ian Radford Managing Director MI Electrical Solutions Limited

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Suspending Performance

Suspending performance of your obligations is a powerful incentive to make the Contractor put you at the top of the list when it comes to making payment.

Used properly, suspension is your best solution to prevent late payment.

Probably the biggest benefit included in the Construction Act provides that if payment is not forthcoming in accordance with the contract terms then the Specialist Contractor may; subject to proper written notice, suspend performance until payment has been received.

When money is in short supply it is often the Specialist Contractor who threatens to suspend work that is the one who gets paid first!

But you need to be extremely careful, because in the absence of an express contractual term, it is difficult to argue that a general right to suspend exists in law, as the courts have consistently refused to recognise such a right. Before using suspension provisions you must make sure you strictly follow the contract's notice and procedural requirements.

You can use our free initial advice service to discuss whether or not suspension is possible in your particular case. We have advised Client’s to suspend performance with extremely effective results.

"We employed Ashmore Consulting following a lengthy payment dispute between ourselves and a main contractor whose contract had been terminated by their client. Less than two weeks later all due monies were in our bank account!

The service we received was prompt, professional and affordable. We strongly recommend Ashmore Consulting to anyone needing help and advice with regards to any contractual dispute."

James Hunt Managing Director Select Facades Ltd

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Final Account Preparation and Negotiation

Preparing the final account is the process of calculating and agreeing any adjustments to the contract sum so that the amount of the final payment can be determined.

Construction contracts may in fact not require the preparation of a final account, although they generally do require the Specialist Contractor to provide all documents necessary for the adjustment of the contract sum within a specified time, and set out the time scale for and consequences of issuing the final certificate.

The contract sum may need to be adjusted for a number of reasons, including:

  • Variations
  • Fluctuations
  • Prime cost sums
  • Provisional sums
  • Payments relating to the opening-up and testing of the works
  • Loss and expense

Agreeing the final account can be a complicated, time consuming and adversarial process, often resulting in disputes. The process can be made easier if adjustments to the contract sum are agreed as the project progresses rather than saving them up for the end.

If you are having problems settling your final account we can help you to ensure that it has been prepared properly, and negotiate with the Contractor to get it settled quickly and cost effectively.

"Barry has proved to be a great find and excellent value for money. His expert knowledge of construction law and his day to day experience in the industry has proved invaluable.

His attention to detail and his passion to help the specialist contractor in often difficult circumstances has been invaluable. Barry is very hands on in his approach which is a welcome attribute for any consultant."

Chris Arkwell Managing Director CDI Group

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Resolving Old or Difficult Accounts

There is a simple legal maxim to bear in mind when dealing with old or difficult accounts and that is "he who alleges must prove".

Fortunately, in civil matters the standard of proof required to prove your claim is known as ‘on the balance of probabilities’. In layman’s terms this means, that based on the supporting evidence, you only need to be 51% right in order to show that what you are claiming is correct.

A well-prepared account is one that includes all of the relevant supporting evidence to confirm that what has been claimed for in the account is true and accurate and represents the value of the claim, and consequently on balance it is probably correct.

Unfortunately from experience many Specialist Contractors fail to submit a sufficiently detailed account, and consequently they end up losing out on thousands of pounds, as they make final account settlements with the Contractor for far less than is actually due.

Or worse still don’t get the account resolved at all.

We can review what you have submitted and help you to ensure your accounts are properly prepared, sufficiently detailed and contain the relevant supporting evidence.

With our help you will be able to prepare robust accounts that will ultimately prove their worth in negotiations with the Contractor, and enable you to put the right kind of pressure on the Contractor to get your account agreed promptly, and cost effectively.

"We now use Barry and his team as our ‘Defacto’ point of reference on all of our contract, payment and dispute ‘issues’. I cannot recommend Barry and his team highly enough, don’t struggle on your own, and touch base with him. Anyone who wants to know what they have done to help us personally then message me or call me but don’t think you have to fight on your own, there is honest help out there!"

Chris Hickling RCDD CDCDP Director Electron Technical Services Ltd

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Set Off, Contra Charges, and Liquidated Damages

If the Contractor is making a set off from your account or is deducting contra charges, there are steps you can take to resolve the situation.

First and foremost you need to take action and fast, because the situation is not going to get better of its own accord.

There is a significant difference between them saying it has cost £"x", for whatever reason and them being able to prove that;

  • it is definitely your responsibility and
  • they have actually incurred those costs

In both cases their claims, are exactly that "claims", and the burden of proof falls on them.

In other words they have to prove that these matters are your responsibility and that any costs they say they have incurred have actually been incurred, and that they are reasonable costs reasonably incurred.

Think of it this way. How much trouble do they put you to when you claim for variations?

If things haven’t gone well for the Contractor he is likely to seek to pass the responsibility for delays down the line to his Sub-Contractors. The Contractor will ordinarily seek to recover three main elements:

  • its own costs of delay - site costs, overheads, financing etc
  • its liability for Liquidated Damages under the main contract
  • its other subcontractors' loss and expense

Most standard form Sub-Contracts avoid Liquidated Damages clauses, and instead provide that the Sub-Contractor must pay the Contractor for its loss and expense resulting from the Sub-Contractor's alleged failure to complete on time. Contractor’s claims will inevitably include all three elements outlined above.

The evaluation and rebuttal of set off’s, contra charges, and liquidated damages requires an amalgam of construction knowledge, programme analysis, commercial nouse, and construction law.

We have advised Clients in relation to set off’s from a few £thousand to several hundreds of £thousands and helped them to achieve successful outcomes.

"I recommend all Specialist Contractors to get in touch with Ashmore Consulting… when we needed contractual support to fight a claim that was dragging on, they were there for us and we got paid within a month."

Trevor Kirby Managing Director Anglian Architectural Ltd

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Retention Recovery Service

Ashmore Consulting provide a specialist Retention Recovery Service delivering pragmatic solutions to Specialist Contractors who are struggling to recover retention monies.

All too often considerable sums are locked up in unpaid retention that Contractors should be releasing to their Sub-Contractors.

Retention is a particularly challenging area for Sub-Contractors. Prior to the October 2011 changes to the Construction Act, many Sub-Contracts stated that retention was released on practical completion and after the certificate of making good defects was issued under the Main Contract meaning that Sub-Contractors have been left waiting for retention money long after their works have completed.

Since 2011 many Main Contractors have opted for ridiculously long retention release periods and Specialist Contractors should carefully check the contracts you are being asked to sign up to.

But to recover retention that is currently outstanding, you can benefit from our extensive experience with solutions tailored to your particular needs, and overcome the frequent excuses used to delay or avoid paying what is rightfully yours.

What we do

Our approach is to use appropriate and effective retention recovery solutions tailored to your circumstances.

The cost effective solutions we offer include: forcefully written letters of demand, professional negotiation services, statutory demands and/or winding up proceedings and formal adjudication, arbitration or court proceedings.

You will find that our experience and expertise gets results quickly, efficiently and cost effectively.

If you are you struggling to recover your retention, why not contact us to discuss the options that are available to you.

"Sub-Contractor friendly, down to earth commercial and contractual advice and support that has already helped us enormously. Recovering retentions has never been so easy!"

Karl Bradshaw Director B&S Electrical Contractors Ltd

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For a FREE initial consultation call 01773 715062 or request a call back.

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