UKL Projects case study

UKL Projects specialist in modular, retail and commercial fit outs. The Sheffield based business delivers projects across the UK for leading supermarkets, as well as MOD and MOJ. The company was upscaled in 2014 ad has continued to grow rapidly as a second tier subcontractor within the construction industry supply chain.

As the firm grew, it began to face a number of challenges and following a dispute with one client, Directors began to research the commercial aspects and legal implications of the dispute. Unable to resolve the issue with a round table sit down, it soon became clear that a lack of understanding and awareness of contracts put the Directors at a disadvantage.

Having identified CE Law and the National Legal Consortium via the web, representatives from the legal firm met with UKL Projects Directors and were introduced to the subscription based service that the NLC is based on.

Rayno De Kock, Director, explained: “For us, legal challenges were always something that we avoid, as we are well aware of the potential cost implications, however, this approach clearly wasn’t working for us. By signing up to become a member of the NLC, we have unlimited access to legal advice which is fantastic.

“The concept is an absolutely brilliant , we are now in the position of being able to give the NLC a contract which they review and returns with any concerns, which is invaluable. We’ve also been involved in a number of client disputes where they have offered a great deal of sound advice. We’re  currently in a situation of none payment by client which the NLC is supporting us through.

“As a subcontractor, we would not have had the time or money to seek legal advice in all these cases and would undoubtedly have lost money. What the NLC gives us is confidence that we can address legal matters and are being given the best sector specific legal advice available.

“We have already subscribed for a second year and would recommend any other subcontractor in our industry to follow suit.”

Commercial Building Contractors

Cannock-based Commercial Building Contractors, deliver a ‘turnkey’ solution for the installation of quality interior fit out projects, refurbishment and internal building works.

The firm offer a complete interior fit out service from simple joinery installations to complete multi-disciplinary projects as well as sub-contracting to larger contractors involved in the leisure, education, health and retail sectors.

Neil Hill, Managing Director of Commercial Building Contractors contacted CE Law several years ago and has utilised their services on an ad hoc basis ever since. Upon formation of the NLC by the team behind the CE Law, a legal service launched specifically for the subcontractor, Neil took the decision to join, gaining unlimited access to construction law advice.

With fees based on turnover, at £500,000, Commercial Building Contractors pay a monthly £180 subscription fee.

Neil Hill, Managing Director explains: “I’ve managed and owned subcontracting businesses for many years and there is a definite notion that the ‘subbie’ should remain subservient to the more powerful main contractor. Withheld payment, unreasonable demands and much more is fairly standard in our industry, often on the basis that the subcontractor won’t be able to tackle any legal or financial challenges.

“What the NLC essentially offers is unlimited legal advice from a construction law specialist. During the past 12 months, I’ve used the NLC many times accessing day to day legal advice over various issues from none payment to concerns with contracts, orders etc. The NLC has issued several letters on our behalf which has undoubtedly prevented the issue from escalating to court, ensuring the client payed before, saving significant time and money.

The NLC is particularly effective if your projects are for end user clients, as the process can be slightly different when it comes to recovering outstanding debt; where construction contracts are not in place and are often based on a simple order or verbal agreement.

We have also found the NLC useful; not just for securing overdue debt from customers, but also for tackling disputes with our own sub contractors/suppliers; ensuring that payless notices are issued properly and responses to court claims are dealt with in accordance with relevant legal procedures and in a timely manner.

“The NLC really makes sense for subcontractors and I've recommended the service to several colleagues. I've recently renewed my membership to the NLC and feel that it’s the best money I’ve spent this year by far!”

Brital Rkg Ltd

For over 20 years, Brital Rkg Ltd specialises in the installation and repair of high performance Aluminium glazing systems encompassing windows, doors, shop fronts and curtain walling. Continuous growth has seen the company become a major supplier of architectural Aluminium, Glass and Louvre systems throughout the UK and Ireland.

With a workforce of 20-plus staff, the firm works as a subcontractor to many main contractors throughout supplying bespoke systems across a arrange of sectors.

Managing Director, Dave Grigg, has faced a number of legal challenges during his 38 years in construction, a significant amount arising whilst owner/managing director of Brital Rkg Ltd. Being faced with a specific legal challenge last year, Dave was forced to seek legal advice and contacted the NLC. Following initial discussions and having discovered more about the unique service and subscription based approach, he signed up to the consortium for 12 months

Dave explained: “I’ve had lots of experience working with various solicitors but few have specialised in construction. It’s this in-depth knowledge that I have been looking for and have undoubtedly found it in the NLC.

“For a flat monthly fee, we are able to access unlimited specialist construction legal advice. We have had several issues that have been resolved by the NLC via email, telephone and in a formal mediation setting. One of these cases alone has paid for the annual NLC subscription – this is the best money that I’ve spent in quite some time.

“Alongside many other subcontractors in the industry, I find time and time again that customers withhold payment particularly on final payment. In a typical case of subbie bashing, main contractors will ‘try their luck’ in the knowledge that the sub-contractor often won’t have the resources or finances in place to challenge this.

“This is a brilliant concept that enables businesses similar to mine to be able to tackle any legal situation. I have recently renewed my membership for the following 12 months and can’t recommend the NLC more and would suggest any sub-contractor join. By being a member the subcontractor has the confidence and security to address any legal situation and not feel oppressed and overshadowed by the often more powerful main contractor.

It really is a case of David now having the resources to tackle Goliath.

NLC in action.

Our client is a small but successful buildings maintenance company based in London. It was approached by an Estate Agent on behalf of a Management Company to undertake some relatively minor work on an empty property.

Our client prepared a detailed quotation which provided that it would remove and dispose of the furniture in the property as the property was to be offered as unfurnished.

The quotation was accepted by the Estate Agent on behalf of the Management Company.

The works were completed, and my client submitted its final invoice for £4750.00. The Management Company wrote denying liability for the invoice on the basis that it had not wanted all the furnishings removed. It said that it had expected certain items to have been kept. It was claiming the cost of replacing the furnishings and refusing to pay the invoice on that basis.

Our advice was that the Management Company was bound by its Agent’s agreement of our client’s quotation. Although we tried to persuade the Management Company to pay the invoice it refused to do so and our client was left with no alternative but to issue proceedings in the Small Claims Court.

As a client of the National Legal Consortium all the work undertaken for our client was paid for by its monthly agreed fee of £240. When proceedings became necessary our client was able to have Small Claims Proceedings prepared and issued for the cost of its monthly agreed fee of £240. The only cost to the client of the preparation of its case was the court fee which is recoverable if it wins the case. Although the NLC does not pay for an advocate in Small Claims Proceedings the client is happy to pay the £150 plus vat fixed fee for an advocate for the hearing of its claim.

Had the company not been a client of the NLC then unless it was prepared to undertake the issue and preparation of the proceedings itself, it would have had to pay a solicitor by the hour (typically £240 plus vat an hour) and the costs of the solicitor may well have been as much as the sums claimed. As it is not possible to claim solicitor’s costs in Small Claims Proceedings this would have meant the proceedings were uneconomic to pursue.

The National Legal Consortium unlocked the ability to take economic proceedings for this client for the cost of its monthly agreed fee of £240.

For more information about the National Legal Consortium visit www.nlcuk.net or call David Jackson on 0800 085 7772.

Covering all Bases

A small flooring company in London was not paid £12500 for work it had undertaken. The reasons why its application had not been paid were set out in a Pay Less Notice. The allegation was that ply had been installed when no ply had been ordered for the works. An examination of the client’s quotation showed that it listed ply as part of the works that were to be undertaken. Further, the client had not used all the ply it had quoted for and had given a credit for the ply it had not used.

Overall it appeared that the client had a good case. This was a case of the Employer concocting an argument in the knowledge that the sum in dispute was not very great and was probably uneconomic to pursue by adjudication or court proceedings. The Employer had probably calculated that with no easy way to take proceedings the client would be forced to accept whatever deal it could secure on its unpaid application.

As the sum in dispute was high than £10,000 the matter could not be dealt with as a small claim and would have to proceed in the fast track of the County Court. That would take up to 12 months (or more), cost more than the sum in dispute and importantly expose the client to a claim for costs in the event that it lost some or all of the arguments.

Adjudication proceedings would likely cost £3500 - £5000 plus vat depending on the arguments before the adjudicator. In addition, there would be a £425 nomination fee for the appointment of the adjudicator. Those sums are not recoverable which meant that the best that the client could hope to gain from adjudication proceedings would be £8500.

In those circumstances the advice may be to settle for the best terms possible.

However, as a client of the NLC, paying £240 per month the client was able to issue adjudication proceedings as part of the service. The only cost to the client was the £425 nomination fee. The proceedings have not yet been completed but the client stands a good chance of an award for the full £12500 and will get all but £425 of that sum.  Had the client not been a client of the NLC the adjudication proceedings would have been uneconomic – a good reason for joining the National Legal Consortium!