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    Read about how PCR have made things better

“PCR having the foresight to involve us early on allowed us to assist them in maximising realisations.”

Quantity Surveyor

The Situation

This UK based construction business based in the South East of England, having weathered the recession, won a significant contract as sub-contractor for a mid-tier main contractor working on a residential development. The contract would ultimately be profitable but the margins were tight and the Company had to source funding and credit for materials and labour.

The contract provided for stage payments and the Company was able to service the contract with careful planning and cashflow management. However, the final stage payment request was not settled on time and when queried, the main contractor cited deficiencies with works. The vast majority of the defects were disputed as being damage caused by other contractors, but in a gesture of goodwill and to facilitate the payment being made, the Company undertook the majority of the remedial works.

The main contractor still refused to settle and issued notice of termination of the contract. The Company had limited funds to meet ongoing costs and could not afford to instruct solicitors.

The Process

The directors sought advice from PCR LLP who advised that the Company should be placed into Liquidation. Once appointed the Liquidators and specialist quantity surveyors reviewed the contract, met with relevant personnel and challenged the basis and process of the purported termination.

The main contractor disputed the arguments put forward and refused to consider the claim. The Liquidators instructed solicitors with a view to commencing proceedings. At this stage, it was apparent to the contractor that the appointment of Liquidators had given the Company more options and a request for mediation was received.

At the mediation a settlement equal to 75% of the outstanding debt was reached.

The Outcome

The prompt actions of the directors in seeking advice meant that the momentum of the disputed claim was maintained by the Liquidators, which in turn meant the professional advisers were able to quickly and accurately assess the circumstances and advise accordingly.

The resulting settlement at mediation enabled the Liquidators to settle the claim without the need for costly and lengthy Court proceedings, which improved the outcome and facilitated an early dividend to creditors.

PCR Logo HomeCan we help you?

Businesses of all sizes, operating in every sector, will at some point be faced with circumstances that threaten their future. PCR provide specialised advisory services for business rescue, transition, exit or winding up. 

  • Ambitious companies seeking to grow can benefit from discreet expert advice and assistance in planning and executing organic or acquisitive expansion. Our extensive business and finance network can deliver significant opportunities.
  • Companies trading under difficult circumstances need our specialist advice and services, helping Directors to fully understand their responsibilities to investors, creditors and employees when working to turnaround a struggling concern. PCR always try and rescue an ailing business and have a proven track record in business recovery.
  • Business owners or shareholders seeking to exit or close a solvent company in the most advantageous and tax efficient manner should contact PCR for discreet and confidential advice.
  • Cash flow is the life blood of every company and bad debts or inefficient credit management can lead to business failure. PCR deliver highly effective debt collection and management services.

PCR do not have a magic wand to cure a poor balance sheet, but we are here to provide discrete sympathetic advice on individual responsibilities under law and the best strategies moving forwards. We are not interested in apportioning blame, rather we are here to try and fix things, and the earlier we are consulted, the better the options for recovery. Even if you are experiencing a temporary downturn and hope to trade yourselves clear, you must seek advice, or it is possible that should things go wrong you may be exposed to personal liability.

In short, if you have even the slightest doubt about the health of your business there is nothing to lose from talking to PCR. It won’t cost you anything to gain an independent view of your situation. Even when the outlook is bleak, contacting PCR has often marked the moment when our clients are able to start looking forwards in a positive manner.

Contact PCR for swift and confidential advice ››

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