Recession is driving up the number of court claims, according to reports in Construction News. The latest annual report from the London Technology and Construction Court showed that the volume of work had increased by 25% compared with an average year. This is despite the workload declining, points out the magazine.
Some 502 claims were brought between October 2009 and September 2010, well above the five-year average of 409 claims per year. The judge in charge of the Technology and Construction Court Robert Akenhead said the figures showed a “sustained high workload over the past two years” as the number stayed broadly flat compared with the 516 cases recorded in 2008/09.
The increase in cases is seen as a consequence of cash flow problems and contractors looking to cover for the taking on jobs at suicidal bids.
Meanwhile, the recession continues to bite as more firms struggle to survive. This week, modular building specialist Britspace went into administration putting 200 jobs at risk, reported Construction Enquirer.
Administrators from restructuring and insolvency specialist FRP Advisory LLP have taken over at the East Yorkshire based firm and are looking for a buyer. Britspace has been in business since 1972 and specialises in off-site manufacturing, Construction Enquirer reported.
Long winded and costly litigation is not the best of ideas if you are having cash flow problems. Consider mediation for the benefits of speed, economy and flexibility of settlements. In addition, mediation is informal, non-adversarial and enables the parties to retain control of the dispute. As a practising mediator, with a background in construction (FRICS, MCIOB) I am happy to give free and confidential advice to any construction companies considering litigation. Visit http://www.michael-dawson.co.uk.