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Bespoke Contract - Contract "Determined"

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My partner and I run a cleaning company and we have been carrying out after-build cleaning for a local house builder. We are operating on 2 sites for them, one of which is running successfully and the other one we have ran into some problems, and this is where I need some advice.

There have been errors from both parties, but ultimately it led to us being told to leave site halfway through the day on October 31st because they had customers ready to move into the property, and we hadn't finished the cleaning.

On the 1st November I received an e-mail from the Contractors Senior QS which had the subject line of "7 Days Notice" and in the main body of the e-mail it started in bold capital letters and underlined "WITHOUT PREJUDICE". He then went onto say that he was serving us our 7 Days Notice but he didn't specify under which clauses of the contract this related too (seems like its based off of a JCT).

We weren't allowed to return to site in those 7 days to improve on the issues, and then on the 8th November I received an e-mail from the SQS stating that our contract had now been "Determined" and that they were withholding all of the outstanding money from our October application.

The payment dates are as follows;
Application Due: 26th of the month forecast till month end.
Due Date: 7 Days after the end of the month
Not later than 5 days after the due date the contractor shall give notice to the subcontractor specifying the amount (if any) of the payment (the notified sum).

The SQS hasn't sent any sort of Payment Notice or withholding notice to us, and I think he thinks that because the contract has been "determined" in his opinion he doesn't need to send any payment notice.

So, there are a few things going on here and I want to know where I stand and what I can do.

1. I don't believe the procedure for the termination has been carried out correctly, by that I mean he hasn't issued the 7 days notice correctly. He starts the email without prejudice and then doesn't specify any clause in which he is serving notice. And then doesn't allow us the 7 days to rectify any problems.

2. Even if the above stands, he now hasn't followed the correct payment procedures.

I sent the Commercial Manager an e-mail expressing my concerns that the termination procedure hadn't been followed correctly and they are withholding outstanding monies. I then went to meet the Commercial Manager and Director to discuss this, and they ran through a list of items which deducted payment, and said that it was going to cost them money to bring in another cleaning contractor which they should be invoicing me for, but they would be happy to just agree a final application of £0 and part ways. This makes me think that they know they haven't followed procedure.

What I need to know is, where do I stand with all this? Could I actually be billing them for lost profit?

Any help is greatly appreciated.
asked Nov 29 in Contractor Claims by SimonOP (120 points)  

1 Answer

0 votes
From what you have said, 'there have been errors from both parties', it look as though there have been issues of contractual non-compliance, which could well have an influence on an outcome.

It is not possible to provide any meaningful comments without knowing; the background information, what the contract actually says, along with a detailed timeline of actions from both parties.

In your situation I would suggest taking specific advice, although bearing in mind what the actual disputed amount is and how much it would cost to realistically pursue any entitlements.
answered Nov 30 by Andrew WI (13,250 points)