Potential Insolvency Brings Stay of Payment

3rd September 2014 10:16 am Leave your thoughts

Normally, when a building dispute arises that leads to an adjudicator making an award in favour of one party, the award is simply paid to the other party and that is that. However, sometimes things are more complicated.

Recently, a company went to the High Court arguing that it should not have to pay an adjudicator’s award in favour of another company because it had counterclaims to pursue against that company and, critically, a winding up petition had been issued against the other company. It argued that it would be unfair for it to have to pay the sum decided by the adjudicator to a company which might be insolvent.

The Court refused to pre-judge the fate of the winding up petition but, since the company had not contributed to the potential insolvency of the other company, ordered that the payment should be ‘stayed’ until the outcome of the insolvency proceedings was known.

If you are owed money or are in dispute with a company that is threatened with insolvency, contact us for advice on how to protect your position.


Categorised in: Company and Commercial Law, Latest news

This post was written by Colemans Solicitors LLP

© Colemans Solicitors LLP, 2018
Authorised and regulated by the Solicitors Regulation Authority no. 459897. Legal Disclaimer

The information given on this website is not a comprehensive review of the law and practices in this area and does not constitute legal advice on a specific issue. Colemans Solicitors LLP does not therefore accept liability if you rely on or apply this information to your specific situation without taking bespoke advice. To seek detailed legal advice in relation to your specific circumstances or transaction please contact us.