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Builder Debt - and routes to recover

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We employed a contractor to run a building project. Fast forward three years

- they went over time, over budget and now owe us money. 


Contract details as follows:


  • JCT Intermediate Building Contract 2016
  • Contract signed early 2017
  • Work commenced early 2017, due to complete end 2017
  • The contractor is a sole trader, not a LTD


We have finally (just) finished after almost 3 years. 


Due to the overrun, contractor over-spending, some dubious valuations by the contractor, the need to pay for some contracts / sub-contractors directly, we finished with the contractor owing us money (c.£40k)*. 


An Interim Certificate was issued by the Contract Administrator in late 2019 which, per the contract, gave the contractor two weeks to pay.

  In parallel, Liquidated Damages (additional £10k's) were also charged due to the project overrun.*


These two amounts remain unpaid, and so are now debts under the contract and subject to interest.


*Note re how we got here: We know this is a significant debt / sum of money. 


We assessed all other possible routes / ways forward at the time; and continuing was the least worst option. 

We got quotes for other contractors to complete the work, and continuing as is was the quickest, cheapest and least stressful option. We have done everything in our power to minimise the debt, and we have fought to keep this moving until the end. 


The contractor was out of his depth and got into debt with his sub-contractors. We believe we have come out of this with the best result given everything, but we knew we would need to sort out the mess at the end. The Contractor agreed at the time. He acknowledges that there is a debt to pay. We are also aware of other debts that the contractor has too. So, he is not in a good place.


We have tried to reach an agreed way forward to settle the debt. We had a lawyer draw up a repayment agreement. But, we have been unable to settle on a repayment period. Clearly, we wanted it to be repaid quickly, with some security. 


The Contractor has proposed a 7 year repayment plan with no security (i.e. a charge), which we think this is too long. But he has stressed it is the "most he can afford", and this will take him well into retirement age which is also a concern.


We are also looking at a claim against the Contractor via the site insurance we took out at the start. The insurer has requested an Independent Expert Report and suggested we need to go thought Adjudication (RIBA) prior to legal action. We have asked them what this needs to cover exactly, as there is no dispute it is just that the contractor does not have money to pay the debt. We are awaiting a response.


The reason for the post is to seek any thoughts / advice on how to proceed?  There are a few options on the table, these are:


  1. Sign a repayment agreement (ideally quicker than 7 years and ideally with some security / a charge on his house as not LTD) Other than a charge on his house, what other security options can we look at?
  2. Complete the Expert Report and Adjudication as requested by the Insurers, then progress a legal case (this will cost us £ thousands)
  3. See if we can claim on the Contractors Site or PI Insurance (I doubt this, but will check)
  4. Start legal action privately (initially sending a Letter before Action, this could cost lots)


We have spoken to a lawyer re the 4th option, but welcome views on this forum on such action at this stage.


We welcome any other suggestions / thoughts on best ways to move forward?


Kind regards.

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is this:



please don't hit Quote...just type we know what we said earlier..


if everyone stopped blindly paying DCA's tomorrow

the biggest financial industry in the UK, the whole DCA industry would collapse overnight.



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Hi - the previous post is part of the same house, that was in relation to a staircase and a very dodgy steel fabricator that has now gone into liquidation.


This post is regarding the main contractor.  It was partly down to the main contractor that the stairs were delayed.


Re this post - we are stuck regarding how to best to proceed.  Any thoughts greatly appreciated.


Kind regards,



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Anybody?  Any thoughts / ideas / experience recovering debts under a JCT contract?

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