Advocate Commercial Debt Recovery has successfully recovered £75k from a construction firm less than a week after being instructed. Our client is well known in the industry for having a vast range of in-house surveying disciplines able to support construction projects in everything from obtaining licences to quality control and environmental impact assessments. Whilst the debtor has a nationwide footprint, they engaged our client to help navigate the unique difficulties with two sites in London sandwiched between monuments and protected land. With limited space for access through heavily pedestrianised zones, the project would call upon all our clients’ specialities. Coming in under budget for the final phase and invoicing a tame £75k, our client rightly expected prompt payment.
Supply Chain Impact
As a main contractor, the debtor had an obligation to ensure all subcontractors were paid on time. Payment delays in the construction industry can quickly send shockwaves down the supply chain. Having been paid promptly for the previous phases, our client grew concerned when rumours reached them of other subcontractors not getting paid. The debtor was now giving our client the silent treatment, ringing further alarm bells. With invoices reaching two months overdue and their year-end fast approaching, our client had to act decisively and instructed Advocate.
Making Debt Pay
On first contact, Accounts Payable claimed the invoices were billed to the incorrect legal entity and on incorrect payment terms. Having been provided with the original contract, Advocate was able to refer the debtor to the copy invoices already provided and relevant contract clauses to show that everything had been billed correctly. Accounts Payable then tried to use the director’s sign-off and staff holidays as excuses to delay payment further. Advocate declined to back down, warning that a Final Demand would be issued, incurring additional statutory charges if payment was not received. Our position was clear – the client completed the work, invoiced in line with the contract, and had every reason to expect payment. Next, they claimed Advocate needed to go through a supplier set-up process, which would take at least two weeks and that our client’s £75k would be delayed for the duration. Again, Advocate declined to back down, emphasising that statutory late payment legislation negates the obligation to adhere to in-house paper pushing processes. On day four of our action, we received the first positive response from Accounts Payable, who advised they expected to get the final director’s signature within 24 hours. This would release payment. The following day we received word that payment of the client’s £75k plus the statutory late payment charges was being made into Advocate’s client account. On day six, full payment was received with the client’s £75k being forwarded on the same day by bank transfer.
This was another example of Advocate Commercial Debt Recovery being able to cut through late payment excuses and promptly recover payment.