In another case involving a winding-up petition, the petition was dismissed, after the court found there was a dispute as to whether the statutory payment scheme applied to the contract. The contractual arrangements between the parties were not formally documented, but there was a basic agreement as to the scope and price of the works, which arose out of a subcontract between Ro-Bal and main contractor McAlpines to provide fabrication and erection of steelworks at two sites. At one site the works were completed and paid for, but at the other there was a dispute regarding payment.
The parties were unable to agree whether the Housing Grants, Construction and Regeneration Act 1996 applied to their contract, with Ro-Bal contending that works fell outside the scope of s.109 of the Act, which imposes stage payment requirements for works extending beyond 45 days because (i) there was an agreed duration of less than 45 days and (ii) the contracts were lump sum contracts.
Jones' response was that s.110, which requires payment notices to be served, applies to every construction contract. As the dispute was heard in the Companies Court, the judge was reluctant to determine that issue. Noting there was a substantial dispute between the parties, the judge dismissed the winding up petition. He also noted that the dispute between the parties could have been swiftly resolved in the TCC.
It is not clear whether the use of winding up petitions in this case and the case reported above was tactical, seeking to avoid the sometimes uncertain outcome of adjudication. In this case it is clear that the parties would have been better served by proceeding in the specialist TCC, rather than the Companies court.