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Stuart J
Stuart J, Solicitor
Category: UK Property Law
Satisfied Customers: 19887
Experience:  PGD Law. 20 years legal profession, 6 as partner in High Street practice
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UK Residential Property Question: I received a bill from

Resolved Question:

UK Residential Property Question:

I received a bill from my builders for work to my property. I wrote a cheque saying it is in final settlement of the bill having deducted £250 for an unpaid bill for the rental of car parking used to store building material etc. The cheque has been cashed but the builder has written back to say that they will pursue me for the £250.

At a pre start of works meeting at my home it was agreed by my builder and a neighbour that the builders would rent a car parking space from the neighbour for 4 months at £250. However, the builder then (without permission) continued to use the parking space for 12 months. The owner of the space charged a further £250 (a total of £500) which the builder did not pay; he paid only the £250 and this was more than a year after it became due. This caused me difficulties with my neighbour and I made the additional payment of £250, deducting it from my builders bill.

At the start of the building works I was told my bill would be lower, but not by how much, if if the builders had the use of the parking space. It was on this basis that I agreed to involve my neighbour. However, my bill was not lowered to reflect the beneit of its use.

Question:

If a cheque is made in final settlement and is cashed can action be taken for the residual amount? If so, can I make a counter claim for a reasonable sum (say £250) to reflect the benefit of the parking space not passed on to me. In addition, there is a contract in place (which does not cover the parking situation) which stipulates a weekly penalty for the late completion of works. The works were 7 weeks late. I am now minded to pursue this money if action is taken for payment of the £250. Can this be as a counter claim or would I need to make a separate claim?
Submitted: 9 months ago.
Category: UK Property Law
Expert:  Stuart J replied 9 months ago.
Thank you for the question. It is my pleasure to help you with this today. Please bear with me if I ask for more information.
How much were you told that the bill would be and how much was it in the end?
Why did it increase?
How firm was the completion date which was missed??
Thanks
Customer: replied 9 months ago.

How much were you told that the bill would be and how much was it in the end?


 


In relation to the parking I was told the bill would be £250 for use of the parking for 4 months. I was told it had increased to £500 having been used for twelve months.



Why did it increase?


 


The parking was used by the builders for 12 months instead of the agreed 4 months. In an attempt to be reasonable my neighbour did not bill for the additional use of the parking on a pro rata basis



How firm was the completion date which was missed??


Very firm. A date was stipulated in the contract.

Expert:  Stuart J replied 9 months ago.
who was supposed to pay the parking, you or the builder? It appears that you paid for it. Why?
How much was the builder’s bill and how much lower was it supposed to be but it actually ended up not being?
Customer: replied 9 months ago.

There was no specific agreement on how the bill would be paid. At the completion of works I asked if the neighbour had been paid and was asked for his details. The builders sent him a cheque directly. The neighbour then contacted the builder to say that the amount was insufficient given their continued use of the parking area. The builder said he should contact me, presumably hoping I would make up the difference at my expense. I made the additional payment to the neighbour because he was unhappy and I felt duty bound to do so as the matter related to my building works.


 


The builders bill was £7,900. I was previously prepared to pay this less the £250 without claiming the payment for the late completion of the works. Had I claimed it, and had they agreed to deduct it (unlikely given their way of operating) it would have been £2,800 less as the penalty stipulated in the contract was £400 for each of the seven weeks they were late.


 


 

Expert:  Stuart J replied 9 months ago.
Thank you. That makes more sense now.
He can still sue you for the balance on the basis that he accepted it under duress. There is plenty of case law on this.
There is a way however, of making sure that it cannot come back to you and ask for any balance.
In cases like this, I never suggest making an offer. I suggest sending a cheque. Armed with a cheque in the hand for some of the amount a claimant wants, compared to an argument over the whole of the amount, (and arguments that they may win or lose) the cheque in the hand is a pretty powerful incentive to accept it.
So, in future, consider deciding how much you would like to pay the (you need to make it attractive enough) and send it with a covering letter headed “without prejudice save as to costs”. That means that they cannot produce the letter in court as any proof that you admit owing them any money at all.
Tell them in the letter that you are offering this money in full and final settlement of all claims against you, past, present and future, and that by cashing it they accept it as such. Tell them that if they do not accept it, they should return the cheque to you and if they issue legal proceedings, you will defend them on the basis of A, B, C, whatever.
Tell them that if they do not understand the significance of the letter. They should take independent legal advice.
I can tell you this approach works nine times out of 10, provided the offer is reasonable and not derisory.
For legal reasons which I will not bore you with but which go back several hundred years, the cheque must not come from you, but was come from a third party, friend, relative, solicitor, our accountant, neighbour, girlfriend, wife, husband, whoever, just not from you.
Here is some rather heavy reading

http://www.voltimum.co.uk/news/2312/cm/the-law----full-and-final-settlement-.html

obviously, it is too late for that now, but it is worthwhile mentioning.
For the £400 penalty payment to be enforceable, it must not be a penalty per se but must be a genuine measure of loss/inconvenience that you suffered as a result of the late payment.
I would write back to the builder and tell him that he is not going to get his £250 and he does issue court proceedings for the £250, you will not only defend it, you will counterclaim £2800 in respect of your loss and inconvenience for late completion under the terms of the contract. I would not mention the word “penalty”.
If he does issue proceedings, then defend them and issue the counterclaim and let the judge decide the issue.
Does that answer the question? Can I assist further?
Customer: replied 9 months ago.


Thank you. One last thing. The builder has also threatened me with costs. For such a small amount (£250) will they have to make any application through the small claims court, where I understand there to be no costs awarded?

Expert:  Stuart J replied 9 months ago.


You are absolutely correct,
costs are not awarded in the Small Claims Court unless either party has been
unreasonable and you do have to be really really unreasonable to get a costs
order against you. It is extremely unusual.

Although, if you lost for any reason, you would have to pay his court
issue, costs and expenses for his day in court in many cases. If he instructs
solicitors, he will not get paid those costs, and he will not get paid any time
for preparing the case.

Stuart J, Solicitor
Category: UK Property Law
Satisfied Customers: 19887
Experience: PGD Law. 20 years legal profession, 6 as partner in High Street practice
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