Carillion collapse – what to do if your business is affected

The fall-out from the collapse of construction giant Carillion continues – with many firms across the East Midlands affected.

Carillion Plc entered into insolvency on 15 January 2018 along with a number of subsidiary companies in the group. All companies will continue to operate, providing continuity of public services, until further notice.

The Official Receiver has been appointed by the Court as liquidator of Carillion Plc and is now responsible for the day-to-day control and management of the liquidated companies in the group. Partners at PwC have been appointed as Special Managers to assist.

When a company enters liquidation, subcontractors are usually classed as non-secure creditors, and come behind secured creditors, such as banks, and employees in the queue for payment.

You will need to register as a creditor in the liquidation if:

– you haven’t been paid for goods or services you’ve supplied to the Carillion companies in liquidation

– you have paid these companies for goods or services that you haven’t received

Self-employed contractors and agency workers who provided services to Carillion are not entitled to redundancy payments and should speak to your usual point of contact in the companies.

And it’s not just small firms who are feeling the pinch.

Van Elle, a Nottinghamshire geotechnical engineering contractor, carried out regular work for Carillion as a specialist lead sub-contractor, principally in respect of rail improvement and maintenance work where Network Rail is the end customer.

The group, based at Pinxton, Nottinghamshire, said it had successfully undertaken several contracts for Carillion during December and had invoiced for the work but had not yet been paid.

Work has continued on some of these contracts into January and as a result, Van Elle said its outstanding debt and work-in-progress exposure with Carillion was now approximately £1.6m.

The group said it would be speaking with Carillion’s advisers (including the Official Receiver) to determine the status of the outstanding payments.

If you’ve been exposed to the collapse of Carillion, then please do get in touch for advice on what your company’s next steps should be.

If you need Debt Recovery assistance, Rothera Sharp have the team for you. Call our solicitors on 0800 088 6280 or email enquiries@rotherasharp.co.uk

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Terhi Sygrove - Rothera Sharp Solicitors, Nottingham