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Stay of execution refused in case of balance sheet insolvency

Building Law Monthly

Stay of execution refused in case of balance sheet insolvency

In Granada Architectural Glazing Ltd v RGB P&C Ltd [2019] EWHC 3296 (TCC) Mr Vineall QC, sitting as a Deputy Judge of the High Court, declined to grant to the claimant a stay of execution in relation to the enforcement of a decision of an adjudicator. Although the claimant was balance sheet insolvent, it had paid its debts as they fell due as a result of support from its parent company and on this basis it could not be said that it would probably be unable to repay the sum that the adjudicator had ordered be paid to it. Further, the claimant’s financial position was similar to its position at the time of entry into the contract with the defendant so that the defendant had accepted the risk of entry into a contract with a party which was in a difficult financial position and it was not appropriate now to protect it against that risk by granting to it a stay of execution. The Deputy Judge therefore refused to grant a stay, nor was he willing to grant a stay on the condition that the defendant paid into court the sum which it had been ordered to pay by the adjudicator.

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