Clugston and Covid 19 sink Leeds civils firm

Aaron Morby 4 years ago

Leeds-based civil engineering contractor Oaklands Construction has been placed into liquidation after being hit by the collapse of Clugston and the Coronavirus crisis.

Oaklands was set up nine years ago by director Mark Lawson and turned over £9.5m, employing around 50 operatives, and 20 staff at peak trading.

The firm ran into financial problems when Clugston ceased trading in the first week of December, owing Oaklands £700,000 for works on Wakefield’s Capa College and Asda Worksop.

Oaklands was also hit for £45,000 with other clients folding over the Christmas period.

The firm along with other subcontractors tried to finish off the Asda store and college project for administrators but ran into problems around the legality of continuing the contracts.

Both projects have now been mothballed.

Lawson said that many clients that owed Oaklands money, knowing its predicament, issued significantly reduced,  even negative payless notices in the past weeks, against moneys applied for.

He said that others delayed payments, blaming closed accounts departments, inability to sign-off payments through homeworking and isolations caused by Corona.

Lawson said: “We tried to keep going on several other jobs, but Coronavirus made it impossible to safely put workers on sites. It was also challenging getting materials, which made the trading position impossible because we couldn’t get the turnover needed to recover.

“The final straw came when our contract on a job in Rugby was terminated because of lack of progress and we were issued with a zero payment notice against £220,000 owed.”

He added: “I had little choice other than to follow the advice of the insolvency practice that we had been working with to rescue the company since mid-December,  resulting in Chamberlain & Co taking control of the business and its assets, book debt and all cash in the bank.”

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