Terra Firma Chambers’ Stephen O’Rourke successfully acted for the defenders in an action for payment brought by a construction company in liquidation against a husband and wife: Gateway Joiners Limited (in liquidation) v Arnott & Arnott (Stirling Sheriff Court, May 2015).  The pursuer sought payment for building work, including the construction of an extension, carried out by the company at the defenders’ house in Stirling.

The pursuers went into liquidation on 30 April 2012. The pursuers claim that at the date when the company went into liquidation work to the value of £133,000 had been carried out. The defenders had made payments to account totalling £107,000 and accordingly the pursuers claimed payment of about £27,000. The defenders counterclaimed for the costs, post liquidation, of finishing the works and also re-doing works which had been carried out defectively by the pursuers.

The case at debate ultimately turned on the issue of whether the equitable principle of balancing of accounts in bankruptcy could be applied as between the claim and the counterclaim and the Learned Sheriff (WA Gilchrist) opined that it could, following the opinion of Lord Hodge in the case of Integrated Building Services Engineering Consultants Limited v Phil UK Limited [2010] CSOH 80. Sheriff Gilchrist fixed a proof before answer.