Was there a sufficiently strong prima facie case of contempt to allow committal proceedings to be brought against BPS鈥檚 directors?
The Facts
In March 2010 Sheer Projects Limited (鈥淪heer鈥�) entered into a contract with Berry Piling Systems Limited (鈥淏PS鈥�) for secant piling. A dispute regarding BPS鈥� entitlement to payment arose. In October 2011 BPS referred the dispute to adjudication claiming 拢78,000. They were awarded 拢20,551.87 plus VAT.
Sheer refused to pay and started arbitration proceedings in December 2011. Sheer also resisted BPS鈥檚 enforcement proceedings on the grounds that BPS would be unable to re-pay the judgment sum. As supporting evidence for this contention BPS relied on expert accounting evidence. In response BPS produced witness statements from two of their directors. Both directors (whose witness statements included a Statement of Truth) described BPS as a solvent profitable going concern with good prospects. The Judge enforced the adjudication decision on 21 February 2012 and Sheer paid up.
BPS went into administration in May 2012 and did not participate further in the arbitration process. In July 2012 the arbitrator awarded Sheer just under 拢100,000 plus interest.
Sheer鈥檚 representatives wrote to BPS鈥檚 two directors