A demolition company that was put under administration last year has been embroiled in litigation over a contract for a £ 500million luxury residential development in Chelsea, it has revealed.
Brown and Mason Limited, with turnover of £ 50million, and its parent company, Brown and Mason Holdings Limited, owned by Terry Brown, took office in September last year. The assets and contracts were purchased by a separate company called Brown and Mason Group Limited, controlled by Terry Brown’s son Nick, who said he had no ties to the old companies.
A report by the Cornerstone Business Recovery administrator revealed that legal action totaling £ 9.9million has been filed against the original company for an alleged breach of contract.
Court documents seen by Construction News show Brown and Mason was the subject of a claim over their work on the luxury Chelsea Waterfront development in central London (pictured)
He was hired in 2008 to perform demolition and alteration, installations and asbestos removal of the old Lots Road power plant, which stood on the site, for work worth £ 10million. sterling. A lawsuit has been filed by a subsidiary of CK Hutchison, the Hong Kong conglomerate formed from the merger of developers Hutchison Whampoa and Cheung Kong, which alleged that its project was delayed by more than a year after the demolition company failed to properly remove asbestos from the site.
He said the asbestos-containing materials remained “easily identifiable on walls, metal framing, ceilings, columns, beams, baseboards, fireplaces and other surfaces” after the work was reportedly completed in 2009 He said the site required additional removal work and architectural work as a result.
According to the claim, Brown and Mason have denied breaking their contract after being contacted by the developer in 2015, after business resumed at the site after a six-year hiatus. The case was put on hold in December 2020 following the entry into the administration of Brown and Mason Limited.
Ardmore won the main construction contract in 2016. The development, consisting of two towers of 37 and 25 floors, is expected to include 700 homes and several residential units.
The latest report from director Engin Faik at Cornerstone also said he was investigating the restructuring of the company, which took place in January 2020. At that point, the original Brown and Mason effectively became inactive. and Brown and Mason Group Limited acquired the majority of its assets.
Faik has extended the administration period by one year, until September 2022.
In a previous report, he said the company worried about its finances in 2019, finding itself with insufficient cash reserves to repay a £ 10million loan plus £ 1million from interests that it had contracted with a company called European Metal Recycling, and having fully utilized its overdraft facility with Santander.
He feared that if creditors withdrew the aid or took coercive action, the company would collapse, leading to breaches of contracts and the loss of 400 jobs.
In January 2020, the company carried out the restructuring with the full agreement of Santander and European Metal Recycling, according to Faik. The two remain its biggest creditors to date, claiming £ 5.5million and £ 19.12million respectively during the administration.
Faik said in the latest report that he continues to “investigate the ‘restructuring'”. He added: “Due to the sensitivity of these issues, I remain unable to disclose further details at this point.”
He said he was unable to meet with Terry Brown as part of the administrative process due to a combination of Brown’s disease and COVID-19 restrictions.
Brown and Mason Group Limited, controlled by Nick Brown, issued a statement last year saying: “We can confirm that Brown and Mason Holdings Limited (BMH) and Brown and Mason Limited (BML) are unrelated to trade. and Brown’s operations. and the Mason group.
“It is well known that we are a third generation family business. As such, there are businesses owned by different family members that share similar names. BMH and BML are two such inherited companies owned by a retired family member who has no interest in the ongoing business. “
CK Hutchison did not respond to a request for comment.