Brian Rogan, managing director, tells High Court that directors believed in December 2003 there was a real risk that the firm would be insolvent within a month.
Wembley steel firm Cleveland Bridge was brought to the brink of insolvency by its problems on the project, managing director Brian Rogan revealed in the High Court yesterday.
Rogan, who took the witness stand in the £50m court battle with Multiplex, said that directors had believed in December 2003 there was a real risk that the firm would be insolvent within a month. The disclosure comes a day after Rogan revealed that CBUK directors had tried to appeal to Tony Blair and Alan Milburn to resolve the firm's Wembley crisis.
In response to questioning from Stewart, Rogan said that he had been asked by Ashley Muldoon in 2003 whether CBUK was trading while insolvent. Rogan said: "I told him that the directors genuinely believed they were not, but if things didn't improve in January, or if [CBUK's major shareholder] Sheikh Abdullah didn't agree to bankroll the firm then it would be in January."
Multiplex alleges that CBUK forced Multiplex into a cost plus period in early 2004 because it knew it was under extreme financial pressure, but that its difficulties had not largely been the result of delays and changes on the Wembley contract. CBUK claims that Multiplex put the firm under unfair financial pressure as part of the Armageddon Plan to get it off the project.