Contractor says it could have resolved problems “years ago” instead of ending up in court
Laing O’Rourke has written to clients telling them that one of its dormant companies has been put into liquidation.
Chief executive Cathal O’Rourke sent the letter nearly three weeks ago saying Laing O’Rouke Construction South was about to be shut. Companies House records show the firm went into liquidation on 28 February.
In his letter, dated 21 February, O’Rourke writes: “Laing O’Rourke Construction South was recently the subject of a legal claim relating to a historic development and, despite our best efforts to reach an amicable solution on this matter, our counterparty did not engage fully with us in order to reach an agreement.”
He added: “We routinely shut legacy subsidiary companies and have undertaken similar actions at 14 subsidiaries since 2022 in order to simplify our corporate structure.”
The job at the centre of the dispute is the One Hyde Park luxury flats scheme in London designed by RSHP for Candy & Candy and which was completed in 2009 with the scheme opening its doors in 2011.
>> See also: One Hyde Park: Heart’s desire
Residents have claimed the complex has been marred by several faults, including pipework corrosion and leaking soldered joints, and have gone to court over the issues to claim £35m in compensation.
O’Rourke said it had tried “to resolve this matter amicably” which included “offering compensation and voluntarily committing to remedial works that would have resolved this issue years ago”.
But it added the development’s management company failed “to engage constructively on this matter”.
Explaining the reason why it sent the letter on 21 February, Laing O’Rourke said: “Given the high-profile nature of the court case, we simply wanted to keep our customers, partners and suppliers in the loop, as we do regularly on many matters.
“Laing O’Rourke Construction South had not traded since 2011, had no assets and was a dormant subsidiary of Laing O’Rourke. Its liquidation has no impact on the wider business.”
A spokesperson for One Hyde Park said Laing O’Rourke’s “offers to carry out the remediation works came with unacceptable caveats and the compensation offered by LOR was insufficient to fund such works by a third party”.
They added: “It is extremely disappointing that after 10 years of our attempting to secure resolution to this case, Laing O’Rourke, a business with revenue of £4bn, stepped away from its subsidiary days before trial. Laing O’Rourke has contested the claim throughout, at huge legal cost, but just as our case and demand for £35m compensation was about to face the scrutiny of the court room, it walked away from its responsibilities.
“This case has been the subject of extensive investigations by the appointed experts. These clearly show defective installations which are covered by the collateral warranty provided to OHP in 2010. Defects were discovered from 2014 onwards and for the past decade Laing O’Rourke has carried out ad hoc remedial work whilst refusing to agree to an appropriate settlement. On 27 February, we applied to the court for a judgment to support our ongoing quest for redress. We look forward to receiving the Judge’s decision in the near future.”
One Hyde Park is considered one of the most expensive apartment buildings in the world with the scheme’s penthouse valued at around £175m.
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