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The contractor鈥檚 troubles stem from 鈥渁ccounting issues within its M&E business鈥� and an expected 拢15m write-down on poorly performing contracts. That is without the little matter of the Bath Spa project, currently almost 拢30m over budget, where Mowlem is fighting a war of attrition with the architect and the client.

Once again, the travails of a leading member of the construction industry remind the world what thin ice contractors skate on. The liabilities contractors expose themselves to in order to scrape the slimmest of margins must be laughed at in other sectors. You don鈥檛 have to be BP to earn a better return for less angst. That鈥檚 construction for you, and most likely always will be, given contractors鈥� desperation to keep their order books full. That said, when Laing imploded in 2001 after a series of high-risk, fixed-price contracts 鈥� two of which make it into our list of the 10 most disastrous projects of all time (pages 54-58) 鈥� it had a sobering effect on the rest of the industry. The lessons of Spa-gate are as yet unclear, apart from the one we ought to know already 鈥� that a single project like this can splash red ink all over the year-end accounts. And who knows what damage this sort of bad PR does to the order books?

Mowlem says it is the innocent victim on this one, and has some convincing evidence to support the claim. It says the council spurned its efforts to broker a peace deal, and it has certainly found a sympathetic ear in construction minister Nigel Griffiths, who describes the (Lib Dem-controlled) council as 鈥渢he client from hell鈥� (page 17). But the truth is that when a dispute turns into a farce, as this one has, nobody comes out well. It may seem unpalatable to the council to abandon the architect and its legal claims to take up Mowlem鈥檚 offer to complete the project on a fixed-price design-and-build deal. But relationships are now so bad, this looks to be the only half-sensible, remotely affordable way forward.

Denise Chevin, editor