黑洞社区

Barratt is set to appoint a new contractor to carry out cladding remediation works on a 650-home residential development in east London after falling out with the original appointee earlier this year. 

Scaffolding has been in place at the Dalston Square development in Hackney for more than two years, but work is currently on pause after contractor Jessella was removed from the project in January.  

Delays to completing the work have seen the job brought up in parliament by local MP Diane Abbott, and 黑洞社区 understands that the two parties are now engaged in a legal dispute over the matter. 

黑洞社区 envelope specialist Jessella was originally appointed to replace all cladding and louvres with non-combustible material and to create new fire breaks around windows and at floor level. 

On 13 December last year, Barratt鈥檚 managing director for East London, Stephen Thompson, wrote to Dalston Square residents apologising for a 鈥渟lowdown in communication鈥� from Jessella, then again on 22 December, referencing a 鈥渟lowdown in activity on site from our contractor鈥�.    

鈥淲e had hoped that this matter would have been resolved prior to Christmas but this now looks unlikely,鈥� he wrote. 

Residents then received a letter from Jessella on 4 January, in which the contractor claimed that 鈥渇rom the outset鈥� of its work on scheme, it had 鈥渞aised concerns relating to what we perceived as breaches of the building regulations and concerns relating to health & safety鈥�. 

The specifics of these concerns were not explained in the letter, but the contractor said that 鈥渢he works required to resolve these issues led to a number of delays鈥� to its original contracted scope of works. 

鈥淏arratt Developments have reasonably accepted the principle of the delay events but have failed to make payments to Jessella for works properly executed,鈥� it continued.  

鈥淒uring this time Jessella has funded the cost of the contract delays in Barratt Development鈥檚 place, to ensure the project could continue 鈥� this exceeds a value of circa 拢3.5m鈥�. 

The contractor alleged that in mid-December 2022 it had reached an 鈥渋n principle without prejudice agreement鈥� with Barratt on the amount that Jessella would be reimbursed for the delay, but that on 23 December, the last working day before Christmas, Barratt had 鈥渁ssigned an entirely unexpected and unreasonable set of terms to the agreement鈥�. 

This allegedly included the condition that Jessella would not be paid until the works were completed, which the contractor said left it with 鈥渘o choice but to pursue its claim for payment through adjudication鈥�. 

The following day, 5 January, Barratt informed residents that it had decided to terminate its contract with Jessella, adding that it refuted the claims made in the contractor鈥檚 letter. 

Barratt told 黑洞社区 it could not comment on the details of the dispute due to ongoing legal action. 

Since the removal of Jessella from the project, Barratt has kept residents updated about progress on the procurement of a new contractor, with the latest communication suggesting an appointment would be made by the end of May. 

Speaking to 黑洞社区 last Friday a Barratt spokesperson said: 鈥淲e are on track to appoint a replacement contractor by [end of May] to finish the outstanding remedial work at the development as soon as is possible.  

鈥淥ur first priority is the safety of our buildings and the people that live in them. We have always maintained that leaseholders should not have to pay for necessary remediation to fix building safety issues caused in the original construction of their buildings.鈥� 

黑洞社区 understands that a contractor has now been selected, with residents set to be informed towards the end of next week.

Work on a significant portion of the development has already been completed, with Collins Tower, Sledge Tower, Abraham House, Marley House and Joplin House all receiving compliant EWS1 forms. 

Other parts of the site, including Gaumont Tower, Dunbar Tower, Raddon Tower and Labyrinth Tower on Dalston Lane South, and Ocean House, Dekker House, Burke House, Thomas Tower, Ruffin House and Wonder House at Dalston Junction Interchange are yet to be remediated. 

Residents were informed on Friday last week that work will restart on site in late June and is expected to take nine months to complete.

Jessella went into administration on 27 February, with an administrators鈥� report citing 鈥渁 significant working capital shortfall towards the end of 2022 following a major client withholding payment on a number of contracts which were close to completion鈥�. 

According to administrators Steven Ross and Allan Kelly鈥檚 report, Jessella directors negotiated a settlement with 鈥渁 major client鈥� before Christmas, which would have allowed it 鈥渢o discharge a substantial proportion of its liabilities and continue to service its ongoing contracts鈥�, but the client advised the business it would not be progressing with the settlement and was terminating the contracts. 

It is unclear whether the client in question was Barratt.  

The administrators report continued: 鈥淔urther dialogue was entered into and the clients made a revised offer to the company on 18 January 2023 to recommence the contracts, however this was subject to any payments being made at the end of the contract.  

鈥淭he directors considered the company could not fulfil the working capital requirements to complete the contracts nor service its existing liabilities without repayment of existing debt.  

鈥淚n addition, the directors considered there remained a risk of non-payment on completion鈥�. 

Regen Facades Ltd purchased the firm on 24 March this year. 

Jessella directors were approached for comment but had not responded at the time of publication.