David Ltd and Goliath plc

Prior to his encounter with Goliath, you would have got great odds on a David victory.   It stands to reason - a good big ‘un always beats good little ‘un.

So, as a small business often contracted to larger (sometimes far larger) companies, one is always aware that, should the mood on site turn sour, the fight you end up in will be an unequal one.

This has happened to us with a number of contractors over many years, in one case with a company I shall call Goliath plc.  The job was, not unusually, running late and, thanks to the errors of others, we were required to produce extra equipment.  After a considerable amount of discussion, Goliath issued us with a variation order and we did the work.  In fact, in the months following we got on well with the site manager and did a good deal more than we were invoicing for.  He was cooperative and the atmosphere was upbeat.

We submitted the final account and looked forward to a satisfactory end to the job.  Then, out of the blue, Goliath's QS emailed us to say he was rescinding the variation order and counter-charging us for other items over which we had no control.  The effect of this was to wipe out 90% of the outstanding money.

We objected by phone, wrote at length to explain our case and agreed to a meeting at which we were given the brush-off.  The assumption was clear.  We were too small, too busy, too ill-equipped to resist Goliath plc.  It was only a matter of time before this particular David Ltd would submit, as we (and many like us) often do for one reason or another.  

But this time we took them to court.  What's more, we also claimed for all the work we had done un-invoiced, thereby doubling our final account figure.

Goliath plc soon realised things were not proceeding as anticipated.  Within a couple of weeks, and with the court date rapidly approaching, they arranged a meeting at which a payment was agreed and made.  If putting the squeeze on the Davids to improve your own cash position at the end of a job is a standard tactic then it’s a pretty shameful one.  And I am sure that Goliath's change of heart was more about avoiding a CCJ than because of some moral epiphany.

In the end, we received significantly more than our final account.  And quite right too.  The hassle, the threats and the time spent preparing for the fight do represent genuine and unnecessary costs.  We had won.

So why do I feel disappointed?  Because I would still have preferred it if the job had ended with a timely payment of the right amount.  You don't have to be David, Goliath or some sort of saint to prefer a scenario in which every party simply gets on with its job.