Late payment lesson from the courts: deadlines really do matter

Late payment disputes aren’t just a problem for small businesses chasing invoices. A recent High Court case shows that even large contractors can come badly unstuck if they miss payment deadlines – even by a few days.

The message from the court was clear: if you don’t follow the payment rules exactly, you may have to pay the full amount claimed, whether you agree with it or not.

What happened?

In Vision Construct Ltd v Gypcraft Drylining Contractors Ltd (2025), a subcontractor (Gypcraft) applied for an interim payment under its contract.

The main contractor (Vision Construct) responded with a payment notice that was five days late. That notice tried to reduce what was owed by around £200,000.

Crucially:

  • No valid payment notice was served on time
  • No pay less notice was issued at all

As a result, Gypcraft launched what’s often called a “smash and grab” adjudication – relying purely on the missed paperwork rather than arguing about the work itself.

The adjudicator agreed with Gypcraft and ordered Vision Construct to pay:

  • £216,947.75 (the full amount claimed)
  • £26,045.76 in interest

Vision Construct paid up, but then tried to get the High Court to overturn the decision.

What did the court decide?

The Technology and Construction Court rejected Vision Construct’s arguments in full.

In simple terms, the judge said:

  • The payment timetable in the contract was clear – it worked perfectly well if followed properly.
  • Just because Gypcraft had previously accepted late notices didn’t mean Vision Construct could rely on that forever.
  • A payment notice can’t be re-labelled later as a pay less notice to fix a mistake.
  • Each notice must:
    • Be served on time
    • Be clearly titled
    • State exactly how much is due and why

Trying to “reclassify” a late notice after the event would undermine the whole purpose of payment protection law.

Why this matters for businesses

This case isn’t just about construction contracts. It highlights a wider truth about late payment risk:

Process failures can be just as costly as genuine disputes.

The key lessons are straightforward:

  • Miss a deadline, lose your leverage
    If you don’t challenge a payment properly and on time, you may have to pay in full – even if the amount is wrong.
  • Labels and wording matter
    Notices must clearly say what they are. Courts won’t accept “you knew what we meant” arguments.
  • Past behaviour won’t save you
    Letting things slide before doesn’t mean the other party can’t enforce the rules later.
  • Good records protect cash flow
    Clear dates, clear notices, and clear audit trails reduce the risk of expensive disputes.

The wider late payment message

For many businesses, the real damage from late payment isn’t legal fees – it’s cash flow uncertainty.

That’s why tackling late payment early, consistently and professionally is so important. Allowing informal practices, missed deadlines or vague communications to creep in can quickly turn into a serious financial problem.

At CPA, we see this every day:
late payment problems usually start small – and escalate fast if not controlled.

If overdue invoices or inconsistent payment behaviour are affecting your business, it’s far better to address the issue at source than absorb the cost later.

Talk to CPA today on 020 8846 0000
We help businesses improve payment behaviour, recover overdue accounts, and protect cash flow – efficiently, effectively and ethically.

Invoices don’t age well.