Settlement of Legal Claim

RNS Number : 7688R

Northern Bear Plc

08 July 2022

 

8 July 2022

Northern Bear plc

("Northern Bear" or the "Company")

Settlement of Legal Claim

The board of directors of Northern Bear plc (the "Board") is pleased to announce that a settlement of £0.6 million has been agreed in respect of a legal claim against one of the Company's subsidiaries, Springs Roofing Limited ("Springs"), by Engie Regeneration (FHM) Limited ("Engie").  There are no other pending legal claims against the Group or its subsidiaries, and we are not aware of any matter that could lead to a material legal claim.

Springs received notice of formal court proceedings in the sum of £1.9 million plus costs in December 2021.  The claim related to roofing work undertaken over a two-year period from April 2009 to March 2011 on eight separate care home properties. 

Engie had experienced performance issues with various aspects of the buildings, including their roof coverings, and subsequently employed Springs to re-roof all eight properties at normal commercial rates.  Springs' directors believe the performance issues were caused by problems with the design of the buildings for which Springs had no responsibility.  The re-roofing work was carried out to a different specification to the original contract with different materials being used.  

Engie subsequently made a claim under its insurance policy in respect of the rectification work.  Engie, in conjunction with its insurers, made a claim against Springs and the conduct of that claim was subrogated to its insurers.  The Springs directors believe that the claim was without merit.  This position was supported by comprehensive third party technical expert and legal advice. 

In reaching the agreed settlement set out above, the Board and the Springs directors considered, in conjunction with its legal advisers, the management time likely to be involved, the future legal costs which would be incurred in defending the claim, including a sizeable sum which would have been irrecoverable should Springs have successfully defended the claim, and the commercial risk of any matter of litigation. 

Springs and Northern Bear's other subsidiaries retain excellent commercial relationships with Engie's regional and national management team. As such, Engie continues to be an important and valued customer for the Group.

The settlement of £0.6m, which can be satisfied from the Company's existing resources, will be recorded as an exceptional item in the Group's annual results to 31 March 2022, which are expected to be released in the week commencing 18 July 2022. 

For further information, please contact:

Northern Bear PLC Jeff Baryshnik - Non-Executive Chairman Tom Hayes - Finance Director	[phone]
Strand Hanson Limited (Nominated Adviser and Broker) James Harris James Bellman	[phone]

The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulation (EU) No. 596/2014 as it forms part of United Kingdom domestic law by virtue of the European Union (Withdrawal) Act 2018 (as amended).

 

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