The court action centres on a dispute over 25 flats in Croydon, south London, which had to be evacuated in early 2006 due to fire-risk fears.
Pellings acted as an agent for the design-and-build contract undertaken by construction firm Baker and Davies, but both firms are being sued with London & Quadrant claiming breach of contract.
The £1.6 million scheme was completed in 2002, but London & Quadrant are demanding £2.6 million in damages, claiming Pellings only attended site meetings monthly rather than weekly.
According to the writ, if Pellings did attend the site every week then it failed to inspect the works properly.
London & Quadrant said that Building Control asked the company to rehouse all tenants because of the fire risk - the flats will remain empty until all work is finished.
London & Quadrant is seeking the costs of rehousing its tenants for around two years, and the loss of rental income.
by Sarah Limbrick