Construction contract — Entitlement to time extensions — Adjudicator’s determination that no extension due — Claim for damages for delay — Adjudicator declining to consider defence based upon further claim for time extension — Whether bound by previous decision on time extension — Application for summary judgment on damages award — Application dismissed
The claimant engaged the defendant to carry out a renovation project under an amended JCT 1998 standard form contract. This provided for the payment of damages by the defendant in the event of delays, but with provision for reasonable time extensions to be granted by the architect, upon receiving due notice from the defendant, in respect of delays caused by relevant events as defined in the contract. In the course of the works, the defendant sent two letters applying for time extensions, which were refused by the architect. The defendant referred the matter to adjudication, pursuant to section 108 of the Housing Grants, Construction and Regeneration Act 1996. The adjudicator determined that the letters did not disclose any entitlement to an extension.
In a subsequent adjudication, the claimant sought to recover liquidated and ascertained damages in respect of the defendant’s delay. It relied upon the decision in the first adjudication that the defendant was not entitled to any time extension for the relevant period. In its response, the defendant claimed an entitlement to a time extension in respect of the entire period, relying upon detailed grounds set out in an appendix. The adjudicator considered himself bound by his previous decision that no extension was due. He declined to consider the defendant’s submissions on that issue and awarded damages.
The defendant refused to pay, asserting that the adjudicator’s decision was unlawful. The claimant applied for summary judgment to enforce the decision. An issue arose as to how the contractual provisions for time extensions interrelated with the provisions of section 108 of the Act and para 9 of the Scheme for Construction Contracts, which prohibited an adjudicator from determining a dispute that was “the same or substantially the same” as one that had previously been decided in an adjudication.
Held: The application was dismissed.
Where a contract permitted a contractor to make multiple applications for extensions of time on different grounds, it followed that multiple adjudications concerning time extensions were also permissible, provided that each application was on a different ground and the adjudication arose from a separate dispute. In each case, the “dispute” would consist of the difference between the contentions of the aggrieved party and the architect’s decision. A contractor could resist a claim for ascertained and liquidated damages by relying, in its defence, upon an entitlement to a time extension, provided that that entitlement had not been considered and rejected in a previous adjudication.
The claim for an extension of time advanced by the defendant in the later adjudication was very different from that put forward in the first. It featured a number of causes of delay that had not been mentioned in the application letters that had been considered in the first adjudication. Accordingly, it was substantially different from the claims there advanced and rejected, and the adjudicator ought to have considered it. In those circumstances, the adjudicator’s decision could not be enforced.
Matthew Holt (instructed by Kennedys) appeared for the claimant; Abdul Jinadu (instructed by Clarkslegal, of Reading) appeared for the defendant.
Sally Dobson, barrister
