Building contract – Adjudication award – Enforcement – Defendant engaging claimant as contractor to carry out building works – Claimant referring dispute to adjudication – Claimant applying for summary judgment against defendant to enforce decisions of adjudicator – Whether referral document being properly served in accordance with Construction Industry Council Rules – Whether adjudicator having jurisdiction to deal with two disputes referred to same adjudicator – Application granted
The defendant employed the claimant as the contractor for part of a mixed-use development which included residential units, offices, retail units, student accommodation and leisure facilities. The contract, dated 30 March 2007, was in the ACA Standard Form of Contract for Project Partnering (PPC 2000).
On 9 October 2012, the claimant served on the defendant a notice of intention to refer to adjudication a dispute as to the sums to which it was entitled for certain basement works which had not been paid (“the basement works dispute”). On the same day, the claimant served a further notice of intention to refer to adjudication a dispute as to its entitlement to be paid sums withheld by the defendant on account of liquidated damages (“the LAD dispute”).
The claimant applied to the Construction Industry Council (CIC) for the appointment of adjudicators, making separate applications and paying separate fees in relation to each of the disputes. The CIC appointed the same adjudicator in relation to each of the two disputes. Rule 14 of the CIC Rules provided that the dispute had to be referred to the adjudicator within seven days of the notice of adjudication. The adjudicator initially said that he had not received the necessary referral document within the time limit but subsequently confirmed that his copy of the referral served on the correct date had been found.
The adjudicator gave a decision in favour of the claimant in each case and ordered the defendant to pay substantial amounts to the claimant. When those sums were not paid, the claimant brought proceedings to enforce the adjudication decisions. The claimant applied for summary judgment on the basis that there were two valid decisions. The defendant contended that the decisions should not be enforced because: (i) the referral had not been properly served in accordance with rule 14 of the CIC Rules; and (ii) the adjudicator did not have jurisdiction to deal with the two disputes because they had been referred to adjudication by the same adjudicator contrary to the provisions of section 108(1) of the Housing Grants, Construction and Regeneration Act 1996 and rule 8 of the CIC Rules.
Held: The application was granted.
(1) The important requirement of rule 14 was that, in compliance with section 108(2)(b) of the 1996 Act, the referring party should send the adjudicator a statement of its case within seven days of the giving of the notice. The date on which that was done was then the date of referral, defined in rule 15, and that led to the start of the primary period of 28 days in which the adjudicator had to reach a decision. If the referring party failed to do so, the adjudication could not proceed because there had been a failure of the fundamental obligation in section 108(2)(b) to refer the dispute to the adjudicator within seven days of the notice of adjudication.
In the present case, it could not be contended that the adjudicator had not received the referral documents within the time limit. Whilst the adjudicator had initially indicated in an email that he had not received the referral document, he expressly stated in his decision that he had found the referral documents and there was no basis for challenging that statement. He also found as a fact that the referral document had been served on the correct date which was within the jurisdiction of the adjudicator and was not open to challenge on this application: Hart v Fidler [2006] EWHC 2857 (TCC); [2007] BLR 30, PR Building Service Ltd v ROK Build Ltd [2008] EWHC 3434 (TCC), Linnett v Halliwells LLP [2009] EWHC 319 (TCC); [2009] PLSCS 81 and Cubitt Building Interiors Ltd v Fleetglade Ltd [2007] 110 Con LR 36 considered.
(2) Rule 14 did not prescribe a particular form by which a party had to set out the statement of its case. Nor did the list of matters to be included with the statement of a party’s case mean that if a particular document was not included, in technical breach of rule 14 of the CIC Rules, the adjudicator would not have jurisdiction to deal with the dispute. There was a distinction to be drawn between the fundamental obligation to refer the dispute to the adjudicator within seven days under rule 14 and the other obligations relating to the detail of the manner in which the matter was referred to the adjudicator contained, in this case, in rule 14 of the CIC Rules.
(3) Accordingly, the defendant had not established that it had real prospects of successfully defending the enforcement of the decisions in the two adjudications on the basis either that the adjudicator did not receive the referral document or, even if he did not, on the basis that the documentation actually received did not sufficiently set out a statement of the claimant’s case for the purpose of the dispute being referred to the adjudicator within seven days of the giving of the notice of adjudication.
(4) There was nothing in the CIC Rules or otherwise to prevent a party from giving two notices of adjudication, each relating only to one single dispute and for each of those adjudications then to be referred to the same adjudicator. Moreover, there was nothing in section 108 of the 1996 Act or in the Rules which prevented a party from giving more than one notice of adjudication, each relating to one dispute and then referring each adjudication to the same adjudicator. A party had the right to give notice of adjudication “at any time” under section 108(2)(a) which made it plain that there was no limit on the time when a party could commence one or more adjudications. A party had to be able to start a number of adjudications, each for a single dispute, at the same time or over the same period, in order to comply with section 108(2)(a). If a party could commence multiple adjudications there was nothing to prevent the same adjudicator from being appointed in a number of those adjudications: Fasttrack Contractors Ltd v Morrison Construction Ltd [2000] BLR 168, David and Teresa Bothma (in partnership) v Mayhaven Healthcare Ltd [2006] EWHC 2601 (QB); [2007] EWCA Civ 527 (CA) and Witney Town Council v Beam Construction (Cheltenham) Ltd [2011] BLR 707 considered.
Jonathan Lee (instructed by Willmott Dixon Holdings Ltd) appeared for the claimant; Alex Hickey (instructed by Trowers & Hamlins LLP) appeared for the defendant.
Eileen O’Grady, barrister
