Coulson On Construction Adjudication

Copyright © 2011. Oxford University Press. All rights reserved.
Coulson, Peter. <i>Coulson on Construction Adjudication</i>,

Oxford University Press, 2011. ProQuest Ebook Central, http://ebookcentral.proquest.
Created from leeds-beck on 2019-10-09 19:11:17.
COULSON ON CONSTRUCTION
ADJUDICATION
second edition
Coulson, Peter. <i>Coulson on Construction Adjudication</i>, Oxford University Press, 2011. ProQuest Ebook Central,
http://ebookcentral.proquest.com/lib/leeds-beck/detail.action?docID=975498.
This page intentionally left blank
COULSON ON
CONSTRUCTION
ADJUDICATION
second edition
The Honourable
Sir Peter Coulson
A Justice of the High Court, Queen’s Bench Division,
Bencher of Gray’s Inn
1
1
Great Clarendon Street, Oxford ox2 6dp
Oxford University Press is a department of the University of Oxford.
It furthers the University’s objective of excellence in research, scholarship,
and education by publishing worldwide in
Oxford New York
Auckland Cape Town Dar es Salaam Hong Kong Karachi
Kuala Lumpur Madrid Melbourne Mexico City Nairobi
New Delhi Shanghai Taipei Toronto
With offices in
Argentina Austria Brazil Chile Czech Republic France Greece
Guatemala Hungary Italy Japan Poland Portugal Singapore
South Korea Switzerland Thailand Turkey Ukraine Vietnam
Oxford is a registered trade mark of Oxford University Press
in the UK and in certain other countries
Published in the United States
by Oxford University Press Inc., New York
© Sir Peter Coulson, 2011
The moral rights of the author have been asserted
Database right Oxford University Press (maker)
Crown copyright material is reproduced under Class Licence
Number C01P000014 with the permission of OPSI
and the Queen’s Printer for Scotland
First published 2007
Second edition published 2011
All rights reserved. No part of this publication may be reproduced,
stored in a retrieval system, or transmitted, in any form or by any means,
without the prior permission in writing of Oxford University Press,
or as expressly permitted by law, or under terms agreed with the appropriate
reprographics rights organization. Enquiries concerning reproduction
outside the scope of the above should be sent to the Rights Department,
Oxford University Press, at the address above
You must not circulate this book in any other binding or cover
and you must impose the same condition on any acquirer
British Library Cataloguing-in-Publication Data
Data available
Library of Congress Cataloging-in-Publication Data

Data available
Typeset by Glyph International, Bangalore, India
Printed in Great Britain
on acid-free paper by
CPI Antony Rowe, Chippenham, Wiltshire
ISBN 978–0–19–959722–2
1 3 5 7 9 10 8 6 4 2
FOREWORD
The mass of authorities on adjudication form an impenetrable jungle, through which it is not
easy to hack out a path.
Six years ago, just before joining the TCC, I set aside several days (of what should have been
vacation) to read into adjudication—an area of law which I had not previously encountered.
It was something of a culture shock, not only because of the number of authorities but also
because of their strangeness, complexity and length. Owing to the ingenuity of counsel and
multiplicity of points taken on all sides, these decisions did not make for easy or pleasurable
reading. Sadly Mr Justice Coulson’s book was not available to guide me on this jungle
exploration.
The first edition of Mr Justice Coulson’s book was published in 2007. It provides a clear and
lucid guide through a bewildering array of case law, which is clustered around the provisions
of the 1996 Act. Mr Justice Coulson’s approach is to unpack the material methodically. Each
topic is clearly signposted and the principles derived from the authorities bearing on that
topic are set out. Inevitably this means that any given authority is referred to more than once,
but this is a price well worth paying. The busy practitioner or judge can rapidly find the
section relevant to his/her problem. He/she can also find a clear exposition and discussion of
the relevant cases.
Since 2007 the flow of new adjudication cases has not abated. Therefore this new edition
Coulson on Construction Adjudication is much to be welcomed. I have read through some
specimen chapters with interest. This edition displays the same high standard of organisation
and exposition as was manifest in the first edition.
If practitioners on both sides of litigation consult this work, they will rapidly be guided to
the relevant principles and will, hopefully, be assisted in settling their differences.
Litigation about adjudication is a form of satellite litigation, which involves the parties
in a second round of legal costs before ever the main proceedings (if there are any main
proceedings) get off the ground. This is not a head of expenditure which contractors,
sub-contractors or building owners welcome. I therefore express the hope and expectation
that, armed with this excellent book, the warring parties will more often be enabled to resolve
their differences about the jurisdiction of adjudicators, validity of appointment, enforceability
of awards and so forth.
This book is a scholarly work of obvious practical utility. It will go into many future editions.
Even if the flow of new cases diminishes (as I hope it will), there will be statutory amendments
to consider and also the interesting question of how those statutory amendments impact
upon earlier case law.
Rupert Jackson
Royal Courts of Justice
London WC2A 2LL
October 2010
v
AUTHOR’S NOTE FOR THE SECOND EDITION
Looking back at the Author’s Note for the first edition of this book, I accept that it was
unwise to declare with such confidence that ‘the number of cases concerning adjudication
was at last decreasing’. Although there was something of a lull during the first part of 2007,
when the majority of that first edition was written, it did not last. Since the last part of that
year, when the book was published, and late 2010, there have been over 100 cases involving
adjudication in the TCC alone. And, because the party seeking to avoid enforcement will
usually run more than one defence, most of those cases deal with multiple issues.
I also said in that Note, with considerably greater accuracy, that by late 2007 ‘a great many of
the difficult questions raised by the 1996 Act had been answered by the TCC and the Court
of Appeal’. Thus, although some of the 100 cases break new ground, many others are simply
examples of how the principles established in the older cases are to be applied to particular
situations. Only a very few of these new cases come from the Court of Appeal. But that is not
to diminish the importance of some of the more recent decisions: it is to be hoped that the
clearer the guidance in any given situation, the less likely it is that there will be a similar
dispute that will come to court.
Some changes have been made to the structure of the book. The chapter on adjudication in
other jurisdictions has been deleted: the topic was simply too large for one chapter, and
others who are much better qualified will write their own books about the adjudication
process in other parts of the world. On the other hand, the chapter on natural justice has
been expanded into three separate chapters (Part IV of this edition), dealing respectively with
general principles, bias and the right to a fair hearing. Challenges to the adjudicator’s decision
on the grounds of natural justice have increased significantly in the last few years, and it
therefore seemed sensible to address this topic in rather more detail this time around. Another
change has been the restructuring of what is now Chapter 15 (Principles of Enforcement).
The peer reviews for the first edition were very kind, but the point was made that this chapter
was obviously important and should be expanded. The difficulty, of course, is that, in some
ways, the whole book could be subtitled ‘principles of enforcement’ and I am very conscious of
too much repetition. Accordingly, I have turned that chapter into a checklist of the common
difficulties on enforcement, and how each has been dealt with by the courts, identifying the
most significant cases under each topic. I hope that makes the chapter rather more user-friendly,
and not too repetitive.
In addition, this edition is also being prepared at a time when the 1996 Act remains in force
in its unamended form, but when the absurdly-titled Local Democracy, Economic
Development and Construction Act 2009 (when will the construction industry in this country
be regarded as important enough to have its own legislation, rather than being tacked on to
other Acts like an afterthought?) has received the Royal Assent but is not yet in force, and is
unlikely to be until a revised Scheme has also been finalised. That may be a year away. In any
event, the new provisions will not be retrospective, so the 1996 Act will continue to apply to
construction contracts for some time to come. Accordingly, where they differ (most notably
on the requirement that the contract be in writing, and the changes to the payment provisions),
vii
Author’s Note for the Second Edition
I have dealt with both the existing provisions and, in Chapter 4, with the 2009 Act. I am
gloomily confident that, when the new provisions come into force, there will be an increase
in disputes finding their way to court, rather than the reverse. Save in the simplest cases,
I consider that there is a fundamental tension between the restricted timetable in an adjudica-
tion and the adjudicator’s ability fairly to address disputes about the terms of an oral contract
or, inevitably, whether or not there was a contract at all.
Although in my day job I only ever see those decisions that are the subject of criticism by at
least one party, it is right to note that the general standard of the adjudication decisions that
we see in the TCC are of a high quality. The work that was undertaken by some of the pro-
fessional bodies in the early days to train adjudicators in all aspects of the work has very
definitely paid off. That high standard is often maintained despite, rather than because of,
the help the adjudicator gets from the parties: there are times when I read through the
correspondence between the solicitors and the adjudicator and marvel at the way in which
the adjudicator has patiently and thoroughly dealt with the points that have been raised,
whether good, bad or indifferent, often in the face of unremitting criticism from one, even
both, parties. Occasionally, the lack of assistance or even common courtesy offered to the
adjudicator by the lawyers or claims consultants is truly shocking.
From a personal viewpoint, I consider that the one area in which adjudicators may wish to
review their practices concerns time and timetabling. The essence of adjudication is speed,
and therefore the prompt production of a cost-effective answer. Remove the speed, and you
are left with an imperfect and expensive process that leads to a temporary result which one
or both sides are entitled to challenge in full. There has been a tendency in recent years for
some adjudicators in larger cases to expand the 28- or 42-day timetable on a rolling basis,
with the result that, as one disgruntled participant expressed it to me, ‘you spend more than
you would have done in court to get an answer which a judge may laugh at’. The overriding
importance of keeping to the timetable must not be forgotten.
Although I can claim to have written every word of this second edition (which makes every
mistake mine, too), it would not have been possible without the hard work and enthusiasm
of a large number of people. I should like to pay particular thanks to Sarah Cox, my former
clerk, who uncomplainingly typed parts of the new material, and Diane Wall, who typed the
bulk of it. David Grant at Keating Chambers again photocopied and filed all the new cases
for me. Roxanne Selby and Eleanor Walter at OUP have provided large dollops of practical
assistance and undimmed enthusiasm for this second edition. Gideon Scott-Holland, of
Keating Chambers, was a great help on the 2009 Act and generously made sure that Chapter
4 did not contain any howling errors. And Matt Molloy again provided sound advice on the
practical aspects of adjudication, set out in Chapters 18–20.
Since the first edition was published—indeed, I got the news the very day that it was
published—I have become a High Court judge, which has required me to get to grips with
a raft of new responsibilities and has inevitably meant that I have spent rather less time in the
TCC than before. As a result, I have attained a much wider experience of work in other parts
of the High Court, which has only led me to value even more highly the competence and
skill of the specialist construction bar and their instructing solicitors, and the patience
and hard work of my colleagues in the TCC, Ramsey, Akenhead and Edwards-Stuart JJ.
For a variety of reasons, some obvious, some less so, this book could not have been written
without them.
viii
Author’s Note for the Second Edition
In addition, becoming a different sort of judge has given me, perhaps rather belatedly, an
insight into the volume of work undertaken by senior members of the judiciary outside the
courtroom, which often remains unseen and unacknowledged by the legal professions, let
alone the wider public. So I would like to acknowledge the vast amount of work done on
behalf of the TCC by three senior judges, each of whom I have been lucky enough to know
since I was a young and inarticulate barrister, and to dedicate this book to them with gratitude
and a certain amount of awe: Lord Dyson, the first construction practitioner to reach the
Supreme Court; Sir Anthony May, the indefatigable President of the Queen’s Bench Division;
and Lord Justice Jackson, who has been unswerving in his encouragement of me personally
and has very kindly provided an Introduction to the second edition of this book. I suspect
that very few of those who read or use this book appreciate just how much the three of them
have done in the last decade or so, both for the TCC and the development of construction
law generally.
The second edition states the law as at 1 November 2010.
Sir Peter Coulson
St Dunstan’s House,
London EC4
1 December 2010
ix
CONTENTS
Table of Cases xvii

Table of Legislation, Treaties and Conventions xxxiii
PART I STATUTORY ADJUDICATION

1. The Latham Report and its Aftermath
Introduction 1.01
The Main Recommendations of the Latham Report 1.07
The Debates on the Bill 1.19
The Debates on the Scheme 1.31
2. Part II of the Housing Grants, Construction and Regeneration Act 1996

General Purpose of Part II of the Act 2.01
Sections 104–105: Construction Contracts and Construction Operations 2.16
Exclusion Order 1998 (SI 1998 No 648) 2.42
Section 106: Residential Occupier 2.45
Section 107: Agreement in Writing 2.51
Section 108: Adjudication 2.93
Sections 109, 110 and 111: Payment Provisions 2.146
Sections 112–115 2.180
3. The Statutory Scheme

Introduction 3.01
Piecemeal or Wholesale Incorporation? 3.04
Part I of the Scheme—Adjudication 3.14
Powers of the Adjudicator 3.60
The Adjudicator’s Decision 3.83
Effect of the Decision 3.99
Part II of the Scheme—Payment 3.113
4. The Local Democracy, Economic Development and Construction Act 2009

Introduction 4.01
Amendments to the Adjudication Provisions 4.04
Amendments to the Payment Provisions 4.16
xi
Contents
PART II OTHER FORMS OF ADJUDICATION

5. Contractual Adjudication
The Importance of the Contractual Provisions 5.01
The JCT 1998 Form 5.08
Other Forms of JCT Contract 5.36
The JCT Adjudication Agreement 5.42
The Standard Forms of Sub-Contracts 5.44
Other Standard Forms of Contract 5.64
Adjudication Rules 5.77
6. Ad Hoc Adjudication
Introduction 6.01
The Earlier Authorities 6.03
The Reservation of the Right to Challenge 6.12
Estoppel 6.18
Conclusions 6.20
PART III THE ADJUDICATOR’S JURISDICTION

7. General Principles
Introduction 7.01
What Happens if there is a Jurisdictional Issue? 7.05
The Adjudicator’s Power to Investigate His Own Jurisdiction 7.09
Adequate Reservation of Position 7.17
The Court’s Investigation 7.23
Fundamental Principle 7.26
Was the Adjudicator Validly Appointed? 7.28
The Dispute 7.47

The Relevance of Earlier Adjudication Decisions 7.97
Ousting the Jurisdiction of the Adjudicator in Other Ways 7.107
Making a Valid Objection on Jurisdiction 7.110
Summary of Principles Relating to Jurisdiction 7.111
8. Errors of Law and Fact

Introduction 8.01
Errors of Law/General 8.04
Errors of Law/Jurisdiction 8.15
Errors of Fact 8.20
xii
Contents
‘Slips’ 8.26
The Alleged Failure to Address Particular Issues 8.36
Fraud 8.39
9. Abatement and Set-Off

The Problem 9.01
Abatement/Set-Off against a Sum Certified/Determined as Due 9.06
Abatement/Set-Off against Sums Claimed 9.13
Set-Off against the Adjudicator’s Decision 9.20
Setting Off against Other Decisions or Arbitral Awards 9.41
Summary 9.43
10. Costs and Fees

Costs 10.01
The Adjudicator’s Fees 10.14
Lien 10.24
PART IV NATURAL JUSTICE

11. General Principles
Introduction 11.01
A Brief History 11.04
Bias 11.09
The Right to a Fair Hearing 11.23
12. Bias
Actual Bias 12.01
Apparent Bias: The Test 12.03
Amec Capital Projects Ltd v Whitefriars City Estates Ltd 12.05

The Appointment of the Same Adjudicator 12.09
Circumstances of Appointment 12.11
Unilateral Contact with the Parties 12.16
Without Prejudice Communications 12.20
The Proper Conduct of Hearings 12.22
13. A Fair Hearing

Introduction 13.01
The Application of the Rules of Natural Justice to Construction Adjudication 13.05
The Materiality of the Alleged Breach 13.10
Size/Nature of Claim 13.13
xiii
Contents
Addressing the Issues 13.26

Communications with and Indications to the Parties 13.40
Procedural Difficulties 13.54
Effect of Earlier Adjudications 13.58
Miscellaneous 13.63
Human Rights 13.66
Unfair Terms in Consumer Contracts Regulations 13.71
PART V ENFORCEMENT
14. The Status and Effect of an Adjudicator’s Decision
Introduction 14.01
A Valid Decision 14.04
Compliance with the Decision 14.16
Status of Decision 14.19
Approbation and Reprobation 14.22
Temporary Finality/Generally 14.30
Temporary Finality/Subsequent Adjudications 14.36
Status in Later Court or Arbitration Proceedings 14.45
Winding Up/Bankruptcy 14.52
Protective Measures in Scotland 14.57
15. Principles of Enforcement

Introduction 15.01
General Approach 15.02
Jurisdiction/The Contract 15.06
Jurisdiction/The Appointment 15.11
Jurisdiction/The Dispute 15.13

Jurisdiction/The Decision 15.18
Natural Justice 15.22
The Severability of the Decision 15.29
Can the Paying Party Set Off a Separate Claim Against the Sum Awarded
by the Adjudicator? 15.33
Summary Judgment 15.35
Summary 15.37
16. Adjudication Business in the TCC

Introduction 16.01
Enforcement Generally 16.02
xiv
Contents
Summary Judgment in the TCC 16.05

Interest and Costs 16.15
The Consequences of Losing an Adjudication 16.23
Injunctions 16.32
Part 8/Declaratory Relief 16.39
Staying Court Proceedings for Adjudication 16.49
17. Stay of Execution

Introduction 17.01
RSC Order 47 17.02
Time to Pay 17.28
Other Circumstances 17.29
PART VI A PRACTICAL GUIDE TO ADJUDICATION

18. Commencing an Adjudication
Introduction 18.01
So You Think You Want to be an Adjudicator? 18.02
Notice of Adjudication 18.06
Response to the Notice of Adjudication 18.11
Appointment of Adjudicator 18.14
Referral Notice 18.25
19. The Adjudication Itself

Directions 19.01
Response to Referral Notice 19.04
Referring Party’s Reply 19.06
Meetings, Evidence and Hearings 19.08

Visits 19.13
Documentation 19.15
Timescale and Requested Extensions 19.19
Natural Justice 19.23
Intimidatory Tactics 19.30
20. The Adjudicator’s Decision

Reasons 20.01
Completion and Communication 20.04
Errors 20.07
Ancillary Matters 20.10
xv
Contents
APPENDICES
Appendix A: Part II of the Housing Grants, Construction and Regeneration

Act 1996 463
Appendix B: Statutory Instrument 1998 No 648 469
Appendix C: Statutory Instrument 1998 No 649 473
Appendix D: Draft Directions in Adjudication Enforcement Proceedings 481
Appendix E: Part 8 of the Local Democracy, Economic Development and
Construction Act 2009 483
Index 487
xvi
TABLE OF CASES
A Company (No 1299 of 2001), Re (2001) CILL 1745. . . . . . . . . . . . . . . . . . . . . . 2.158, 9.08, 14.54
ABB Power Construction Ltd v Norwest Holst Engineering Ltd
[2000] TCLR 831 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.28, 2.33–2.37, 7.28, 16.35
ABB Zantingh v Zedal Building Services Ltd [2001] BLR 66 . . . . . . . . . . . . . . . . . . . . . . . . 2.36, 7.23
A C Yule & Son Ltd v Speedwell Roofing & Cladding Ltd [2007]
EWHC 1360 (TCC); [2007] BLR 499 . . . . . . . . . . . . . . . . . . . . . . . . . . 2.124, 3.81, 3.82, 5.25,
10.26, 14.06, 19.22
A&D Maintenance & Construction Ltd v Pagehurst
Construction Services Ltd [1999] CILL 1518 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.111
A J Brenton T/A Manton Electrical Components v Jack Palmer
(TCC), 19 January 2001. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8.20, 8.22
A.R.T. Consultancy Limited v Navera Trading Limited [2007]
EWHC 1375, (TCC) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.68, 7.41
A & S Enterprises Ltd v Kema Holdings Ltd [2004] CILL 2165 . . . . . . . . . . . . . . . . . . . . . . . . . 13.64
ASM Shipping Ltd of India v TTMI Ltd of England [2005]
EWHC 2238 (Comm); [2006] 2 All ER (Comm) 122 . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15.28
AWG Construction Services Ltd v Rockingham Motor Speedway Ltd
[2004] EWHC 888 (TCC); [2004] TCLR 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.13, 2.116, 7.68,
7.86, 13.08, 13.14, 17.22
AWG Group Limited v Morrison [2006] EWCA Civ 6; [2006] 1 WLR 1163 . . . . . . . . . . . . . . . 11.21
A v B (2002) CA 110/02 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.83, 5.84
Able Construction (UK) Ltd v Forest Property Development Ltd [2009]
EWHC 159, (TCC) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.30, 15.13, 16.16
Abraham v Jutsun [1963] 1WLR 658 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.08
Absolute Rentals Ltd v Glencor Enterprises (2000) CILL 1637 . . . . . . . . . . . . . . . . 3.101, 8.01, 17.21
Adami v Ethical Standards Officer. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.38
Adonis Construction v O’Keefe Soil Remediation [2009] EWHC 2047
(TCC); [2009] CILL 2784 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.72, 2.73, 15.32
Aedifice V Partnership Ltd v Shar [2010] EWHC 2106 (TCC); [2010] CILL 2905. . . . . . . . . . . . 7.19
Afovos Shipping v Pagnan [1983] 1 WLR 195, HL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.181
Air Design (Kent) Ltd v Deerglen (Jersey) Ltd [2008] EWHC 3047 (TCC);
[2009] CILL 2657 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2.86, 2.105, 7.18, 8.14, 17.26
Ale Heavy Lift v MSD (Darlington) Ltd [2006] EWHC 2080, TCC . . . . . . . . 2.92, 7.110, 9.32, 17.24
Allen Wilson Joinery Ltd v Privetgrange Construction Ltd [2008] EWHC
2802 (TCC); [2009] TCLR 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.69, 2.85, 3.89, 3.90
Allen Wilson Shop Fitters v Anthony Buckingham [2005] EWHC 1165
(TCC); [2005] 102 Con LR 154. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.107, 5.06, 8.10, 13.79
Allied London & Scottish Properties PLC v Riverbrae
Construction Ltd [1999] BLR 246 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8.08, 9.21
Allied P&L Ltd v Paradigm Housing Group Limited [2009]
EWHC 2890 (TCC); [2010] BLR 59 . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.15, 6.16, 6.21, 7.20,
7.21, 7.76, 8.35, 15.13
Allied Vision Limited v VBS Film Entertainment Gmbh
[1991] I Lloyd’s Rep 392. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.17, 7.20
Alstom Signalling Ltd v Jarvis Facilities Ltd [2004] EWHC 1232 (TCC);
[2004] 95 Con LR 55 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.153, 2.159, 3.118, 14.04
xvii
Table of Cases
Amber Construction Services Ltd v London Interspace

HG Ltd [2007] EWHC 3042, (TCC) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16.13
Amec Civil Engineering Ltd v The Secretary of
State for Transport [2004] EWHC 2339, (TCC). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.69
Amec Group Ltd v Thames Water Utilities Ltd [2010]
EWHC 419, (TCC) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2.105, 3.96, 5.73, 7.04, 7.85, 8.37,
13.19, 13.28, 13.34, 14.25, 15.19, 15.25
Amec Projects Ltd v Whitefriars City Estates Ltd [2004]
EWHC 393 (TCC); (2004) 20 Const LJ 338; [2004]
EWCA Civ 1418; [2005] BLR 1, CA . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.24, 5.12, 7.03, 7.16,
7.33, 7.100, 12.05, 12.07, 12.08, 12.10,
12.11, 12.16, 12.19, 13.01, 15.29
Andrew Wallace Ltd v Artisan Regeneration Ltd [2006] EWHC 15, (TCC) . . . . . . . . . . . . . 7.45, 8.40
Anglo Swiss Holdings Ltd and others v Packman Lucas Ltd [2009]
EWHC 3212 (TCC); [2010] BLR 109 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16.29
Anisminic Ltd v Foreign Compensation
Commission [1969] 2 AC 147, HL. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.12, 8.05, 8.07, 8.08
Ardmore Construction Ltd v Taylor Woodrow Ltd (2006) CILL 2309 . . . . . . . . . . . . . . . . . . . . 13.52
Ashley House Plc v Galliers Southern Ltd [2002] Adj LR 02/15 . . . . . . . . . . . . . . . . . . . . . . . . . 17.17
Ashville Investments v Elmer Contractors [1989] QB 488; [1988] 3 WLR 867 . . . . . . . . . . 7.31, 7.107
Attorney General v Ryan [1980] AC 718. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.03
Austin Hall Building Ltd v Buckland Securities Ltd [2001] BLR 274 . . . . . . . . . . 2.137, 13.67, 13.70
Aveat Heating Ltd v Jerram Falkus Construction Ltd [2007]
EWHC 131 (TCC); [2007] TCLR 3 . . . . . . . . . . . . . . . . . . . . . . . . . 2.118, 2.123, 2.132, 3.09,
3.36, 3.82, 5.67, 5.89, 7.38, 10.26, 14.08
Avoncroft Construction Ltd v Sharba Homes (CN) Ltd [2008]
EWHC 933 (TCC); [2008] TCLR 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9.40, 17.06
BAL (1996) Ltd v Taylor Woodrow Construction Ltd [2004] All ER (D) 218 (Feb) . . . . . . . . . . 13.50
BP Refinery v Shire of Hastings [1978] ALJR 20 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.143
Balfour Beatty Construction Ltd v Serco Ltd [2004]
EWHC 3336, TCC . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9.24, 9.31, 9.35, 9.39
Balfour Beatty Construction Ltd v The Mayor & Burgesses
of the London Borough of Lambeth [2002] EWHC 597;
[2002] BLR 288 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.04, 3.49, 3.93, 5.20, 7.04, 9.39, 13.01,
13.08, 13.42, 13.48, 13.51
Balfour Beatty Construction Northern Ltd v Modus Corovest

(Blackpool) Ltd [2008] EWHC 3029 (TCC);
[2009] CILL 2660 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.184, 3.17, 3.97, 5.35, 8.36,
9.33, 13.30, 13.37, 17.30
Balfour Beatty Engineering Services (HY) Ltd v Shepherd
Construction Ltd [2009] EWHC 2218 (TCC);
[2009] 127 Con LR 110 . . . . . . . . . . . . . . . . . . . . . . . . . . 3.96, 7.92, 7.103, 13.52, 13.65, 15.20
Ballast Construction Ltd v Burrell Ltd [2001] BLR 529 . . . . . . . . . . 3.06, 7.12, 7.87, 8.08, 8.12, 8.15
Banham Marshalls v Lincolnshire CC [2007] EWHC 402 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16.16
Banner Holdings Ltd v Colchester Borough Council [2010]
EWHC 139 (TCC); [2010] 131 Con LR 77 . . . . . . . . . . . . . . . . . . . . 2.132, 2.144, 2.145, 3.10,
3.12, 3.85, 3.114, 5.66, 5.89, 16.36
Banque des Marchands de Moscou v Kindersley [1951] 1 Ch112 . . . . . . . . . . . . . 14.22, 14.26, 14.27
Barnes & Elliott Ltd v Taylor Woodrow Holdings Ltd [2003]
EWHC 3100; [2004] BLR 111 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.120, 2.129, 3.80, 3.81,
5.24, 5.26, 14.06, 15.21
Barr Ltd v Law Mining Ltd (2001) 80 Con LR 134 . . . . . . . . . . . . . . . . .2.103, 5.69, 7.83, 7.95, 15.14
xviii
Table of Cases
Beck Peppiatt Ltd v Norwest Holst Construction Ltd [2003]

EWHC 822 (TCC); [2003] BLR 316 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.65, 7.67
Benfield Construction Ltd v Trudson (Hatton) Ltd [2008]
EWHC 2333 (TCC); [2008] CILL 2633 . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.95, 7.104, 13.61,
14.44, 15.27
Bennett (Electrical) Services Ltd v Inviron Ltd [2007] EWHC 49, (TCC) . . . . . . . . . . 2.63, 2.74, 7.40
Bickerton Construction Ltd v Temple Windows Ltd, unreported,
26 June 2001, (TCC) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.60, 7.89
Bill Biakh v Hyundai Corporation [1988] 1 Lloyd’s Rep 187 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.72
Birmingham City Council v Paddison Construction Ltd [2008]
EWHC 2254 (TCC); [2008] BLR 622 . . . . . . . . . . . . . . . . . . . . . . . . 7.104, 14.44, 16.40, 20.03
Bloor Construction (UK) Ltd v Bowmer & Kirkland (London) Ltd
[2000] BLR 314 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.139, 2.140, 3.103, 4.11, 8.29,
8.30, 14.11, 14.13, 20.08
Boddington v B T Police [1999] AC 143 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8.06
Bothma (t/a DAB Builders) v Mayhaven Healthcare
Ltd See David and Teresa Bothma (In Partnership)
T/A DAB Builders v Mayhaven Healthcare . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Bouygues (UK) Ltd v Dahl-Jensen (UK) Ltd [2000] BLR 49. . . . . . . . . . . . . . . . . . . . . . . . 2.04, 2.08,
2.09,5.79, 5.88, 7.04, 7.26, 8.03,
8.05, 8.08, 8.23, 8.27, 8.28, 8.37,
13.02,13.34,14.09, 14.12, 14.31,
14.34, 15.02, 15.36, 17.07, 17.08
Bovis Lend Lease Ltd v Cofely Engineering Services [2009]
EWHC 1120, (TCC) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.29, 5.57, 6.14, 7.22
Bovis Lend Lease Ltd v The Trustees of the London Clinic [2009]
EWHC 64 (TCC); [2009] 123 Con LR 15 . . . . . . . . . . . . . . . . . .7.77, 7.95, 13.22, 13.57, 15.32
Bovis Lend Lease Ltd v Triangle Development [2002] EWHC 3123
(TCC); [2003] BLR 31. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.143, 2.166, 9.25, 14.20
Bridgeway Construction Ltd v Tolent Construction Ltd [2000]
CILL 1662 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.13, 5.91, 10.08, 10.09
Broadwell v k3D [2006] ADJCS04/21 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13.30, 14.15
Brodyn Pty Ltd v Davenport and Anor 61 NSWLR 421 . . . . . . . . . . . . . . . . . . . . . . . . . . 2.125, 2.126
Brownlow Ltd v Dem-master Demolition Ltd, unreported, 26 February 2004 . . . . . . . . . . . . . . . 2.79
Bryen & Langley Ltd v Martin Rodney Boston [2004] EWHC
2450 (TCC); [2005] BLR 508; [2005] EWCA Civ 973 . . . . . . . . . . . . . . . . . . . . . . . . . . . 13.77
Buxton Building Contractors Ltd v The Governors of Durand

Primary School [2004] EWHC 733 (TCC); [2004] BLR 374 . . . . . . . . . . 3.69, 3.128, 5.06, 7.91
C&B Scene Concept Design Ltd v Isobars Ltd [2001] CILL 1781–1783;
[2002] BLR 93 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.09-2.12, 3.05, 3.105–3.107,
5.06, 5.59, 7.04, 7.26, 8.03,
8.08–8.11, 13.06, 15.04
CIB Properties Ltd v Birse Construction Ltd [2004] EWHC 2365 (TCC);
[2005] 1 WLR 2252; [2005] BLR 173 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.14, 2.102, 2.116,
3.78, 8.32, 13.15–13.17, 14.14, 15.23
CJP Builders Ltd v William Verry Ltd [2008] EWHC 2025 (TCC);
[2008] BLR 545 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .5.56, 7.38, 13.35, 13.39, 16.41
Cable & Wireless plc v IBM United Kingdom Ltd [2002] EWHC 2059
(Comm); [2002] 2 All ER (Comm) 1041 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16.51, 16.53
Camden v Makers [2009] EWHC 605 (TCC); [2009] 124 Con LR 32 . . . . . . . . . . . . . . . 12.14, 13.20
Camillin Denny Architects Ltd v Adelaide Jones & Co [2009]
EWHC 2110 (TCC); [2009] BLR 606 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.64, 12.02
xix
Table of Cases
Cantillon v Urvasco [2008] EWHC 282 (TCC); [2008] BLR 250 . . . . . . . . . . . . . . . . . . . 2.41, 5.50,
5.58, 7.55, 7.72, 13.11, 13.35,
13.45, 13.46, 15.13, 15.28, 15.29
Cape Durasteel Ltd v Rosser & Russell Building Services Ltd
(1995) 46 Con LR 75 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16.52, 16.53
Capital Structures v Time & Tide [2006] EWHC 591; [2006] BLR 226 . . . . . . . . . . . . . . . . 7.31, 7.43
Captiva Estates Ltd v Rybarn Ltd (In Administration) [2005]
EWHC 2744 (TCC); [2006] BLR 66 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.43, 2.44
Carillion Construction Ltd v Devonport Royal Dockyard [2005]
EWHC 778 (TCC); [2005] BLR 310; [2005] EWCA Civ 1358;
[2006] BLR 15 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.15, 2.59, 2.79, 2.83, 3.71,
3.87–3.93, 5.07, 7.03, 7.04, 7.91,
7.112, 8.04, 8.38, 13.01, 13.04,
13.10,13.35, 13.51,14.31,
15.01, 15.20, 15.38, 20.03
Carl Construction (Scotland) Ltd v Sweeney Civil Engineering
(Scotland) Ltd [2001] SCLR 95 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8.18
Cartwright v Fay, unreported, 9 February 2005 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.43, 10.24
Castle Inns (Stirling) Limited v Clark Contracts Limited [2007] CSOH 21. . . . . . . 5.29, 7.100, 10.15
Chamberlain Carpentry and Joinery Ltd v Alfred McAlpine
Construction Ltd [2002] EWHC 514, (TCC) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.59
Channel Tunnel Group Limited v Balfour Beatty Construction
Limited [1993] AC 334 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16.51, 16.53
Checkpoint Ltd v Strathclyde Pension Fund [2003] EWCA Civ 84;
[2003] L & TR 22 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.37
Cheeung and Minister of Employment in Immigration [1981]
122 DLR (3d) 41 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.34
Chief Constable of North Wales Police v Evans [1982] 1 WLR 1155 . . . . . . . . . . . . . . . . . . . . . . 11.24
Christiani & Nielsen Ltd v The Lowry Centre Development Co Ltd [2004] TCLR 2. . . . . . . . . . . 6.05
Citex Professional Services Ltd v Kenmore Developments Ltd
[2004] ScotCS 20; [2004] A1195/02 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.27, 14.49
City Inn Ltd v Shepherd Construction Ltd [2002] SLT 781 . . . . . . . . . . . . . . . . . . . . . . . . 5.27, 14.48
Clark Contracts Ltd v The Burrell Co (Construction Management)
Ltd [2002] SLT 103 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.158, 9.09, 9.11, 9.18
Cleveland Bridge (UK) Ltd v Whessoe-Volker Stevin Joint
Venture [2010] EWHC 1076 (TCC); [2010] BLR 415. . . . . . . . . .1.28, 2.40, 2.41, 15.07, 15.31
Codrington v Codrington [1875] LR7HL 854 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14.22

Collins (Contractors) Ltd v Baltic Quay Management (1994) Ltd
[2004] EWCA Civ 1757; [2005] BLR 63 . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.177, 2.178, 3.102, 7.70
Compania Maritima Zorroza SA v Sesostris SA (The Marques
de Bolarque) [1984] 1 Lloyd’s Rep 652 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.17, 7.20
Comsite Projects Ltd v Andritz AG [2003] EWHC 958 (TCC); (2004)
20 Const LJ 24 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.37, 2.39, 2.41
Connex v MJ Building Services Group PLC [2004] EWHC 1518;
[2004] BLR 333; [2005] EWCA Civ 193; [2005] BLR 201 . . . . . . . . . . . . . . . 2.71, 2.83, 2.112
Conor Engineering Ltd v Les Constructions Industrielles de la
Mediterranée [2004] EWHC 899 (TCC); [2004] BLR 212 . . . . . . . . . . . . . . . . . . . . . 2.37, 9.36
Construction Centre Group Ltd, The v Highland Council
[2002] BLR 476 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.166, 5.71, 9.39
Cooper v Wandsworth Board of Works (1863) 14 CB (NS) 180 . . . . . . . . . . . . . . . . . . . . . . . . . 11.05
Cornwall v Henson [1900] 2 Ch 298, CA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.181
Costain Ltd v Wescol Steel Ltd [2003] EWHC 312, (TCC) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.46
Cott UK Ltd v F E Barber Ltd [1997] 3 All ER 540 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16.51, 16.53
xx
Table of Cases
Coventry Scaffolding Company (London) Ltd v Lancsville Construction

Ltd [2009] EWHC 2995, (TCC) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16.14
Cowlin Construction Ltd v CFW Architects (A Firm) [2003] CILL 1961;
[2003] BLR 252–254 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.67
Cruden Construction Ltd v Commission for the New Towns [1995]
2 Lloyd’s Law Rep 387 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.76
Cubitt Building & Interiors Ltd v Fleetglade Ltd [2006] EWHC
3413 (TCC); [2006] 110 Con LR 36 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.14, 2.119, 2.123,
2.128, 2.195, 3.38, 3.40, 3.81, 5.01, 5.02,
5.09, 5.15, 5.25, 5.26, 5.43, 5.46, 7.36, 7.57,
8.31, 10.23,10.26,10.27,
14.06, 14.08, 14.13, 18.17, 20.05
Cubitt Building and Interiors Ltd v Richardson Roofing (Industrial)
Ltd [2008] EWHC 1020 (TCC); [2008] BLR 354 . . . . . . . . . . . . .2.75, 2.96, 5.46, 16.54, 16.56
Cygnet Healthcare Plc v Higgins City Ltd (2000) 16 Const LJ 394 . . . . . . . . . . . . . . . . . . . . . . . 2.110
DGT Steel & Cladding Ltd v Cubitt Building & Interiors Ltd [2007]
EWHC 1584 (TCC); [2008] Bus LR 132 . . . . . . . . . . . . . . . . . .2.95, 2.109, 16.50, 16.53, 16.54
DSND Sub-Sea v Petroleum Geoservices [2006] EWHC 591
(TCC); [2006] BLR 226. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.43
Dalkia Energy and Technical Services Ltd v Bell Group UK Ltd
[2009] EWHC 73 (TCC); [2009] 122 Con LR 66 . . . . . . . . . . . . . . . . . . . . . . . . . . 2.132, 3.20,
3.42, 6.15, 7.18, 7.38, 16.45
David and Teresa Bothma (In Partnership) T/A DAB Builders v
Mayhaven Healthcare Limited [2007] EWCA Civ 527; [2007]
114 Con LR 131. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2.102, 3.46, 6.16, 7.82, 7.110
David MacLean Contractors Ltd v The Albany Building Ltd,
unreported, 10 November 2005 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9.30, 7.100, 14.38
David McLean Housing Contractors Ltd v Swansea Housing
Association Ltd [2002] BLR 125. . . . . . . . . . . . . . . . . . . . . . . . . . 2.101, 2.176, 3.26, 5.05, 7.51,
7.79, 7.80, 7.109, 9.35, 14.19
Davidson v Scottish Ministers [2004] UKHL 34; 2005 1 SC, HL . . . . . . . . . . . . . . . . . . . . . . . . 11.16
Davis v Carew-Pole [1956] 1WLR 833 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.32
Dawnays v Minter [1971] 1 WLR 1205 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.01, 9.02
Dean & Dyball Construction Ltd v Kenneth Grubb Associates Ltd
[2003] EWHC 2465; [2003] 100 Con LR 92 . . . . . . . . . . . . . . . . . . . . . . 2.62, 5.90, 8.08, 12.18
Debeck Ductwork Installation Ltd v TE Engineering Ltd, unreported,

14 January 2002 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.63
Decro-Wall International S.A. v Practitioners in Marketing [1971] 1 WLR 361, CA . . . . . . . . . . 2.181
Deko Scotland Ltd v Edinburgh Royal Joint Venture Scots Law Times 2003, 727 . . . . . . . . 5.85, 10.10
Dimes v Grand Junction Canal [1852] 3 HLC 759 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.10
Director General of Fair Trading v First National Bank plc [2002] 1 AC 481 . . . . . . . . . . . . . . . . 13.72
Director General of Fair Trading v Proprietary Association of Great
Britain [2000] All ER (D) 2425 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12.03
Discain Project Services Ltd v Opecprime Developments Ltd [2000]
BLR 402; [2001] BLR 287 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.134, 3.63, 5.20, 7.04,
13.07, 13.08, 13.41, 13.69
Donal Pugh v Harris Calnan Construction Ltd [2003] CLDC 30.6.03. . . . . . . . . . . . . . . . . . . . 10.15
Dorchester Hotel Ltd v Vivid Interiors Ltd [2009] EWHC 70 (TCC);
[2009] Bus LR 1026 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13.23, 15.23, 16.35, 16.41
Dumarc Building Services Ltd v Salvador Rico, unreported,
31 January 2003 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.39, 9.29
Durabella Ltd v J Jarvis & Sons Ltd [2001] 83 Con LR 145. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.189
xxi
Table of Cases
Earls Terrace Properties Ltd v Waterloo Investments Ltd [2002] CILL 1889–1892 . . . . . . . . . . . . 2.23
Edenbooth v Cre8 Developments Ltd [2008] EWHC 570 (TCC);
[2008] CILL 2592 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.38, 2.48, 13.03, 15.23
Edmund Nuttall Ltd v RG Carter Ltd [2002] BLR 312 . . . . . . . . . . . . . .5.48, 7.66, 7.72, 12.09, 13.55
Edmund Nuttall Ltd v Sevenoaks District Council, unreported,
14 April 2000 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8.30, 9.37, 14.12, 20.08
Edwards v Hope [1885] 14 QBD 922 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9.41
Elanay Contracts Ltd v The Vestry [2001] BLR 33 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13.66
Emcor Drake & Skull Ltd v Costain Construction Ltd [2004] EWHC 2439;
[2004] 97 Con LR 142 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.61, 14.37
Enterprise Managed Services Ltd v East Midland Contracting Ltd
[2007] EWHC 727, (TCC) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16.48
Enterprise Managed Services Ltd v Tony McFadden Utilities Ltd
[2009] EWHC 3222 (TCC); [2010] BLR 89 . . . . . . . . . . . . . . . . . . . . . . . . . . 2.14, 2.106, 3.42,
7.14, 7.44, 7.74, 7.85, 13.24
Epping Electrical Co Ltd v Briggs & Forrester (Plumbing Services)
Ltd [2007] EWHC 4 (TCC); [2007] BLR 126 . . . . . . . . . . . . . . . . . . . . . . . 2.119, 2.123, 2.132,
3.82, 5.89, 10.28
Estor Ltd v Multifit (UK) Ltd [2009] EWHC 2108 (TCC);
[2009] 126 Con LR 40 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.46
Euro Construction Scaffolding Ltd v SLLB Construction Ltd [2008]
EWHC 3160 (TCC); [2009] CILL 2679 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.69, 7.18
FG Minter v Dawnays 13 BLR 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.90

FW Cook Ltd v Shimizu (UK) Ltd [2000] BLR 199 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.49
Fairmount Investments Ltd v Secretary of State for the Environment
[1976] 1WLR 1255 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.03
Faithful & Gould Ltd v Arcal Ltd (In Administrative Receivership)
& Ors, unreported, (TCC), Newcastle District Registry, No E190023 . . . . . . . . . . . . . . . . 10.24
Farebrother Building Services Ltd v Frogmore Investments Ltd
[2001] CILL 1762–1764 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.79, 5.80
Fastrack Contractors Ltd v Morrison Construction Ltd & Anor
[2000] BLR 168 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.100, 3.42, 7.05, 7.09, 7.24,
7.63, 7.67, 7.79, 7.83, 15.14, 15.18
Fencegate Ltd v James R Knowles Ltd [2001] CILL 1757–1759 . . . . . . . . . . . . . . . . . . . . . . . . . . 2.20
Fenice Investments Inc v Jerram Falkus Construction Ltd [2009]
EWHC 3272 (TCC); [2009] 128 Con LR 124 . . . . . . . . . . . . . . . . . . . . . . . . 5.34, 16.16, 16.47
Ferson Contractors Ltd v Levolux [2002] EWCA Civ 11; [2002]
CLC 605; [2003] BLR 118 . . . . . . . . . . . . . . . . . . . . . . . . . 2.141, 2.166, 9.26, 9.28, 9.39, 15.34
Fileturn Ltd v Royal Garden Hotel Ltd [2010] EWHC 1736 (TCC);
[2010] BLR 512 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12.01, 12.15, 15.22
Fitzroy Robinson Ltd v Mentmore Towers Ltd [2009] EWHC 1552
(TCC); [2009] BLR 505; [2009] EWHC 3365 (TCC); [2010]
BLR 165; [2010] EWHC 98, (TCC) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16.30
Flannery Construction Ltd v M Holleran (2007) Ltd [2007] EWHC 825, (TCC) . . . . . . . . . . . . 2.63
Forest Heath District Council v ISG Jackson Ltd [2010] EWHC 322, (TCC) . . . . . . . . . . 14.35, 16.47
Franklin v Minister of Town and Country Planning [1948] AC 87 . . . . . . . . . . . . . . . . . . . . . . . 11.06
Fredrick Mark Ltd v Schield [1972] 1 Lloyd’s Rep 9 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9.02
Fulham Leisure Holdings Ltd v Nicholson Graham & Jones [2008]
EWCA Civ 84; [2008] PNLR 22 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10.04
GKN Foundations Ltd v Wandsworth London Borough Council

[1972] 1 Lloyd’s Rep 528 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9.02
xxii
Table of Cases
GPS Marine Contractors Ltd v Ringway Infrastructure

Services Ltd [2010] EWHC 283 (TCC); [2010] BLR 377 . . . . . . . . . . . . . . . . . . . . 3.42, 3.108,
6.17, 6.21, 7.20, 7.32, 8.14, 8.19,
8.41, 13.37, 15.13, 15.25
Galliford Try Construction v Michael Heal Associates Ltd [2003]
EWHC 2886 (TCC); [2003] 99 Con LR 19 . . . . . . . . . . . . . . . . . . . . . . . . 2.84, 6.09, 6.10, 6.21
General Medical Council v Spackman [1943] AC 627 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.26
Geoffrey Osborne Ltd v Atkins Rail Ltd [2009] EWHC 2425 (TCC);
[2010] BLR 363 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.08, 3.108, 8.23, 14.34,
14.35, 15.04, 16.46, 16.47
George Parke v The Fenton Gretton Partnership [2001] CILL 1713 . . . . . . . . . . . . . . . . . . . . . . 14.53
George v Secretary of State for the Environment (1979) 77 LGR 689 . . . . . . . . . . . . . . . . . . . . . 11.25
Geris Handelsgesellschaft v Les Constructions Industrielles de la
Mediterrannée S.A [2005] EWHC 499, QB . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9.35
Gibson Lea Retail Interiors Ltd v Makro Self Service Wholesalers
Ltd [2001] BLR 407 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.22, 2.29
Gilbert-Ash v Modern Engineering (Bristol) Ltd [1973] 3 WLR 421 . . . . . . . . . . . . . . . . . . . 9.01, 9.03
Gillies Ramsey Diamond v PJW Enterprises [2002] CILL 1901–1903;
[2003] BLR 48 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.19, 3.93, 3.95, 8.08
Gipping Construction Ltd v Eaves Ltd [2008] EWHC 3134, (TCC) . . . . . . . . . . 13.65, 16.20, 17.28
Glencot Development & Design Co Ltd v Ben Barrett & Son
(Contractors) Ltd [2001] BLR 207 . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.134, 2.143, 3.62, 5.20,
12.04, 12.17, 13.07, 13.69
Goel v Amega Ltd [2010] EWHC 2454, (TCC) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12.22
Gray & Sons Builders (Bedford) Ltd v Essential Box Company Ltd
[2006] EWHC 2520 (TCC); [2006] 108 Con LR 49 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16.20
Griffin & Anor (t/a K&D Contractors) v Midas Homes Ltd [2000]
78 Con LR 152. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.192, 7.51, 10.18, 15.29
Grovedeck Ltd v Capital Demolition Ltd [2000] BLR 181 . . . . . . . . . . . . . . . . . . . . . . . . 2.88, 2.102,
7.09, 7.13, 7.39, 7.81, 15.14
Guardi Shoes Ltd v Datum Contracts [2002] CILL 1934 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14.55
HG Construction v Ashwell Homes [2007] EWHC 144 (TCC);

[2007] BLR 175 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7.100, 13.61, 14.42, 14.44, 18.23
HS Works Ltd v Enterprise Managed Services Ltd [2009] EWHC 729
(TCC); [2009] BLR 378. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9.41, 13.18, 13.32, 15.25
Hadmor Productions Ltd v Hamilton [1983] 1 AC 191 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.08

Halki Shipping Corporation v Sopex Oils Ltd (The Halki)[1998]
1 WLR 726 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.177, 7.64, 7.67
Hannam v Bradford Corporation [1970] 1WLR 937 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.17
Harlow & Milner v Linda Teasdale (No 1) [2006] EWHC 54 . . . . . . . . . . . 14.52, 16.04, 16.19, 16.23
Harlow & Milner v Linda Teasdale (No 2) [2006] EWHC 535, (TCC) . . . . . . . . . . . . . . . . . . . . 16.23
Harlow & Milner v Linda Teasdale (No 3) [2006] EWHC 1708 (TCC);
[2006] BLR 359 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16.23
Harris Calnan Construction Co Ltd v Ridgewood (Kensington) Ltd
[2007] EWHC 2738 (TCC); [2008] Bus LR 636 . . . . . . . . . . . . . . . . . . . 2.75, 6.13, 6.21, 16.20
Hart Investments Ltd v Fidler & Ors [2006] EWHC 2857 (TCC);
[2007] BLR 30 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.73, 2.76, 2.123, 3.37, 3.82,
7.36, 10.26, 15.12, 17.08, 18.17
Harwood Construction Ltd v Lantrode Ltd, unreported,
24 November 2000 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.163, 7.55, 9.22, 17.09
Hayter v Nelson [1990] 2 Lloyd’s Rep 265, CA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.177
Herring v Templeman [1973] 3 All ER 569 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.40
xxiii
Table of Cases
Herschel Engineering Ltd v Breen Property Ltd [2000]

BLR 272. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2.108. 16.52, 16.53, 17.16, 17.18
Hillcourt v Teliasonera AB [2006] EWHC 508, Ch D . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17.04
Hills Electrical & Mechanical Plc v Dawn Construction Ltd
[2004] SLT 477 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.07, 3.12, 3.128
Hillview Industrial Developments (UK) Ltd v Botes Building
Ltd [2006] EWHC 1365, (TCC) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9.32
Hitec Power Protection BV v MCI Worldcom Ltd [2002] EWHC 1953 . . . . . . . . . . . . . . . . . . . . 7.66
Holt Insulation Ltd v Colt International Ltd, unreported, 23.7.01 . . . . . . . . . . . . . . . . . . . 3.52, 7.100
Homer Burgess Ltd v Chirex (Annan) Ltd [2000] BLR 124. . . . . . . . . . . . . . . . . 2.32, 2.37, 7.09, 7.13
Humes Building Contracts Limited v Charlotte Homes (Surrey)
Ltd, unreported, 4 January 2007 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13.52
Hurst Stores and Interiors Ltd v ML Europe Property Ltd [2003] BLR 391 . . . . . . . . . . . . . . . . . . 5.86
IDE Contracting Ltd v RG Carter (Cambridge) Ltd [2004] EWHC 36

(TCC); [2004] BLR 172. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.197, 3.27, 3.20,
7.15, 7.33, 7.36, 15.11
Interserve Industrial Services Ltd v Cleveland Bridge UK Ltd [2006]
EWHC 741, (TCC) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9.32, 9.41, 16.26, 17.06
JPA Design and Build Ltd v Sentosa (UK) Ltd [2009] EWHC
2312 (TCC); [2009] 50 EG 68 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9.34, 9.41, 17.27
JT Mackley & Co Ltd v Gosport Marina Ltd [2002] BLR 367 . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.70
JW Hughes Building Contractors Ltd v GB Metal Work Ltd [2003]
EWHC 2421, (TCC) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.11, 7.108, 13.63, 17.20
Jacques and Another v Ensign [2009] EWHC 3383, (TCC) . . . . . . . . . . . . . . . . . . . . . . . 7.95, 13.33,
13.62, 17.24, 17.28
Jarvis Facilities Ltd v Alstom Signalling Ltd [2004] EWHC
1285, (TCC) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14.33, 16.44
Jerome Engineering v Lloyd Morris [2002] CILL 1827 . . . . . . . . . . . . . . . . . . . . . . . . 3.15, 5.55, 7.52
Jim Ennis Construction Ltd v Premier Asphalt Ltd [2009]
EWHC 1906 (TCC); [2009] 125 Con LR 141 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.142, 14.21
John Cothliff Ltd v Allen Build (North West) Ltd [1999] CILL 1530 . . . . . . . . . . . . . . . . . . . . . 10.07
John Mowlem Ltd v Hydra-Tight Ltd [2002] 17 Const LJ 358 . . . . . . . . . . . . . . . . . 3.08, 5.74, 16.35
John Roberts Architects Ltd v Parkcare Homes (No 2) Ltd [2006]
EWCA Civ 64; [2006] 1 CLC 333 . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9.01, 10.06, 10.11, 10.13
Joinery Plus Ltd v Laing Ltd [2003] BLR 184 . . . . . . . . . . . . . . . . . . . . . . . . . 3.105, 5.59, 8.11, 14.14
KNS Industrial Services (Birmingham) Ltd v Sindall Ltd

[2001] 75 Con LR 71 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.101, 3.33, 5.45, 5.52, 7.58,
7.88, 9.14, 9.19, 15.29
Kanda v Government of Malaya [1962] AC 322 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.30
Ken Griffin v Midas Homes Ltd [2001] 78 Con LR 152 . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.15, 15.15
Kier Regional Limited v City & General (Holborn) [2006] EWHC
848 (TCC); [2006] BLR 315 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.74, 13.10, 13.35, 17.29
Kier Regional Ltd v City & General (Holborn) Ltd (No 2)[2008]
EWHC 2454 (TCC); [2009] BLR 90 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14.51, 16.31
King v Thomas McKenna Ltd [1991] 1 All ER 653 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8.29
Knapman (RJ) Ltd v Richards & Ors [2006] EWHC 2518 (TCC);
[2006] 108 Con LR 64 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9.32, 14.28
L Brown & Sons Ltd v Crosby Homes (North West) Ltd [2005] EWHC 3503, (TCC) . . . . . . . . . 7.30
LPL Electrical Services Ltd v Kershaw Mechanical Services Ltd, unreported, 2 February 2001 . . . . 7.52
xxiv
Table of Cases
Lakshmijit v Faiz Sherani [1974] AC 605, PC . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.181

Lathom Construction Ltd v Brian Cross and Ann Cross [2000] CILL 1568 . . . . . . . . . . . . . . . . . 7.29
Lawal v Northern Spirit Ltd [2003] UKHL 35; [2004] 1 All ER 187 . . . . . . . . . . . . . . . . . 11.12, 11.13
Lead Technical Services Ltd v CMS Medical Ltd [2007] EWCA Civ 316;
[2007] BLR 251 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.82, 3.29, 7.35, 7.38
Ledwood Mechanical Engineering Ltd v Whessoe Oil and Gas Ltd
[2007] EWHC 2743, (TCC) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.18, 9.33, 20.03
Lee v Chartered Properties (Building) Ltd [2010] EWHC 1540 (TCC);
[2010] BLR 500 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.131, 3.82, 7.25, 7.32, 7.37, 15.08
Letchworth Roofing Company v Sterling Building Company [2009]
EWHC 1119 (TCC); [2009] CILL 2717 . . . . . . . . . . . . . . . . . . . . . . . . 2.124, 3.17, 7.55, 15.15
Levolux A.T. Ltd v Ferson Contractors Ltd [2002] BLR 341; [2003]
86 Con LR 98, CA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.64, 5.65, 7.04, 14.20
Lindsay Parkinson (Sir) & Co v Triplan Ltd [1973] QB 609 . . . . . . . . . . . . . . . . . . . . . . . 17.15, 17.18
Linnett v Halliwells LLP [2009] EWHC 319 (TCC); [2009]
BLR 312. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .3.55, 3.111, 3.40, 5.04, 5.16, 5.18,
5.22, 5.31, 7.36, 10.16, 10.20, 14.29
Lissenden v CAV Bosch Ltd [1940] AC 413 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14.22
Lloyd v McMahon [1987] AC 625 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.01, 11.29
Locabail (UK) Limited v Bayfields Properties Limited [2000] 2 WLR 870, CA . . . . . . . . . 11.20, 12.03
London & Amsterdam Properties Ltd v Waterman Partnership
Ltd [2004] BLR 179 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.110, 8.08, 13.14, 13.54
London Borough of Camden v Makers UK Ltd [2009] EWHC 605
(TCC); [2009] 124 Con LR 32. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.96, 2.113, 16.57
London Borough of Camden v Makers UK Ltd (No2)[2009]
EWHC 2944, (TCC) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17.12
Lovell Projects Ltd v Legg & Carver [2003] BLR 452 . . . . . . . . . . . . . .5.37, 7.68, 13.74, 13.75, 13.78
Lucy v Royal Borough of Kensington and Chelsea [1997] COD 191 . . . . . . . . . . . . . . . . . . . . . . 11.36
M Rhode Construction v Nicholas Markham-David [2006]

EWHC 814 (TCC); [2006] BLR 291 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.129, 2.194
M J Gleeson Group Plc v Devonshire Green Holding Ltd, unreported, 19 March 2004 . . . . . . . . . 9.29
Macob Civil Engineering Ltd v Morrison Construction Ltd
[1999] BLR 93 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2.01, 2.04, 2.07, 2.13, 7.26, 8.04,
8.05, 8.20, 13.06, 14.17, 14.22,
14.31, 15.02, 16.02, 16.33, 16.34
Mahon v Air New Zealand [1984] AC 808 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.08, 11.32

Makers UK Ltd v London Borough of Camden [2008]
EWHC 1836 (TCC); [2008] BLR 470 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.10, 12.12, 12.14
Management Solutions and Professional Consultants Ltd v Bennett
(Electrical) Services Ltd [2006] EWHC 1720, (TCC) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.80
Marine Contractors Ltd v Ringway Infrastructure Services Ltd [2010]
EWHC 283 (TCC); [2010] BLR 377 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.67
Martin Girt v Page Bentley [2002] EWHC 2434 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.86
Mast Electrical Services v Kendall Cross Holdings Ltd [2007]
EWHC 1296 (TCC); [2007] NPC 70 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.67
Maxi Construction Management Ltd v Morton Rolls Ltd [2001] CILL 1784–1787 . . . . . . . . . . 2.152
Maymac Environmental Services v Faraday Building Services (2000)
75 Con LR 101. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.44, 6.18
McAlpine PPS Pipeline Systems Joint Venture v Transco Plc,
unreported, 12 May 2004 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.65, 7.90, 13.42, 13.55
McConnell Dowell Constructors (Aust) Pty Ltd v National Grid
Gas Plc [2007] BLR 92 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.31, 17.25
xxv
Table of Cases
McNabb v United States 318 US 332 (1943) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.23

Mead General Building Ltd v Dartmoor Properties Ltd [2009]
EWHC 200 (TCC); [2009] BLR 225 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16.21, 17.10, 17.26
Mecright Ltd v TA Morris Developments Ltd, unreported, 22 June 2001 . . . . . . 3.16, 3.33, 7.50, 7.58
Medicaments and Related Classes of Goods, Re (No 2) [2001]
1 WLR 700, CA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.11, 12.01, 12.03, 12.04
Melville Dundas Ltd (in receivership) v George Wimpey UK Ltd [2007]
UKHL 18; [2007] BLR 257; [2005] SLT 24; [2007] UKHL 18;
[2007] 1 WLR 1136 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.160, 2.161, 2.169, 2.173, 2.174,
4.03, 4.26, 5.30, 5.54, 9.07, 9.12
Mentmore Towers Ltd v Packman Lucas Ltd [2010] EWHC 457
(TCC); [2010] BLR 393. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16.29, 16.36, 16.53
Mersey Steel & Iron Co Ltd v Naylor [1884] 9 App Cas 434, HL . . . . . . . . . . . . . . . . . . . . . . . . 2.181
Michael John Construction Ltd v Golledge & Ors [2006] EWHC 71
(TCC); [2006] TCLR 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.45, 7.79, 7.102, 12.10,
13.50, 17.19, 19.30
Michel v R [2010] 1 Cr App R 24 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12.22
Midland Expressway Ltd & Anor v Carillion Construction Ltd & Ors
(No 3) [2006] EWHC 1505 (TCC); [2006] BLR 325 . . . . . . . . . . . . . . . . . . . . . . . 7.71, 10.13
Millers Specialist Joinery Co Ltd v Nobles Construction Ltd [2001]
CILL 1770–1773 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2.157, 2.163, 9.15, 9.16, 9.19
Mivan Ltd v Lighting Technology Projects Ltd [2001] ADJCS 04/09 . . . . . . . . . . . . . . . . . 3.52, 7.101
Modern Engineering Ltd v Gilbert-Ash [1974] AC 689 . . . . . . . . . . . . . . . . . . . . . . . 1.01, 1.03, 5.39
Mohammed v Dr Michael Bowles 2002, a decision of the Bankruptcy Registrar . . . . . . . . . . . . . . 5.37
Monmouthshire County Council v Costelloe & Kemple Ltd [1965] 5 BLR 83 . . . . . . . . . . . . . . . 7.64
Montan, The [1985] 1 Lloyd’s Rep 189 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8.29
Mott MacDonald Limited v London & Regional Properties Limited [2007]
EWHC 1055 (TCC); [2007] 113 Con LR 33 . . . . . . . . . . . . . . . . . . . . . . . . . . 2.74, 2.90, 2.131,
3.64, 3.82, 10.28, 12.01
Multiconcept Developments Ltd v Abacus (CI) Ltd [2002] Adj LR 03/22 . . . . . . . . . . . . . . 9.23, 17.21
Multiplex Constructions (UK) Ltd v Cleveland Bridge [2006] EWCA Civ 1834; . . . . . . . . . . . . 14.45
Multiplex Constructions (UK) Ltd v Honeywell Control Systems [2007]
EWHC 236 (TCC); [2007] BLR 167 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14.45
Multiplex Constructions (UK) Ltd v Mott MacDonald Ltd [2007]
EWHC 20 (TCC); [2007] 110 Con LR 63 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.71, 14.45
Multiplex Constructions (UK) Ltd v West India Quay Development
Co (Eastern) Ltd [2006] EWHC 1569 (TCC); [2006]

111 Con LR 33. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.94, 7.86, 13.44, 17.21
Murray Building Services v Spree Developments, unreported, 30 July 2004 . . . . . . . . . . . . . . . . . . 2.70
Nageh v Richard Giddings [2006] EWHC 3240 (TCC); [2007] CILL 2420 . . . . . . . . . . . . . . . . 2.196
National Assembly for Wales v Condron [2006] EWCA Civ 1573;
[2007] BLGR 87 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.15
Naylor v Greenacres [2001] SLT 1092 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.54, 7.100
Nickleby FM Ltd v Somerfield Stores Ltd [2010] EWHC 1976, (TCC) . . . . . . . . . . . . . . . 2.66, 14.27
Nikko Hotels (UK) Ltd v MEPC Plc [1991] 2 EGLR 103. . . . . . . . . . . . . . . . . . . . . . 2.05, 2.08, 8.02
Nolan Davis Ltd v Stephen Catton, unreported, 2000
(TCC) No 590 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8.20, 8.21, 10.07, 17.21
Norbrook Laboratories v A Tank [2006] EWHC 1055 (Comm);
[2006] 2 Lloyd’s Rep 485 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15.28
Nordot v Siemens [2001] CILL 1778–1779 . . . . . . . . . . . . . . . 5.79, 6.01, 6.06, 6.13, 6.15, 6.20, 7.18
North Midland Construction PLC v AE & E Lentjes [2009]
EWHC 1371 (TCC); [2009] BLR 574 . . . . . . . . . . . . . . . . . . . . . . .1.28, 2.35, 2.38, 7.28, 15.07
xxvi
Table of Cases
Northern Developments (Cumbria) Ltd v J&J Nichol

[2000] BLR 158 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.09, 2.11, 2.156, 3.91, 5.59,
7.48, 8.13, 10.02, 10.06
Nottingham Community Housing Association Ltd v Powerminster
Ltd [2000] BLR 309 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.30
OSC Building Services Ltd v Interior Dimensions Contracts Ltd

[2009] EWHC 248 (TCC); [2009] CILL 2688 . . . . . . . . . . . . . . . . . . . . . . . . . 6.13, 7.60, 7.92
O’Donnell Developments Ltd v Build Ability Ltd [2009] EWHC
3388 (TCC); [2009] 128 Con LR 141 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.140, 8.14, 8.34
O’Reilly v Mackman [1983] 2 AC 287 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8.05, 8.08, 11.03
Orange EBS Ltd v ABB Ltd [2003] BLR 323 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.51, 7.67
Outwing Construction Ltd v H Randell & Son Ltd [1999] BLR 156 . . . . . . . . . . . . . . . . . . . . . 14.18
PT Building Ltd v ROK Euro Build Ltd [2008] EWHC 3434, (TCC) . . . . . . . . . . . . . . . . 2.76, 2.86,
2.105, 3.21, 3.34, 13.27,
14.25, 14.29, 15.12, 15.24
PTB Building Services Ltd v ROK Build Ltd [2008] EWHC 343
(TCC); [2008] 117 Con LR 53. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.77
Palmac Contracting Ltd v Park Lane Estate Ltd [2005] EWHC 919,
[2005] BLR 301 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.20, 5.21, 5.46, 13.08
Palmers Ltd v ABB Power Construction Ltd [1999] BLR 426 . . . . . . . . . . . . . . . . . . . . . . . 2.25, 2.26,
2.32, 2.35, 2.36, 2.39, 2.183
Parsons Plastics (Research and Development) Ltd v Purac Ltd [2002]
BLR 334, CA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .6.08, 9.23, 9.27, 9.35, 15.33
Paul Jenson Ltd v Staveley Industries Plc, unreported, 27 September 2001 . . . . . . . . . . . . . . . . . 10.17
Pegram Shopfitters Ltd v Tally Wiejl (UK) Ltd [2003] EWCA Civ 1750;
[2004] BLR 65; [2004] 1 WLR 2082 . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.02, 1.18, 7.04, 7.09,
7.35, 7.38, 8.11, 8.15, 15.06
Pergamon Press Limited, Re [1971] Ch 388 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.40
Peter Rankilor (Dr) v Perco Engineering Services Ltd and Another,
unreported, 27 January 2006 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10.22, 13.53
Peterhead Harbour Trustees v Lilley Construction Ltd (2003) SLT 731 . . . . . . . . . . . . . . . . . . . . . 5.73
Picardi v Cuniberti & Cuniberti [2003] BLR 487 . . . . . . . . . . . . . . . . 2.46, 5.76, 13.73–13.75, 13.80
Pierce Design International Limited v Mark Johnston and Another
[2007] EWHC 1691 (TCC); [2007] BLR 381 . . . . . . . . . . . . . . . . . . . . . 2.174, 4.26, 5.30, 9.07
Pilon Ltd v Breyer Group PLC [2010] EWHC 837 (TCC);

[2010] BLR 452 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.17, 7.18, 7.53, 8.28, 8.38,
13.31, 13.35, 14.29, 15.19,
15.31, 15.32, 16.46, 17.11
Porter v Magill [2002] AC 357, HL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12.03
Prentice Island Ltd v Castle Contracting Ltd, unreported,
15 December 2003 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.55, 7.101, 10.18
Priddle v Fisher and Sons [1968] 1 WLR 1478 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.36
Primus Build Ltd v Pompey Centre Ltd & Another [2009] EWHC
1487 (TCC); [2009] BLR 437 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.197, 5.89, 7.93, 13.28,
13.46, 15.18, 15.24, 16.22
Pring & St Hill Ltd v CJ Hafner (t/a Southern Erectors) [2002]
EWHC 1775 (TCC); (2004) 20 Const LJ 402 . . . . . . . . . . . . . . . .2.192, 3.44, 3.57, 7.34, 13.43
Pro-design Ltd v New Millenium Experience Company Ltd, Liverpool
(TCC), 26 September 2001 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8.40
Project Consultancy Group, The v The Trustees of The Gray Trust [1999]
BLR 377. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.03, 6.21, 7.02, 7.08, 7.18, 7.110, 8.20
xxvii
Table of Cases
Quality Street Properties (Trading) Ltd v Elmwood (Glasgow) Ltd

[2002] CILL 1922 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.107
Quarmby v Larraby (2003), unreported, Leeds (TCC) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.31
Quartzelec Ltd v Honeywell Control Systems [2008] EWHC 3315
(TCC); [2009] BLR 328. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.55, 8.36, 8.37,
13.31, 13.35, 15.31
Quietfield Ltd v Vascroft Construction Ltd [2007] BLR 67 . . . . . . . . . . . . . . . . . . 7.106, 13.59, 13.61,
14.39–14.43, 15.27
R Durtnell and Sons Ltd v Kaduna Ltd [2003] BLR 225 . . . . . . . . . . . . . . . . . . . . . . . 5.19, 7.13, 7.89,
13.28, 14.24, 15.18, 15.23
RC Pillar & Son v The Camber (Portsmouth) Ltd [2007] EWHC
1626 (TCC); (2007) 115 Con LR 102 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.13
R G Carter Ltd v Edmund Nuttall Ltd (No 2) [2002] BLR 359 . . . . . . . . . . . . . . . . . . . . . 12.09, 13.70
RJT Consulting Engineers Ltd v DM Engineering (NI) Ltd [2001]
CILL 1766–1768 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2.58, 2.79, 5.31, 7.40, 15.09
ROK Building Ltd v Bestwood Carpentry Ltd [2010] EWHC 1409,
(TCC) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.69, 2.71, 2.81
ROK Building Ltd v Celtic Composting Systems Ltd [2009] EWHC
2664 (TCC); [2009] 130 Con LR 61 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14.12, 20.03
ROK Building Ltd v Celtic Composting Systems Ltd (No 2) [2010]
EWHC 66 (TCC); [2010] 130 Con LR 74 . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8.33, 9.34, 13.65
ROK Building Ltd v Harris Woolf Development Company Limited
[2006] EWHC 3573, (TCC) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.44
RSL (South West) Ltd v Stansell Ltd [2003] EWHC 1390,
(TCC) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .5.58, 5.63, 13.09, 13.43, 15.29
RWE Npower PLC v Alstom Power Ltd [2009] EWHC 3388
(TCC); [2009] 128 Con LR 141; [2010] CILL 2835 . . . . . . . . . . . . . . . . . . . . 2.105, 3.42, 7.75,
7.85, 9.40, 14.26, 16.11
R v Agricultural Dwelling House Advisory Committee ex parte
Brough [1897] 1 EGLR 106 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.40
R v Archbishop of Canterbury [1859] 1 E & E 545 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.08
R v Barnsley Licensing Justices [1960] 2 KB 167 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.10
R v Birmingham City Council ex parte Ferrero Limited [1991] 3 Admin LR 613 . . . . . . . . . . . . 11.28
R v Bow Street Magistrates ex parte Pinochet [2000] 1 AC 119 . . . . . . . . . . . . . . . . . . . . . . . . . . 11.10
R v Criminal Injuries Compensation Board ex parte Ince [1973] 1 WLR 1334 . . . . . . . . . . . . . . 11.31
R v Cripps ex parte Muldoon [1984] QB 686 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8.29

R v Deal Justices [1881] 45 LT 439 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.22
R v Deputy Industrial Injuries Commissioner ex parte Jones [1962] 2 QB 677 . . . . . . . . . . . . . . 11.31
R v Deputy Industrial Injuries Commissioner ex parte Moore [1965] 1 QB 456 . . . . . . . . . . . . . 11.34
R v Gaisford [1892] 1 QB 381 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.17
R v Gough [1993] AC 646 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12.03
R v Halifax Justice ex parte Robinson [1912] 76 JP 233 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.18
R v Handley [1921] 61 DLR 656 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.18
R v Henley [1892] 1 QB 504 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.17
R v Higher Education Funding Council ex parte Institute of Dental Surgery
[1994] 1 WLR 242 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.38
R v Holderness BC ex parte James Roberts Limited [1992] 5 Admin LR 470 . . . . . . . . . . . . . . . . 11.19
R v Home Secretary ex parte Doody [1994] 1 AC 531 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.37
R v Home Secretary ex parte Jahromi [1996] 8 Admin LR 197 . . . . . . . . . . . . . . . . . . . . . . . . . . 11.38
R v Home Secretary ex parte Malhi [1991] 1 QB 194 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.29
R v Home Secretary ex parte Santillo [1981] QB 778 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.24
R v Hull Prison Visitors ex parte St Germain (No 2) [1979] 1 WLR 1401 . . . . . . . . . . . . . . . . . . 11.34
xxviii
Table of Cases
R v Huntington DC ex parte Cowan [1984] 1 WLR 501 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.29

R v Immigration Tribunal ex parte Mehmet [1977] 1 WLR 795 . . . . . . . . . . . . . . . . . . . . . . . . . 11.27
R v Kent Police Authority ex parte Godden [1971] 2 QB 662 . . . . . . . . . . . . . . . . . . . . . . 11.14, 11.40
R v London County Council re Empire Theatre [1894] 71 LT 638 . . . . . . . . . . . . . . . . . . . . . . . 11.18
R v Lord President of the Privy Council ex parte Page [1993] AC 682 . . . . . . . . . . . . . . . . . . . . . . 8.06
R v Meyer [1875] 1 QBD 173 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.10
R v National Insurance Commissioner ex parte Viscusi [1974] 1 WLR 646 . . . . . . . . . . . . . . . . . 11.33
R v Newmarket Assessment Committee ex parte Allen Newport
Limited [1945] 2 All ER 371 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.34
R v Portsmouth City Council ex parte Gregory and Moss [1991] 2 Admin LR 681 . . . . . . . . . . . 11.36
R v Rand [1866] LR 1 QB 230 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.18
R v Romsey Justices ex parte Gale [1992] COD 323 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.18
R v Secretary of State for the Environment ex parte Kirkstall Valley Campaign
Limited [1996] 3 All ER 304 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.14
R v Soneji [2006] 1 AC 340 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.125, 2.126
R v Sussex Justices ex parte McCarthy [1924] 1 KB 256 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.09
R v Thames Magistrates Court ex parte Polemis [1974] 1 WLR 1371 . . . . . . . . . . . . . . . . . . . . . 11.32
R v Westminster Assessment Committee [1941] 1 KB 53 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.33
R v Wicks [1998] AC 92 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8.06
R v Wood Green Crown Court ex parte Taylor The Times, 25 May 1995 . . . . . . . . . . . . . . . . . . . 11.18
R (West) v Parole Board [2005] UKHL1, [2005] 1 WLR 350 . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.27
Racal Communications Ltd [1981] AC 374 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8.06
Rainford House Ltd v Cadogan Ltd [2001] BLR 416 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17.17
Redworth Construction Ltd v Brookdale Healthcare Ltd [2006] EWHC
1994 (TCC); [2006] BLR 366 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.66, 6.09, 14.26, 14.27
Reid v Cupper [1915] 2 KB 147 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9.41
Rentokil Allsa Environmental Ltd v Eastend Civil Engineering Ltd (1999) CILL 1506 . . . . . . . . 14.57
Richie Brothers v David Philip [2005] BLR 384 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.18, 5.25, 7.96
Ridge v Baldwin [1963] 1 QB 539 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.01, 11.07
Ringway Infrastructure Services Ltd v Vauxhall Motors Ltd [2007]
EWHC 2421, (TCC) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.33, 7.14, 7.74
Ringway Infrastructure Services v Vauxhall Motors Ltd (No 2) [2007]
EWHC 2507 (TCC); [2008] TCLR 2 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.143
Ritchie Brothers (PWC) Ltd v David Philip (Commercial) Ltd [2004]
BLR 379; [2005] SLDT 341. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.118, 2.122, 2.123,
3.79–3.81, 10.26, 14.06, 14.07, 15.21
Rupert Morgan Building Services (LLC) Ltd v Jervis & Anor [2004]
1 WLR 1867 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.159, 9.10, 9.11,
9.18, 9.19, 15.16, 15.17
Ruttell Plant Hire Ltd v Secretary of State Environment Food and
Rural Affairs [2009] EWCA Civ 97; [2009] BLR 301 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16.16
SG Hart v Dennis Smith [2009] EWHC 2223 (TCC); (2009) 159 NLJ 1296. . . . . . . . . . . 9.40, 20.03
SG South Ltd v Kingshead Cirencester LLP [2009] EWHC 2645; [2010] BLR 47 . . . . . . . . . . . . 8.41
SG South Ltd v Swan Yard (Cirencester) Ltd [2010] EWHC 376 (TCC);
[2010] 19 EG 110 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.92, 5.28, 17.26, 17.30
SL Timber Systems v Carillion Construction Ltd [2001] BLR 516 . . . . . . . . . . 2.157, 9.10, 9.17–9.19
Samuel Thomas Construction v Anon, unreported, 28 January 2000. . . . . . . . . . . . . . . . . . . . . . . 2.47
Save Britain’s Heritage v No 1 Poultry Ltd [1991] 1 WLR 153 . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.93
Shaw (Mr and Mrs Christopher) v Massey Foundation and Pilings Ltd
[2009] EWHC 493, (TCC) . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2.48, 2.49, 2.175, 16.27, 16.31
Shepherd Construction Ltd v Mecright Ltd [2000] BLR 489 . . . . . . . . . . . . . . . . . . 7.29, 7.31, 7.107
Sherwood & Casson Ltd v MacKenzie [2000] 2 TCLR 418. . . . . . . 2.09–2.11, 3.51, 3.53, 7.98, 15.37
xxix
Table of Cases
Shimizu Europe Ltd v Automajor Ltd [2002] BLR 113 . . . . . . . . . . . . . . . . . . . 8.24, 8.25, 8.35, 14.23
Shimizu Europe Ltd v LBJ Fabrications Ltd [2003] BLR 381 . . . . . . . . . . . . . . . . . . 2.166, 5.53, 5.64,
5.80, 7.01, 13.51, 15.26, 15.29
Simons Construction Ltd v Aardvark Developments Ltd [2003]
EWHC 2474; [2004] BLR 117 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.121, 2.122, 3.79, 14.06
Sindall Ltd v Abner Solland & Ors [2001] 3 TCLR 30 . . . . . . . . . . . . . . . . . . . 2.101, 7.65, 7.67, 7.88
Skanska Construction UK Ltd v The ERDC Group Ltd & Anor
[2003] SCLR 296 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.53, 7.101
Solland International Ltd v Daraydan Holdings Ltd [2002]
EWHC 220 (TCC); [2002] 83 Con LR 109 . . . . . . . . . . . . . . . . . . . . . . . . . . 2.163, 3.104, 9.35
South Bucks BC & Anor v Porter (No 2) [2004] UKHL 33;
[2004] 1 WLR 1953 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.93, 11.38
South West Contractors Limited v Birakos Enterprises Limited
[2006] EWHC 2794, (TCC) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13.12
Southern Electric v Mead Realisations [2009] EWHC 2947, (TCC) . . . . . . . . . . . . . . . . . 16.13, 16.19
Specialist Ceiling Services Northern Ltd v ZVI Construction (UK) Ltd
[2004] BLR 403 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12.20
Speymill Contracts Ltd v Eric Baskind [2010] EWCA Civ 120; [2010]
BLR 257. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8.39
St Andrews Bay Development Ltd v HBG Management Ltd [2003] SLT 740 . . . . . . . . . . . 5.24, 10.26
Staveley Industries Plc v Odebrecht Oil and Gas Services Ltd [2001] 98(10)
LSG 46. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.31
Steve Domsalla (t/a Domsalla Building Services) v Kenneth Dyason
[2007] EWHC 1174 (TCC); [2007] BLR 348 . . . . . . . . . . . . . . . . .2.46, 5.07, 5.38, 7.01, 13.79
Stiell Ltd v Riema Control Systems Ltd [2001] 3 TCLR 9 . . . . . . . . . . . . . . . . . . . . 5.87, 14.50, 14.57
Stratfield Saye Estate, Trustees of v AHL Construction Ltd [2004]
All ER (D) 77 (Dec); [2004] EWHC 3286, (TCC) . . . . . . . . . . . . . . . . . . . 2.60, 2.61, 2.65, 7.40
Strathmore Building Services Ltd v Colin Scott Greig (Trading as Hestia
Far Side Design) [2001] 17 Const LJ 72 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.164, 2.165
Stubbs Rich Architects v WH Tolley & Son Ltd, unreported, 8 August 2001 . . . . . . . . . . . . . . . . 10.21
Summit Property Ltd v Pitmans [2001] EWCA Civ 2020; [2002] CPLR 97 . . . . . . . . . . . . . . . . 10.04
Supablast (Nationwide) Ltd v Story Rail Ltd [2010] EWHC 56 (TCC);
[2010] BLR 211 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.104
T&T Fabrications Ltd v Hubbard Architectural Metalwork Ltd [2008]

EWHC B7, (TCC) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.63
Taylor v Lawrence [2002] EWCA Civ 90, [2003] QB 528. . . . . . . . . . . . . . . . . . . . . . . . . 11.22, 12.15
Thermal Energy Construction Ltd v AE & E Lentjes UK Ltd [2009]
EWHC 408, (TCC) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .3.95, 5.82, 8.36, 13.30, 15.25
Thomas Vale Construction Plc v Brookside Syston Ltd [2006]
EWHC 3637 (TCC); (2009) 25 Const LJ 675 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.167
Thomas-Fredric’s (Construction) Ltd v Keith Wilson [2003]
EWCA Civ 1494; [2004] BLR 23 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.64, 6.11, 7.03,
7.44, 8.17, 8.21, 8.22
Tim Butler Contractors Ltd v Merewood Homes Ltd [2002] 18 Const LJ 74 . . . . . . . . . . . 2.150, 8.08
Total M E Services Ltd v ABB Building Technologies Ltd [2002]
EWHC 248 (TCC); [2002] 87 Con LR 154 . . . . . . . . . . . . . . . . . . . . . . . . . . 2.78, 10.05, 17.20
Tracy Bennett v FMK Construction Ltd [2005] EWHC 1268 (TCC);
[2005] 101 Con LR 92 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.30, 5.17, 5.18, 7.57
Treasure & Son Ltd v Martin Dawes [2007] EWHC 2420 (TCC);
[2008] BLR 24 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.18, 2.54, 3.98, 5.04,
5.31, 7.42, 15.10, 20.03
Try Construction Ltd v Eton Town House Group Ltd [2003] CILL 1982 . . . . . . . . . . . . . . . . . . 13.49
xxx
Table of Cases
VGC Construction Ltd v Jackson Civil Engineering Ltd [2008] EWHC

2082 (TCC); [2008] 120 Con LR 178 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.75, 13.28
VHE Construction v RBSTB Trust Co [2000] 70 Con LR51; [2000]
BLR 187. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.11, 2.143, 2.162,
2.166, 7.54, 7.99, 9.21, 14.19
Vaultrise Ltd v Paul Cook [2004] ADJCS 04/06 . . . . . . . . . . . . . . . . . . . . . . . 3.85, 5.41, 7.109, 13.64
Vision Homes Ltd v Lancsville Construction Ltd [2009] EWHC
2042 (TCC); [2009] BLR 525 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.21, 3.42, 7.16, 7.93,
7.95, 7.105, 15.11
Vitpol Building Services v Michael Samen [2008] EWHC 2283; (2009)
25 Const LJ 319, (TCC) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.46, 16.45, 16.47, 16.57
Volker Stevin Ltd v Holystone Contracts Ltd [2010] EWHC 2344,
(TCC) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2.15, 3.67, 3.75, 12.20, 12.21
Wagner v Laubscher Brothers & Co [1970] 2 QB 313, CA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17.04

Walter Lilly & Co Ltd v DMW Developments Ltd [2008] EWHC 3139
(TCC); [2009] TCLR 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14.33, 16.45
Wates Construction Ltd v HGP Greentree Allchurch Evans Ltd [2005]
EWHC 2174 (TCC); [2006] BLR 45 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16.20
Watkin Jones v LIDL [2002] CILL 1834–1836 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.68
Watson Building Services Ltd v Harrison [2001] SLT 846 . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.26, 7.10
Westdawn Refurbishments Ltd v Roselodge Ltd [2006] Adj LR 04/25 . . . . . . . . . . . . . . . . . 2.63, 7.44
Westminster Building Co Ltd v Beckingham [2004] BLR 163 . . . . . . . . . . . . . . . . . . . . . 13.76, 13.78
Westminster Chemicals and Produce Ltd v Eicholz & Loeser [1954] 1 LLR 99 . . . . . . . . . . . 6.02, 6.03
Westwood Structural Services Ltd v Blyth Wood Park Management
Ltd [2008] EWHC 3138 (TCC); [2009] CILL 2666 . . . . . . . . . . . . . . . . . . . . . . . . . 5.40, 15.34
Whiteways Contractors (Sussex) Ltd v Impresa Castelli Construction
United Kingdom Ltd [2000] 16 Const LJ 453 . . . . . . . . . . . . . . . . . . . . . . 5.53, 7.11, 9.15, 9.19
William Hare Ltd v Shepherd Construction Ltd [2009] EWHC
1603 (TCC); [2010] BCC 332; [2010] EWCA Civ 283; [2010] BLR 358 . . . . . . . . . 2.190, 5.57
William Oakley & David Oakley v Airclear Environmental Ltd and
Airclear TS Ltd [2002] CILL 1824 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.19
William Verry (Glazing Systems) Ltd v Furlong Homes Ltd [2005]
EWHC 138, (TCC) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7.52, 7.69, 13.21, 13.59, 14.39
William Verry Ltd v London Borough of Camden [2006] EWHC 761 . . . . . . . . . . . . . . . . . . . . 2.141
William Verry v North West London Communal Mikva [2004]
BLR 3008. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.38, 5.02, 5.14, 8.18

Wimbledon Construction Company 2000 Ltd v Derick Vago [2005]
EWHC 1086 (TCC); [2005] BLR 374 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17.15, 17.23, 17.26
Windglass Windows Ltd v Capital Skyline Construction Ltd and
Another [2009] EWHC 2022 (TCC); [2009] 126 Con LR 118 . . . . . . . . . . . . . . . . . 2.168, 3.17
Wiseman v Borneman [1971] AC 279 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.28, 11.39
Woods Hardwick v Chiltern Conditioning [2001] BLR 23 . . . . . . . . . . . . . . . . . . . . 9.14, 9.19, 12.17
Workplace Technologies Plc v E Squared Ltd [2000] CILL 1607 . . . . . . . . . . . . . . . . . . . . 16.35, 16.38
Workspace Management Ltd v YJL London Ltd [2009] EWHC 2017
(TCC); [2009] BLR 497. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7.52, 9.34, 9.42, 17.29, 20.03
YCMS Ltd v Grabiner [2009] EWHC 127 (TCC); [2009] BLR 211 . . . . . . . . . . . . . . . . . . . 8.33, 9.33
Yarm Road Ltd v Costain Ltd, unreported, 30 July 2001 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.22
Yuanda (UK) Co Ltd v WW Gear Construction Ltd [2010]
EWHC 720; [2010] BLR 435 (TCC); [2010] BLR 435 . . . . . . . . . . . . . . . . . . . . . . . 3.11, 4.13,
5.91, 10.03, 10.09, 15.10, 16.17
xxxi
TABLE OF LEGISLATION, TREATIES AND
CONVENTIONS
A. Treaties and Conventions xxxiii

B. UK Statutes xxxiii
C. UK Statutory Instruments xxxiv
A. TREATIES AND CONVENTIONS s 107(5) . . . . . . . . . . . . . . . . . . . . 7.39, 7.81

s 108 . . . . . . . . . . . . .2.03, 2.12, 2.86, 2.93,
European Convention on Human Rights
2.94, 2.144, 3.02, 3.03,
Art 6 . . . . . . . . . . . . . . . . 2.137, 3.62, 13.66,
3.12, 4.07, 5.01, 5.03,
13.68, 13.69
5.66, 7.30, 7.69, 8.15,
Art 6(1) . . . . . . . . . . . . . . . . . . . . . . . 11.13
9.27, 10.02, 15.34,
15.36, App A
B. UK STATUTES s 108(1) . . . . . . . . . . . . . . . . . . . . 3.06, 5.74
Paragraph references in bold indicate that the s 108(1)–(4) . . . . . . . . . . . . . . . . . 3.11, 5.02
text is reproduced in full s 108(2) . . . . . . . . . . . . 2.116, 2.118, 2.137,
Arbitration Act 1996 3.06, 5.74, 5.89
s 9 . . . . . . . . . . . . . . . . . . . . . . 2.177, 3.101 s 108(2)(a) . . . . . . . . . . . . . . . . . 2.107, 5.74
s 42 . . . . . . . . . . . . . . . . . . . . . . 3.99, 3.109 s 108(2)(c) . . . . . . . . . . . . . . . . . . . . . . 5.67
s 57 . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.82 s 108(3) . . . . . . . . . . . . 2.109, 2.138, 2.141,
s 66 . . . . . . . . . . . . . . . . . . . . . . . . . . 14.19 3.108, 5.84, 14.16, 14.41
s 70 . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.82 s 108(4) . . . . . . . . . . . . . . .3.06, 5.74, 10.21
Contracts (Rights of Third Parties) s 108(5) . . . . . . . . . . . . . . . . . . . . 3.10, 5.01
Act 1999 . . . . . . . . . . . . . . . . . . . . . 5.43 s 108A . . . . . . . . . . . . . . . . . . . . . . . . App E
Employment Rights Act 1996 . . . . . . . . . . 2.16 s 108A(1) . . . . . . . . . . . . . . . . . . . . . . . 4.14
s 42 . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.02 s 108A(2) . . . . . . . . . . . . . . . . . . . 4.14, 4.15
Housing Grants Construction and s 109 . . . . . . . . . . . . . . 2.146, 2.147-2.174,
Regeneration Act 1996 . . . . . . . . . . . 1.19 3.02, App A
Pt 2 . . . . . . . . . . . . . . . . . . . . . . . Chapter 2 ss 109–111 . . . . . . . . . . . 2.12, 2.146-2.177,
s 101 . . . . . . . . . . . . . . . . . . . . . . . . . . 2.48 3.03, 3.04

s 104 . . . . . . . . . . . . . . . . . 2.16, 2.24-2.41, s 110 . . . . . . . . . . . . . . 2.146, 2.148, 2.154-
3.03, 7.28, App A 2.174, 4.16, 5.45, 5.53,
s 104(1) . . . . . . . . . . . . . . . . . . . . 2.17, 2.19 9.04, 9.08, App A
s 104(2) . . . . . . . . . . . . . . . .2.17, 2.20, 2.21 s 110(1) . . . . . . . . . . . . . . . . . . 2.152, 2.153
s 104(5) . . . . . . . . . . . . . . . . . . . . 2.21, 2.22 s 110(1A) . . . . . . . . . . . . . . . . . . . . . . . 4.21
s 104(6) . . . . . . . . . . . . . . . . . . . . . . . . 2.23 s 110(2) . . . . . . . . . . . . . . . . . . . . . . . 2.154
s 105 . . . . . . . 2.16, 2.24, 2.38, 7.28, App A s 110(3) . . . . . . . . . . . . . . . . . . . . . . . . 3.12
s 105(1) . . . . . . . . . . . 1.22, 2.17, 3.03, 6.06 s 110A . . . . . . . . . . . . . . . . . . . .4.16, App E
s 105(2) . . . . . . . . . . . 1.22, 2.17, 2.32-2.41, s 110B . . . . . . . . . . . . . . . 4.16, 4.19, App E
3.03, 7.28, 15.07 s 111 . . . . . . . . . . . . . . 2.146, 2.148-2.177,
s 106 . . . . . . . . . . . . .2.45, 2.48, 2.50, 4.05, 3.129, 4.22–4.24, 5.45,
8.10, 13.73, 16.57, App A 5.53, 9.04, 9.08, 9.12,
s 106A . . . . . . . . . . . . . . . . . . . .4.05, App E 9.17, 9.21, 14.54, App A
s 107 . . . . . . . . . . . . . 2.51-2.92, 2.52, 5.04, s 111(1) . . . . . . . . . . . . . .2.154, 2.158, 9.12
8.16, App A s 111(10) . . . . . . . . . . . . . . . . . . . . . . . 4.26
s 107(2)–(4) . . . . . . . . . . . . . . . . . . . . . 7.40 s 112 . . . . . . . . . . . . . . 2.180, 2.181-2.185,
App A
xxxiii
Table of Legislation, Treaties and Conventions
ss 112–115 . . . . . . . . . . . . . . . . 2.180-2.197 Insolvency Rules 1986 (SI 1986/1925)

s 113 . . . . . . . . . . . . . . 2.186-2.190, App A r 4.90 . . . . . . . . . . . . . . . . . . . . 2.106, 17.07
s 113(1) . . . . . . . . . . . . . . . . . . . . . . . 2.180 Rules of the Supreme Court
s 114 . . . . . . . . . . . . . . 2.180, 2.191, 2.192, Ord 14 . . . . . . . . . . . . . . . . . . . . . . . . . 1.03
17.18, App A Ord 47 . . . . . . . . . . . . . . . . . . . 17.02–17.27
s 114(4) . . . . . . . . . . . . . . . . . . . . 3.02, 3.07 Scheme for Construction
s 115 . . . . . . . . . 2.180, 2.193-2.197, App A Contracts (England and
s 116 . . . . . . . . . . . . . . . . . . . . . . . . . App A Wales) Regulations 1998
s 117 . . . . . . . . . . . . . . . . . . . . . . . . . App A (SI 1998/649). . . . . . . . . . . . 2.01, 3.01, App C
Human Rights Act 1998 . . . . . . . . . . . . . .3.62, Pt I, para 1 . . . . . . . . . . . . . . . . . . . . . . 3.14
13.68, 13.70 Pt I, para 2 . . . . . . . . . . . . . . . . . . 3.19–3.28
s 6(2) . . . . . . . . . . . . . . . . . . . . . . . . . 2.137 Pt I, paras 2–6. . . . . . . . . . . . . . . . . . . . 3.18
Income and Corporation Taxes Act 1988 Pt I, para 5 . . . . . . . . . . . . . . . . . . . . . . 3.23
s 562(2) . . . . . . . . . . . . . . . . . . . . . . . . 2.31 Pt I, para 6 . . . . . . . . . . . . . . . . . . 3.23, 3.28
Late Payment of Commercial Pt I, para 7 . . . . . . . . 3.15, 3.23, 3.31, 3.34–
Debts (Interest) Act 1998 . . . . 3.90, 16.16 3.39
s 8(1) . . . . . . . . . . . . . . . . . . . . . . . . . 16.17 Pt I, para 8 . . . . . . . . .3.41, 3.43, 3.45, 3.57,
s 9(2) . . . . . . . . . . . . . . . . . . . . . . . . . 16.17 7.34, 7.83
Local Democracy, Economic Pt I, para 9 . . . . . . . . .3.47, 3.48–3.55, 3.59,
Development and Construction 3.77–3.82, 3.111, 14.40
Act 2009 . . . . . . . . . . . 1.07, 3.133, 4.02 Pt I, para 10 . . . . . . . . . . . . . . . . . 3.56, 3.57
s 138 . . . . . . . . . . . . . . . . 4.04, 4.05, App E Pt I, para 11 . . . . . . . . . . . . . . . . . 3.58, 3.59
s 139 . . . . . . . . . . . . 2.51, 2.72, 4.06, App E Pt I, paras 12–19. . . . . . . . . . . . . . . . . . 3.60
s 140 . . . . . . . . . . . . . . . . 4.10, 8.31, App E Pt I, para 13 . . . . . . . . . . . . . . . . . . . . . 3.65
s 141 . . . . . . . . . . . . . . . . . . . . .4.12, App E Pt I, para 17 . . . . . . . . . . . . . . . . . 3.68–3.72
s 142 . . . . . . . . . . . . . . . 3.121, 4.16, App E Pt I, para 19 . . . . . . . . . . . . . . . . . . . . . 3.76
s 142-144 . . . . . . . . . . . . . . . . . . . . . . 2.161 Pt I, para 20 . . . . . . . . 3.16, 3.84, 3.87–3.90
s 143 . . . . . . . . . . . . . . 2.160, 3.119, 3.121, Pt I, paras 20–22. . . . . . . . . . . . . . . . . . 3.83
4.16, App E Pt I, para 22 . . . . . . . . . . . . . . . . . . . . . 3.93
s 144 . . . . . . . . . . . . . . . . . . . . .4.22, App E Pt I, para 23 . . . . . . . . . .3.104, 3.108, 14.40
s 145 . . . . . . . . . . . . . . . . . . . . .4.27, App E Pt I, paras 23–26. . . . . . . . . . . . . . . . . . 3.99
New Towns Act 1946 . . . . . . . . . . . . . . . 11.06 Pt I, para 24 . . . . . . . . . . . . . . . . . . . . 3.109
Unfair Contract Terms Act 1977 . . . . . . . 3.114 Pt I, para 25 . . . . . . . . . . . . . . . 3.110, 3.111
Pt II . . . . . . . . . . . . . . . . . . . . . 3.113–3.133
C. UK STATUTORY INSTRUMENTS Pt II, para 1. . . . . . . . . . .3.115, 3.116, 3.119
Pt II, para 2. . . . . . . . . . 3.115, 3.116, 3.119,
Civil Procedure Rules 1998 3.120
(SI 1998/3132). . . . . . . . . . . . . . . . 2.195
Pt II, para 3. . . . . . . . . . . . . . . . . . . . . 3.116

Pt 1 . . . . . . . . . . . . . . . . . . . . . . . . . . 17.18 Pt II, paras 3–7 . . . . . . . . . . . . . . . . . . 3.122
Pt 3 . . . . . . . . . . . . . . . . . . . . . . . . . . 16.48 Pt II, para 4. . . . . . . . . . . . . . . . 3.116, 3.123
Pt 7 . . . . . . . . . . . . . . . . . . . . . 16.06, 16.57 Pt II, para 5. . . . . . . . . . . . . . . . . . . . . 3.128
Pt 8 . . . . . . . . . . . .2.08, 8.28, 14.33, 14.35, Pt II, para 7. . . . . . . . . . . . . . . . . . . . . 3.125
15.04, 16.06, 16.36, Pt II, para 8. . . . . . . . . . . 3.69, 3.126, 3.127,
16.39–16.48 3.128, 5.06
Pt 11 . . . . . . . . . . . . . . . . . . . . . . . . . 16.48 Pt II, para 9. . . . . . . . . . . . . . . . . . . . . 3.129
Pt 23 . . . . . . . . . . . . . . . . . . . . . . . . . 17.02 Pt II, para 10. . . . . . . . . . . . . . . . . . . . 3.129
Pt 24 . . . . . . . . . . . . .7.02, 7.15, 7.17, 7.25, Pt II, para 11. . . . . . . . . . . . . . . . . . . . 3.132
16.02, 16.05, 16.08, Pt II, para 12. . . . . . . . . 3.117, 3.118, 3.123,
16.11, 16.18, 16.48, 3.124
17.01, 17.18 Unfair Terms in Consumer
Pt 25 . . . . . . . . . . . . . . . . . . . . . . . . . 16.37 Contracts Regulations 1999 . . . . . . .5.76,
PD 25 . . . . . . . . . . . . . . . . . . . . . . . . 16.37 13.71–13.80, 15.08
Pt 45 . . . . . . . . . . . . . . . . . . . . . . . . . 16.18 reg 5 . . . . . . . . . . . . . . . . . . . . . . . . . . 13.71
Construction Contracts (England
and Wales) Exclusion Order
1998 (SI 1998/648) . . . 2.42-2.44, App B
xxxiv
Part I
STATUTORY ADJUDICATION
1. The Latham Report and its Aftermath 3

2. Part II of the Housing Grants, Construction and
Regeneration Act 1996 13
3. The Statutory Scheme 87
4. The Local Democracy, Economic Development and
1
THE LATHAM REPORT AND ITS
AFTERMATH
Introduction 1.01 The Debates on the Bill 1.19

The Main Recommendations The Debates on the Scheme 1.31
of the Latham Report 1.07
Contract Terms 1.10
Adjudication 1.13
5.13 There are several ways to approach the concerns expressed by all sides of the
construction process about contracts. They are:—
1. To do nothing.
2. To amend existing Standard Forms to meet some of the concerns.
3. To try to define what a modern construction contract ought to contain. If
this can be achieved, there are then two further alternatives, which are to
change existing contract forms to take account of such requirements and/or
to introduce a new contract which will deliver them.
5.14 It is no longer possible to do nothing. That option can be discarded at once.
From ‘Constructing the Team’ by Sir Michael Latham, Final Report, July 1994
Introduction
A graph that indicated the health (and otherwise) of the construction industry in the UK in 1.01
the twentieth century would make a startling sight: a bewildering series of peaks and
troughs that often, but not always, mirrored the wider health of the UK economy. On
occasions in the past, many have endeavoured to promote or otherwise help the construction
industry, with a record of success that can only be described as mixed. Changing priorities
amongst the senior judiciary have not always helped to encourage stability and certainty.
Thus, for example, in Dawnays v Minter,1 Lord Denning MR decided, not for the first or the
last time, that architects’ certificates under standard forms of building contracts were, broadly
speaking, to be regarded in the same way as a cheque or cash, and that, because ‘cash flow
was the very lifeblood of the enterprise’, such certificates had to be honoured. He held that
a certified sum had to be paid, regardless of the existence of cross-claims or other potential
deductions. The principle, if that is what it was, in Dawnays v Minter was quickly overruled
1
[1971] 1 WLR 1205.
3
Statutory Adjudication
by the House of Lords in Modern Engineering Ltd v Gilbert-Ash.2 In that case Lord Diplock
famously observed that cash flow was the life blood of the village grocer, too.
1.02 The reason that these, and other reported cases concerned with interim payments, mattered so
much was due to the volatility of the construction industry. A general building contractor who
was not paid on time might find himself unable to complete the contract and, within weeks, out
of business and bankrupt. These problems were exacerbated by the fact that, by their very nature,
construction contracts have always generated disputes about payment. They last a good deal
longer than most commercial contracts, thus increasing the chances of things going wrong some-
where along the line. Most disputes arising in connection with commercial contracts concern
defects of one sort or another; in construction contracts, it is common for there to be complaints
about defects and delays, as well as the inevitable disputes about variations and extra expense.3
1.03 Following the decision in Modern Engineering, an employer who wanted to avoid making an
interim payment to his contractor was often able to do so by putting together some kind of
cross-claim which, even if it was rather thin, would be good enough to avoid summary judgement
being given on the contractor’s claim under RSC Order 14. For many years it was felt that this
was an unsatisfactory state of affairs and that, in the right circumstances, something should
be done to tip the balance at least a little way back in favour of the claiming party, even at the
temporary expense of those who had to pay. This was the genesis of compulsory adjudication.
However, it took a major recession before the idea became more widely advocated.
1.04 By the early 1990s, it was generally considered that the construction industry in the UK was
in the grip of a major and deep-seated crisis. The general recession of the late 1980s/early
1990s had hit the construction industry hard. The decline in property prices led to a reduction
in work, and the wider financial constraints meant that contractors and sub-contractors were
continually starved of the necessary cash flow. It was calculated that, by 1993, construction
output was some 39 percent below its 1990 peak, compared to a reduction of just three percent
in the manufacturing industry.4
1.05 However, the difficulties in the industry went much wider than the general effects of the
recession. Another major concern was the high cost of the UK construction industry, particu-
larly when compared with costs in Europe and in the USA. Allied to the concerns about high
cost were worries about the high proportion of disputes within the construction industry,
the length of time that it took for such disputes to be resolved, and their cost. It was, for
instance, noteworthy that during this period of recession for the industry, there was a signifi-
cant increase in the volume of work for those directly concerned with construction disputes,
including barristers, solicitors, claims consultants and other construction professionals.
1.06 The problems within the construction industry mattered because the industry itself comprised
such a major part of the UK economy overall. For example, in 1993, the value of output in
the whole construction industry was £46.3 billion, which represented about eight percent of
2 [1974] AC 689.
3
In his judgment in Pegram Shopfitters Ltd v Tally Wiejl (UK) Ltd [2003] EWCA Civ 1750, [2004] BLR 65
May LJ said: ‘Construction contracts do by their nature generate disputes about payment. If there are delays,
variations or other causes of additional expense, those who do the work often consider themselves entitled to
additional payment. Those who have the work done often have reasons, good or bad, for saying that the additional
payment is not due.’
4 See paragraph 2.6 of the Latham Report.
4
The Latham Report and its Aftermath
gross domestic product.5 With as many as 200,000 contractors in the UK, the health of the
industry plainly mattered to the health of the UK economy as a whole.
The Main Recommendations of the Latham Report

On 5 July 1993, it was announced in the House of Commons that there was to be a Joint 1.07
Review of Procurement and Contractual Arrangements in the United Kingdom Construction
Industry. The Review was funded by the Department of the Environment, together with
four industry organisations and two groups representing clients. The Review was conducted
by Sir Michael Latham. An Interim Report, entitled ‘Trust and Money’, was published in
December 2003. The Final Report, entitled ‘Constructing the Team’, was published in July
1994. This latter document is referred to below as ‘the Latham Report’. It is not to be con-
fused with the subsequent Latham Report which led, eventually, to the changes set out in
Part 8 of the Local Democracy, Economic Development and Construction Act 2009, referred
to as the 2009 Act and analysed in Chapter 4 below.
The Latham Report was extremely wide-ranging. Although this book, of necessity, concentrates 1.08
on those aspects of the Latham Report that relate to construction contracts and the efficient
resolution of construction disputes, it should be noted that the Report dealt with a wide
variety of topics, including the ‘Role of Clients’, ‘The Design Process’, ‘Selection and
Tendering Procedures’, ‘Team Work on Site’ and even ‘Liability Post-Completion’. A number
of the recommendations in these areas have yet to be implemented.
The two most radical aspects of the Latham Report concerned its recommendation of particu- 1.09
lar payment provisions to be implied into building contracts, and its unequivocal recommen-
dation of a new type of mandatory dispute resolution mechanism known as adjudication.
Contract Terms
Despite the wide range of available Standard Forms of Construction and Engineering Con- 1.10
tracts, it appears that Sir Michael Latham was unimpressed with their applicability to what
he called the ‘reality on modern construction sites’.6 He considered that certain common
features of all construction and engineering contracts were desirable and should include:—
1. a general duty to trade fairly, with specific requirements relating to payment and related
issues;
2. clearly defined work stages, including milestones or other forms of activity schedules;
3. the pre-pricing of any variations;
4. an adjudication system which was independent of contract administration.7
The recommendations for ‘the most effective form of contract in modern conditions’8 identified
13 specific elements which, in Sir Michael Latham’s view, should be included in any contract.
The Report was particularly critical of what were described as ‘unfair conditions’ that 1.11
were regularly included within construction contracts. Paragraph 8.9 of the Report
5
This statistic can be found at paragraph 2.1 of the Latham Report. The source is given as the Department
of the Environment.
6 See paragraph 5.17(2) of the Latham Report.
7 See paragraph 5.17(4) of the Latham Report.
5
(Recommendation 25) recommended that there should be a ‘Construction Contract Bill’

which should state that particular actions were unfair or invalid. These included any attempt:
1. to amend or delete those sections of the contract relating to times and conditions of payment,
and the right of interest on late payments;
2. to seek to deny or frustrate the right of immediate adjudication to any party to the contract
or sub-contract, where it has been requested by that party;
3. to refuse to implement the decision of the adjudicator;
4. to seek to exercise any right of set-off or contra-charge without:
(i) giving notification in advance;
(ii) specifying the exact reason for deducting the set-off; and
(iii) being prepared to submit immediately to adjudication and accepting the result;
5. to seek to set off in respect of any contract other than the one in progress.
1.12 In addition, the Report concluded unequivocally that ‘pay-when-paid’ clauses should be
expressly declared unfair and invalid.9 In making this recommendation, the Report was
essentially accepting the submissions made to the review by the Constructors Liaison Group
and the Confederation of Construction Specialists, representing sub-contractors, who were
particularly upset at the widespread use of such provisions. Of course, it was the sub-contractors
who often bore the financial burden of the insolvency or failure of a company much higher
up the contractual chain. Thus, in the many pieces of satellite litigation arising out of the
building of the first tower at Canary Wharf, and major developments such as the Hatfield
Galleria development over the A1 in Hertfordshire, the financial difficulties of the employers
were passed on, via ‘pay-when-paid’ clauses, to those sub-contractors who had actually carried
out the work and were therefore most at risk if the relevant payments were not made.
Adjudication
1.13 The entirety of Chapter 9 of the Latham Report was given over to a discussion about dispute
resolution. This highlighted the adversarial attitudes in the UK construction industry. Whilst
it maintained that ‘the best solution is to avoid disputes,’10 the Report realistically accepted
that a certain number of disputes were inevitable. The unequivocal recommendation in the
Report was that the best way of resolving such disputes was by way of adjudication: indeed,
at paragraph 9.4, the conclusion was that a system of adjudication ‘must become the key to
settling disputes in the construction industry’.

1.14 The Latham Report identified a number of key elements of the adjudication process that
it was recommending. Amongst other things, the Report stated that there was no inherent
reason why adjudication should not be used for any size of contract. It recommended
that there should be no restriction on the issues to be placed before the adjudicator for
decision and no specified ‘cooling-off period’ before the adjudicator could be called in.
It recommended that the adjudicator be named in the contract before the work started and
could then be called in when necessary. The Report also stated that:
As well as dealing with disputes between clients and main contractors, the contract documents
must specify that the adjudicator must have equal scope to determine disputes between
contractors and sub-contractors, and between sub-contractors and sub-sub-contractors.
Jurisdiction on sub-contract issues should not be limited to disputes over set-off. It should
9
See paragraph 8.10 of the Latham Report.
6
encompass any matter which can also be within the scope of resolution under the main
contract.11
It is interesting to note that, even at this stage, the Report grappled with the extent to which 1.15
the decisions of adjudicators should be final and binding. It is clear that at least one well-
known construction claims consultant recommended that, once an adjudicator had reached
his decision, no appeal or reference to the High Court should be permitted under any
circumstances. However, the Report concluded that this was going too far. At paragraph 9.7,
it was recorded that:
It is correct that the authority of the adjudicator/expert must be upheld, and that the decision
should be implemented at once. Such published experience as exists of adjudication—and it
does not seem very extensive at main contract level, because the possibility of the system
being used appears to induce the parties to reach their own settlement without recourse to
it—suggests that it is successful in reducing disputes without further appeal or litigation. But
it would be difficult to deny a party which feels totally aggrieved by an adjudicator’s decision
any opportunity to appeal either to the courts or arbitration. I doubt whether such a restriction
would be enforceable.
Accordingly, the Latham Report recommended that, whilst an adjudication result had to 1.16
be implemented at once, it could subsequently be overturned by the courts or an arbitrator
after practical completion. Thus, as the Report made plain, ‘if the award of the adjudicator
involves payment, it must be made at once’.12 The Report also stated that, unless there
was some exceptional or important issue of law that had to be brought to court immediately,
the courts should only be approached as a last resort, and after practical completion of the
contract.
Accordingly, at paragraph 9.14, the Report set out its recommendations as to adjudication: 1.17
I have already recommended that a system of adjudication should be introduced within
all the Standard Forms of Contract (except where comparable arrangements already exist
for mediation or conciliation) and that this should be underpinned by legislation. I also
recommend that:—
1. There should be no restrictions on the issues capable of being referred to the adjudicator,
conciliator or mediator, either in the main contract or sub-contract documentation.
2. The award of the adjudicator should be implemented immediately. The use of stakeholders
should only be permitted if both parties agree or if the adjudicator so directs.

3. Any appeals to arbitration or the courts should be after practical completion, and should
not be permitted to delay the implementation of the award, unless an immediate and
exceptional issue arises for the courts or as in the circumstances described in (4) . . .
4. Resort to the courts should be immediately available if a party refuses to implement the
award of an adjudicator. In such circumstances, the courts may wish to support the system
of adjudication by agreeing to expedited procedures for interim payment.
5. Training procedures should be devised for adjudicators. A Code of Practice should also be
drawn up under the auspices of the proposed Implementation Forum.
In these recommendations, the concept of mandatory adjudication was born. It should 1.18
not, however, be thought that this was the first time that such a dispute resolution mechan-
ism had been invented. Indeed, as May LJ pointed out in Pegram Shopfitters Ltd v Tally
Weijl (UK) Ltd,13 ‘those who consider and make policy for the building industry, including the

12
See paragraph 9.7(2) of the Latham Report.
13 [2003] EWCA Civ 1750, [2004] BLR 65.
7
government, have taken a general view over the years that a temporary balance should in
appropriate circumstances fall in favour of those who claim payment, at the temporary
expense of those who pay’ with the result that, prior to the Latham Report, a number of
standard forms of building and engineering contracts already made provision for a type of
adjudication process. What was radical about the recommendations in the Latham Report was
that adjudication would now be the compulsory first step in any dispute arising under most
construction and engineering contracts.
The Debates on the Bill

1.19 The Housing Grants Construction and Regeneration Bill was introduced early in 1996. One
of its main features were the complex provisions concerning what were ‘construction operations’
(which were covered by the Bill and therefore subject to the detailed adjudication provisions)
and what was outside the definition of ‘construction operations’, which would have the effect
of excluding the underlying contracts from the scope of the Bill. The debates in Parliament,
particularly those in the House of Lords, foreshadowed the disputes that arose in the TCC
(Technology and Construction Court) in the early days of adjudication, as to whether or not
a particular operation or activity was within or outside the Act. It is difficult, even now, to see
quite why, if adjudication was the effective solution to dispute resolution that its advocates
proclaimed it to be, it was thought necessary to exclude from its reach so many operations
that would ordinarily be within the rubric of ‘construction activities’, and thus deprive so
many parties within the construction industry of its alleged benefits.
1.20 It is instructive to take just one example from the debates to illustrate the nice distinctions
that were being, and continue to be, made. In the House of Lords on 28 March 1996, Lord
Howie of Troon used by way of example the component parts of the then new Waterloo
International Terminal. He made the point that the steel train shed was made in a factory and
then brought on site and assembled. As a result, that element of this major project would be
excluded from the Bill because of the distinction between manufacture and construction.
However the undercroft was formed of massed concrete that was carried out on site, and
would therefore be included within the Bill. However, he then went on to say that, to the
extent that parts of the undercroft were pre-cast concrete elements, manufactured elsewhere,
those might be outside the Bill after all. Earl Ferrers seemed rather reluctant to discuss
the precise consequences of the Bill for particular industries, saying that ‘those muddy what
we seek to do in the Bill’.14 Having conceded that ‘this is not a simple area’, he confirmed that
‘the fitting in of a part manufactured elsewhere’ was part of the manufacturing process and
was not therefore a construction activity. It seems a pity that no-one pointed out that the
simple task of bricklaying, the quintessential ‘construction activity’, could be described as
‘the fitting in of a part manufactured elsewhere’, and was thus, at least on one analysis,
excluded from the Bill.
1.21 Some members of the House of Lords could not understand why certain industries had
asked to be excluded from the Bill given that the principal aim of the Bill appeared to be:
. . . to ensure that where we have a contractual morass within the construction industry there
is a fall-back position to protect everyone in the industry from the previous regime of litigation
14 See Hansard, 28.3.96, column 1858.
8
concerning contracts that have not been fulfilled adequately and endless arbitration and
disputes procedures. It is a fall-back position to protect the people operating within the industry
rather than an imposition of some new series of regulations, red tape and other paraphernalia.
If one looks at it in that light, the arguments from the processing industry, the mining industry
and the small contractor effectively fall away.15
This point was later reflected in the debate in the House of Commons, when one MP, not
unreasonably, made this comparison:
There is no more reason to exclude the process industries than to exempt drivers who have
never had an accident from obeying the Highway Code. This is a good Bill, and we should
include all the industries that are relevant to construction, not leave out the process industries
because they have largely been able to manage their affairs reasonably well in the past. There
can be problems, and the industries would benefit from the legislation.16
Whatever the intrinsic merits of these points, they were not successful. When the Bill 1.22
passed into law, it included a lengthy definition of the works included within ‘construction
operations’ (s105(1)), and it also allowed the exclusion of a number of different industries
and activities which might ordinarily be thought of as encompassing ‘construction opera-
tions’ (s105(2)).
Another point that arose during the debates in the House of Lords was the extent to which it 1.23
was necessary to exclude smaller contracts from the provisions of the Bill including, of course,
the requirement for adjudication. At one stage, a minimum limit of £25,000 was suggested.17
Although this suggestion was received sympathetically, in the end the Bill passed into law
with no such lower limit. However, the fact that the Bill excluded contracts with residential
occupiers, and contracts that would take less than 45 days to complete, made it less important
to exclude small value works, since small scale work would be likely to be carried out as part
of domestic refurbishment, or take a short period to complete, and would therefore be
excluded in any event.
Unsurprisingly, there was a considerable debate about the extent to which the decision of the 1.24
adjudicator would be binding. Lord Lucas made it clear, on behalf of the Government, that
many parties wanted adjudication to resolve disputes only until practical completion of the
contract, and that this was perfectly acceptable.18 However, difficulties arose from the
proposed fall-back position that, if the contract did not provide to the contrary, the adjudicator’s
decision would be final. As Lord Berkeley put it:
I do not believe that there is any situation in which the adjudication could be made binding
on all contracts. If there is a serious problem, one cannot expect disputes worth tens or hun-
dreds of millions of pounds to be resolved in four weeks.19
However, the debate on this topic revealed a lack of clarity as to the extent to which an
adjudicator’s decision would be binding. Despite Lord Lucas registering his ‘surprise’
that arrangements could be contemplated that allowed a dispute involving £1 million or
£100 million to be settled in 28 days by a single individual, choosing his own evidence and
15
See the speech of Lord Monkswell, Hansard 28.3.96, column 1865.
16
Taken from the speech of Mr Peter Thurnham, MP for Bolton North-East in the debate on 8 July 1996
(Hansard, column 94).
17 See the speech of Viscount Ullswater, Hansard 28.3.96, column 1865.
18 Hansard 28.3.96, column 1909.
19 Hansard 28.3.96, column 1911.
9
with no form of appeal, it was pointed out that there was a risk that the Bill, and the
provisional version of the scheme included within it, provided for just that. The uncertain
nature of the status of the adjudicator’s decision was exacerbated when it was said that
‘binding’ meant that the decision was ‘the end of it unless you have a dispute which can
be taken to the court. That is a strictly limited category connected with areas of law and
misbehaviour.’20
1.25 There was grave concern that, on this point at least, the Government’s proposals were
moving away from the type of adjudication envisaged in the Latham Report. That allowed
for a decision that was binding until practical completion and had to be complied with, but
with no fetters or restrictions on the type or nature of the challenge that could be made after
practical completion. This point was made in the debate in the House of Lords by Lord
Howie of Troon who referred, not for the first time, to a confusion in the Bill between
adjudication and arbitration. He made plain that it was inherently impractical to have a
situation in which, after just 28 days, the adjudicator’s decision was binding and could only
be reviewed on a point of law. He said that the adjudicator’s decision must be subject to
revisitation ‘not only on points of law but on whether he was correct in his decision in terms
of the contract and the context in which the contract was carried out’. In the end, it was this
view that prevailed.
1.26 The Bill also included a proposed scheme for adjudication, withholding notices and the like,
to be incorporated into all contracts that made no express provision for such matters. In the
debates in both the House of Lords and the House of Commons, it can be seen from Hansard
that, whilst there was a general level of agreement as to the provisions in the Bill, there was
widespread dismay at the provisions of the proposed scheme for adjudication itself. Again,
many of the difficulties appear to arise from a confusion between adjudication and arbitration.21
There was also concern as to the over-complex nature of the scheme originally proposed,
leading to the conclusion that, although the scheme had been ‘conceived with the best inten-
tions . . . it is really a monster’.22 These criticisms reflected comments made by industry
professionals: the Institute of Civil Engineers described the scheme as originally proposed as
‘dismal’, whilst the Building Employers Confederation said that they had given the scheme
‘the thumbs down’. The Constructors’ Liaison Group described the proposed scheme as
‘quite appalling’ and the Official Referee’s Solicitors Association (now TeCSA) described it
as ‘misconceived’.23
1.27 On 7 May, the Bill was debated in the House of Commons. The majority of the debate was
given over to other elements of the Bill. There was, however, a useful introduction to the
system of adjudication proposed in the Bill. The Minister for Construction Planning and
Energy Efficiency, Mr Robert B Jones, said:
The Bill promotes a clear system of dispute resolution called adjudication. The industry is clear
about what it means by that: it wants a mechanism that produces a fast and impartial resolu-
tion of a dispute and allows the contract to continue. The industry does not want the decision
necessarily to be the final one. It wants to ensure that disputes are tested at the time, on the spot
and are resolved quickly to the parties’ satisfaction.
20
Hansard 28.3.96, column 1911, taken from the speech of Lord Lucas.
21 See the speech of Lord Howie of Troon, Hansard 28.3.96, columns 1933 and 1934.
22 Lord Howie of Troon, Hansard 28.3.96, column 1934.
23 All the references are taken from the speech of Lord Berkley, Hansard 1.4.96, column 13.
10
Our provisions provide a right to refer construction disputes for adjudication. We expect that
entitlement to be met normally by the construction industry deciding, as a matter of course,
to include adjudication arrangements in its contracts. The Government are challenging the
industry to take action to improve its contractual practice and to introduce the sort of adju-
dication arrangements that best suit it. The best outcome must be that there is no need for a
fall-back.
However, we have a view about the minimum standards that contractual adjudication must
satisfy. They relate to speed of decision, impartiality and the freedom for an adjudicator to
investigate disputes and reach his own conclusion.24
The reports in Hansard reveal that, when the Bill went into Committee, many of the poten- 1.28
tial anomalies in the definition of ‘construction operations’ were trotted out all over again.
There was much debate about the nice differences between construction maintenance and
construction repair. One MP made the justifiable point about these debates that:
We are returning to definitional problems . . . which have bedevilled the industry. There will
be a field day for lawyers and a wonderful opportunity for people to find ways of frustrating
the good intentions of the Bill and Sir Michael Latham’s Report.25
However, this intervention failed to persuade those responsible for the Bill to omit the various
complex definitions of what was within, and what was beyond, the reach of the new compulsory
adjudication process, definitions that are still giving rise to difficulties and unfairness today.26
There was also a significant debate about the effect of an adjudicator’s decision. However, 1.29
there seemed to be widespread agreement that, at least until practical completion, the
adjudicator’s decision was not simply to be regarded as a recommendation or advisory, but a
decision that had to be complied with. There was reference to the representation provided to
the Committee by Professor John Uff CBE QC, who said that the objective should be to
ensure ‘decisions of temporary finality only’.27 However, no amendment to the Bill, to make
clear the precise status of the adjudicator’s decision, was accepted.
The last debate in the Commons occurred on 8 July 1996. Some of the points identified above 1.30
were revisited in argument but with little effect on the Bill. However, although it then received the
Royal Assent, the Housing Grants Construction and Regeneration Act did not come into effect
until 1 May 1998. This was principally because of the delays in the formulation of an acceptable
scheme for adjudication. The relevant sections of the 1996 Act are attached at Appendix A.
The Debates on the Scheme

As noted above, the original scheme for adjudication proposed in 1996 as part of the Bill 1.31
attracted far more opprobrium than the Bill itself. This was largely the result of attempts to
limit the ways in which an adjudicator’s decision might be capable of later challenge. In the
debate in the House of Lords on 22 April 1996, Lord Ackner referred to the extensive criticism
of the proposed scheme and said:
24
Hansard, 7.5.96, column 52.
25
From the speech of Mr Nick Raynsford, MP for Greenwich, Hansard, 13.6.96, column 292.
26
See, for example, the recent cases of North Midland Construction PLC v AE & E Lentjes [2009] EWHC
1371 (TCC), [2009] BLR 574 and Cleveland Bridge (UK) Ltd v Whessoe-Volker Stevin Joint Venture [2010]
EWHC 1076 (TCC), [2010] BLR 415.
27 Hansard, 18.6.96, columns 331 and 332: Standing Committee F.
11
What I have always understood to be required by the adjudication process was a quick,
enforceable interim decision which lasted until practical completion when, if not acceptable,
it would be the subject matter of arbitration or litigation. That was a highly satisfactory process.
It came under the rubric of ‘pay now, argue later’, which was a sensible way of dealing expedi-
tiously and relatively inexpensively with disputes which might hold up the completion of
important contracts.
What is being proposed here is a speedy, fast-track arbitration which produces a binding
conclusion, not open to any challenge after practical completion, but fixed and firm for all
time in a wholly unrealistic time scale . . . What on earth is the point of rushing through an
arbitration which is to be final and binding in a situation probably of great complexity and,
what is worse, one where the speed can be frustrated by applications to the court of the kind
envisaged by the new Arbitration Bill which will become an Act in 1996? Because of the
finality which it is suggested is to be ingrained in the adjudication, the courts will obviously
be listened to. So there will be delay and frustration in the sense that payment will be put off
and the adjudication process which is designed will be self-defeating for a reason which I find
difficult to follow.28
1.32 As a result of this decisive intervention, and other points made during the debates about the
scheme, it was decided that further consultation would be necessary before the scheme was
finalised. In November 1996, once the Bill had received Royal Assent in July 1996, the
Department of the Environment sent out a consultation paper, seeking responses as to the
nature and extent of the scheme.
1.33 The eventual result of this consultation paper was the Scheme for Construction Contracts
(England and Wales) Regulations 1998. In the discussions on these Regulations in the rele-
vant Committees of the House of Commons and the House of Lords, it quickly became
apparent that many of the concerns, raised by Lord Ackner and others two years previously,
had been dealt with in the new version of the scheme, particularly in the removal of the
provisions making an adjudicator’s decision binding for all time. There was broad agreement
as to the contents of the proposed scheme; it was felt that, finally, the concepts of arbitration
and adjudication had been distinguished, and that the scheme allowed for a decision which
was binding and had to be complied with, although it could be challenged either in arbitration
or in the courts. The Regulations, and the Scheme for which they provided, came into effect
on 1 May 1998. They are attached as Appendix C.
1.34 As previously noted, some aspects of both the 1996 Act and the Scheme have been altered by
Part 8 of the 2009 Act, which is at Appendix E. These changes are dealt with in Chapter 4
below. However, the 2009 Act is not yet in force, and will not be until there is an amended
Scheme to go with it. At the time of writing, there is not even a draft of the new Scheme, so
the 1996 Act and the original Scheme will remain the relevant regime for some time to come,
particularly as the new provisions will apply only to construction contracts made after the
2009 Act finally comes into force.
28 Hansard, 22.4.96, columns 989–990.
12
2
PART II OF THE HOUSING GRANTS,
CONSTRUCTION AND REGENERATION
ACT 1996
General Purpose of Part II of the Act 2.01 Section 108: Adjudication 2.93
Sections 104–105: Construction Contracts ‘A Dispute’ 2.97
and Construction Operations 2.16 Notice at Any Time 2.107
Section 104 2.19 28 Days 2.114
Section 105: General 2.24 Impartiality/Fairness 2.133
The Section 105(2) Exceptions 2.32 ‘Binding’ 2.138
The Current Approach of the Courts 2.38 No Limit 2.144
Exclusion Order 1998 (SI 1998 No 648) 2.42 Sections 109, 110 and 111: Payment
Provisions 2.146
Section 106: Residential Occupier 2.45
Payment Due Under the Contract 2.155
Section 107: Agreement in Writing 2.51 Set-Off 2.162
All, Not Part, of the Agreement Must Nature and Timing of Withholding Notice 2.164
be in Writing 2.55 Relationship with Other Terms 2.169
Price 2.70 Stay For Arbitration 2.175
Formality 2.72 Stay For Adjudication 2.179
Letters of Intent 2.73
Sections 112–115 2.180
Oral Variations 2.77
Section 112: Suspension of Work 2.181
Implied Terms 2.83
Section 113: ‘Pay-When-Paid’ Clauses 2.186
Multiple/Supplemental Contracts in Writing 2.86
Section 114: The Scheme 2.191
Section 107(5) 2.87
Section 115: Service of Documents 2.193
We do not intend that adjudication should be used simply to postpone resolving disputes.
We have had enough of disputes within the construction industry. Government, the
industry and its clients want to see an end to them: they are expensive and damaging
to the industry’s productivity and reputation.
Robert Jones, Minister for Construction, Planning and Energy Efficiency1
General Purpose of Part II of the Act

The provisions relating to adjudication are set out in Part II of the 1996 Act. They are included 2.01
at Appendix A. The Scheme for Construction Contracts is at Appendix C. The early cases in
which the principles behind Part II were considered by the courts remain of critical importance.
1 Hansard, 7.5.96, column 54.
13
In Macob Civil Engineering Ltd v Morrison Construction Ltd,2 the adjudicator had directed that
Morrison should pay Macob £302,366.34 plus VAT, interest and fees. The principal dispute in
the adjudication concerned the agreement between the parties as to the relevant dates for
payment. The adjudicator decided that he could not determine what agreement, if any, had
been reached on this point and, in the absence of an adequate contractual mechanism for deter-
mining the dates when payments became due, he applied the payment provisions of Part II of
the Scheme for Construction Contracts (SI 1998 No 649). As a result of those provisions, he
held that Morrison’s notice of intention to withhold payment was out of time.
2.02 Morrison contended, amongst other things, that the decision was invalid. Their main argument
was that the adjudicator had failed to give the parties the opportunity to make representations
on the question of whether the mechanism for payment was ambiguous and therefore inad-
equate within the meaning of the Act. It was also said that he had acted in breach of natural
justice because he had invoked s42 of the Arbitration Act 1996 (peremptory orders) without
giving the parties the opportunity to make representations on that point.
2.03 Morrison argued that, to be enforceable under the Act, an adjudicator’s decision had to be a
lawful and valid decision. Thus, they said, where the validity of a decision was challenged,
that decision could not be binding or enforceable until the validity of the decision had been
determined or agreed. Dyson J (as he then was) rejected that argument. He said:
It will be seen at once that, if this argument is correct, it substantially undermines the effect-
iveness of the scheme for adjudication. The intention of Parliament in enacting the Act was
plain. It was to introduce a speedy mechanism for settling disputes in construction contracts
on a provisional interim basis, and requiring the decisions of adjudicators to be enforced,
pending the final determination of disputes by arbitration, litigation or agreement: see s108(3)
of the Act and paragraph 23(2) of Part I of the Scheme. The timetable for adjudication is very
tight (see s108 of the Act). Many would say unreasonably tight, and likely to result in injustice.
Parliament must be taken to have been aware of this. So far as procedure is concerned, the
adjudicator is given a fairly free hand. It is true (but hardly surprising) that he is required to act
impartially (s108(2)(e) of the Act and paragraph 12(a) of the Part I of the Scheme). He is,
however, permitted to take the initiative in ascertaining the facts and the law (s108(2)(f ) of the
Act and paragraph 13 of Part I of the Scheme). He may, therefore, conduct an entirely inquisi-
torial process, or he may, as in the present case, invite representations from the parties. It is clear
that Parliament intended that the adjudication should be conducted in a manner which those
familiar with the grinding detail of the traditional approach to the resolution of construction
disputes apparently find difficult to accept. But Parliament has not abolished arbitration or
litigation of construction disputes. It has merely introduced an intervening provisional stage
in the dispute resolution process. Crucially, it has made it clear that decisions of adjudicators
are binding and are to be complied with until the dispute is finall-y resolved.
2.04 Macob is the starting point for a series of reported cases that have explained in some detail the
purpose of Part II of the Act in general and the adjudication process in particular. The vast
majority of those cases confirm ‘that the purpose of adjudication is not to be thwarted by an
overly sensitive concern for procedural niceties’.3 In many ways the stark reality of the Act,
and the courts’ approach to its general purpose, was made plain early on in the case of
Bouygues (UK) Ltd v Dahl-Jensen (UK) Ltd.4 In that case Bouygues had purported to determine
2
[1999] BLR 93.
3 HHJ Lloyd QC in Balfour Beatty Construction Ltd v The Mayor & Burgesses of the London Borough of
Lambeth [2002] EWHC 597; [2002] BLR 288 at paragraph 27.
4
[2000] BLR 49. The judgments in the Court of Appeal are at [2000] BLR 522.
14
Part II of the Housing Grants, Construction and Regeneration Act 1996
the sub-contract in question and Dahl-Jensen left site. Subsequently, Dahl-Jensen issued a
notice to adjudicate claiming a variety of sums by way of additional payment, damages for
breach of contract, and delay and disruption costs. The adjudicator’s decision was based on
his calculations of the sums due to the respective parties under each head of claim. This gave
rise, on his calculations, to a balance due to Dahl-Jensen of approximately £200,000.
However, in undertaking these calculations, the adjudicator had taken a gross sum, including
retention, and deducted from it the amount actually paid during the sub-contract works.
Those amounts did not include any retention because none had by then fallen due. As a result
of this failure to compare like with like, the adjudicator incorrectly awarded Dahl-Jensen the
release of all the retention by way of his decision. Had he undertaken the calculation properly,
the net result of his award would have been completely different, with a sum of £140,000
being due from Dahl-Jensen to Bouygues.
Unsurprisingly perhaps, Bouygues refused to comply with the adjudicator’s decision. The 2.05
matter came originally before Dyson J. He decided that, in considering whether the adjudi-
cator’s decision was enforceable, the court should adopt an approach similar to that applied
by Knox J in Nikko Hotels (UK) Ltd v MEPC Plc.5 That was a rent review case in which the
tenants contended that the expert’s decision was a nullity because it was based on a mis-
interpretation of the rent review clause. Knox J held that the expert’s decision was conclusive
and not open to review on the grounds that it was erroneous in law, unless it could be shown
that the expert had not performed the task assigned to him. He said: ‘If he has answered the
right question in the wrong way, his decision will be binding. If he has answered the wrong
question, his decision will be a nullity.’
Dyson J concluded that, by effectively ordering the release of the retention, the adjudicator 2.06
had plainly made a mistake. However, he accepted the argument put forward by Bouygues
that the mistake was made in the adjudicator’s calculation of the value of the disputes that
were referred to him, and that the adjudicator had not made a mistaken decision to deal with
(or purport to deal with) a dispute that was outside his jurisdiction. Although the judge found
that it was common ground that Dahl-Jensen was not yet entitled to the release of the reten-
tion, he said that the adjudicator did not purport to determine that Dahl-Jensen was entitled
to the release of such retention. He went on to say that it was not difficult to make mistakes in
doing calculations of this type, particularly when an adjudicator was working under the severe
time constraints imposed by the 1996 Act. He concluded that the error derived from the
adjudicator’s miscalculation of the amount of the overpayment in the counterclaim and that
there could be no doubt that what the adjudicator was doing in his counterclaim analysis was
calculating the amount of the overpayment. He was, therefore, doing precisely what he had
been asked to do; he was answering the right question, but in the wrong way.
Dyson J then went on to address the consequences of that conclusion: 2.07
35. Mr Furst submits that, if Dahl-Jensen is permitted to enforce a decision which is
plainly erroneous, Bouygues will suffer an injustice, and this will bring the adjudication
scheme into disrepute. But as I said in Macob, the purpose of the scheme is to provide a
speedy mechanism for settling disputes in construction contracts on a provisional interim
basis, and requiring the decisions of adjudicators to be enforced pending final determination
of disputes by arbitration, litigation or agreement, whether those decisions are wrong in
points of law or fact. It is inherent in the scheme that injustices will occur, because from time
5
[1991] 2 EGLR 103.
15
to time adjudicators will make mistakes. Sometimes those mistakes will be glaringly obvious
and disastrous in their consequences for the losing party. The victims of mistakes will
usually be able to recoup their losses by subsequent arbitration or litigation, and possibly
even by subsequent adjudication. Sometimes they will not be able to do so, where, for
example, there is intervening insolvency, either of the victim or of the fortunate beneficiary
of the mistake.
Dyson J reiterated the difference between an erroneous decision that the adjudicator was
entitled to reach, and a decision that was outside his jurisdiction:
36. Where the adjudicator has gone outside his terms of reference, the court will not
enforce his purported decision. This is not because it is unjust to enforce such a decision.
It is because such a decision is of no effect in law. In deciding whether a decision has been
made outside an adjudicator’s terms of reference, the court should give a fair, natural and
sensible interpretation to the decision in the light of the disputes that are the subject of the
reference. There will be some cases where it is clear that the adjudicator has decided an
issue that was not referred to him or her. But in deciding whether the adjudicator has
decided the wrong question, rather than given the wrong answer to the right question, the
court should bear in mind that the speedy nature of the adjudication process means that
mistakes will inevitably occur, and, in my view, it should guard against characterising a
mistaken answer to an issue that lies within the scope of the reference as an excess of
jurisdiction.
2.08 Bouygues appealed, but their appeal was refused. Buxton LJ dismissed the argument based
on the plain injustice of the mistake, considering that Dyson J had been quite right when he
pointed out that the possibility of such an outcome was inherent in the exceptional and sum-
mary procedure provided by the 1996 Act. He made the point that unfairness in a specific
case could not be determinative of the true construction or effect of the Scheme for
Construction Contracts in general.6 Chadwick LJ also agreed with and upheld the approach
based on Nikko Hotels. He said:
28. I am satisfied, for the reasons given by Buxton LJ, that in the present case, the adjudicator
did confine himself to the determination of the issues put to him. This is not a case in which
he can be said to have answered the wrong question. He answered the right question. But, as
is accepted by both parties, he answered that question in the wrong way. That being so, not-
withstanding that he appears to have made an error that is manifest on the face of his calculations,
it is accepted that, subject to the limitations to which I have already referred, his determination
is binding upon the parties.
It should be noted that, although Bouygues remains the critical early authority on the status
and enforceability of an adjudicator’s decision, the result itself might have been different if
there had been no arbitration clause, and the court had been invited finally to decide, by way
of parallel CPR Part 8 proceedings, the issue of the adjudicator’s error.7
2.09 The decision in Bouygues set out clearly the courts’ approach to the general purpose and
policy behind the adjudication provisions of the 1996 Act. A more detailed analysis of the
general purpose and effect of the provisions of Part II of the 1996 Act can be traced
through three other early cases: Sherwood & Casson Ltd v MacKenzie,8 Northern
6
[2000] BLR 522 at 525, paragraph 15.
7 See Geoffrey Osborne Ltd v Atkins Rail Ltd [2009] EWHC 2425 (TCC); [2010] BLR 363, discussed at
16.53–16.54.
8 A decision of HHJ Thornton QC, dated 30 November 1999, reported at [2000] 2 TCLR 418.
16
Developments v J & J Nichol 9 and the decision of the Court of Appeal in C&B Scene v
Isobars.10
In Sherwood & Casson Ltd v MacKenzie, HHJ Thornton QC summarised the approach of the 2.10
courts to the 1996 Act in five propositions, as follows:
1. A decision of an adjudicator whose validity is challenged as to its factual or legal conclu-
sions or as to procedural error remains a decision that is both enforceable and should be
enforced.
2. A decision that is erroneous, even if the error is disclosed by the reasons, will still not
ordinarily be capable of being challenged and should, ordinarily, still be enforced.
3. A decision may be challenged on the ground that the adjudicator was not empowered by
the HGCRA to make the decision because there was no underlying construction contract
between the parties or because he had gone outside his terms of reference.
4. The adjudication is intended to be a speedy process in which mistakes will inevitably occur.
Thus, the court should guard against characterising a mistaken answer to an issue, which
is within an adjudicator’s jurisdiction, as being an excess of jurisdiction. Furthermore, the
court should give a fair, natural and sensible interpretation to the decision in the light of the
disputes that are the subject of the reference.
5. An issue as to whether a construction contract ever came into existence, which is one
challenging the jurisdiction of the adjudicator, so long as it is reasonably and clearly raised,
must be determined by the court on the balance of probabilities with, if necessary, oral and
documentary evidence.
This approach was adopted by HHJ Bowsher QC in Northern Developments v JJ Nichol who 2.11
expressly followed the five propositions set out by Judge Thornton in Sherwood & Casson.11
These five principles were also cited with approval by Sir Murray Stuart-Smith in his judgment
in C&B Scene.
In C&B Scene, the recorder at first instance refused C&B Scene’s application for summary 2.12
judgment and gave Isobars permission to defend on the basis that the points that they raised
as to the errors made by the adjudicator were at the very least arguable. The Court of Appeal
allowed C&B Scene’s appeal, notwithstanding the fact that the court accepted, for the
purposes of the argument, that the adjudicator had made an error in law. Sir Murray
Stuart-Smith said:
22. The real question is whether this error on the part of the adjudicator went to his jurisdiction,
or was merely an erroneous decision of law on a matter within his jurisdiction. If it was the
former the Recorder was right to hold that summary judgment should not be entered. If it was
the latter, then in my judgment the proper course, subject to any question of stay of execution,
is that the claimant is entitled to summary judgment.
23. The whole purpose of Section 108 of the Act, which imports into construction contracts
the right to refer disputes to adjudication, is that it provides a swift and effective means of
resolution of disputes which is binding during the currency of the contract and until final
determination by litigation or arbitration, Section 108(3). The provisions of Sections 109–111
are designed to enable the contractor to obtain payment of interim payments. Any dispute can
be quickly resolved by the adjudicator and enforced through the courts. If he is wrong, the
matter can be corrected in subsequent litigation or arbitration. . . .
9
[2000] BLR 158.
10 [2002] BLR 93.
11 In addition, Judge Bowsher cited with approval the statement by HHJ Hicks QC in VHE v RBSTB [2000]
BLR 187 that the courts had no general appellate jurisdiction over adjudicators.
17
30. It is important that the enforcement of an adjudicator’s decision by summary judgment

should not be prevented by arguments that the adjudicator has made errors of law in reaching
his decision, unless the adjudicator has purported to decide matters which are not referred to
him. He must decide as a matter of construction of the referral, and therefore as a matter of
law, what the dispute is that he has to decide. If he erroneously decides that the dispute referred
to him is wider than it is, then, in so far as he has exceeded his jurisdiction, his decision cannot
be enforced. But in the present case there was entire agreement to the scope of the dispute, and
the adjudicator’s decision, albeit he may have made errors of law as to the relevant contractual
provisions, is still binding and enforceable until the matter is corrected in the final
determination.
2.13 It is a theme regularly taken up in the later decisions of the TCC and the Court of Appeal,
when setting out how and why the adjudicator’s decision should be enforced provided that
he had the jurisdiction to reach it, no matter how mistaken that decision might seem, to
emphasise that the decision is of a temporary nature only. Just as Sir Murray Stuart-Smith
pointed out in the above passage that any mistakes could be corrected in subsequent litiga-
tion and arbitration, the courts have generally observed that the justification for enforcing a
decision that may be wrong in fact or in law is because that is consistent with the ‘pay now,
argue later’ philosophy built into the Act itself.12 It is worth noting, as some dissenting voices
have pointed out, that in larger construction disputes, the sums of money at stake in an
adjudication are very significant, and, since the parties have to bear their own costs of the
adjudication process, a party can lose a very considerable sum in adjudication and face no
realistic prospect of recovering that sum for months, if not years. In AWG Construction
Services Ltd v Rockingham Motor Speedway Ltd,13 HHJ Toulmin CMG QC picked up the
point from the judgment of Dyson J in Macob where it had been noted that the decision of
the adjudicator was ‘merely introduced [as] an intervening stage in the dispute resolution
process’. Judge Toulmin went on to observe:
122. The word ‘mere’ was entirely appropriate to characterise the summary and inexpensive
procedure that was envisaged by Parliament. It is a less appropriate description of a process
which has already cost over £1 million. The court has to grapple with a procedure which
Parliament introduced to provide a quick, easy and cheap provisional answer so that, in particular,
sub-contractors were not unjustly kept out of their money. It has developed into an elaborate
and expensive procedure which is wholly confrontational, a full-scale trial normally, on the
documents, of the issues referred to the adjudicator (not necessarily the whole dispute) within
a timetable of 42 days from notice of adjudication to decision by the adjudicator. . .
123. The claimant has the considerable advantage in a complex adjudication that it can choose
when to start the adjudication, having taken the time it has needed to prepare. It will then impose
a very tight timetable on the defendant and frequently on the adjudicator. It is with this in mind
that I raise the possibility that there may be disputes which are so complex and the advantages so
weighted against a defendant that there is a conflict between the right to refer to adjudication and
to obtain a decision under s108(2)(c) and (d) of the Act, and the adjudicator’s duty to act impar-
tially under s108(e) of Act and that this may be a conflict which it is impossible to resolve.
2.14 Although in the later case of CIB Properties v Birse Construction Ltd 14 the same judge signifi-
cantly modified his comments about large cases and their suitability for adjudication, his
remarks continue to strike a chord with anybody who has acted for the responding party in
12 See paragraph 1.31.

13 [2004] EWHC 888 (TCC); [2004] TCLR 6.
14 [2004] EWHC 2365 (TCC); [2005] 1 WLR 2252; [2005] BLR 173.
18
adjudication, who can often be given very little time to respond to a case of inordinate detail,
on which millions of pounds may turn, of which it has had very little prior notice. But, as
CIB v Birse makes plain, it is for the adjudicator to decide whether or not he can fairly and
properly arrive at a conclusion within the 28 days, or any extended period that may be
agreed, and if he cannot, he should refuse the appointment.15 In reality, very few do, even
when the material relied on by both sides in an adjudication has grown significantly during
the 28-day period, making it impossible for the adjudicator to produce a realistic assessment
of how long he might need to produce a fair decision, and preventing efficient case manage-
ment by either the adjudicator or the parties.16 There is little doubt, therefore, that the
potential abuse of the 1996 Act, as outlined by Judge Toulmin, remains a risk, albeit one that,
on the authorities, is rather more theoretical than real: neither the TCC nor the Court of
Appeal have been persuaded that such considerations ought to colour their approach to the
general purpose of the 1996 Act, and the enforcement of adjudicators’ decisions.
The most authoratitive statement of the general purpose of the adjudication provisions 2.15
within the 1996 Act can be found at paragraphs 85–87 of the judgment of Chadwick LJ
in Carillion Construction Ltd v Devonport Royal Dockyard Ltd,17 which are set out verbatim
at paragraph 7.111–7.113 below. Chadwick LJ emphasised that the courts would enforce
the decision of an adjudicator unless it was one of those rare instances when the question
that the adjudicator decided was not the question referred to him or the way in which he
has gone about the adjudication was obviously unfair. He noted that the adjudicator’s task
was simply to find an interim solution that met the needs of the case, and that the need to
have the ‘right’ answer had been subordinated to the need to have an answer quickly. He
also said that adjudication under the 1996 Act was not intended to provide definitive
answers to complex questions. It might be thought that this was an unequivocal statement
as to the general purpose and effect of the 1996 Act: if the adjudicator had the jurisdiction
to reach the decision he did, and if he arrived at that conclusion in a way that was not obvi-
ously unfair, it will be enforced, no matter how wrong it may ultimately prove to be.18
Sections 104–105: Construction Contracts

and Construction Operations
Sections 104 and 105 of the 1996 Act provide as follows: 2.16
104–(1) In this Part a ‘construction contract’ means an agreement with a person for any of
the following—
(a) the carrying out of construction operations;
15 In some Australian states, the adjudicator has the express power to rule that a particular dispute is not
suited to the adjudication process.

16 In Cubitt Building & Interiors Ltd v Fleetglade Ltd [2006] EWHC 3413 (TCC); [2006] 110 Con LR 36,
at paragraph 15 of his judgment, the TCC judge described this process as ‘creep’. In Enterprise Managed Services
Ltd v Tony McFadden Utilities Ltd [2009] EWHC 3222 (TCC); [2010] BLR 89 the same judge criticised the
adjudicator for not properly considering whether, in view of the nature and size of the dispute, he could reach a
proper decision in the time available and, if not, whether he should resign.
17
[2005] EWCA (Civ) 1358; [2006] BLR 15.
18 It would be futile to set out every decision since Carillion in which the judge has summarised the applicable
principles by reference to Chadwick LJ’s exposition, since there are so many of them. See by way of recent
example only Volker Stevin Ltd v Holystone Contracts Ltd [2010] EWHC 2344 (TCC), paragraph 4.
19
(b) arranging for the carrying out of construction operations by others, whether under
sub-contract to him or otherwise;
(c) providing his own labour, or the labour of others, for the carrying out of construction
operations.
(2) References in this Part to a construction contract include an agreement—
(a) to do architectural design or surveying work, or
(b) to provide advice on building, engineering interior or exterior decoration or on the
laying-out of landscape,
in relation to construction operations.
(3) References in this Part to a construction contract do not include a contract of employment
(within the meaning of the Employment Rights Act 1996).
(4) The Secretary of State may by order, add to, amend or repeal any of the provisions of sub-
section (1)(2) or (3) as to the agreements which are construction contracts for the purposes
of this Part or are to be taken or not to be taken as included in references to such contract.
No such order shall be made unless a draft of it has been laid before and approved by
resolution of each House of Parliament.
(5) Where an agreement relates to construction operations and other matters, this Part applies
to it only so far as it relates to construction operations.
An agreement relates to construction operations so far as it makes provision of any kind
within sub-section (1) or (2).
(6) This Part applies only to construction contracts which—
(a) are entered into after the commencement of this Part, and
(b) relate to the carrying out of construction operations in England, Wales or Scotland.
(7) This Part applies whether or not the law of England and Wales or Scotland is otherwise
the applicable law in relation to the contract.
105(1) In this Part ‘construction operations’ means, subject as follows, operations of any of
the following descriptions—
(a) construction, alteration, repair, maintenance, extension, demolition or dismantling of
buildings, or structures forming, or to form, part of the land (whether permanent or
not);
(b) construction, alteration, repair, maintenance, extension, demolition or dismantling of
any works forming, or to form, part of the land, including (without prejudice to the fore-
going) walls, roadworks, power-lines, telecommunication apparatus, aircraft runways,
docks and harbours, railways, inland waterways, pipe-lines, reservoirs, water-mains,
wells, sewers, industrial plant and installations for purposes of land drainage, coast pro-
tection or defence;
(c) installation in any building or structure of fittings forming a part of the land including
(without prejudice to the foregoing) systems of heating, lighting, air-conditioning, venti-
lation, power supply, drainage, sanitation, water supply or fire protection or security or
communications systems;
(d) external or internal cleaning of buildings and structures, so far as carried out in the course
of their construction, alteration, repair, extension or restoration;
(e) alterations which form an integral part of, or are preparatory to, or are for rendering com-
plete, such operations as are previously described in this sub-section, including site clear-
ance, earth-moving, excavation, tunnelling and boring, laying of foundations, erection,
maintenance or dismantling of scaffolding, site restoration, landscaping and the provi-
sion of roadways and other access works;
(f ) painting or decorating the internal or external surfaces of any building or structure.
(2) The following operations are not construction operations within the meaning of this Part—
(a) drilling for, or extraction of, oil or natural gas;
(b) extraction (whether by underground or surface working) of minerals; tunnelling or
boring, or construction of underground works, for this purpose;
20
(c) assembly, installation or demolition of plant or machinery or erection or demolition

of steelwork for the purposes of supporting or providing access to plant or machinery,
on a site where the primary activity is—
(i) nuclear processing, power generation, or water or effluent treatment, or
(ii) the production, transmission, processing or bulk storage (other than ware-housing)
of chemicals, pharmaceuticals, oil, gas, steel or food and drink;
(d) manufacture or delivery to site of—
(i) building or engineering components or equipment,
(ii) materials, plant or machinery, or
(iii) components for systems of heating, lighting, air-conditioning, ventilation,
power supply, drainage, sanitation, water supply or fire protection, or for security
or communications systems,
except under a contract which also provides for their installation;
(e) the making, installation and repair of artistic works, being sculptures, murals and
other works which are wholly artistic in nature.
(3) The Secretary of State may by order add to, amend or repeal any of the provisions of
sub-section (1) or (2) as to the operations and work to be treated as construction operations
for the purpose of this Part.
(4) No such order shall be made unless a draft of it has been laid before and approved by
We have already seen19 that much of the debate in both Houses of Parliament at the Bill stage 2.17
centred upon the apparent contradictions encompassed in these sections. Despite the many
effective points made during those debates, the Act was passed in the somewhat unusual form
set out above. Thus there is a wide definition of construction contracts in s104(1) and (2); this
wide definition is then the subject of detailed exposition at s105(1), before being the subject of
a number of equally wide exceptions (s105(2)). It is difficult not to feel instinctive sympathy with
those who pointed out during the Parliamentary debates that these definitions were likely to lead
to just the sort of disputes that the Act itself was designed to avoid. Be that as it may, the effect
of these sections is to state that the 1996 Act applies to all contracts related to the carrying out of
construction operations: there are then lengthy lists of what are included within construction
operations, and what operations, for the purposes of the Act, are very firmly excluded. As was
envisaged by Parliament, there have now been a number of reported cases on these provisions.
Before embarking on a consideration of the cases under these provisions, the point must be 2.18
made that the precise nature of the operations being performed on site will not matter if the
parties have agreed to adjudicate their disputes. In other words, an analysis under ss104 and
105 will only arise in the absence of an express contractual adjudication agreement. Thus, in
Ledwood Mechanical Engineering Ltd v Whessoe Oil and Gas Ltd.20 Ramsey J noted that the
sub-contract in question was for the fabrication and erection of pipework at a natural gas
import terminal, which was not a construction operation pursuant to the provisions of
s105(2) of the 1996 Act. However, because there was an express adjudication agreement
incorporated within the parties’ contract, the nature of the operations being performed did
not matter and the adjudicator had the necessary jurisdiction.21
19 See Chapter 1, paragraphs 1.19–1.22.

20 [2007] EWHC 2743(TCC).
21
This is merely an example of the point made in paragraphs 2.54 and 5.31, by reference to the judgement of
Akenhead J in Treasure and Son Ltd v Martin Dawes [2007] EWHC 2420 (TCC); [2008] BLR 24, that an
express contractual agreement to adjudicate will be enforced, even if, had there been no such agreed terms, the
provisions of the 1996 Act would have been excluded.
21
Section 104
2.19 The provisions at s104(1) have not caused significant difficulty. In Gillies Ramsay Diamond v
PJW Enterprises Ltd 22 a decision of the Outer House of the Court of Session, a contractor
was successful in adjudication on his claim against the employer, PJW, largely as a result of
the failure by the employer’s architect, GRD, to issue written instructions. PJW then issued
its own adjudication against GRD alleging professional negligence. One of GRD’s arguments
was that, since he was the contract administrator, such work did not fall within the definition
of a construction contract in s104(1). The court disagreed, finding that contract adminis-
tration services amounted to ‘arranging for the carrying out of construction operations by
others, whether under sub-contract . . . or otherwise’. The court held that it was of the
essence of a contract administrator’s function to arrange for the carrying out of the con-
struction operation by means of advising on consultations required, orchestrating tenders,
programming, certifying and controlling finances. The court held that, without such measures,
the construction operations would not be carried out, and certainly would not be performed
in a satisfactory way.
2.20 Section 104(2) is designed to ensure that contracts for the provision of professional services
in connection with construction operations were firmly caught by the provisions of the
1996 Act. However, s104(2) has been treated as referring only to professional services asso-
ciated with actual construction operations. Thus, in Fencegate Ltd v James R Knowles Ltd 23
James R Knowles, the well-known construction claims consultants, provided a range of ser-
vices to Fencegate in connection with a construction arbitration. Thereafter disputes arose
as to Knowles’ entitlement to fees, and these were referred to adjudication. Although the
adjudicator awarded Knowles £31,000 odd, Fencegate applied to the court for a declaration
that the adjudicator had no jurisdiction because the contract between themselves and
Knowles was not within s104(2). HHJ Gilliland QC, sitting at the TCC in Salford, rejected
the submission that the giving of factual evidence by an architect, designer or surveyor at an
arbitration fell within the words of s104(2)(a) of the 1996 Act. He held that it was not the
‘doing’ of architectural designing or surveying work itself. He decided that, although the
reporting back to the client of what had been discovered upon a survey will form an essential
part of the services that the surveyor has agreed to provide and should be regarded as part of
the actual survey (and therefore included in the ‘doing’ of the work), the giving of factual
evidence at an arbitration or in court of what had been found in the course of that survey
was a significantly different activity from actually surveying the property and reporting to
the client. The judge also held that assisting in an arbitration was not the same thing as
providing advice on building or engineering. As a result, he held that the contract fell
outside s104(2) of the 1996 Act and the adjudicator had no jurisdiction to decide the fee
dispute referred to him.
2.21 Section 104(5) has given rise to a certain amount of difficulty. As Judge Gilliland pointed out
in Fencegate 24 it is difficult to see what s104(5) adds to s104(2), particularly given that
s104(2) itself imposes a requirement that matters which are not themselves construction
operations are only brought within the definition of a construction contract (and thus within
Part II of the Act) if they relate to construction operations. Judge Gilliland concluded that
22 [2002] CILL 1901–1903.

23 [2001] CILL 1757–1759.
24 [2001] CILL 1757–1759 at paragraph 7.
22
s104(5) was intended to make clear that, where a contract related both to construction
operations and to other activities, the contract was to be treated as severable between those
parts that related to construction operations, and those parts that related to other activities,
and that Part II, and the other provisions for adjudication, were to apply to the contract only
in so far as the contract related to construction operations. This seems a sensible and practical
interpretation of the Act and would appear to be the only way in which real effect can be
given to s104(5).
In Gibson Lea Retail Interiors Ltd v Makro Self Service Wholesalers Ltd 25 Gibson Lea were 2.22
employed by Makro to supply and install shop fittings at four cash and carry stores. Gibson
Lea wished to issue adjudication proceedings and, when Makro took the point that the shop
fittings works were not construction operations within s104 of the Act, Gibson Lea sought a
declaration that the works that were the subject matter of the four contracts were indeed
construction operations. Makro’s principal argument was that the works were not construction
operations but, in the alternative, they argued that, even if some of the works undertaken by
Gibson Lea could be regarded as construction operations within the meaning of the Act, it
was plain that other items of work that they carried out were not within that description.
Thus it was argued that, at best, the Act only applied to some of the items supplied under the
contracts. In support of this submission, Makro relied on s104(5). HHJ Seymour QC found
that Makro were right and that the shopfitting work being carried out by Gibson Lea was not
within the definition of construction operations. However, he expressly found that, had it
been necessary to do so, he would have found that, on any view, the works which Gibson Lea
had agreed to undertake included specific operations that were undoubtedly not con-
struction operations, and that Makro’s submissions as to the meaning and effect of s104(5)
were therefore correct.
Section 104(6) provides two limits to the applicability of the Act. Sub-s (a) makes it clear 2.23
that the Act applies only to construction contracts that were entered into after the com-
mencement of that Part of the Act and sub-s (b) makes plain that the Part only applies to the
carrying out of construction operations in England, Wales or Scotland. There have been a
number of disputes as to the commencement provisions. In Earls Terrace Properties Ltd v
Waterloo Investments Ltd 26 HHJ Seymour QC had to deal with a situation where the con-
struction contract was dated 4 December 1996, which was before the commencement of
Part II of the Act. The contract was later varied by agreement on 20 July 1998. That variation
did not affect the content of the services to be provided, although it did alter the fee arrange-
ments. The judge held that the provisions of the 1996 Act did not apply to the first agreement
because of s104(6)(a). The question was whether the 1998 agreement made any difference.
The judge concluded that the 1998 agreement was not itself a construction contract and that
it would be a bizarre consequence if the effect of the making of such an agreement brought
the original contract within Part II of the Act. As to s104(6), the judge said this:
By making the provision which it did in s104(6) of the 1996 Act, Parliament plainly intended
that the far reaching, and to some extent possibly draconian, provisions of Part II of the 1996
Act should only apply to construction contracts which were made at a date after which the
parties making the contract were aware that the provisions of Part II were going to apply to
that contract. Parliament therefore seems deliberately to have wished not to bring within the
25 [2001] BLR 407.

26 [2002] CILL 1889–1892.
23
scope of Part II of the 1996 Act contracts which were made at a time at which the parties could
not have envisaged that provisions such as those which the 1996 Act made in relation to
adjudication would be thrust upon them.
He concluded that the variations made in the 1998 agreement were simply variations to
sums of money that were payable in respect of services that had themselves not altered and
therefore it was not contemplated that that variation could or would bring the original con-
tract within the scope of Part II of the Act.27
Section 105: General

2.24 Unlike s104, the drafting of s105 has given rise to a raft of problems, although it is thought
that the proper approach has now been clearly spelt out by Ramsey J in the two cases cited in
paragraphs 2.38–2.41 below. Many of the difficulties are inherent in the structure of this
section itself. Section 105(1) purports to define what is meant by ‘construction operations’
for the purposes of the 1996 Act. Section 105(1)(e) widens the definition further because it
includes ‘operations that form an integral part of, or are preparatory to, or are for rendering
complete, such operations as are previously described in this sub-section . . .’ However,
s105(2) then seeks to identify a number of operations that, for the purposes of the Act, are
not to be construed as ‘construction operations’ even if an ordinary, common sense view
would be that such activities were obviously construction operations.
2.25 The operation of these sections was one of the matters considered by HHJ Thornton QC in
Palmers Ltd v ABB Power Construction Ltd.28 He concluded that the right approach was as
follows:
24. In considering the somewhat convoluted section 105 of the HGCRA, it is helpful first to
notice one of its most important features. This is that there are some operations which fall
within the definition, provided by section 105(1), and would therefore appear to be construc-
tion operations and yet are not such operations as a result of section 105(2) of the Act. This is
because sub-section 105(1) states, somewhat inelegantly, that sub-section (1) applies ‘subject
as follows’ which, in its context, means that sub-section (1) is to apply unless sub-section
(2) also applies. If sub-section (2) applies, sub-section (1) is not to apply. The inapplicability of
sub-section 105(1) arises in any particular case even though most, if not all, of the relevant
operations described in sub-section (2) also fall within one of the descriptions of relevant
operations set out in sub-section (1).
2.26 In Palmers v ABB, the claimant sub-contractor sought a declaration that the work that was
the subject matter of its sub-contracts was within the 1996 Act because it comprised ‘con-
struction operations’. ABB argued that the work was excluded by s105(2) because the sites
where the work was being carried out had, as their primary activity, the generation of power.
The scaffolding provided by Palmers was used to provide temporary access and support to
the structural frame within which ABB were installing boilers and associated pipe work. The
scaffolding therefore required almost constant modification to provide the necessary access
whilst the works being carried out by ABB were progressed.
27 The decision in Earls Terrace is, perhaps, to be contrasted with the decision of HHJ Havery QC in Yarm
Road Ltd v Costain Ltd (unreported) 30 July 2001. There the original sub-contract was dated 7 August 1995,
which was before Part II of the 1996 Act came into force. There was a novation agreement dated 14 August
1998. Judge Havery held that the novation agreement discharged the original sub-contract and created a fresh
sub-contract the subject matter of which was the carrying out of construction operations. The judge therefore
concluded that the novation agreement fell within s104(6)(a).
28 [1999] BLR 426.
24
Judge Thornton held that ABB’s work was a construction operation within s105(1). He held 2.27
that the assembly and fixing to the land of industrial plant and similar features were included
within s105(1)(b). He then went on to consider the scaffolding being provided by Palmers
and said that, by reference to s105(1)(e), ‘it might be thought that there was no question but
that the scaffolding work was preparatory to one of the operations “previously described”’.
But, as he went on to note, the assembling and erecting of the boiler by ABB also fell within
the ambit of s105(2)(c), which was one of the exclusions to the Act. ABB argued that Palmers’
scaffolding work was similarly excluded. They maintained that ‘previously described in
this sub-section’ was a reference to those operations previously described which were not,
additionally, included in sub-s (2), so that it was said that such operations were not ‘previ-
ously described in this sub-section’ but were operations that were subsequently described
in sub-s (2), and therefore excluded. The judge held, by reference to the Act itself (and, if
there was any doubt about it, by reference to the Parliamentary debates), that the relevant
words suggested that s105(1)(e) was not incorporating the exclusions provided by sub-s (2).
The judge said:
34 . . . If the words had been intended to exclude from sub-section 105(1)(e) preparatory
operations for those operations which, although apparently within the ambit of sub-section
105(1), are not to be treated as being so because they are also within the definition of excluded
construction operations that are set out in sub-section 105(2), it would have been a more
natural use of language to use these words: ‘such construction operations as are previously
defined by this sub-section’ rather than the words actually used: ‘such operations as are previously
described in this sub-section’. By widening the relevant reference from ‘construction operations’
to ‘operations’ and by referring to operations that are ‘described in this sub-section’ rather than
to operations that are ‘defined by this sub-section’ the draftsman of the HGCRA appears to be
pointing to operations which fit the words of sub-section (1) even if they fall outside its ambit
by virtue of sub-section (2). In other words, scaffolding which is preparatory to an excluded
construction operation may, nonetheless, itself be a construction operation.
This was an important decision because it meant that a sub-contractor who was carrying out 2.28
an activity further down the contractual chain, which activity was plainly a ‘construction
operation’ within the meaning of s105(1), would not be deprived of his right to adjudication
merely because the site on which he was working, or the work of the main contractor for
whom he was providing certain services, may fall within s105(2) and therefore be excluded
by the Act. It construed s105(2) narrowly. However, Judge Thornton’s decision is to be

contrasted with the decision in ABB Power Construction Ltd v Norwest Holst Engineering
Ltd,29 discussed at paragraphs 2.33–2.35 below.
An argument as to the relationship between the two principal parts of s105 also arose in 2.29
Gibson Lea v Makro.30 In that case the principal argument was whether shopfitting amounted
to ‘construction operations’. Makro’s argument, which was accepted by the judge, was that
the items supplied by Gibson Lea to Makro were, in so far as they were installed, not fixtures
and therefore did not form part of the land. Thus they were not a construction operation
within s105(1)(a). However, as part of the argument before the court, Gibson Lea contended
that a purposive approach should be adopted to s105 and that, effectively, the right way to
define ‘construction operations’ under s105(1) was to include everything which arguably fell
within those words, unless the operation was specifically excluded by s105(2). The submission
29 [2000] TCLR 831.

30 [2001] BLR 407.
25
was also that it was appropriate to have regard to the terms of s105(2) to indicate that which
would fall within the definition of ‘construction operations’, but for its express exclusion
by sub-s (2). The judge concluded that, since s105(1)(a) was clear and not ambiguous, and
that since the shopfitting works in that case plainly did not fall within s105(1)(a), the Act
did not apply. However, although the judgment does not address expressly the wide argu-
ment put forward by Gibson Lea, noted above, it is submitted that their proposition cannot
be right. If a wide interpretation of the expression ‘construction operations’ was to be
adopted, with only the express exclusions at s105(2) to define those operations by way of
limited exception, the Act would have said that. Instead, the Act at s105(1) sets out a whole
list of matters that are ‘construction operations’. It is suggested, therefore, that if, on the
evidence, the work being done does not fall within s105(1) it is not a construction operation,
regardless of the position under s105(2).
2.30 The inter-relationship between the various sub-sections of s105 have themselves caused
difficulty. In Nottingham Community Housing Association Ltd v Powerminster Ltd 31 the relevant
contract provided for an annual service by Powerminster of each gas appliance in the properties
owned by the housing association. Powerminster made a claim in adjudication for unpaid
sums under the contract, and the housing association countered by contending that it
was not a construction contract within the meaning of the Act. The housing association’s
principal argument was that, although para (a) of s105(1) included within the definition
of ‘construction operations’, the ‘construction alteration, repair, maintenance, extension,
demolition or dismantling of buildings’, para (c) of s105(3), which expressly referred to ‘systems
of heating’, related only to the installation of such a system. Thus the argument was that
repair and maintenance of systems of heating were not within s105(1)(c) and was therefore
not a construction operation within the meaning of the Act. Dyson J concluded that the
maintenance and repair of heating systems that had been installed in a building were opera-
tions within para (a) and that it would be surprising if it were otherwise. However, that left
the difficulty of para (c), which, on its face, was limited to installation, and did not include
maintenance and repair. Counsel for Powerminster accepted that, on his construction of
para (a), para (c) was redundant. However, Dyson J said that he was not persuaded by the
redundancy argument and that, whatever the reason for including para (c) he was not
persuaded that its inclusion should lead him not to give para (a) what he considered to be
its clear and true meaning. He therefore held that the contract was a construction contract
within the meaning of the Act.
2.31 Another example of the court’s approach to s105(1) can be found in Staveley Industries Plc v
Odebrecht Oil and Gas Services Ltd.32 There Odebrecht sub-contracted to Staveley the design,
engineering, supply, delivery, installation, testing and commissioning of various electrical
and telecommunications equipment for installation in the modules that were intended to be
the living quarters for operatives at an oil and gas rig. Staveley sought a declaration that this
was a construction contract and contended that the work fell within s105(1)(c), as well as
s105(1)(a). The defendant said that the work did not come within s105(1)(a) or (c) because
the modules did not form part of the land. HHJ Havery QC ruled that the contract was not
a construction contract. He held that the reference to ‘the land’ in s105(1) referred to the
land where the building or structure was situated when built. Furthermore, since the provisions
31 [2000] BLR 309.

32 [2001] 98(10) LSG 46.
26
of s105(1) were derived from s562(2) of the Income and Corporation Taxes Act 1988, which
Act included a provision for offshore installations (which was not included within s105(1)
of the 1996 Act), it seemed clear that there was no intention to include offshore installations
within the 1996 Act.
The Section 105(2) Exceptions

Inevitably, the principal problem arising under s105 has been the list of exclusions contained 2.32
within s105(2). The vast bulk of these disputes have centred on cases where the party anxious
to avoid the adjudication process has argued that the work in question (often being carried
out by a sub-contractor or a sub-sub-contractor) is being performed at a site where the primary
activity is, say, power generation or bulk storage pursuant to 105(2)(c).33 The first of these
disputes to come to court was the decision of the Outer House of the Court of Session (Lord
MacFadyen) in Homer Burgess Ltd v Chirex (Annan) Ltd.34 There the pursuers were engaged
to construct pipework at the defender’s site, which pipework ran between various pieces of
machinery and equipment and by which ingredients and pharmaceuticals in the process of
manufacture were conveyed from one stage of the manufacturing process to another. The
adjudicator decided that this was a construction contract because, as an engineer, he regarded
‘plant’ as being a device or a piece of apparatus in which part of the process was effected, and
he therefore concluded that the installation of the pipework was not the installation of ‘plant’
within s105(2)(c). The court held that the adjudicator was wrong in law in defining
‘plant’ in the way in which he did and that, given that this was a decision that went to his
jurisdiction, it was one that the court was entitled to review. Lord MacFadyen found that the
pipework was part of the plant being assembled and installed at the defender’s site and that,
without that pipework, the individual pieces of machinery or equipment would be unable to
operate. Given that the pipework was in a real sense part of the apparatus which the defenders
were going to use in order to carry out their business of manufacturing pharmaceuticals, the
installation of that pipework was an operation that fell within the scope of the exception in
s105(2)(c)(ii).
The decision in Homer Burgess was considered by HHJ Lloyd QC in ABB Power Construction 2.33
Ltd v Norwest Holst Engineering Ltd.35 In that case ABB were building three boiler houses as
part of a project to extend the existing power station in Aberdeen. The area of the extension
was separated from the existing power station by a fence. ABB engaged Norwest Holst as
sub-contractors to carry out insulation/cladding works to boilers, ducts, pipework, drums
and tanks. Norwest Holst also prefabricated the materials off site. ABB contended the sub-
contract was for the assembly or installation of plant on a site where the primary activity was
power generation and that, in consequence, the exception at s105(2)(c)(i) applied. Norwest
Holst argued, amongst other things, that the work was not a site where the primary activity
‘is’ power generation but was work on a site where the primary activity would be power
generation in the future. In addition they argued that there were two sites: the existing site
and the site of the new extension.
Judge Lloyd held that the words in s105(2)(c) ‘assembly, installation . . . of plant’ included 2.34
insulation or cladding of pipework, because without insulation or cladding the boilers and
33 See for example, Palmers v ABB analysed at paragraphs 2.25–2.27.

34 [2000] BLR 124.
35 [2000] TCLR 831.
27
the associated plant would simply not function. Thus work which would otherwise be a
construction operation under s105(1) would not be a construction operation by reason of
s105(2)(c), assuming always that installation was undertaken on a site (such as a site for
nuclear processing or power generation), that was within that sub-section. He also decided
that s105(2)(c) applied to work on a site where the activity will be one of those described in
the section when the works are completed, and not only to a site where the activity ‘is’ such
an activity. He treated the site as a single site where power generation was the primary activity,
notwithstanding the existence of the fence.
2.35 In reaching his decision, Judge Lloyd adopted a different approach to that of Judge
Thornton in Palmers v ABB36 by focusing more broadly on the purpose of the site as a whole.
At paragraph 14 of his judgment in ABB v Norwest Holst, Judge Lloyd said:
14 . . . It is in my judgment clear from the language used in Section 105(2) that it was
intended that, if the regimes were not to apply, it would be invidious if they applied to some
but not all construction contracts on a site or for a project. Defining the exempt construction
operations by reference to the nature of the project or by reference to a site should minimise
the possibility that, for example, one contractor or sub-contractor would think that it was
better or worse off than another working alongside it, or preceding or following it. That would
not be conducive to the purpose of the legislation and would be inimical to the establishment
or maintenance of harmonious working relationships and the concept of team work. Section
105(2) plainly reflects the fact that the majority of construction work done for the purposes
set out in paragraphs (a) to (d) is carried out by contractors responsible for design or per-
formance and for owners or employers most of whom take an active interest in seeing that
every aspect of their project should be properly planned and coordinated. Such involvement
minimises the incidence of disputes at every level or tier. The object of this sub-section is
therefore that all the construction operations necessary to achieve the aims or purposes of the
owners or of the principal contractors (as described in it) would be exempt. If these approaches
are correct then an interpretation should be given to Section 105(2) which would further and
not thwart them.
Thus, although a narrow approach to the exclusions had been taken in Palmer v ABB, a
much broader approach was adopted by Judge Lloyd in ABB v Norwest Holt. This import-
ant difference was resolved by Ramsey J, in favour of the narrow approach, in North
Midland Construction PLC v AE & E Lentjes,37 discussed at paragraphs 2.38–2.39 below.
2.36 The exception at s105(2)(c)(i), concerned with power generation, led to a common
argument that wherever power generation plant could be found at a site, the relevant
contract or sub-contract was excluded from the workings of the Act. This argument was
rejected as fallacious by HHJ Bowsher QC in ABB Zantingh v Zedal Building Services
Ltd.38 The dispute concerned two large printing sites owned by the Miller Colour Print
Group in Watford and Oldham. At each site they decided to build a diesel-powered
generation station to supply power to their printing operations. ABB Zantingh agreed to
design, build and maintain the power generation stations, and they sub-contracted to
Zedal, the defendant, the supply, installation, labelling, termination and testing of all
field wiring. Disputes arose and Zedal appointed an adjudicator. ABB Zantingh challenged
the adjudicator’s jurisdiction on the basis that this was not a construction contract,
36 See also the decision of the Outer House in Mitsui Babcock Energy Services v Foster Wheeler Energia OY
[2001] SLT 24.

37
[2009] EWHC 1371 (TCC); [2009] BLR 574.
38
[2001] BLR 66.
28
because the work was exempted by s105(2)(c)(i). Judge Bowsher rejected this argument.
He said that, if the sites were defined as the whole areas occupied by Miller at Oldham
and Watford, then it could not conceivably be said that the primary activity of those
sites was power generation. He said that, taking those sites as a whole, power generation
could only be regarded as ancillary to the primary activity of printing colour magazines,
whether or not any excess power that might be generated at the sites could be sold to
others. He went on to find that the exception at s105(2)(c) only related to sites where
the primary activity was power generation and that there was no statutory exception in
relation to sites where the secondary or tertiary activity was power generation. He there-
fore concluded that the exception did not apply and that the relevant sub-contract was
a construction contract within the meaning of the Act.
Similarly pragmatic conclusions were reached in two later cases, Comsite Projects Ltd v Andritz 2.37
AG 39 and Conor Engineering Ltd v Les Constructions Industrielles de la Mediterranée.40 In
Comsite the claimant argued that the work sub-contracted to them by AAG, which included
the installation of wiring and building services to a dryer building that formed part of a new
waste water treatment works, was within the definition of construction operations under
s105(1). AAG argued that the work fell within s105(2)(c)(i) and was therefore excluded.
HHJ Kirkham concluded that the building services that Comsite were to install were
physically integral to the building, but not integral to the dryer plant. There was no reason to
suppose that the dryer plant was not capable of operating without any of the services to be
installed pursuant to the sub-contract. Accordingly, adopting the approach in Homer Burgess v
Chirex and ABB Power v Norwest Holst, the judge concluded that none of the services
supplied under the sub-contract were connected to the plant or used to enable the plant
physically to be operated. Their purpose and function were simply related to the building,
which involved not only the plant but also other areas of activity. The sub-contract was there-
fore a construction contract within s105(1). Similarly, in Conor, the dispute concerned a
waste incineration plant that, when in operation, turned the water in the pipes surrounding
the furnace into steam, which was then used to produce electricity. Mr Recorder Blunt QC
found that the prime purpose of the plant was the incineration of waste and that the
principal physical activity at the site was also the incineration of waste. He accepted the
argument that the generation of electricity was simply ‘a spin-off’ from the incineration pro-
cess. He decided that he could not conclude that the principal purpose of the site was power
generation, and he therefore rejected the submission that the work fell within the exception
at s105(2)(c)(i).41
The Current Approach of the Courts

The current approach of the TCC to these potentially difficult questions is best illustrated by 2.38
two decisions of Ramsey J. In North Midland Construction PLC v AE & E Lentjes UK Ltd 42
AEE entered in to four agreements with NBC, including an enabling works contract, at two
coal-fired power stations. Disputes arose between the parties and NBC sought a declaration
under CPR Part 8 that the works were construction operations under s105 and were not
39 [2003] EWHC 958 (TCC); (2004) 20 Const LJ 24.

40 [2004] EWHC 899 (TCC); [2004] BLR 212.
41
Similarly, in Edenbooth v Cre8 Developments Ltd [2008] EWHC 570 (TCC); [2008] CILL 2592, the
judge decided that groundworks and drainage work were construction operations under s105(1), and were not
excluded under s105(2)(d), which was concerned with the offsite manufacture of components.
42 [2009] EWHC 1371(TCC); [2009] BLR 574.
29
excluded by operation of s105(2)(c). It was not in issue that the enabling works and the civil
works at the two power stations would come within s105(1). The question was whether they
were excluded by operation of s105(2)(c)(i). The judge made a number of important general
observations:
(i) Operations described in s105(2) can generally be brought within the description of
operations in s105(1) so that the intention was to exclude a specific operation from the
more general description of operations;
(ii) The purpose of the Act was to make improvements in the construction industry by
providing a rapid dispute resolution method, so that the provisions which have the effect
of excluding particular operations must apply for particular reasons;
(iii) S105(2)(a)(c) is aimed at excluding certain particular operations in specific industries.
Instead of saying that all operations which would otherwise be construction operations
were excluded on sites where the primary activity is one of those industries, the exclusion
is limited to particular operations;
(iv) The definition of operations in s105(2) has not been broadened by the use of such words
as ‘operations which form an integral part of, or are preparatory to, or are for rendering
complete, such operations’ as had been done in s105(1)(e);
(v) The focus of s105(2)(c) is ‘plant or machinery’. Plant and machinery should be treated as
being components or items of plant rather than the whole industrial plant.
2.39 Ramsey J went on to review the authorities noted above and compared the different
approaches in Palmers v ABB and ABB v Norwest Holt, noting that whilst the former
construed the scope of s105(2) narrowly, the latter construed the provisions broadly so
that all the construction operations necessary to achieve the aims and purposes of the
owner would be exempt. The judge said that, on that approach, the exclusions in s105(2)
would be defined by reference to the nature or aims of those responsible for promoting
or implementing the scheme, project or activity, rather than by reference to the individual
construction operations for the assembly or installation of plant. Ramsey J concluded
that the narrower approach to the construction of s105(2), as set out in Palmers v ABB,
was generally appropriate, and more in keeping with the general observations noted in
the preceding paragraph. If it had been intended to exclude all construction operations
on a site where the primary activity was power generation then that could easily have
been done. The intent of the 1996 Act was that it should generally apply to construction
operations within s105(1), and the broad construction of s105(2) would deprive the
Act of effect in many cases, and would lead to a strained construction of the words
‘assembly, installation . . . of plant or machinery’. On the other hand, the narrow con-
struction would give effect to the Act by applying it only in cases where the work was
assembly or installation of plant or machinery. On the facts of the case, he concluded
that both the enabling works and the civil works at the two power stations were con-
struction operations as defined in s105(1) so that the provisions of the 1996 Act
applied.43
2.40 The same judge applied the same approach, but was obliged to come to a completely differ-
ent conclusion, on the facts, in Cleveland Bridge (UK) Ltd v Whessoe-Volker Stevin Joint
Venture.44 The joint venture argued that the works carried out by CB on site were excluded
43
In reaching this conclusion Ramsey J expressly approved the decision of HHJ Kirkham in Comsite Project
Ltd v Andritz AG [2003] EWHC 958 (TCC); (2004) 20 Const LJ 24 where, as noted in paragraph 2.37, the
judge rejected the broad submissions based on ABB v Norwest Holt.
44 [2010] EWHC 1076 (TCC); [2010] BLR 415.
30
by operation of s105(2)(c)(ii). In the alternative, they said that, even if some works fell
within the definition of construction operations under s105(1), other elements of the work
fell within the s105(2) exceptions, and therefore the adjudicator’s decision (which covered
both) could not be enforced. The judge adopted the same approach as in North Midlands v
Lentjes, reiterating that it was not the intention of the 1996 Act for there to be a minute
analysis to find an item that was arguably a construction operation or was within the exclu-
sion, so as to defeat the purpose of either giving or excluding the rights of the Act to or from
the contract in question. He concluded that the joint venture was right to say that the ele-
ment of the contract works that involved steelwork to the piperacks and the pipebridges was
significant and substantial work that came within the exclusion at s105(2)(c)(ii). He consid-
ered in detail the precise scope of the works to the piperacks and pipebridges, which was
excluded by operation of s105(2)(c)(ii), and concluded that the exclusion did not include
the prior activities of fabrication drawings, off-site fabrication or delivery to site of the fabri-
cated steel work.
Thus, on the facts, the judge concluded that many of CB’s operations were construction 2.41
operations in accordance with s105(1), but some were excluded by operation of s105(2).
What effect did that have on the application to enforce the adjudicator’s decision, which
dealt with claims arising in respect of both the included and excluded operations?
Ramsey J had touched on that point in North Midland v Lentjes, and expressed the view
that, if the dispute was not limited to construction operations under s105(1), it would
be impossible to apply the adjudication provisions of the Act to any part of the dispute.
But the matter was argued much more fully in Cleveland Bridge, where Ramsey J
embarked on a detailed review of the authorities.45 The judge concluded that the effect
of s104(5) was that the adjudicator did not have jurisdiction to deal with the whole of
the dispute referred to her, but did have jurisdiction in relation to that part of the dis-
pute that related to construction operations under the sub-contract. He found that
there was nothing, in principle, that prevented the adjudicator from making a decision
as to that part of the dispute that was within her jurisdiction, so that the fact that part
of the dispute related to matters over which the adjudicator had no jurisdiction did not
prevent her from exercising the jurisdiction she did have. The real issue, however, was
severability. By reference to the decision of Akenhead J in Cantillon v Urvasco,46 where
the judge had said that, in all cases where there was a decision on a single dispute or dif-
ference, and the adjudicator acts, materially, in excess of jurisdiction, the decision could
not be enforced by the court, Ramsey J concluded that the adjudicator’s decision in
Cleveland Bridge could not be severed. On the facts of that case, an attempt at severance
would produce a decision partly made by the adjudicator and partly made by the court,
and it was not the role of the court to act by opening up, reviewing and revising an adjudica-
tor’s decision in enforcement proceedings, where part of that decision was made without
jurisdiction. Thus, for all those reasons, the decision of the adjudicator was not
enforced.47
45
Paragraphs 69–90 of the judgment
46
[2008] EWHC 282 (TCC); [2008] BLR 250;.
47
It is perhaps possible to glean a certain reluctance on the part of the judge in reaching this conclusion. That
is understandable, given that, if he had felt able to dissect the amount of the decision, a sum in excess of
£100,000 would appear to have been due to CB in any event. The whole question of severability is addressed at
paragraphs 15.29–15.32.
31
Exclusion Order 1998 (SI 1998 No 648)

2.42 It is convenient here to consider the terms of the Exclusion Order (SI 1998 No 648), which
excludes certain contracts from the ambit of the 1996 Act that would otherwise fall within
it. A copy of the statutory instrument appears at Appendix B. Paragraph 3 excludes certain
agreements under statute; para 4 excludes private finance initiatives; para 5 excludes finance
agreements, as defined by the Order; and para 6 excludes development agreements, again as
defined by the Order.
2.43 There are no reported cases under paras 3–5 inclusive of the SI. In Captiva Estates Ltd v
Rybarn Ltd (In Administration)48 HHJ Wilcox had to consider para 6, concerned with
development agreements. A development agreement was excluded from the ambit of the
1996 Act ‘if it includes provision for the grant or disposal of a relevant interest in the
land on which take place the principal construction operations to which the contract
relates’. The order goes on to define a relevant interest in land as either freehold or ‘a
leasehold for a period which is to expire no earlier than 12 months after the completion
of the construction operations under the contract’. In Captiva, the contract granted
Rybarn options for the grant of leases for seven of the flats that were the subject of the
development. The terms of the contract which created that option meant that, on the
due exercise by Rybarn of the option, Captiva had an estate or interest taken away with-
out its consent and vested in another. Thus the judge found that this was a relevant
interest in land for the purposes of the Exclusion Order and was caught by paragraph 6
of the Exclusion Order. Thus he concluded that the contract was excluded from the Act
and the adjudication was invalid.
2.44 It is not clear precisely what Parliament had in mind when they excluded development
agreements from the ambit of the 1996 Act. Furthermore, para 6 of the Order is broadly
drafted, such that, as in Captiva, it covered a contract where only seven out of 28 flats were
the subject of the relevant option. As the learned editors of the Building Law Reports point
out, the wide words of para 6 appear to provide parties with a route by which they might
effectively contract out of the 1996 Act, provided of course that they were willing to incorpor-
ate an option in relation to a relevant interest in respect of part of the ongoing development.
Section 106: Residential Occupier

2.45 Section 106 of the 1996 Act provides as follows:
106–(1) This Part does not apply—
(a) to a construction contract with a residential occupier (see below), or
(b) to any other description of construction contract excluded from the operation
of this Part of order of the Secretary of State.
(2) A construction contract with a residential occupier means a construction contract
which principally relates to operations on a dwelling which one of the parties to the
contract occupies, or intends to occupy, as his residence.
In this sub-section ‘dwelling’ means a dwelling-house or a flat; and for this purpose—
‘dwelling-house’ does not include a building containing a flat; and
48
[2005] EWHC 2744 (TCC); [2006] BLR 66.
32
‘flat’ means separate and self-contained premises constructed or adapted for use for
residential purposes and forming part of a building from some other part of which the
premises are divided horizontally.
(3) The Secretary of State made by order amend sub-section (2).
(4) No order under this section shall be made unless a draft of it has been laid before and
approved by resolution of each House of Parliament.
The importance of this section has been diminished over the years, as the standard forms of 2.46
building contract have incorporated their own forms of adjudication agreement. Thus, if a
residential occupier signs a building contract that incorporates, for instance, one of the JCT
standard forms, then he is prima facie agreeing to adjudication in the event of disputes,
despite the fact that he is a residential occupier within the meaning of the Act. Accordingly,
this exception now only applies in situations where there is no express agreement to adjudicate.49
However, it remains of some significance, not least because it has been relied on to argue that,
even where an express agreement to adjudicate was incorporated into the contract with the
residential occupier, the agreement was invalid pursuant to the terms of the Unfair Terms in
Consumer Contract Regulations. Thus, in Picardi v Cuniberti & Cuniberti 50 HHJ Toulmin
CMG QC found that the adjudication provisions should have been (and were not) drawn to
the residential occupier’s attention. He referred to adjudication as ‘an unusual procedure’,
and that Parliament had specifically excluded private dwelling houses from its application.
Therefore, he said, a contract provision that, despite this exclusion, adjudication is to be
adopted is clearly an unusual provision that must be brought to the specific attention of the
lay party if it is later to be validly invoked.51 This is perhaps to be contrasted with the decision
of HHJ Thornton QC in Steve Domsalla (t/a Domsalla Building Services) v Kenneth Dyason,52
in which the residential occupier had signed a standard form with an adjudication provision.
The judge rejected the suggestion that the adjudication provisions were somehow not binding
on the employer, and he also rejected the submission that such provisions were unfair pursuant
to the Unfair Terms in Consumer Contracts Regulations. However, he did find that, on the
facts, the withholding notice provisions were unfair.
In Samuel Thomas Construction v Anon53 the adjudicator had decided that the builder’s 2.47
contract was not with a residential occupier, and was therefore caught by the 1996 Act. The
contract in question concerned the refurbishment of a number of farm buildings. One barn
was being refurbished so that the employers could live in it. However, the contract also
encompassed barn A, which was being refurbished for onward sale, as well as other barns and
a garage block. The adjudicator decided that, where the construction contract was for two
dwellings, one of which was to be occupied by one of the parties and one of which was not,
the contract in question could not be said principally to relate to operations on a dwelling
which one of the parties to the contract intended to occupy. He therefore decided that he had
49
In Vitpol Building Services v Michael Samen [2008] EWHC 2283 (TCC); (2009) 25 Const LJ 319, the
court concluded that it had the necessary jurisdiction to decide the terms of a disputed contract, in circum-
stances where the contractor was arguing that, although the work was done for a residential occupier, the con-
tract for which it contended incorporated a standard form adjudication clause which made the statutory
exclusion irrelevant. The contractor wanted findings in its favour so as to be able to commence adjudication
proceedings without the threat of a subsequent jurisdictional challenge.
50
[2003] BLR 487.
51 For a fuller discussion of this topic, see paragraphs 13.71–13.80.
52 [2007] EWHC 1174 (TCC); [2007] BLR 348;.
53 (Unreported) 28 January 2000.
33
the necessary jurisdiction to adjudicate. This decision was upheld by HHJ Overend, sitting
as the TCC judge in Exeter.
2.48 Two more recent cases demonstrate the scope and limitations of the residential occupier
exclusion.
• In Edenbooth Ltd v Cre8 Developments Ltd 54 the defendant was a development company
owned by one man and his father. They occupied two adjoining properties in Finchley
and the son was the owner of one of them. The development company had engaged
a contractor who obtained an adjudicator’s decision in his favour. On enforcement,
the company argued that the residential occupier exclusion operated in its favour.
The TCC judge rejected that submission for three reasons. First, the defendant was a
company, and the judge said that it was difficult to imagine how a company could ever
be a residential occupier, since the use of the word ‘residential’ conveyed a requirement
that, for the exemption to bite, a real person must be living in—residing in—the house
or flat in question. Secondly, he noted that the defendant company was engaged in
property development, which was its stated purpose. The contract was with the
company, not the individuals, which again negated the suggestion that the work was
being carried out by or on behalf of a residential occupier, and instead supported the
view that this was a purely commercial arrangement. Thirdly, the defendant company
was not the registered owner of either property. Accordingly, the judge concluded that
the residential occupier exemption did not apply.
• In Mr and Mrs Christopher Shaw v Massey Foundation and Pilings Ltd 55 the same judge
reached the same conclusion, albeit on very different facts. There, the work in question
was being carried out to one of the lodge buildings that formed part of a large country
estate centred on Great Moreton Hall. Although, the claimants occupied the Hall, the
lodge was a separate building, which was not occupied and in which the claimants did
not intend to live. At first instance the judge had concluded that the residential occupier
exemption did not apply. That decision was upheld on appeal, for the same reason. The
definition of ‘dwelling’ in s106 did not encompass the lodge building because it was not
a dwelling which one of the parties to the contract occupied or intended to occupy as his
or her residence. The definition of ‘dwelling’ in Part I, s101 of the 1996 Act, which
includes ‘outhouses and appurtenances belonging to the dwelling’, was found to be
irrelevant to Part II in general and s106 in particular.

2.49 The unnecessary complexities created by the residential occupier exclusion were illustrated
by the TCC judge in Shaw v Massey at paragraph 37 of his judgement. He said:
Mrs Shaw repeatedly maintained that she and her husband were being discriminated against
because of the size of their principal property. As I explained to her during argument, I hope
politely, this was nonsense. Under the definition in s106, an old lady who can no longer afford
to live in her terraced house may spend her savings on a conversion of the house into three small
flats, one of which she will live in, the other two being sold or rented. On that basis, the s106
exclusion would not apply to her either, because of the commercial elements of the works (as per
Thomas). The section excludes certain works but does not exempt others: it is a matter of the
words used in the section and it has nothing to do with the size of the property owned by the
employer.
54 [2008] EWHC 570 (TCC); [2008] CILL 2592.

55 [2009] EWHC 493 (TCC).
34
One further complication arising from these provisions concerns the work done to the 2.50
common parts of a building that might be divided into flats, one of which is owned by the
residential occupier employing the contractor. It would appear that, if the contract was solely
for work in respect of those common parts, the exception at s106 would not apply because it
could not be said that the construction contract principally related to operations in the flat
occupied by the employer. It may be more difficult to say whether or not the exception
applied if the contract was for both work to the common parts and work to the employer’s
own flat.
Section 107: Agreement in Writing

Before embarking on this analysis of s107, the critical point needs to be made that, pursuant 2.51
to s139 of the Local Democracy, Economic Development and Construction Act 2009
(Appendix E), this exclusion will be done away with altogether, and it will no longer be
necessary for a party who does not have the benefit of an express adjudication agreement to
demonstrate that all of the terms of the construction contract are in writing before being able
to refer a dispute to adjudication.56 But it is as yet unclear when s139, or any other part of
the 2009 Act, will come into force. Moreover, the new provision only applies to contracts
made after it comes into force, so there will be a potentially long period during which the
provisions in s107 of the 1996 Act will remain applicable. For both these reasons, the next
42 paragraphs deal in some detail with this troublesome section of the 1996 Act.
Section 107 of the Act provides as follows: 2.52
107–(1) The provisions of this Part apply only where the construction contract is in writing,
and any other agreement between the parties as to any matter is effective for the
purposes of this Part only if in writing.
The expressions ‘agreement’, ‘agree’ and ‘agreed’ shall be construed accordingly.
(2) There is an agreement in writing—
(a) if the agreement is made in writing (whether or not it is signed by the parties),
(b) if the agreement is made by exchange of communications in writing, or
(c) if the agreement is evidenced in writing.
(3) Where parties agree otherwise than in writing by reference to terms which are in
writing they make an agreement in writing.

(4) An agreement is evidenced in writing if an agreement made otherwise than in writing
is recorded by one of the parties, or by a third party, with the authority of the parties
to the agreement.
(5) An exchange of written submissions in adjudication proceedings, or in arbitral or
legal proceedings in which the existence of an agreement otherwise than in writing
is alleged by one party against another party and not denied by the other party in his
response constitutes as between those parties an agreement in writing to the effect
alleged.
(6) References in the Part to anything being written or in writing included being
recorded by any means.
At first sight, this is a rather curious set of provisions. They appear to be designed to achieve 2.53
two different results. On the one hand, sub-ss (2), (3), (4) and (5) are all intended to ensure
that there will be an agreement in writing for the purposes of the 1996 Act, even if there is
56 The relevant provisions are discussed at paragraphs 4.06–4.09.
35
not a completed contract form. On the other hand, the underlying principle of the section
is a recognition that, if the terms of the contract are in doubt, particularly if the argument
concerns what was said and/or agreed during particular conversations, then it would be an
impossible task for an adjudicator to decide the underlying dispute in circumstances where
the relevant terms of the contract itself are in issue.
2.54 Again, the point needs to be made at the outset that these provisions are of no relevance if
there is an agreed adjudication provision (even if it is said that not all of the other contract
terms were in writing). Thus in Treasure & Son Ltd v Martin Dawes57 although there was a
standard form contract with an adjudication clause, it was submitted that, because there was
an oral variation to a written contract, so that not all the terms were in writing, it was
therefore not a construction contract in writing in accordance with s107 and the adjudication
provisions therefore did not apply. Akenhead J rejected that submission, holding that where
there was a contractual agreement to adjudicate, that adjudication process was not under-
mined, jurisdictionally or otherwise, by the fact that the terms of the original contract (which
contained the adjudication clause) were orally varied. In other words, s107 only applies at all
if there is no express contractual agreement to adjudicate.
All, Not Part, of the Agreement Must be in Writing

2.55 The most important sub-section is sub-s (2). This appears to recognise that it is common in
the UK construction industry for the parties to work quite happily on the basis of an agreed
contract, without a formalised set of contract documents in place. Thus the sub-section
provides that there is an agreement in writing, whether or not that agreement is actually
signed, or if the agreement is made by an exchange of letters, or if there is some other way in
which the agreement can be said to be evidenced in writing. The leading case on this sub-
section is the Court of Appeal decision in RJT Consulting Engineers Ltd v DM Engineering
(NI) Ltd.58
2.56 RJT agreed to complete the design of some mechanical engineering works for DM. The
agreement was oral. DM complained about the quality of the design and commenced
adjudication proceedings. RJT maintained that, because the contract was oral, the adjudicator
had no jurisdiction. HHJ Mackay QC rejected that argument. He referred to the corres-
pondence, which made reference to an oral agreement, and concluded that there was sufficient
material to bring the agreement within s107(2). He said:

It seems to me that if I were to find that it is necessary to have a recitation of the terms of
an agreement when the existence of the agreement, the parties to the agreement and the
nature of the work and the price of the agreement are plainly to be found in documentary
form, but nonetheless in a contract worth more than three-quarters of a million pounds
because the initial agreement was oral, it is not caught by the Act, and it seems to me such
an attempt would run contrary not only to the terms of the Act but contrary to my duty
to carry out what I believe to be the law at any particular time. And therefore, adopting
that methodology, I hold that it is not necessary to have the terms identified and the exten-
sive documentary evidence in this case is well sufficient to bring it within the adjudication
proceedings . . .
57
[2007] EWHC 2420 (TCC); [2008] BLR 24.
58 The first instance decision was that of HHJ Mackay QC, the TCC judge in Liverpool, reported at [2001]
CILL 1766–1768. The Court of Appeal decision, which allowed the appeal from Judge Mackay’s decision, is
reported at [2002] BLR 217.
36
RJT appealed. The Court of Appeal allowed the appeal. One strand in the judgments of both 2.57
Ward LJ and Auld LJ was the absence, in the written material before them, of a clear record
of the terms that had been agreed orally. As Auld LJ put it at paragraph 21 of the judgment,
‘the material terms of the agreement were insufficiently recorded in writing in any of those
forms’. However, it is clear from the judgment of Ward LJ that the majority of the Court of
Appeal were persuaded that, as a matter of principle, it was important for the purposes of
s107(2) that all of the material terms were recorded in writing in order for the contract to
come within the relevant sub-section. At paragraph 12 of his judgment Ward LJ said:
[s107] must be seen against the background which led to the introduction of this change. In
its origin it was an attempt to force the industry to submit to a standard form of contract. That
did not succeed but writing is still important and writing is important because it provides
certainty. Certainty is all the more important when adjudication is envisaged to take place
under a demanding timetable. The adjudicator has to start with some certainty as to what the
terms of the contract are.
As to the requirements of s107 itself, Ward LJ, at paragraph 19 of his judgment, was 2.58
unequivocal:
On the point of construction of section 107, what has to be evidenced in writing is, literally,
the agreement, which means all of it, not part of it. A record of the agreement also suggests a
complete agreement, not a partial one. The only exception to the generality of that construc-
tion is the instance falling within sub-section 5 where the material relevant parts alleged and
not denied in the written submissions in the adjudication proceedings are sufficient.
Unfortunately I do not think sub-section 5 can so dominate the interpretation of the section
as a whole so as to limit what needs to be evidenced in writing simply to the material terms
raised in the arbitration.
Ward LJ was, however, anxious to ensure that this point did not lead to what he described as
‘jurisdictional wrangling’ and he expressed the hope that adjudicators would be robust in
excluding the trivial from the ambit of the agreement. Robert Walker LJ agreed with the
judgment of Ward LJ.
Although the third member of the Court of Appeal, Auld LJ, agreed that the appeal should be 2.59
allowed, he appeared to express himself in rather different language, emphasising (as already
noted) that it was only the ‘material’ terms which had to be in writing. For this reason, the
decision of the Court of Appeal in RJT Consulting has been summarised in three propositions:59
1. a contract is not evidenced in writing merely because there are documents that indicate
the existence of a contract;
2. all the terms of the oral agreement must be evidenced in writing;
3. alternatively, as per Auld LJ, the material terms of the agreement must be evidenced in
writing.
This summary highlights the potentially important difference between the majority and 2.60
Auld LJ. Is it all the terms that have to be in writing, or just the material terms, and, if the latter,
how can it be determined what is ‘material’ and what is not? The answer to this potential
difficulty was provided by Jackson J in Trustees of the Stratfield Saye Estate v AHL Construction.60
59 See the decision of HHJ Bowsher QC in Carillion Construction Ltd v Devonport Royal Dockyard [2003]
79, at 83, paragraph 25.

60 [2004] EWHC 3286 (TCC); [2004] All ER (D) 77 (DEC).
37
The judge pointed out that the remarks of Auld LJ were not the views of the majority, and that
it was not possible to regard them ‘as some kind of gloss upon or amplification of the majority.
The reasoning of Auld LJ, attractive though it is, does not form part of the ratio of RJT.’
Therefore, as he stressed, what mattered was the recording of all the contract terms in writing.
2.61 The principles in RJT, as explained by Jackson J in Stratfield Saye, have been applied in a
number of subsequent cases.61 It is instructive to take a number of examples to see the courts’
general approach to ensuring that, wherever possible, an objection raising a deficiency in the
written record of the contract terms will not usually be permitted to frustrate the enforce-
ment of the adjudicator’s decision.
2.62 In Dean & Dyball Construction Ltd v Kenneth Grubb Associates Ltd 62 Dean & Dyball were
contractors building a marina at Watchet in Somerset. They engaged Grubb to carry out
related design work. Grubb sent Dean & Dyball a letter, called the proposal letter, in May
2000, which said that his offer was open for a period of 30 days. The proposal was not
accepted in that time but, on 23 August 2000, Dean & Dyball accepted the proposal and
said that: ‘Our official appointment letter will follow in due course’. In fact, no such letter
was sent. HHJ Seymour QC held that the absence of such a letter did not prevent the finding
that the parties had entered into a binding contract. The judge went on to reject the submission
that, in some way, the contract was partly oral and partly in writing, and concluded that the
contract was evidenced in writing and was therefore within the provisions of s107(2).
2.63 Two subsequent cases from the TCC in Birmingham, and two from London, show the
courts’ general approach to disputes concerning terms allegedly agreed orally.
1. In Debeck Ductwork Installation Ltd v TE Engineering Ltd,63 HHJ Kirkham was dealing
with an application to enforce an adjudicator’s decision. The claimant, Debeck, claimed
that there was a fax, sent by them to the defendant, which evidenced the agreement in
writing. On the facts, the judge rejected that submission. She found that the fax in ques-
tion did not set out or record all of the matters on which Debeck itself sought to rely in
pursuing its claim. For example, the fax did not explain, even in summary terms, the
scope of the work to be undertaken. In addition, the fax made no mention of a number
of further terms of the contract on which the defendant relied, including issues concern-
ing specification, quality and timing. The judge concluded that it was quite wrong for
Debeck to argue that it was entitled to rely on a document that did not contain all the
relevant terms, and then to ignore, and invite the court to disregard, the additional terms
that the defendant said had been agreed orally. The judge therefore concluded that
Debeck could not show that there was an agreement that had been evidenced in writing
and that the adjudicator did not have the necessary jurisdiction to decide the dispute.
2. In Westdawn Refurbishments Ltd v Roselodge Ltd 64 HHJ McCahill QC refused the summary
enforcement of an adjudicator’s decision because he concluded that many of the contract
terms, including the important agreements as to when an invoice would be rendered, and
when the interim payments would be made, were agreed orally. The case is interesting
because the referring party was obviously aware of the potential difficulties with its case on
61
See, by way of example, Bennett Electrical Sevices Ltd v Inviron Ltd (paragraph 2.74) and A.R.T. Consultancy
Ltd v Navera Trading Ltd (paragraph 2.68).
62 [2003] EWHC 2465; [2003] 100 Con LR 92.
63 Unreported, 14 January 2002, HHJ Kirkham (sitting at the TCC in Birmingham).
64 [2006] Adj LR 04/25.
38
the contract, and argued before the adjudicator that, because no terms were agreed orally,
the contract must therefore have been made up of written terms and/or terms to be implied
from various statutes. This was not only wrong on the facts of the case, but it is also thought
that, even if it could have been shown that nothing was agreed orally, it is potentially dan-
gerous for a claimant to put its case on a contract in writing in such a nebulous way.
3. In Bennett Electrical Services v Inviron Ltd,65 HHJ Wilcox held that a letter of intent,
which was plainly marked ‘subject to contract’, could not evidence or give rise to a bind-
ing contract. Further, even if it did, it could not be said that all the terms of the contract
were in writing, in accordance with RJT. He therefore held that the adjudicator had no
jurisdiction.
4. In Flannery Construction Ltd v M Holleran (2007) Ltd,66 the same judge concluded
that the various documents relied on as forming the contract did not identify with any
certainty the scope of the works or how that scope might be varied in the future. He
also found that the documents evidenced a major (and unresolved) difference between
the parties, because one side wanted one overall ‘framework’ agreement to cover all the
various sites where work was to be performed, and the other wanted a series of discrete
contracts. The failure to reach agreement on this fundamental issue was another rea-
son why the judge concluded that the defendant had a strong arguable case that there
was no concluded contract at all, and certainly no contract in accordance with
s107.67
In addition to RJT, the other main Court of Appeal authority on this specific topic is 2.64
Thomas-Fredric’s (Construction) Ltd v Keith Wilson68 in which the principal point contained
the identity of one of the parties. Although the underlying agreement was oral, it was
evidenced by a letter dated 6 August 2002, which had been signed by Mr Wilson, the
appellant, ‘on behalf of Gowersand Ltd’. The contractors made arrangements to transfer
the NHBC Certificate to Gowersand. However, thereafter, they contended that, after all,
they had contracted directly with Mr Wilson. The judge held that that was indeed the
case. However, Simon Brown LJ had ‘the greatest difficulty with this conclusion’;69 as he
pointed out, the adjudicator’s jurisdiction under the 1996 Act only arose in respect of a
construction contract in writing and, in this case, the only agreement that was relied on
was the letter of 6 August 2002, which was expressly signed, not on behalf of Mr Wilson
himself, but on behalf of the company, Gowersand. Simon Brown LJ referred back to the
decision of the Court of Appeal in RJT Consulting and said that, in the absence of any
evidence that Mr Wilson, rather than Gowersand, was the contracting party, there could
be no claim against him personally; there was simply no written contract to which he was
a party. Accordingly, the appellant had not submitted to the adjudicator’s jurisdiction and
the appeal was allowed.70
65 [2007] EWHC 49.

66 [2007] EWHC 825 (TCC).
67 HHJ Wilcox also refused to enforce the adjudicator’s decision in T&T Fabrications Ltd v Hubbard
Arcitectural Metalwork Ltd [2008] EWHC B7 (TCC) because there was a triable issue as to whether or not the
contract contained two terms, concerned with the provision of drawings and the timing of the works, which
had not been reduced to writing.
68
[2003] EWCA Civ 1494; [2004] BLR 23.
69
See paragraph 13 of the judgment.
70 A contract which is properly novated will constitute a contract in writing between the new party and the
other (original) contracting party but the novation must be ‘clear, unqualified and fully retrospective’: see Camillin
Denny Architects Ltd v Adelaide Jones & Co [2009] EWHC 2110 (TCC); [2009] BLR 606, paragraph 34–36.
39
2.65 Following RJT, there were a number of other decisions under s107 in the TCC in which the
principles noted by the Court of Appeal were applied to a variety of common factual situations.
The first was that of Jackson J (as he then was) in Trustees of the Stratfield Saye Estate v AHL
Construction Ltd,71 noted above. In that case, Jackson J concluded that there was a contract
between the parties for a defined scope of work. He then had to decide whether or not that
contract was in writing for the purposes of s107(2). Having said that an agreement was only
evidenced in writing for the purposes of s107 if all the express terms of that agreement are
recorded in writing, and that it was not sufficient merely to show that all terms material to
the issues under adjudication have been recorded in writing, he concluded that, on the facts
before him, all the express terms of the agreement between the parties had been recorded in
writing.
2.66 In Redworth Construction Ltd v Brookdale Healthcare Ltd 72 the contract between the par-
ties was evidenced in a variety of documents and oral agreements. The claimant contrac-
tor commenced adjudication by referring to one such document, but omitting any
reference to others. The adjudicator decided on that limited basis that there was a written
contract and that he did have the necessary jurisdiction. In the subsequent enforcement
proceedings, HHJ Havery QC found that Redworth could not go beyond the matters on
which they had relied in the adjudication in support of their argument that the adjudica-
tor had the necessary jurisdiction. He said that they had elected to rely on particular mat-
ters, and they could not both approbate and reprobate their earlier arguments.73 They had
put their argument in such a way as to obtain a benefit and thus it would not be just to
allow them to resile from that election. The judge went on to point out that, on the evi-
dence, certain terms of the contract were not in writing. In particular, the date of posses-
sion, the contract period and the date for completion of the works were not agreed in
writing. The completion date was only ever agreed orally. Thus, given that the claim before
the adjudicator was for the recovery of sums withheld because the contract overran that
date, the judge had no hesitation in concluding that the contract was not a contract in
writing within the meaning of s107 of the Act. The adjudicator did not therefore have the
necessary jurisdiction.
2.67 Also relevant on this topic is Mast Electrical Services v Kendall Cross Holdings Ltd.74 In that
case, there were three different sites and a plethora of tenders, revised tenders and other
correspondence on each. In respect of each alleged contract, Jackson J doubted there was
a contract at all and noted that, even if there was, the documents relied on did not record
basic matters like agreed rates of payment. Indeed, on the facts, he concluded that debates
about what the rates should be were never resolved. The adjudicator had originally resigned
because there was no contract in writing in accordance with the 1996 Act; Jackson J con-
cluded that he had been right to do so.
2.68 Of course, there is a significant difference between the situation where there is one contract,
and some of its terms are not in writing, and the situation where the parties reach separate
agreements in relation to different aspects of the work. Thus, in A.R.T. Consultancy Limited
71
[2004] EWHC 3286 (TCC); [2004] All ER (D) 77 (DEC).
72
[2006] EWHC 1994 (TCC); [2006] BLR 366.
73 The part of the judgment dealing with election has been doubted by Akenhead J in Nickleby FM Ltd v
Somerfield Stores Ltd [2010] EWHC 1976 (TCC), at paragraph 28.

74 [2007] EWHC 1296 (TCC); [2007] NPC 70.
40
v Navera Trading Limited 75 the parties had reached an oral agreement in respect of certain
design works and subsequently agreed a written contract in connection with the work on
site. The adjudicator’s decision related solely to the claims under the written contract. The
TCC judge concluded that the contract complied with the principles set out in RJT, and that
the existence of an earlier agreement, in respect of anterior design works, did not deprive the
adjudicator of jurisdiction.
The current approach of the TCC to issues regarding contracts in writing can be illustrated 2.69
by reference to three decisions of Akenhead J. First, in Allen Wilson Joinery Ltd v Privetgrange
Construction Ltd,76 he said that adjudicators and judges should be robust in determining
whether trivial matters said to have been agreed only orally between the parties can prevent
what would otherwise be a written contract for the purpose of s107 falling outside the
scope of the Act. He said that the exercise of determining what is ‘trivial’ must be an
objective one in relation to the particular contract and parties concerned: what may be
‘trivial’ in one contract may not be in another. In addition, it was always necessary to deter-
mine whether a so-called agreement made orally was, in reality, intended to be binding
between the parties. On the facts in that case he concluded, not without hesitation, that there
was a triable issue as to a number of terms that were not reduced to writing and that could
not be described as trivial, such as an obligation to design the staircases and issues as to
timing. In Euro Construction Scaffolding Ltd v SLLB Construction Ltd 77 he adopted the same
approach and concluded that SLLB had failed to show a real prospect of establishing that there
was an oral term of the contract in connection with the purposes for which the scaffolding was
required. The adjudicator’s decision was therefore enforced. In ROK Building Ltd v Bestwood
Carpentry Ltd 78 the judge concluded that, although there was a contract between the parties,
some of the terms of that contract were orally agreed and not contained in or evidenced
by writing. He therefore made the declaration sought that the adjudicator did not have
jurisdiction to proceed with the adjudication.
Price
In Murray Building Services v Spree Developments 79 the main contractor, Spree, placed an 2.70
order with the sub-contractor, Murray, even though Murray’s tender figures had been supplied
only to the employer’s consulting engineers, Book, and had not been disclosed to them. The
judge concluded that it was not necessary, for there to be a construction contract in writing,
that the actual price was expressly recorded in writing in documents passing between the two
contracting parties. In that case it was enough that the figures were in writing and had been
agreed by the employer.
At paragraph 28 of his judgement in ROK Building Ltd, Akenhead J expressly agreed with 2.71
that conclusion. However the judge went on to make the point that, if the price was orally
agreed and was not evidenced in writing, then a key agreed term was not in writing and
the contract was not a construction contract in writing for the purposes of the 1996 Act.
In Murray there had been no such oral agreement. Akenhead J went on to make clear that,
when no price had been agreed orally, but there was otherwise a construction contract in
75
[2007] EWHC 1375 (TCC).
76
[2008] EWHC 2802 (TCC); [2009] TCLR 1.
77 [2008] EWHC 3160 (TCC); [2009] CILL 2679.
78 [2010] EWHC 1409 (TCC).
79 His Honour Judge Raynor QC, 30 July 2004, unreported
41
writing, the adjudicator or court would imply a term requiring payment of a reasonable price
or reasonable remuneration. In such circumstances, there was a written construction con-
tract in accordance with s107, even if the price or the rates fell to be determined by reference
to an implied as to reasonable rates or prices.80
Formality
2.72 Sometimes, the argument about whether or not all the terms were in writing will stray into
a more fundamental debate about whether there was a contract at all. As noted in Chapter 4
below, even when s107 is repealed, the adjudicator is going to have to grapple with issues of
this kind. It is therefore instructive to note the decision of Christopher Clarke J in Adonis
Construction v O’Keefe Soil Remediation.81 In that case the argument was that the relevant
contract was concluded by O’Keefe’s acceptance by performance of Adonis’ order. However,
the judge concluded that the order did not amount to an offer because it was referred to as a
draft, and because it stated that the official order would be signed off and issued in the post
in due course. In any event the offer was not capable of acceptance by conduct because it
required acceptance to be made by a signature and a seal, which never happened. Thus the
judge concluded that there was no offer and no acceptance, or that it was at least arguable
that this was the case, thus resulting in the failure of the enforcement application. Whilst it
may not matter under s139 of the 2009 Act whether terms are oral or written, it will still
matter for the purposes of the adjudicator’s jurisdiction that there was at least a binding
contract between the parties. It was very difficult to say on the facts of Adonis that there was
any such contract. In those circumstances, even under the new regime, the adjudicator would
not have had any jurisdiction.
Letters of Intent
2.73 Three earlier decisions of the TCC, on whether contracts which were in the form of simple
letters of intent complied with s107, suggested that the answer was in the negative. In Hart
Investments Ltd v Fidler & Ors82 the employer’s agent sent the contractor a letter of intent in
conventional terms. No formal contract was ever agreed and the work was therefore carried
out in accordance with the ‘fall-back’ provisions of the letter, to the effect that the employer
would reimburse the contractor’s reasonable costs. The TCC judge was aware that similar
arrangements to such a letter of intent were common in the UK construction industry and
that, up until that point, there had been no reported case on whether such an arrangement
complied with s107(2)(c) of the 1996 Act. He concluded that it did not. First, he said it was
not easy to say that such a loose arrangement constituted a binding/enforceable contract at
all. Even if it did, the sort of clarity of terms envisaged by s107(2)(c) and the Court of Appeal
in RJT was wholly absent. He pointed out that, on the facts in that case, it was unclear
whether there was any agreement on matters that might be regarded as the minimum
necessary for a building contract, namely agreement as to parties, work scope, price and
time. He said that the biggest difficulty came with the consideration of the contract work
scope. The work scope was work that would, or might be, the subject of orders in the future,
whether written or oral. It was not discernible from the letter of intent. Such a definition was
80
The conclusion that the existence of implied terms did not prevent compliance with section 107 was in
accordance with the Court of Appeal decision in Connex South Eastern Ltd v MJ Building Services Group PLC
[2004] BLR 333
81 [2009] EWHC 2047 (TCC); [2009] CILL 2784.
82 [2006] EWHC 2857 (TCC); [2007] BLR 30.
42
a recipe for confusion and dispute, and the very situation that s107(2)(c) was designed to
avoid. Furthermore the judge concluded that the fact that all of these arrangements were
designed to be a fall-back position, only relevant at all if no formal/full contract was ever
concluded, also militated against the conclusion that this was a contract in writing con-
taining all the terms that had been agreed by the parties. On the contrary, it was designed
to provide a very basic framework that would only be operated if a formal/full contract was
not agreed.83
The same conclusion in respect of a similar letter of intent was reached by HHJ Wilcox in 2.74
Bennett (Electrical) Services Ltd v Inviron Ltd.84 There the judge observed that the fixed
price in the letter of intent was £169,157 but, in the usual way, a great deal of extra work
had been instructed because the claimant contractor’s valuation of all the works carried out
was £542,287, of which £203,763 had already been paid. The judge concluded that a
number of issues had been discussed at one particular meeting, including working hours,
mechanisms of payment, variations, insurance and health and safety. However none of
those matters were the subject of recorded written agreement. He also pointed out that one
of the claims before the adjudicator for additional monies was not defined by any written
contract terms, because the default provisions in the letter of intent made no provision for
price and rates, the method of assessing and timing and the payment of such additional
monies. Accordingly he concluded that there was no written contract in accordance with
s107. Likewise, at paragraphs 49–52 of his judgment in Mott MacDonald Limited v London &
Regional Properties Limited,85 HHJ Thornton QC set out his conclusions as to why the
letter of intent in that case was not in accordance with s107(2) of the 1996 Act. He noted
that many of the core terms of the parties’ agreement were inferred by conduct or were
evidenced in other documents that were not relied on by the referring party in the
adjudication.
However, it must now be regarded as doubtful whether these authorities should be taken 2.75
as supporting a general proposition that, wherever there is a letter of intent, there can be
no construction contract in writing. Subsequent decisions have made plain that such an
issue will always turn on the particular facts of the case, and in particular the precise word-
ing of the letter of intent. Thus, in Harris Calnan Construction Co Ltd v Ridgewood
(Kensington) Ltd 86 the TCC judge said that the particular letter of intent in issue in that
case demonstrated that there was complete agreement as to the parties, as to the contract
workscope, as to an agreed lump sum, and as to an agreed set of contract terms. The judge
found that the adjudicator had been right to observe that ‘there appears to be nothing left
for the parties to agree’. And in Cubitt Building and Interiors Ltd v Richardson Roofing
(Industrial) Ltd 87 Akenhead J concluded that the letter of intent in that case, which referred
to the incorporation of standard conditions of sub-contract, amounted to a complete
contract in writing.
83
Christopher Clarke J, in paragraph 45 of his judgment in Adonis Construction v O’Keefe Soil Remediation
[2009] EWHC 2047 (TCC); [2009] CILL 2784, noted that the decision in Hart v Fidler meant that it was
‘doubtful’ whether a letter of intent was capable of constituting a construction contract in writing but, for other
reasons, found it unnecessary to go into the issue further.
84
[2007] EWHC 49 (TCC).
85 [2007] EWHC 1055 (TCC); [2007] 113 Con LR 33.
86 [2007] EWHC 2738 (TCC); [2008] Bus LR 636.
87 [2008] EWHC 1020 (TCC); [2008] BLR 354.
43
2.76 Although the decision by Ramsey J in PT Building Services Ltd v ROK Build Ltd 88 was
concerned with a note of a meeting, as opposed to a letter of intent, the same considerations
as to the scope of one limited written document applied. In particular, the principal issue in
that case, as in Hart v Fidler, was the absence of a definition of the workscope. Ramsey J said
that Hart v Fidler was a case where, on the facts, the workscope had not been sufficiently
contained in or evidenced in the letter of intent. By contrast, in PT Building Services Ltd,
some workscope was defined within the meeting note, and that workscope was to be the
subject of further information and instructions, which were themselves to be provided
pursuant to the terms of the meeting note. The judge concluded that, in consequence, all
terms were evidenced in writing and therefore the contract came within s107. Accordingly,
it is now safe to assume that a letter of intent can amount to a contract in writing for the
purposes of s107 and that the only thing that will matter is whether or not the letter of intent
expressed all the contractual terms that had been agreed.
Oral Variations
2.77 It is common in the UK construction industry for parties to agree, part way through the
contract, to make changes either to the workscope, and/or to the terms of the contract itself.
There can then be arguments to the effect that the contract no longer complies with s107,
and it is in such instances that s107(3) can often be relevant.
2.78 In Total M E Services Ltd v ABB Building Technologies Ltd,89 HHJ Wilcox was dealing with
the common situation where, although the original contract in writing was for a lump
sum, additional works were ordered. It was argued that the mechanism by which addi-
tional works were ordered and paid for was an oral variation to the written contract and,
since that variation was not recorded in writing, the contract was not within s107(2).
Judge Wilcox rejected that submission, basing his decision on s107(3) (‘an agreement
otherwise than in writing by reference to terms which are in writing’). He held that the
adjudicator made his decision on the basis of a dispute that arose out of a single written
construction contract as varied orally by the parties. He concluded that the varied con-
tract was clearly within the provisions of s107, notwithstanding the fact that it was
evidenced partly in writing and partly orally. He therefore decided that the adjudicator
had the necessary jurisdiction.
2.79 A different result, on rather different facts, arose in the first dispute in Carillion Construction
Ltd v Devonport Road Dockyard.90 In that case, there was a written construction contract
between the parties. Part way through the contract there was a meeting on the 30 October
1999 which, on Carillion’s case, led to a binding agreement that revised the basis of payment
to the sort of ‘costs reimbursable’ arrangement so popular with contractors. Although this
was disputed by Devonport, the adjudicator decided that a binding agreement had been
reached varying the terms such that Carillion were entitled to be reimbursed their costs.
Devonport defended the summary judgment application on the basis that the adjudicator
had no jurisdiction to reach that decision. HHJ Bowsher QC referred to RJT Consulting.
He then identified certain documents in the evidence and said that, although they
demonstrated that there was a discussion about whether the contract should become costs
88 [2008] EWHC 3434 (TCC).

89 [2002] EWHC 248 (TCC); [2002] 87 Con LR 154.
90 [2003] BLR 79
44
reimbursable, they did not evidence any agreed contract, because the documents conflicted.
He went on at paragraph 4 to say:
It is a simple proposition, and easy to accept, that once a construction agreement in writing is
before an adjudicator he has the jurisdiction to construe its express terms and to decide what,
if any, terms are to be implied or incorporated by reference. But it is quite a different thing to
suggest that once a construction agreement is before an adjudicator, he has jurisdiction to
decide on the existence of an oral agreement not evidenced in writing just because it follows
and amends the written agreement. I am not considering what in the construction industry
would come under the normal heading of ‘variations made pursuant to a term of the contract’.
What is in issue is an alleged oral agreement that radically changed the written agreement
(if it was made). . .
He therefore concluded that the adjudicator did not have the jurisdiction to enter into the
adjudication at all.91
An example of what Judge Bowsher called ‘variations made pursuant to a term of the con- 2.80
tract’ arose in Management Solutions and Professional Consultants Ltd v Bennett (Electrical)
Services Ltd.92 In that case, the defendant, Bennett, contended that the effect of oral
instructions that varied the scope of the work or added extra work was to remove the contract
from s107 of the 1996 Act because the whole of the agreement was not in writing or evidenced
in writing. HHJ Thornton QC noted that the relevant contractual term provided that no
variation to the work was to be carried out without Bennett issuing a written instruction to
carry out that variation. The requirement that such variations had to be in writing could be
waived by agreement, so that the requirement for a written variation was not a pre-condition
to a variation instruction being issued or taking effect where the parties agreed, expressly or
by implication, that the varied work could be carried out as instructed orally. The judge
concluded that the entirety of the contract was in writing; that the contract allowed the work
scope to be changed within the limits provided for by the written contractual provisions so
that, although the works could be varied, such variations did not vary the contract but were
merely instructions issued under the contract and with the authority of the contractual
provisions. He also found that the disputed variations were undertaken under the terms of
the contract and within its scope, even if such variations were oral and not evidenced in writing.
If the instructions were issued orally by Bennett then the resulting work was carried out by
agreement and the only consequence was that the contractual requirement that a variation
should be evidenced in writing was waived by both parties.
The most recent decision on the issue of oral variations is that of Akenhead J in ROK Building 2.81
Ltd v Bestwood Carpentry Ltd.93 In that case, the only contract in writing merely confirmed
an agreement whereby Bestwood would supply six joiners on a daywork basis at agreed rates
from a particular date. The document confirmed the fact that there were agreed rates, but did
not evidence in writing what that agreement was, so the written contract related only to the
91 In Brownlow Ltd v Dem-master Demolition Ltd (unreported 26 February 2004, a decision of the Sheriffdom
of Lothian Borders) there was a dispute about the letters exchanged between the parties and whether or not they
comprised an agreement in writing. It appears that the letters did not contain a detailed description of the work
that was to be carried out. Despite the citing of a number of the relevant authorities, including Debeck, and RJT
Consulting, the Sheriff found that the documents came within s107 and that therefore there was an agreement
in writing. On the face of it this looks a surprising decision but it is difficult, without sight of the letters them-
selves, which are not set out in the judgment, to form a concluded view.
92 [2006] EWHC 1720 (TCC).
93 [2010] EWHC 1409 (TCC).
45
provision of joiners on a daywork basis and did not go beyond that. The contract was
subsequently varied to provide for the provision of additional joiners upon 48 hours’ notice,
the agreed provision of snagging lists to the joiners, and the fact that supervision and manage-
ment of the joiners was to be provided, not by Bestwood, but by ROK. Although there had
been an earlier discussion about all of those matters, nothing was confirmed in writing and
none of that was included in the fax of 9 February 2006, which was the only document in
writing for the purposes of s107. Accordingly, the judge found that, amongst other things,
there was no written enforceable contractual right on the part of ROK to issue variation
instructions or to require Bestwood to carry out such variations. There was therefore no
contact in writing in accordance with s107.
2.82 Accordingly, the mere fact that there were oral instructions or oral variations will not, of
itself, take the contract outside the scope of s107.94 What matters is the nature and effect of
any such oral agreement. It is respectfully suggested that it is no more than common sense
that a written contract that permits variation instructions should be caught by s107, regardless
of whether those subsequent variations were oral or in writing. But other types of subsequent
oral instruction or agreement will be treated differently. An example can be found in the
Court of Appeal decision in Lead Technical Services Ltd v CMS Medical Ltd.95 In that case the
principal issue concerned the precise form of contract that had been agreed by the parties,
because that dictated whether or not the adjudicator had been rightly appointed. However,
from paragraph 16 onwards of his judgment, Moses LJ dealt with a separate contention as to
why the adjudicator had no jurisdiction. This was by reference to an alleged oral agreement
that the claimant’s fees were to be capped at £20,000. It was CMS’s case that there was such
an oral agreement in place and that, in consequence, there was no contract in writing as
defined by s107. Moses LJ identified the various elements of the evidence that supported
CMS’s contention and noted that the judge at first instance did not deal with these points at
all. He concluded that the judge was ‘miles away’ from justifying a summary judgment dis-
missing those assertions and that there was a real prospect, based on cogent grounds, of
establishing that the adjudicator had acted without jurisdiction (because the contract was
partly written and partly oral). The Court of Appeal therefore concluded that the judge had
erred in enforcing the adjudicator’s decision.
Implied Terms
2.83 In Connex v MJ Building Sevices Group PLC 96 HHJ Havery QC found that there were no
express terms of the agreement that were not in writing. In any event, he decided that, because
there was a reference in a set of minutes to Connex giving an instruction to MJ that the project
be carried out immediately, the conclusion was irresistible that this instruction constituted an
acceptance of MJ’s tender. He further concluded that, since the minutes were written with the
authority of the parties, they constituted evidence falling within s107(4) of the Act of
the acceptance. Although this decision went to the Court of Appeal97 this part of the judge’s
decision was not appealed, and was therefore not considered by the Court of Appeal.98
94
As demonstrated by the decisions in Total M&E and Management Solutions.
95
[2007] EWCA Civ 316; [2007] BLR 251.
96
[2004] EWHC 1518; [2004] BLR 333.
97 [2005] EWCA Civ 193; [2005] BLR 201.
98 See also HHJ Bowsher QC in Carillion Construction Ltd v Devonport Royal Dockyard Ltd [2003] BLR 79,
in which he said at paragraph 34 that an adjudicator could consider implied terms.
46
One of the arguments that arose in Connex was the question of implied terms. It had been 2.84
submitted there that it was manifestly not the intention of Parliament to exclude from the
jurisdiction of an adjudicator contracts that contained implied terms. Judge Havery accepted
what he called ‘that very reasonable proposition’. The same point arose in Galliford Try
Construction v Michael Heal Associates Ltd.99 There HHJ Seymour QC concluded that
no contract had been made at all. However, at paragraph 29 of his judgment, he went on to
consider the issue as to whether, if there had been a contract, it could be said to be in writing
within the meaning of s107. He referred to the decision in RJT Consulting and observed that
the Court of Appeal did not consider what the position would be if a contract included terms
which were to be implied. He said:
It may be that the mischief which Parliament was anxious to avoid does not arise in a case in
which terms fall to be implied into a contract as a matter of law, regardless of the actual inten-
tion of the parties. However, it could arise in an acute form if it were suggested that a contract,
not otherwise complete, could be completed after it had been executed by the implication of
terms which were said to represent the actual, but unexpressed, intention of the parties.
It is respectfully suggested that Judge Seymour was probably right to differentiate between 2.85
implied terms in this way. The usual terms which are implied into construction contracts as
a matter of law, such as terms as to reasonable quality, fitness for purpose and the like, could
not possibly be said to render a contract outside the terms of s107. However, implied terms
that are relied on because of, say, particular conversations between the parties, or a particular
course of dealing in the past, and which are not set out in the documents put forward under
s107, would probably take the contract outside the terms of s107, and therefore deny the
adjudicator any jurisdiction. However, it must be noted that, in Allen Wilson Joinery Ltd v
Privetgrange Construction Ltd 100 Akenhead J was not persuaded by the distinction. He said
that terms were implied into contracts by operation of law, albeit that some terms may be
implied in the context of a factual relationship or even a factual history which existed between
the parties. He saw no reason to distinguish between different implied terms in the context
of s107 of the 1996 Act. He expressed the view that the implication of any terms into the
contract, howsoever arising, did not render what would otherwise be a written contract
under that section into something not covered by Part II of the 1996 Act.
Multiple/Supplemental Contracts in Writing

The issue of multiple contracts is touched on in connection with s108 of the 1996 Act 2.86
(paragraphs 2.104–2.106 below) because the usual issue that arises under multiple con-
tracts between the same parties is whether there was more than one dispute that was referred
to the adjudicator. However, some of those authorities also address the issue of whether or
not, if there was more than one contract, the other contracts were in writing. In Air Design
(Kent) Ltd v Deerglen ( Jersey) Ltd 101 there was a base build contract and a variety of later
agreements, at least one of which was a signed letter of intent. The judge considered that it
was part of the adjudicator’s jurisdiction to decide whether or not, and if so to what extent,
the base build contract had been varied by the other agreements. Whether he was right or
wrong to find or make the assumption that there was effectively one contract (which was
varied) was therefore immaterial on enforcement. Moreover, the judge said that all the disputes
99 [2003] EWHC 2886 (TCC); [2003] 99 Con LR 19.

100 [2008] EWHC 2802 (TCC); [2009] TCLR 1.
101 [2008] EWHC 3047 (TCC); [2009] CILL 2657.
47
could probably be said to have arisen under the base build contract and the parties had agreed
that the adjudicator would have jurisdiction to determine the value of sums due under that
contract and any variations to that contract. Similarly, in PT Building Services Ltd v ROK
Build Ltd 102 Ramsey J was not persuaded that subsequent works were not in fact carried
out as part of the construction contract evidenced in writing by the meeting note and the
other documents, as opposed to later agreements. Accordingly, he enforced the decision of
the adjudicator.
Section 107(5)
2.87 The provisions of s107(5) are, on their face, surprising. They appear to be designed to prevent
a party from appearing to accept the existence of an agreement in writing during the adjudi-
cation itself, and then, at a later date, arguing before the court that there was, in truth, no
such agreement. It is, in one sense, a form of statutory estoppel.
2.88 The principal early case on this provision is the decision of HHJ Bowsher QC in Grovedeck
Ltd v Demolition Ltd.103 In that case, the relevant demolition sub-contracts were oral, so, on
its face, the Act did not apply. However, the claimants contended that the events in the
adjudication conferred a jurisdiction upon the adjudicator pursuant to s107(5). This was an
ambitious submission, given that the defendants challenged and denied the jurisdiction of
the adjudicator in every communication after his appointment. As Judge Bowsher observed,
‘freedom of contract has fallen but I cannot believe that it has fallen that far’.104 He also had
to deal with the problem of s107(5). He said:
On one reading of section 107(5), if one party to an adjudication alleges the existence of an
oral agreement and the other does not deny the existence of an oral agreement, then there is
an agreement in writing ‘to the effect alleged’, that is, in the terms alleged by the claimant, even
though the other party hotly denies, as he did here, that the agreement was in the terms
alleged. Parliament cannot have intended such an unjust result.
2.89 Judge Bowsher was persuaded to look at the reports in Hansard. As a result he concluded:
29. If one reads section 107(5) without the words ‘in adjudication proceedings or’ it is clear
that the intention of Parliament was that a contract should be treated as a contract in writing
if in arbitral or litigation proceedings before the adjudication proceedings in question an oral
contract had been alleged and admitted. I also would read the words ‘and not denied’ as meaning
that the alleged terms of the contract were not denied. By adding the words ‘in adjudication
proceedings or’, Parliament intended to add a reference to other preceding adjudication
proceedings. There was no intention by Parliament to provide that submissions made by a
party to an unauthorised adjudication should give to the supposed adjudicator a jurisdiction
which he did not have when he was appointed.
30. Read in that way, the sub-section has an entirely sensible and practical intention and
purpose and I so read it. Disputes as to the terms, express and implied, of oral construction
agreements are surprisingly common and are not readily susceptible of resolution by a
summary procedure such as adjudication. It is not surprising that Parliament should have
intended that such disputes should not be determined by Adjudicators under the Act, but if
in any case such room for dispute has been removed by previous formal and binding legal
submissions, then the adjudicator has jurisdiction.
102 [2008] EWHC 3434 (TCC).

103 [2000] BLR 181.
104 See 185, paragraph 27.
48
In a similar way, in Mott MacDonald Limited v London & Regional Properties Limited,105 it 2.90
was argued on behalf of the claimant that, even if the contract itself was not in writing, the
pleadings exchanged in the adjudication were sufficient to bring it within s107(5). There, the
claimant had referred to a contractually binding letter of intent and, in response, the defendant
had simply said that the adjudicator should give effect to the express, clear and unambiguous
wording agreed in that letter. Judge Thornton analysed the pleadings and the adjudication
correspondence in detail, and concluded that the response was not one that could be
described as ‘not denying the existence of an agreement that was not in writing’. Section
107(5) was not, therefore, engaged.
These decisions therefore limit the potential effect of s107(5). It is submitted that they do so 2.91
in an entirely sensible and practical way, and in a manner that is entirely consistent with the
principle that Ward LJ emphasised in RJT Consulting Engineers: the critical importance of
contracts being in writing was because the summary adjudication procedure could only
work if there were not disputes about the terms of the very contract under that the adjudi-
cator had been appointed.106 It should, however, be noted that in RJT Consulting, the Court
of Appeal expressly chose not to rule upon or decide the issue before Judge Bowsher in
Grovedeck. Thus the particular point in that case, and the specific limitation placed on
s107(5) by Judge Bowsher QC, remains to be considered by an appellate court.
It should not, however, be thought that the result of these cases is that s107(5) has been 2.92
rendered inoperable. For example, in Ale Heavy Lift v MSD (Darlington) Ltd,107 it was
argued that the adjudicator had no jurisdiction to hear the dispute because there were
effectively two contracts, and the second was not in writing. HHJ Toulmin CMG QC held
that, as a result of the exchange of written submissions in the adjudication, there was, pursuant
to s107(5), an agreement in writing to the effect alleged. The judge, in reaching this conclu-
sion, was clearly influenced by the fact that no jurisdictional challenge had been made to the
adjudicator at the time. And in SG South Ltd v Swan Yard (Cirencester) Ltd 108 the adjudi-
cator himself noted that there was no written contract between the parties, despite the fact
that the responding party, Swan Yard, had not taken any point as to his jurisdiction. The
adjudicator wrongly concluded that he had jurisdiction because he found that the contract
arose either by oral agreement or by conduct. But the judge concluded that the decision
was enforceable by operation of s107(5). Swan Yard had not complained about the lack of
jurisdiction on the part of the adjudicator either at the commencement of, or during, or at the
conclusion of the adjudication. All of their submissions were based on their assumption or
acceptance that the adjudicator did have the necessary jurisdiction, and that they were
happy for him to decide the dispute. Thus the judge concluded that the exchanges in the
adjudication, and/or the exchanges in the subsequent enforcement proceedings,
amounted to an exchange of written submissions in which the existence of an agreement
otherwise than in writing had been alleged by South and not denied by Swan Yard. In those
circumstances, the judge concluded that the adjudicator had the necessary jurisdiction and
his decision was enforced.
105
[2007] EWHC 1055 (TCC); [2007] 113 Con LR 33.
106
This is why some commentators consider it to be slightly curious that the 2009 Act will do away with this
safeguard altogether.
107 [2006] EWHC 2080 (TCC).
108 [2010] EWHC 376 (TCC); [2010] 19 EG 110.
49
Section 108: Adjudication

2.93 Section 108 of the 1996 Act reads as follows:
108 (1) A party to a construction contract has the right to refer a dispute arising under the
contract for adjudication under a procedure complying with this section.
For this purpose ‘dispute’ includes any difference.
(2) The contract shall—
(a) enable a party to give notice at any time of his intention to refer a dispute to
adjudication;
(b) provide a timetable with the object of securing the appointment of the adjudi-
cator and referral of the dispute to him within 7 days of such notice;
(c) require the adjudicator to reach a decision within 28 days of referral or such
longer period as is agreed by the parties after the dispute has been referred;
(d) allow the adjudicator to extend the period of 28 days by up to 14 days, with the
consent of the party by whom the dispute was referred;
(e) impose a duty on the adjudicator to act impartially; and
(f ) enable the adjudicator to take the initiative in ascertaining the facts and the law.
(3) The contract shall provide that the decision of the adjudicator is binding until the
dispute is finally determined by legal proceedings, by arbitration (if the contract
provides for arbitration or the parties otherwise agree to arbitration) or by agree-
ment. The parties may agree to accept the decision of the adjudicator as finally deter-
mining the dispute.
(4) The contract shall also provide that the adjudicator is not liable for anything done or
omitted in the discharge or purported discharge of his functions as adjudicator unless
the act or omission is in bad faith, and that any employee or agent of the adjudicator
is similarly protected from liability.
(5) If the contract does not comply with the requirements of sub-section (1) to (4), the
adjudication provisions of the Scheme for Construction Contracts apply.
(6) For England and Wales, the scheme may apply the provisions of the Arbitration Act
1996 with such adaptions and modifications as appear to the Minister making
the scheme to be appropriate. For Scotland the scheme may include provision
conferring powers on courts in relation to adjudication and provision relating to
the enforcement of the adjudicator’s decision.
2.94 The general aims and intention of these provisions relating to adjudication have been
addressed in paragraphs 2.01–2.15 above. The detailed issues that arise out of these specific
provisions form a major part of the remainder of this book. Accordingly, this part of Chapter 2
will deal in outline only with seven particular elements of s108 that have been the source of
controversy. They are: whether the provisions create a right or an obligation to adjudicate
(paragraphs 2.95–2.96 below); the correct definition of ‘a dispute’ used throughout the section
(paragraphs 2.97–2.106 below); the meaning to be given to the phrase ‘at any time’ in
s108(2)(a) (paragraphs 2.107–2.113 below); the effect of the 28 days provision at s108(2)(d)
(paragraphs 2.114–2.132 below); the extent of the duty to act impartially (paragraphs
2.133–2.137 below); the binding nature of the decision referred to at s108(3) (paragraphs
2.138–2.143 below); and whether there can properly be any limit on what type of dispute
can be referred to adjudication (paragraphs 2.144–2.145 below).
2.95 The threshold question that arises is to whether these provisions (and indeed any binding
contractual adjudication agreement) create simply a right to adjudicate, or a mandatory
obligation to adjudicate any dispute that might arise. In other words, if these provisions are
incorporated into the contract, is it compulsory to adjudicate any dispute that might arise? In
50
DGT Steel Cladding Ltd v Cubitt Building Interiors Ltd 109 the suggestion was that the particular
obligation in that case was compulsory, although that view was not determinative of the issue
(because the judge concluded on the facts that, even if the agreement was permissive only, the
proceedings should still be stayed in order to allow an adjudication to take place). But it now seems
clear that the better view is that these provisions, or any other similar express contractual arrange-
ment, create a right, and not a compulsory obligation, to refer the dispute to adjudication.
In Cubitt Building and Interiors Ltd v Richardson Roofing (Industrial) Ltd 110 Cubitt sought to 2.96
injunct Richardson from continuing with an arbitration and maintained that the dispute
between the parties should first be the subject of an adjudication. Akenhead J rejected that
submission, saying that, whilst it was open to any party to apply for relief to the requisite
tribunal to enable it to exercise its right to adjudicate, he did not accept that there must auto-
matically be a stay of any legitimately constituted proceedings, whether in arbitration or in
court, where there was merely a discretionary right to adjudicate. The party who had started
court or arbitration proceedings was entitled to have those proceedings resolved as reasonably
expeditiously as the court or the arbitrator could achieve and justice demanded; it should not
be forced to have those proceedings delayed or stayed by itself being forced to adjudicate,
particularly when it did not want to exercise its right to do so. And in London Borough of
Camden v Makers UK Ltd,111 where Camden obtained judgment in default against Makers,
the same judge decided that it was not appropriate to impose upon Makers a condition that,
if judgement in default was set aside, they should not be permitted to adjudicate. The judge
noted that a party to a construction contract had a statutory right to adjudicate upon any
dispute at any time and that this right gave a party a particular commercial advantage or
lever. Thus it was open and permissible to a party such as Makers to threaten adjudication
against the other party, particularly as the costs of defending such proceedings would usually be
irrecoverable. Judgment was set aside without the proposed prohibition on future adjudication.
‘A Dispute’
There have been two distinct types of debate concerning the references to ‘a dispute’ throughout 2.97
s108. The first type, of which there are a large number of reported cases, concerns the appro-
priate approach to deciding whether or not ‘a dispute’ had crystallised at the time of the
notice of the intention to refer that dispute to adjudication. It has been frequently argued by
responding parties in the adjudication that the alleged dispute that the referring party had
raised was not a matter which had previously arisen. The argument is that such a claim, since
it had not been considered, let alone rejected, by the responding party, could not be said to
be in dispute at the time of the notice. If a dispute had not crystallised when the adjudication
commenced, it is said that, in consequence, the adjudicator did not have the necessary
jurisdiction. This is an important point and is considered in some detail in Chapter 7 below,
at paragraphs 7.61–7.77. In short, the courts have endeavoured to avoid a legalistic approach
to the meaning of the word ‘dispute’, and have been relatively quick to conclude that a claim
or assertion that has gone unanswered, even for a comparatively short time, was ‘disputed’
for the purposes of the 1996 Act.
109
[2007] EWHC 1584 (TCC); [2008] Bus LR 132.
110
[2008] EWHC 1020 (TCC); [2008] BLR 354.
111 [2009] EWHC 605 (TCC); [2009] 124 Con LR 32.
51
2.98 The other type of debate arising out of the words ‘a dispute’ concerns the clear use in s108 of
the singular word ‘dispute’. The 1996 Act was designed to provide a swift summary procedure
in relation to a specific, clear-cut dispute. Only one dispute can be referred to the adjudicator
at any given time. Of course, during the currency of a construction contract, a variety of
disputes may arise between the employer and the main contractor or between the main
contractor and his sub-contractors. How is the expression ‘a dispute’, in the singular, to be
interpreted in such circumstances?
2.99 This is one of the perennial areas of debate under the 1996 Act that has yet to be considered
by the Court of Appeal. It is dealt with in detail in paragraphs 7.78–7.85 below. However, by
way of an introduction to the point, it is right to say that, at first instance, the courts have
taken a relatively broad interpretation of the expression ‘a dispute’ and have made plain that
a number of different claims (both money claims and, say, claims for extensions of time) can
be encompassed within a single ‘dispute’.
2.100 The starting point is the decision of HHJ Thornton QC in Fastrack Contractors Ltd v
Morrison Construction Ltd & Anor.112 In that case, the claim was for measured work, variations,
prolongation costs, loss and expense and loss of profit as a result of repudiation. It was
effectively Fastrack’s claim for outstanding sums following the termination of the contract.
Judge Thornton concluded that such a claim, which was disputed by Morrison, comprised
‘a dispute’ (in the singular) for the purposes of the Act and was not an attempt to refer more
than one dispute to the same adjudicator. He said at paragraph 20 of his judgment:
It is to be noted that the HGCRA refers to a ‘dispute’ and not to ‘disputes’. Thus, at any one
time, a referring party must refer a single dispute, albeit that the Scheme allows for disputing
parties to agree, thereafter, to extend the reference to cover ‘more than one dispute under the
same contract’ and ‘related disputes under different contracts’. During the course of a con-
struction contract, many claims, heads of claim, issues, contentions and causes of action will
arise. Many of these will be, collectively or individually, disputed. When a dispute arises, it
may cover one, several or many of one, some or all of these matters. At any particular moment
in time, it will be a question of fact what is in dispute. Thus the ‘dispute’ which may be referred
to adjudication is all or part of whatever is in dispute at the moment that the referring party
first intimates an adjudication reference. In other words, the ‘dispute’ is whatever claims,
heads of claim, issues, contentions or causes of action that are then in dispute which the refer-
ring party has chosen to crystallise into an adjudication reference. A vital and necessary ques-
tion to be answered, when a jurisdictional challenge is mounted, is what was actually referred?
That involves a careful characterisation of the dispute referred to be made. This exercise will
not necessarily be determined solely by the wording of the notice of adjudication since this
document, like any commercial document having contractual force, must be construed
against the underlying factual background from which it springs and which will be known to
both parties.
2.101 This inclusive approach was followed by HHJ Lloyd QC in a trio of cases that he decided
subsequently: KNS Industrial Services (Birmingham) Ltd v Sindall Ltd,113 Sindall Ltd v
Solland 114 and David McLean Housing Contractors Ltd v Swansea Housing Association Ltd.115
In that last case, the notice to refer identified what were called six separate disputes, including
claims for loss and expense, extensions of time, valuation of variations and the valuation of
112
[2000] BLR 168.
113 [2001] 75 Con LR 71.
114 [2001] 3 TCLR 30.
115 [2002] BLR 125.
52
measured work. The judge concluded that, despite the words used in the notice, the matters
referred to adjudication constituted one single dispute because, on the facts, the dispute
between the parties was what sum should have been paid by the employer as a result of the
claimant’s single payment application number 19.
As a result of this approach, it has not been common for a claim by a contractor to have been 2.102
incapable of being presented as one single dispute.116 This is particularly so in respect of a
claim made at the end of the contract. Thus, although those responsible for the 1996 Act
probably did not envisage it being used for this purpose, a contractor with a complex final
account claim is entitled to argue that his claim is, in essence, one single claim for an unpaid
sum and that therefore he is entitled to adjudicate his final account claim, no matter how
large the claim might be and no matter how voluminous the supporting documentation.
One of the more extreme examples was the adjudication claim in CIB Properties Ltd v Birse
Construction Ltd.117 In that case, there was a disputed termination of the contract and, in the
first adjudication, the adjudicator had ruled that the termination was the responsibility of
the contractor. Some time later the employer, CIB, then made a claim for the financial
consequences of the termination that was said to amount to £15 million. The claim encom-
passed numerous different heads of loss and was supported by documents that filled in excess
of 50 lever arch files. It was, however, impossible to argue that this was anything other than
a single dispute: it was a single, disputed claim that the £15 million was due to CIB as a result
of Birse’s responsibility for the termination of the contract. Whether such a result is what the
framers of the 1996 Act had in mind when they created the adjudication process is, perhaps,
another question.118
The inclusive approach adopted by the courts at first instance, beginning with Fastrack, 2.103
was questioned by Lord MacFadyen in Barr Ltd v Law Mining Ltd.119 Lord MacFadyen
pointed out that there was some force in the criticism of Judge Thornton’s inclusive
analysis in Fastrack because, if everything currently in dispute between the parties formed
a single dispute, s108 was restricted in scope and might even be deprived of content.
However, having made that point, he was not persuaded that, on the facts in Barr, the
adjudicator had fallen into error in holding that the matters referred to him constituted
a single dispute. The adjudicator had decided that it was open to him to regard the matters
before him as one dispute and the judge could not say that he was wrong to have taken
that view.
In the context of what is covered by a singular dispute, it is also necessary to note the particular 2.104
problems that can arise under multiple contracts. If there are a number of contracts between
the same parties, there is obviously a risk that the disputed claim might have arisen under
more than one of those contracts, and that will give rise to the argument that, since there is
116 There have been two reported cases where the court has concluded that two disputes were referred
simultaneously, and the adjudicator lacked jurisdiction as a result. They are Grovedeck Ltd v Capital Demolition
Ltd [2000] BLR 181, where there were disputes on two different contracts, and David and Teresa Bothma (In
Partnership) T/A DAB Builders v Mayhaven Healthcare Limited (16 November 2006, TCC in Bristol), where the
notice of adjudication talked of disputes, and there was no link between the contractor’s financial claim and his
claim for an extension of time. These cases are dealt with in greater detail in paragraphs 7.81 and 7.82.
117
[2005] 1 WLR 2252.
118
Despite the fact that courts have, from time to time, expressed doubts about the use of adjudication in
such cases, no enforcement proceedings have yet failed because of the size and extent of the dispute referred to
adjudication.
119 (2001) 80 Con LR 134.
53
more than one separate contractual claim, there must be more than one dispute. This issue
arose, in its most basic form, in Supablast (Nationwide) Ltd v Story Rail Ltd.120 In that case,
after disputes had arisen between the parties in respect of the sub-contractor’s final account,
the main contractor argued that there were in reality two sub-contracts, one concerned with
scaffolding, grit-blasting and painting, and the other concerned with steelworks. They
therefore maintained that there were two sub-contracts, and the final account claim, extending
as it did across both sub-contracts, raised two separate disputes that should not have been the
subject of an adjudicator’s decision. Akenhead J rejected that submission, noting its ‘absence
of reality’. He analysed the contractual arrangements between the parties and concluded that
it was obvious and clear that the parties had agreed that both the original works and the
steelworks should be dealt with under the umbrella of one sub-contract.
2.105 Even where there is no dispute that there were a number of separate contracts between the
parties, it will not necessarily follow that a single dispute cannot still arise. Thus, in Air Design
(Kent) Ltd v Deerglen (Jersey) Ltd 121 there was an agreed ‘base build’ contract between the
parties and a number of subsequent, supplementary agreements of various sorts. The
adjudicator concluded that the subsequent contracts were simply variations of the base build
contract, and it was under the base build contract that the dispute arose. He therefore decided
that he had the necessary jurisdiction. Akenhead J said that the substantive decision-making
process upon which the adjudicator had to embark necessarily involved a consideration of
whether there was more than one contract, and it was thus within his jurisdiction to decide
that there was one contract, albeit one that may have been varied by agreement. Therefore,
whether he was right or wrong to find or make that finding was immaterial, because, even if
he was wrong, that did not mean that he did not have the jurisdiction to decide the point.122
Similarly, in Amec Group Ltd v Thames Water Utilities Ltd 123 Thames Water had engaged
Amec to carry out works under a framework agreement. Each individual work package,
which ran to many hundreds, was the subject of a separate works contract. The TCC judge
concluded that the dispute arose under the framework agreement, which was also the
contract that included the adjudication agreement. He noted that the contractual adjudication
mechanism applied to ‘any dispute or difference arising out of or in connection with’ the
framework agreement, and that those words were wide enough to include the claims arising
under the individual works contracts. It was also noted that, if Thames Water had been right,
there would have had to have been hundreds of separate adjudications arising under the
individual works contracts, each for a trifling sum, which was not ‘a solution that can be
described as commercially sensible’.124
2.106 A similar problem arose in Enterprise Managed Services Ltd v Tony McFadden Utilities Ltd.125
In that case, Utilities were pursuing a claim against Enterprise as assignees of the liquidators of
a related company, TML. Although Utilities purported to bring their claim under just one of
the four contracts that existed between TML and Enterprise, rule 4.90 of the Insolvency Rules
1986 required that all mutual credits and set-off on all four sub-contracts had to be dealt with
120
[2010] EWHC 56 (TCC); [2010] BLR 211.
121
[2008] EWHC 3047 (TCC); [2009] CILL 2657.
122
See also PT Building Services Ltd v ROK Build Ltd [2008] EWHC 3434 (TCC).
123
[2010] EWHC 419 (TCC).
124 A similar result was reached in RWE Npower PLC v Alstom Power Ltd [2009] EWHC 3388 (TCC);
[2009] 128 Con LR 141.

125 [2009] EWHC 3222 (TCC); [2010] BLR 89.
54
at the same time. The judge found that what was assigned to Utilities was the net balance
arising out of the mutual dealings between Enterprise and TML. Thus, absent agreement,
an adjudicator could never undertake the necessary task under rule 4.90 if there was more
than one contract between the parties. In addition, rule 4.90 envisaged that the account
would be taken and the balance decided in one set of proceedings where the result would be
final and binding, which again ruled out adjudication as the proper dispute resolution
forum.
Notice at Any Time

Section 108(2)(a) allows a party to give notice of his intention to refer a dispute to adjudication 2.107
‘at any time’. Arguments as to how this provision should be interpreted have arisen in three
factual situations: first, where there were already ongoing court/arbitration proceedings
between the parties; secondly, where the underlying contract has come to an end; and thirdly,
where there was a delay between the relevant events and the commencement of the
adjudication proceedings. Each situation is dealt with below.
In Herschel Engineering Ltd v Breen Property Ltd,126 Herschel obtained judgment in default 2.108
of defence in respect of their claim for unpaid invoices. Judgment was subsequently set aside
and Breen were given unconditional leave to defend. Herschel served a notice of appeal on
14 January 2000 and the appeal was set down for 24 May 2000. However, immediately prior
to serving its notice of appeal, on 13 January, Herschel referred the dispute arising from the
non-payment of the invoices to adjudication. Breen sought an injunction restraining
Herschel from proceeding with the adjudication on the grounds that the court should not
countenance two concurrent proceedings.
Dyson J refused to grant the injunction. He accepted that there was a well-established line 2.109
of authority to the effect that party A should not normally make the same claim against
party B in different proceedings, because such conduct would be oppressive and unjust to
B, and gave rise to the risk of inconsistent findings. This applied both to concurrent court
proceedings and to concurrent court and arbitration proceedings. However, he rejected the
submission that there was a close analogy between the position of an arbitrator and that of
an adjudicator. An adjudicator’s decision was only of temporary effect. It gave rise to no
estoppel. Thus he concluded that the principles deriving from the authorities as to concurrent
proceedings had no application to adjudication. The judge went on at paragraph 19 of his

judgment:
If Parliament had intended that a party should not be able to refer a dispute to adjudication
once litigation or arbitration proceedings had been commenced, I would have expected this
to be expressly stated. The relationship between adjudication on the one hand and litigation
and arbitration on the other, was what informed the content of section 108(3) of the Act. The
aggrieved claimant should not have to wait many months, if not years, before his dispute
passed through the various hoops of a full blown action or arbitration.
He concluded that the words ‘at any time’ meant what they said, and that was so even if, in
the meantime, separate court proceedings had been commenced.127
126
[2000] BLR 272.
127 It should also be noted that Dyson J was not asked to stay the TCC proceedings whilst the adjudication
took place. That was the application successfully made in DGT Steel & Cladding Ltd v Cubitt Building & Interiors
Ltd [2007] EWHC 1584 (TCC); [2008] Bus LR 132, discussed at paragraphs 16.54–16.55.
55
2.110 However, it should not be thought that concurrent proceedings will always be allowed: it will
always depend on the facts. Thus, in Cygnet Healthcare Plc v Higgins City Ltd 128 there was a
dispute between the parties as to whether or not there was a contract. The parties agreed that
that dispute should be referred to an ad hoc arbitration and an arbitrator was appointed.
However, at the same time, Cygnet commenced an adjudication to reclaim monies due to
alleged delays and consequential losses. That claim necessarily involved the adjudicator in
considering the ‘contract/no contract’ issue. The adjudicator awarded Cygnet certain sums
pursuant to that claim and they commenced enforcement proceedings. The enforcement
application failed. HHJ Thornton QC held that the dispute as to whether or not a contract
existed had been validly referred to the ad hoc arbitration and thus, if the court were to
entertain the claimant’s application to enforce, it would necessarily have to determine
the very question that the parties had agreed to refer to arbitration. The judge distinguished
the decision in Herschel, on the grounds that, in Cygnet, the parties had entered into an ad
hoc arbitration agreement, which covered one of the very disputes that was immediately
thereafter referred to the adjudicator. The judge considered that, in all the circumstances,
the party’s ad hoc arbitration agreement should be enforced and he declined to entertain
Cygnet’s applications.
2.111 As noted above, it has been unsuccessfully argued that, in circumstances where the
underlying contract has come to an end, the adjudication provisions must also be regarded
as inoperable. In A&D Maintenance & Construction Ltd v Pagehurst Construction Services
Ltd 129 the contract came to an end in November 1998 and the adjudication, comprising a
claim for the balance due for work done, took place in February/March 1999. HHJ Wilcox
rejected the submission that, because the contract had come to an end, the sub-contractor was
unable to make a claim in accordance with its provisions. The judge noted that s108(2)(a)
expressly provided that the party could give a notice ‘at any time’. He pointed out that,
even if the contract had been terminated, the matters referred to the adjudicator
remained in dispute under the contract. As a result the adjudication provisions clearly
remained operative, in precisely the same way as the arbitration clause would also remain
operative.
2.112 In Connex South Eastern Ltd v MJ Building Services Group Plc130 the Court of Appeal had to
consider a submission that it was an abuse of process for MJ to start adjudication proceedings
on 13 February 2004 when, 15 months beforehand, on 29 November 2002, they had

written to Connex stating that the latter’s conduct amounted to a repudiatory breach of
contract which MJ accepted, thereby terminating the contract. It was argued by Connex that
this delay amounted to ‘an abuse of process’ and that the phrase ‘at any time’ could not be
read literally. The argument was that the whole point of adjudication was to arrive at a quick,
cheap, temporary decision and that if, as a result of the passage of time, it was no longer
possible to have a quick, cheap and temporary adjudication, then it was an abuse of process
to permit an adjudication to take place. Dyson LJ adopted precisely the same approach as he
had adopted in Herschel.131 He said:
128
(2000) 16 Const LJ 394.
129
[1999] CILL 1518.
130 [2005] EWCA Civ 193; [2005] BLR 201.
131
It does not appear from the judgment in the Court of Appeal that Herschel v Breen was cited to the Court
of Appeal in Connex. However, that seemed to have made no difference since Dyson LJ followed precisely the
same approach as he had adopted in Herschel v Breen five years before.
56
I cannot accept these submissions. The phrase ‘at any time’ means exactly what it says. It would
have been possible to restrict the time within which an adjudication could be commenced, say, to
a period by reference to the date when work was completed or the contract terminated. But this was
not done. It is clear from Hansard that the question of the time for referring a dispute to adjudica-
tion was carefully considered, and that it was decided not to provide any time limit for the reasons
given by Lord Lucas. Those reasons were entirely rational. There is, therefore, no time limit.
The practical effect of the right to commence adjudication proceedings ‘at any time’ was 2.113
made plain by the decision of Akenhead J in London Borough of Camden v Makers UK Ltd.132
In that case, Camden had obtained judgement in default against Makers and sought to argue
that if the judgement in default was set aside, Makers should be prevented from commencing
a further adjudication claim against Camden. The reason why Camden sought such an
unusual order was because any further adjudication decision was likely to result in a substantial
financial award in Makers’ favour, which sum would not be recoverable, even if the decision
was reversed, because of Makers’ parlous financial position. There was also a probability that
any further adjudication would result in considerable irrecoverable costs on Camden’s part.
The judge refused to impose the condition sought. He pointed out that a party to a construction
contract had a statutory right to adjudicate on any dispute at any time, and the fact that court
or arbitration proceedings had been instituted did not prevent a party from exercising its
statutory or contractual right to adjudicate. If Parliament had intended that a party could
not institute adjudication if there were already court proceedings addressing the same dis-
pute, it would have said so. The judge also said that a concomitant of the right to adjudicate
at any time was that it gave a party a commercial advantage, including the threat that the
other side would incur significant costs that they would not recover.
28 Days
The 28-day period was deliberately designed to ensure a swift response to the dispute being 2.114
referred to the adjudicator. Depending on the size of the claim being referred, and the extent
and effect of any decision on the claim, those involved in dealing with adjudications on a
regular basis know that the amount of work necessary to prepare a party’s case can be
significant. It is a very demanding process, not least for the adjudicator, who not only has to
understand the arguments being put forward by both sides, but has to reach a clear and
cogent decision, and publish it, all within 28 days of the referral. This has given rise to a
number of practical difficulties.

First, there will be disputes that, when they are referred to the adjudicator, are so extensive 2.115
that they are simply not capable of being fairly determined within the 28 days.133 It is for the
adjudicator to decide whether or not he is capable of arriving at a fair conclusion within
the limited period available to him. If he is not, then he should decline the reference.
Problems can occur when the issues involved in the resolution of the single dispute turn out 2.116
to be much more extensive than had originally been envisaged. In CIB Properties Ltd v Birse
Construction Ltd 134 the adjudicator, a well-known construction QC, sought a number of
extensions during the adjudication itself, as a result of the size and scope of the submissions
being exchanged between the parties. Eventually, the adjudication took about three months.
132 [2009] EWHC 605 (TCC); [2009] 124 Con LR 32.

133
This, of course, was what Judge Toulmin had in mind in his remarks in AWG Building Services, quoted at
paragraph 2.13. But no decision has yet failed at the enforcement hurdle for this reason.
134
[2005] 1 WLR 2252.
57
In an ordinary case, the position is that the referring party can agree unilaterally to extend
the adjudication for an additional 14 days (making a total of 42 days in total). Although
s108(2)(d) would not appear to allow the parties the opportunity to agree that the adjudi-
cator can have additional time, s108(2)(c) is not so restricted, so further extensions beyond
the 42 days can be granted, provided that both sides agree.
2.117 There have been a number of decisions concerned with the 28-day (or agreed extended)
period and an adjudicator’s obligation to comply therewith. These are analysed below. The
first question is: when does the 28 days start to run? The second is whether or not the adju-
dicator is obliged to complete the decision within the 28-day (or agreed extended) period.
The third is whether, if he has completed his decision on time, the adjudicator is entitled to
a further period, following the expiry of the 28 days, in which to communicate that decision
to the parties.
When Does the 28-Day Period Start to Run?
2.118 In Ritchie Brothers (PWC) Ltd v David Philip (Commercials) Ltd135 at first instance, Lord
Eassie expressed the view that, in paragraph 19 of the Scheme, the ‘date of the referral notice’
meant the date of despatch of that notice. However, in Aveat Heating Ltd v Jerram Falkus
Construction Ltd136 HHJ Havery QC considered that that was inconsistent with s108(2)(c)
of the Act. He concluded that something could not be referred to another person unless that
person received it; it might be sent with the intention of referring it but, if the document was
never received, the notice was never referred. He therefore concluded that ‘referral takes
place upon receipt of the notice by the adjudicator’. Thus, the 28 days, or any agreed extended
period, starts to run from the date that the referral notice was received by the adjudicator.
On the facts of Aveat, Judge Havery concluded that the decision was reached within the
agreed extended period. It is thought that, to the extent, there is a conflict between these two
approaches, Judge Havery’s reasoning is to be preferred.
Is the Adjudicator Obliged to Complete the Decision Within 28 Days or Any Agreed
Extended Period?
2.119 It would appear that, on the basis of the case law as it presently stands, the answer to this
question is an unequivocal yes. At the outset of any consideration of this point, it must be
noted that the courts have repeatedly held that the completion of the decision, and its
subsequent communication to the parties, are separate events. Although it has been regularly
argued that the decision is not complete until it has been communicated to the parties, it
has just as regularly been held that that is a fallacious submission.137 Further, it will be
noted from the authorities analysed below that, whilst there is some leeway in relation to
the time for communication of the decision, the decision itself must be completed within
the 28 days or the agreed extended period.
2.120 In Barnes & Elliott Ltd v Taylor Woodrow Holdings Ltd & Anor 138 HHJ Lloyd QC was principally
concerned with a decision which was completed within the relevant period but not delivered
until after the expiry of that period. This was one of the many cases in which the judge made
135
[2004] BLR 379.
136
[2007] EWHC 131 (TCC); [2007] TCLR 3.
137 This argument has been repeatedly rejected by the TCC judges; see Epping Electrical Co Ltd v Briggs &
Forrester (Plumbing Services) Ltd [2007] EWHC 4 (TCC); [2007] BLR 126 and Cubitt Building and Interiors
Ltd v Fleetglade Ltd [2006] EWHC 3413 (TCC); [2006] 110 Con LR 36.
138 [2003] EWHC 3100 (TCC); [2004] BLR 111
58
plain that there were two stages, namely the completion of the decision and then the
subsequent notification of that decision. Judge Lloyd emphasised that an adjudicator was
not entitled to complete the decision outside the time allowed and that the Act only con-
ferred authority to the adjudicator to make a decision within the 28-day period or such
extended period as was agreed by the parties.
A decision that is incapable of being reconciled with the Act, and the other authorities, is 2.121
Simons Construction Ltd v Aardvark Developments Ltd.139 This dispute did not arise under the
Act and the Scheme, but was instead a case under a particular contractual form of adju-
dication. However, the contractual stipulation was that the adjudicator had to give his
decision in that case by 17 June. He in fact gave it on 25 June. HHJ Seymour QC held that
the decision was binding, provided only that the adjudication agreement had not already
been terminated as a result of the adjudicator’s failure to produce a decision in the relevant
timescale, and that a fresh notice of referral had not already been given by one of the parties.
He appeared to base this decision on various provisions within the Scheme. On the face of it,
it is difficult to see how a decision that was not reached within 28 days could be valid, given
the emphasis in the 1996 Act on the necessity of the adjudicator’s decision being completed
within that timescale.
The decision in Simons Construction was the subject of sustained criticism by the Lord 2.122
Justice Clerk (Gill) in Ritchie Brothers (PWC) Ltd v David Philip (Commercial) Ltd 140 and
it was not followed in that case by the Court of Session. On the facts of Ritchie, the deci-
sion was due on 16 October but the adjudicator had requested the contractors to consent
to an extension until 23 October. The decision was not delivered to the parties until
27 October. The Lord Justice Clerk concluded that the decision was not within the
adjudicator’s jurisdiction because it was a decision reached out of time. He emphasised
that the 28-day period meant what it said. He rejected the suggestion that the adjudicator
was entitled to reach his decision at any time during an indefinite period after the expiry
of the 28 days, so long as neither of the parties had served a fresh notice of adjudication.
In a short concurring judgment, Lord Nimmo Smith said that: ‘If a speedy outcome is an
objective, it is best achieved by adherence to strict time limits.’ He added that: ‘If cer-
tainty is an objective, it is not achieved by leaving the parties in doubt as to where they
stand after the expiry of the 28 day period.’ The adjudicator’s decision was therefore held
to be a nullity.
Although the decision in Ritchie was a majority decision, it was the first by an appellate court 2.123
on the point. It has been followed by the TCC in London in a number of subsequent cases.
In Hart Investments Ltd v Fidler & Anor141 the TCC judge concluded that the decision in
Ritchie was a correct statement of the law and that a decision reached outside the 28-day
period would be a nullity unless there was an agreed extension of that period. In Cubitt
Building & Interiors Ltd v Fleetglade Ltd142 the same judge repeated that view, concluding
that adjudicators do not have the jurisdiction to grant themselves extensions of time
without the express consent of both parties. Although it is unclear whether either of
these cases was cited to HHJ Havery QC in Epping Electrical Co Ltd v Briggs & Forrester
139 [2003] EWHC 2474; [2004] BLR 117.

140 [2005] SLDT 341.
141
[2006] EWHC 2857 (TCC); [2007] BLR 30; [2007] TLLR 1; (2007) 109 Con LR 14.
142 [2006] EWHC 3413 (TCC); [2006] 110 Con LR 36.
59
(Plumbing Services) Ltd,143 he reached the same conclusion in that case. Having noted that
Ritchie was the only decision on the point by an appellate court, Judge Havery said that it
would be anomalous and undesirable if the 28-day provision was interpreted in different ways
in the two jurisdictions. Whilst strictly he was not bound by the decision in Ritchie, he con-
sidered that he ought to follow it. The same judge repeated that conclusion in the later case
of Aveat Heating Ltd v Jerram Falkus Construction Ltd.144
2.124 The most recent decision in which the TCC emphasised the importance of compliance with
the 28-day (or the agreed extended) period is A C Yule & Son Ltd v Speedwell Roofing & Cladding
Ltd.145 There, as a result of Speedwell’s request for further time to make representations on one
particular aspect of the case, the adjudicator had sought a consequential extension of two
days to complete his decision. Yule had agreed to his request. Although Speedwell did not
respond to the request itself, they conducted themselves in a way that was only consistent
with an extension of time having been agreed. Following the adjudicator’s decision, which
was provided during the two-day extension period, Speedwell took the point that the
decision was invalid because they had not consented to the requested extension. The TCC
judge rejected that contention, saying that there was a clear obligation on the part of both
parties to the adjudication to respond plainly and promptly to an adjudicator’s request for
further time. If, in breach of that obligation, one party failed to respond at all, there was a
very strong case for saying that that party had accepted, by their silence, the need for the
required extension. As the judge put it, ‘The adjudicator can do no more than work out that
he needs a short extension, and seek agreement from the parties to such an extension.
Common sense, as well as common courtesy, requires a prompt response.’ He went on to
find that Speedwell’s conduct was only consistent with their having agreed to an extension
of time and, even if he was wrong about that, he concluded that Speedwell were estopped
from belatedly taking the point that the decision was invalid because it had not been
completed in time.146
2.125 Although the judge’s conclusion meant that the adjudicator’s decision was valid, and was
therefore enforced by way of summary judgment, Yule is also of some additional significance
because, in shortly addressing the claimant’s alternative arguments, the TCC judge con-
sidered afresh the consequences of non-compliance with the statutory or agreed period.
Although his remarks were necessarily brief, they constitute the first time in which the courts
have expressly considered the contention, by reference to the House of Lords decision in R v
Soneji,147 and the Australian case of Brodyn Pty Ltd v Davenport and Anor,148 that what matters
is not the language in which the statutory requirement of completion within 28 days is
expressed, but the consequences of non-compliance with that period. It has been suggested
in some quarters that Ritchie, and the other cases referred to in the preceding paragraphs,
143 [2007] EWHC 4 (TCC); [2007] BLR 126.

144 [2007] EWHC 131 (TCC); [2007] TCLR 3. A separate point arises out of this second decision of Judge
Havery, dealt with at paragraph 2.132.
145 [2007] EWHC 1360 (TCC); [2007] BLR 499.
146 In Letchworth Roofing Co v Sterling Building Co [2009] EWHC 1119 (TCC); [2009] CILL 2717, it was
the defendant who argued that the claimant had not agreed to extend time from 28 to 42 days. On the facts,
that submission was rejected. The judge also said that, if the decision of the adjudicator had not been to the
claimant’s liking, and it had sought to avoid enforcement by claiming that it had not agreed to the 42 days, the
judge would have rejected that submission for the same reasons set out in Yule.
147 [2006] 1 AC 340.
148 61 NSWLR 421.
60
were wrongly decided, because they placed too much emphasis on the mandatory
requirements of the 1996 Act, and gave insufficient weight to the consequences of a finding
that a decision, provided out of time, was a nullity.
The judge made five points in rejecting the argument that Ritchie, and the cases that followed 2.126
it, were wrongly decided. First, he did not consider that such an approach, which was clearly
applicable to the sort of ‘one-chance only’ applications sometimes required by the criminal
law (and that lay at the heart of the debate in R v Soneji), was necessarily applicable to the
field of private dispute resolution. He made the point that the Arbitration Act 1996
stipulated tight time limits for applications to appeal against or set aside an arbitrator’s
award, and that there were numerous decisions of the Commercial Court and the Court of
Appeal that made plain that a failure to comply with those time limits was almost always fatal
to an application made out of time, regardless of the consequences. Secondly, he concluded
that, because adjudication was a process in which accuracy had been sacrificed for speed, it
would be contrary to the whole basis of adjudication for speed suddenly to become less
important, with the pace of any given adjudication to be dictated, not by the statutory
requirements, but ‘by a complex (and potentially ever-changing) kaleidoscope of factors
comprised of the consequences of the adjudicator’s failure to comply with those requirements’.
Thirdly, he pointed out that the mere fact that the decision was a nullity was not an end to
the process (unlike the confiscation order application at issue in R v Soneji), because a fresh
adjudication could always be commenced if the first decision was a nullity. In addition, the
extent of the delay and the amount of any wasted costs in the event of a further adjudication
might be small. Fourthly, he distinguished the decision of the Court of Appeal of New South
Wales in Brodyn Pty Ltd v Davenport and Anor,149 on the basis that the adjudication provisions
under consideration in that case were very different to those provided by the Scheme for
Construction Contracts. There was, for example, no obligation that the adjudicator ‘shall’
complete his decision within a particular time.150
The fifth and final point that the judge made in Yule, in concluding that the 28-day (or any 2.127
agreed extended) period was to be regarded as mandatory, was his view that, in a speedy process
like adjudication, the need for certainty was paramount. He considered that that certainty
would be lost if the 28 days was no longer regarded as a clear and mandatory requirement, but
merely a guideline. Equally, he said, certainty would be lost if an adjudicator was given as long
as he wanted to provide an enforceable decision, provided only that the parties could not show
clear prejudice as a result of any delays beyond the 28-day (or agreed extended) period. Thus
he concluded that, even if he was persuaded to adopt the approach in R v Soneji, in construing
the 1996 Act as a whole (and paragraph 19 of the Scheme in particular) he would come to the
same conclusion, namely that the benefits of speed and certainty underpinned the statutory
requirement that the decision of the adjudicator shall be provided within 28 days (or any
agreed extended period), and not thereafter. He concluded that the 1996 Act and the Scheme
were to be construed purposively to ensure that those objectives were maintained.
Accordingly, unless and until this issue is reviewed by the Court of Appeal, it seems clear that 2.128
the adjudicator must endeavour to complete his decision within 28 days, or the extended
149
(2004) 61 NSWLR 421.
150 Furthermore, a closer examination of the decision in Brodyn makes clear that the NSW Court of Appeal
were not dismissing the notion that a failure to comply with statutory requirements and time limits rendered an
adjudicator’s decision unenforceable.
61
period, and his failure to do so will mean that his decision is a nullity. Furthermore, for the
reasons explained by the TCC judge in Cubitt Building & Interiors Ltd v Fleetglade Ltd 151 this
could, in certain circumstances, deprive one of the parties to the contract of a substantive and
permanent remedy (such as where the challenge to the final certificate has to be made within
a certain period, otherwise the certificate becomes binding). It is therefore important for
everybody, including the adjudicator, to ensure that his decision is completed within the
relevant period.
Is There Any Leeway Available to the Adjudicator When Communicating the Decision?
2.129 Just as the authorities are clear that an adjudicator does not have the right or ability to extend
time unilaterally to complete his decision, they also demonstrate that he does have some
leeway in the communication of that decision. Thus, in Barnes v Elliott (paragraph 2.120
above), the adjudicator completed his decision within time but, due to a mix-up as to the
method of delivery, it was not provided to the parties until one day after the expiry of the
relevant period. Judge Lloyd decided that an error which resulted in a delay of a day, or
possibly of two days, in the communication of the decision, was in all the circumstances
excusable. He held that it was within the tolerance and commercial practice which one had
to afford to the 1996 Act and to the contract. A valid decision reached within 28 days did not
become unauthorised and invalid merely because, as a result of an error by the adjudicator in
despatching the decision, it did not reach the parties within the time limit.152
2.130 In Cubitt Building & Interiors Ltd v Fleetglade Ltd 153 the adjudicator’s decision was dated
the last day of the agreed extended period. However, the decision was not provided to the
parties until just after noon the following day. There was extensive argument to the effect
that the decision had not been completed within time and/or that the decision should have
been communicated immediately, and not over 12 hours late. The TCC judge expressed
his concern that it had been necessary for him to consider in detail the evidence of the
adjudicator’s thinking on an almost hour-by-hour basis. He concluded that the communi-
cation just after noon the following day complied with the adjudicator’s obligation to
communicate the decision forthwith but warned that, in the days of email and fax, the
time for the communication of the decision following its completion should be very
short—a matter of a few hours at most. He struggled to see how any decision not communi-
cated at the latest by the middle of the day after the final deadline, as in Cubitt, could be
said to have been communicated ‘forthwith’. He said that the safest thing for an adjudicator
to do, if the decision had reached the last day of the 28-day period, was to email that decision
during that final day.154
2.131 On the facts in Mott MacDonald Limited v London & Regional Properties Limited,155 the
decision was completed before the end of the period, but was not communicated until after
the expiry of the period. This delay arose because of the adjudicator’s insistence on recovering
151
[2006] EWHC 3413 (TCC); [2006] 110 Con LR 36.
152 It is respectfully suggested that it was this point which Jackson J had in mind when, in M Rhode
Construction v Nicholas Markham-David [2006] EWHC 814 (TCC); [2006] BLR 291 he said that ‘a slight
delay is not fatal to the decision’.
153 [2006] EWHC 3413 (TCC); [2006] 110 Con LR 36.
154 In both Cubitt and Epping Electrical, there was a delay because the adjudicator wrongly considered that
he was entitled to a lien in respect of his fees. This question is dealt with in greater detail in paragraphs 10.24-
10.29.
155
[2007] EWHC 1055 (TCC); [2007] 113 Con LR 33.
62
his fees before he released his decision.156 The delay was held to be outside the requirements
of the 1996 Act, and the decision was not enforced. Similarly, in Lee v Chartered Properties
(Building) Ltd 157 it was held that an adjudicator’s decision, which had been reached within
the extended period, had not been delivered ‘as soon as possible after’ it had been reached,
because there was a three-day period between the completion of the decision and the time
when it was issued to the parties. The judge noted that there was ‘simply no evidence as to
why some three days or 72 hours were required by the adjudicator to deliver his decision’.
The decision was therefore held to be unenforceable.
Although many standard forms of building and engineering contract were amended so as to 2.132
comply with the 1996 Act, one way in which they sometimes departed from s108 was by
suggesting that a decision reached after the expiry of the 42 days would still be valid, provided
that it was reached before the appointment of a replacement adjudicator. Such a provision
was held not to comply with s108.158 Other standard forms did not go that far and instead
provided simply that a decision will be valid if issued after the time allowed. Although such
a clause was held to be invalid for the same reasons,159 it is thought that, on analysis, such a
provision is not necessarily objectionable. On one view it simply enshrines the principle that
the adjudicator has a small amount of leeway between concluding his decision and issuing it,
as discussed above. In Dalkia Energy and Technical Services Ltd v Bell Group UK Ltd 160 the
TCC judge noted that, whilst a decision had to be reached within the time limits set out in
the 1996 Act, since an adjudicator was entitled to a short period in which to issue that deci-
sion, a decision issued after the 28- or 42-day period may still be a valid decision.
Impartiality/Fairness
Again, the question as to whether or not an adjudicator has to comply with the rules of natural 2.133
justice, and the extent to which it is necessary for him so to comply, has been a major feature
of arguments as to the enforceability or otherwise of adjudicators’ decisions. Accordingly,
this important topic is dealt with in some detail in Part IV, Chapters 11–13 below. However, it
is instructive to note at this point the courts’ initial approach to the adjudicator’s obligation,
pursuant to s108(2)(e), to act impartially.
The scope of this obligation to act impartially was first considered by the courts in Discain 2.134
Project Services Ltd v Opecprime Developments Ltd.161 In that case the adjudicator had two
private conversations with employees of the contractor which, although he did not initiate
them, were not recorded and communicated to the defendant. On the application for
summary judgment, HHJ Bowsher QC said that he found the fact of these discussions
‘distasteful, and I cannot bring myself to enforce an adjudication which has been arrived at
in that way’. The matter then went to a full hearing, with evidence.162 In his final judgment,
Judge Bowsher made plain that he did not criticise the adjudicator for misuse of his inquisitorial
powers, but did criticise him because he failed to use his powers to control the conduct of
the proceedings in order to prevent one party approaching him in a way that the adjudicator
156 An adjudicator is not entitled to exercise a lien in this way: see paragraphs 10.24–10.29.
157 [2010] EWHC 1540 (TCC); [2010] BLR 500.
158 Epping Electrical Company Ltd v Briggs and Forrester [2007] EWHC 4; [2007] BLR 126; Banner Holdings
Ltd v Colchester Borough Council [2010] EWHC 139 (TCC); [2010] 131 Con LR 77
159 Aveat Heating Ltd v Jerram Falkus Construction Ltd [2007] EWHC 131 (TCC); [2007] TCLR 3.
160
[2009] EWHC 73 (TCC); [2009] 122 Con LR 66
161
[2000] BLR 402.
162
[2001] BLR 287.
63
felt improper. The judge found that, as a matter of general principle, the adjudicator had
to conduct the proceedings in accordance with the rules of natural justice or as fairly as
the limitations imposed by Parliament permit. In so deciding, he followed the same
approach as HHJ Lloyd QC in Glencot Development & Design Co Ltd v Ben Barrett & Son
(Contractors) Ltd.163
2.135 Judge Bowsher was obviously concerned that, in arriving at the conclusion that the
adjudicator was obliged to act in accordance with the rules of natural justice (and in this
case, had failed so to do) he was expressing a view that was contrary to that expressed by
Dyson J in Macob. It will be remembered that there, Dyson J had indicated that, even if the
adjudicator had reached his decision by making a procedural error which invalidated that
decision, ‘it is still a decision on the issue’ and was therefore to be enforced. Judge Bowsher
concluded that that cannot have been what Dyson J meant in Macob, saying:
On the other hand, with all respect, it is a startling proposition that an adjudicator’s decision,
if arrived at in serious breach of a principle of natural justice, must as a matter of law never-
theless be enforced in circumstances where payment under an invalid decision could easily turn
out to be irretrievable and precipitate the insolvency of the party affected (particularly
where, as here, there had not even been a decision by the adjudicator on the merits, but only
a procedural one shutting out consideration of any defence or cross-claim). Even given the
inherent and obvious pro-producer and anti-customer and anti-paymaster bias of the
HGCRA’s statutory adjudication proposals, it is submitted that, in the absence of express
wording, Parliament can only have intended adjudicator’s decisions validly arrived at on the
merits or law of a properly referred dispute to be binding on the parties for the comparatively
lengthy period which could be involved before final judgment or award and almost incon-
ceivable that Parliament intended to accord to adjudicators’ decisions or conduct an immunity
and enforceability not accorded by the law to arbitrators in their awards or even to the
judiciary and their judgments.
2.136 For the reasons explored in the detailed analysis of the cases under this topic at Chapters
11–13 below, the principles outlined by Judge Bowsher in Discain underpin the courts’
approach to these issues. This essentially means that, within the confines of the particular
adjudication and the time limits imposed, the adjudicator must comply with the rules of
natural justice.
2.137 A related question is the extent to which the provisions of s108(2) amount to a breach of the
Human Rights Act 1998, and the European Convention on Human Rights Article 6, which
provides that everyone is entitled to a fair and public hearing within a reasonable time. In
Austin Hall Building Ltd v Buckland Securities Ltd 164 it was argued that the adjudication
process was in breach of the human rights legislation. HHJ Bowsher QC rejected that sub-
mission. He doubted whether the adjudicator was a public authority and that, even if there
was a right to a public hearing, that right could be waived and such waiver could be inferred
by a failure to ask for a public hearing. However, the judge’s principal reason for rejecting
the submission was that s6(2) of the Human Rights Act made plain that sub-s (1) did not
apply to any particular act if ‘as a result of one or more provisions of primary legislation, the
authority could not have acted differently’. The judge held that, in order to comply with the
28-day time limit provided by the 1996 Act, the adjudicator could not have acted differ-
ently in imposing the time limits that he imposed on the parties, about which the defendant
163 [2001] BLR 207.

164 [2001] BLR 274.
64
subsequently complained. Thus the adjudicator was acting in accordance with primary
legislation and could not be criticised for imposing the time limits that he did. This important
strand of the judge’s conclusion on the human rights issue is set out verbatim in paragraph
13.68 below.
‘Binding’
Clearly, the extent to which the adjudicator’s decision was binding was one of the most 2.138
important elements of the Bill and was the subject of extensive debate.165 However,
s108(3) has not, of itself, engendered very much controversy. The parties to a construc-
tion contract are aware that the decision of an adjudicator is binding until the matter is
taken either to court or to a final determination by an arbitrator. As previously noted,
the arguments as to whether or not the decision is binding have tended to revolve
around questions of the enforceability of the decision, and those issues have them-
selves turned, in the main, on arguments as to the adjudicator’s jurisdiction or about
natural justice.
However, there has been dispute about the binding nature of those decisions that contain 2.139
a palpable error. As we saw from the decision of the Court of Appeal in Bouygues, the general
position is that, if the adjudicator was answering the question that he had been asked by the
parties, then it mattered not whether there were errors of fact or law in that decision: it was
still enforceable. However, this question arose even more starkly in Bloor Construction (UK)
Ltd v Bowmer & Kirkland (London) Ltd.166 In that case the adjudicator faxed to the parties a
decision at 3.32 pm on 11 February 2000. The decision stated that Bowmer should pay
Bloor a total of £122,098.76. Bowmer realised that the adjudicator had failed to deduct the
payments on account that they had already made. The error was pointed out to him and
on the same day, at 5.53 pm, he sent out a corrected decision that confirmed that, once
due allowance was taken for the payments on account, no further sum was due to Bloor.
The adjudicator said that his first decision was ‘an obvious slip’. Bloor sought to enforce the
adjudicator’s first and uncorrected decision. HHJ Toulmin CMG QC categorised the error as
‘a slip’. He said that, in the absence of any specific agreement to the contrary, a term could and
should be implied into the contract allowing the adjudicator to correct an error arising from
an accidental error or omission. He said that the purpose of adjudication was to enable broad
justice to be done between the parties and that that would be achieved if the parties were
taken to agreeing that the adjudicator could correct an obvious mistake of the sort that he
had made in that case.
It is respectfully submitted that the decision in Bloor was based on contractual common 2.140
sense. Some commentators have suggested that the problem with the result is that it is diffi-
cult to say that it was not contrary to the reasoning of both Dyson J and the Court of Appeal
in Bouygues. However, it is thought that the two can be reconciled. Bloor was a strong case on
the facts, because the adjudicator accepted that there had been an error and rectified it imme-
diately. Thus, if the parties agree or the adjudicator decides that there has been a slip and takes
corrective action within time, then the slip can be corrected. But if the parties are in dispute
as to the obviousness (or otherwise) of the alleged ‘slip’, or the adjudicator does not accept
that an error had been made, or does accept it but only some time after the publication of the
165 Please see Chapter 1.

166 [2000] BLR 314.
65
decision, then it is probable that the approach in Bouygues will remain appropriate.167 This is
discussed in greater detail in paragraphs 8.26–8.35 below. The 2009 Act expressly provides
for a statutory ‘slip rule’, discussed at paragraphs 4.10–4.11 below.
2.141 The leading case on the proper construction of the word ‘binding’ in s108(3) is the Court of
Appeal case of Ferson Contractors v Levolux AT Limited,168 referred to in detail in paragraphs
9.26–9.28 below. In William Verry Ltd v London Borough of Camden,169 Ramsey J referred to
that decision and said that the Court of Appeal ‘set out in clear terms the principle which
applies to the implementation of the intention of Parliament. . . . In my judgment, the effect
of those statutory provisions [particularly s108] and of the passages in Levolux is generally to
exclude a right of set-off from an adjudicator’s decision.’
2.142 Because the adjudicator’s decision is binding, a particular issue arises as to the accrual of
rights arising specifically out of his or her decision. In Jim Ennis Construction Ltd v Premier
Asphalt Ltd,170 a losing party in an adjudication subsequently commenced court proceed-
ings as a claimant to seek a final determination of the matters decided by the adjudicator,
with a view to recovering monies paid to the successful party (subsequently the defendant)
in compliance with the adjudicator’s decision. Although the proceedings started only a
month later, the defendant raised a limitation defence and, because of the defendant’s
delays in commencing the adjudication in the first place, it appeared that, if the claimant’s
cause of action arose under the original contract, it was indeed statute-barred. Thus the
claimant argued that its cause of action, in seeking to recover sums paid out in compliance
with an adjudicator’s decision, was separate and distinct from the cause of action in respect
of the original contractual dispute, and did not arise until the date of payment in compli-
ance with the decision.
2.143 HHJ Stephen Davies referred to a number of different authorities171 and concluded that the
obligation to comply with the adjudicator’s decision gave rise to a new cause of action in
favour of the successful party to compel the losing party to comply with that decision. That
conclusion led on to the finding that there was an implied term of the contract that an
unsuccessful party was entitled to bring court proceedings, so as to have the dispute that had
been referred to the adjudicator finally determined and, if successful in persuading the court
to reach a conclusion different to that reached by the adjudicator, to be repaid all sums paid
by him in compliance with the decision. The judge found that the implied term satisfied the
five conditions noted in BP Refinery v Shire of Hastings.172 The claimant was therefore successful
and the claim for recovery of the sums paid out was held not to be statute-barred. It is to be
noted that the judge raised the unattractive possibility that, as a result of this finding, a losing
party in an adjudication might bring its claim nearly six years after the original adjudication,
167
In O’Donnell Developments Ltd v Build Ability Ltd [2009] EWHC 3388 (TCC); [2009] 128 Con LR
141, there was a discussion about this paragraph. Ramsey J expressly approved the passage, noting that it did
not necessarily follow that the slip rule could be activated only if the parties agreed. In that case, the parties did
not agree that the slip rule was necessarily activated, but the adjudicator made corrections. Ramsey J said that
he was entitled to do so. The case is discussed in greater detail in paragraph 8.34.
168 [2003] BLR 118.
169
[2006] EWHC 761.
170
[2009] EWHC 1906 (TCC); [2009] 125 Con LR 141.
171
Glencot Development v Ben Barrett [2001] BLR 207; VHE Construction v RBSTB Trust Co [2000] 70 Con
LR 51; Bovis Lend Lease Ltd v Triangle Development [2002] EWHC 3123 (TCC); [2003] BLR 31; and Ringway
Infrastructure Services v Vauxhall Motors No 2 [2007] EWHC 2507 (TCC); [2008] TCLR 2.
172 [1978] ALJR 20.
66
which might itself have occurred nearly six years after the contractual claim originally
accrued, but he concluded that that was still a fairer result than the one for which the defendant
had so strenuously contended.
No Limit
It is thought that, on a proper construction of s108 of the 1996 Act, there is no limit or 2.144
qualification on the type of dispute which can be referred to adjudication and which is
therefore the subject of the process set out in the section. This is important because some
of the standard forms do purport to limit the jurisdiction of the adjudicator in particular
ways. This issue arose starkly in Banner Holdings Ltd v Colchester Borough Council.173 In
that case, the TCC judge concluded that the particular dispute that had been referred to
adjudication was not caught by the purported exclusion and thus found that the adjudi-
cator had the necessary jurisdiction to decide the dispute. But he went on to say that, if
he was wrong about that, the provision which prevented the council from referring the
dispute about termination to adjudication fell foul of s108 of the 1996 Act. He said:
There is nothing in s108, or any other part of the 1996 Act, that could justify such a limit on
the adjudicators power and jurisdiction. Section 108 contains no qualification, no limitation,
upon the nature, scope and extent of the disputes that can be referred to adjudication under a
construction contract. There is certainly no basis for reading s108 as excluding an adjudicator’s
jurisdiction to decide, under this form of contract, whether the determination under condition
56(1) was justified or not.
The decision in Banner also raised the issue as to s108(5) and what happens if one particular 2.145
part of a written contract does not comply with the 1996 Act, even if everything else
does. That debate can now be taken to have been resolved and is dealt with in paragraphs
3.04–3.12 below.
Sections 109, 110 and 111: Payment Provisions

The relevant sections of the 1996 Act read as follows: 2.146
109–(1) A party to a construction contract is entitled to payment by instalments, stage
payments or other periodic payments for any work under the contract unless—
(a) it is specified in the contract that the duration of the work is to be less than
45 days, or
(b) it is agreed between the parties that the duration of the work is estimated to be
less than 45 days.
(2) The parties are free to agree the amounts of the payments and the intervals at which,
or circumstances in which, they become due.
(3) Any absence of such agreement, the relevant provisions of the Scheme for
Construction Contracts apply.
(4) References in the following sections to a payment under the contract include a
payment by virtue of this section.
110–(1) Every construction contract shall—
(a) provide an adequate mechanism for determining what payments become due
under the contract, and when, and
(b) provide for a final date for payment in relation to any sum which becomes due.
173 [2010] EWHC 139 (TCC); [2010] 131 Con LR 77.
67
The parties are free to agree how long the period is to be between the date on which
the sum becomes due and the final date for payment.
(2) Every construction contract shall provide for the giving of notice by a party not later
than five days after the date on which a payment becomes due from him under the
contract, or would have become due if—
(a) the other party had carried out his obligations under the contract; and
(b) no set-off or abatement was permitted by reference to any sum claimed to be due
under one or more other contracts,
specifying the amount, if any, of the payment made or proposed to be made, and the
basis on which that amount was calculated.
(3) If or to the extent that a contract does not contain such provision as is mentioned
in sub-section (1) or (2), the relevant provisions of the Scheme for Construction
Contracts apply.
111–(1) A party to a construction contract may not withhold payment after the final date for
payment of a sum due under the contract unless he has given an effective notice of
intention to withhold payment.
The notice mentioned in section 110(2) may suffice as a notice of intention to with-
hold payment if it complies with the requirements of this section.
(2) To be effective such a notice must specify—
(a) the amount proposed to be withheld and the ground for withholding payment, or
(b) if there is more than one ground, each ground and the amount attributable to it,
and must be given not later than the prescribed period before the final date for
payment.
(3) The parties are free to agree what that prescribed period is to be.
In the absence of such agreement, the period shall be that provided by the Scheme
for Construction Contracts.
(4) Where an effective notice of intention to withhold payment is given, but on the mat-
ter being referred to adjudication it is decided that the whole or part of the amount
should be paid, the decision shall be construed as requiring payment not later than—
(a) seven days from the date of the decision, or
(b) the date which apart from the notice would have been the final date for payment,
whichever is the later.
2.147 Again, the point must be made at the outset that these provisions have been significantly
amended by the 2009 Act,174 but currently remain in force in their unamended form. At
their heart is the attempt to ensure that every construction contract contains a transparent
and straightforward mechanism for the payment to the contractor of interim payments on
account (sometimes called instalments or progress payments). In addition it recognises that,
although there will inevitably be a period between the date on which a payment becomes
due, and the final date on which that sum must be paid, it imposes an obligation on the payer
to notify the payee well in advance of the final date for payment how much is going to be paid and
how that sum has been calculated. If the payer wishes to withhold part or all of a sum other-
wise due under the contract, then a withholding notice must be served, again well in advance
of the final date for payment, which makes it crystal clear what is being withheld and why.
2.148 The mischief at which s110 is aimed is clear: too often in the past, construction contracts,
particularly sub-contracts, were either absurdly complex or vague as to what sums would
become due and when. Section 110 is designed to do away with such uncertainty. The mischief
174
See paragraphs 4.16-4.28.
68
that s111 is aimed at is more subtle but was, prior to the 1996 Act, a major source of dispute
and difficulty within the construction industry. It was common for contractors and, particularly
sub-contractors, to carry out a large amount of work and comply with the contractual mech-
anism in respect of payment. The contractor or sub-contractor would then confidently expect
to be paid only to receive at, or sometimes after the final date for payment, an indication that the
monies would not be forthcoming as a result of an alleged defect or other deficiencies in the
contractor’s work. Sometimes, the out-of-pocket contractor or sub-contractor would have
no idea why the sums were not being paid until, once he had issued his writ and issued his
application for summary judgment, he would be informed, sometimes for the first time, that
the payer had a set-off and counterclaim that extinguished his claim. It was notoriously easy
for unscrupulous payers, be they employers or main contractors, to put together a sufficiently
intimidating counterclaim to ensure that the payee did not receive the sums due at the sum-
mary judgment hearing. In order to destroy such abuses once and for all, s111 created the
system of withholding notices, whereby if the payer had a genuine reason not to pay sums
otherwise due, they had to spell that reason out in advance of the payment becoming due.
Accordingly, these three sections of the 1996 Act are designed to introduce into most 2.149
construction contracts three distinct arrangements: a system of stage payments (s109); a
clear mechanism by which those stage payments become due and finally payable (s110); and
the mechanism by which the payer must notify the payee of its intention to withhold payment
(s111). Each section is considered briefly below. It is unsurprising that it is in relation to s111
that the majority of the authorities occur.
Most construction contracts, and certainly all the standard forms in common use, provide 2.150
for a system of stage payments. The purpose of s109(1) is to ensure that, save in smaller con-
tracts where the work will take less than 45 days, all contracts provide for a stage payment
mechanism. In Tim Butler Contractors Ltd v Merewood Homes Ltd 175 the defendant contended
that s109 did not apply because the duration of the work was less than 45 days. The adjudicator
held that the duration of the works under the contract was not specified or agreed as less than
45 days, concluding that the parties had agreed price, terms and conditions and the date of
commencement, but had reached no agreement as to the duration of the works. Although
there was a programme that showed a four-week duration, the adjudicator found that that
did not form part of the contract between the parties. The adjudicator therefore decided in
favour of the claimant.

The enforcement application was heard by HHJ Gilliland QC in the TCC in Salford, when 2.151
he too rejected the defendant’s submission. He concluded that the question as to whether a
construction contract came into existence that entitled the claimant to stage payments was a
dispute as to the terms of the contract. It was not a dispute that went to the jurisdiction of
the adjudicator. The adjudicator had to decide what the agreed terms were and, in particular,
whether or not the programme was a term of the contract. The adjudicator did so and
concluded that the programme was not a term of the contract. The judge found that the
adjudicator was entitled to reach that view and, whether it was right or wrong, it was a decision
within his jurisdiction. The decision was therefore enforced.
Section 110(1) requires that every construction contract must provide an adequate mechanism 2.152
for determining what payments were due under the contract and when, and, in respect of
175
[2002] 18 Const LJ 74.
69
each payment, providing a final date for such payment. The problem that arose in Maxi
Construction Management Ltd v Morton Rolls Ltd 176 is not uncommon. There, the payment
provisions of the contract had been amended to include two distinct stages. The first was the
agreement of the contractor’s valuation by the employer’s agent, whilst the second stage
envisaged an application by the contractor for payment of the sum that had been agreed.
Lord MacFadyen concluded that such a regime was not in accordance with s110(1)(a).
A requirement that a valuation be agreed by the employer’s agent before a claim for payment
could be made was not necessarily incompatible with s110(1)(a), provided always that there
was a timetable for the process of agreement, and, just as importantly, a means of resolving a
failure to reach any such agreement. The amendments in the contract under consideration
included no such timetable and no such mechanism. Thus, failure on the part of the employer’s
agent to agree a valuation could hold up the making of claim for payment indefinitely. Thus
the judge concluded that the contract did not provide an adequate mechanism for determining
when payments became due under the contract. Accordingly, the Scheme for Construction
Contracts was implied instead.
2.153 Section 110(1)(b) is plainly important because it requires each construction contract to pro-
vide a final date by which each stage payment must be paid. This provision was considered by
HHJ Lloyd QC in Alstom Signalling Ltd v Jarvis Facilities Ltd.177 In that case the adjudicator
found that the contract did not satisfy s110(1)(b) because, he said, the final date for payment
was capable of being unilaterally altered. The judge rejected that analysis. He said that the
payment terms in the sub-contract that he was considering related up the contractual chain
to the main contract with Railtrack. The contract provided that payment would be made
within seven days of a Railtrack certificate. The judge held that there was therefore certainty
as to the final date for payment, namely seven days after the Railtrack certificate, and the fact
that Railtrack, possibly in breach of its own contract with Alstom, might fail to issue that
certificate did not mean that, for the purposes of s110(1)(b), there was no final date for payment.
The judge pointed out that the final date for payment remained seven days after the issue of
the certificate. He also made the important point that the fact that a date was set by reference
to a future event did not render it any the less a final date. The event on which the payment
might turn could be a stage, or milestone date, or completion, practical or substantial. It
could be the result of an action by a third party, such as a certificate under a superior contract
or transaction. However, provided that the event was readily recognisable and would produce
a date by reference to which the final date could be set, there was no reason why the event
could not provide for a final date for payment in accordance with s110(1)(b).
2.154 Section 110(2) imposes upon the payer the obligation to notify the payee, not later than five
days after the date on which a payment become due, the amount of the payment that was
being or would be made, and the basis on which that amount was calculated.178 As pointed
out above, this was of important practical significance to the payee, because it meant that he
would be promptly notified if the employer intended not to pay the full amount that the
payee was expecting. As s111(1) makes expressly clear, such a notice could also constitute a
withholding notice under s111. It is therefore instructive to turn to the authorities under
that section, and the inter-relationship between s110 and s111. This is analysed under five
176 [2001] CILL 1784–1787.

177
[2004] EWHC 1232 (TCC); [2004] 95 Con LR 55.
178
Under a contract with a certificate regime, this provision is superfluous. The changes introduced by the
2009 Act expressly allow for this: see paragraphs 4.16–4.21.
70
sub-headings: what is meant by ‘a payment due’ (paragraphs 2.155–2.161 below); the extent,
if at all, to which the payer is entitled to set off against sums otherwise due (paragraphs
2.162–2.163 below); the nature and timing of the withholding notice under s111 (para-
graphs 2.164–2.168 below); the inter-relationship with these provisions and other terms
of the contract (paragraph 2.169–2.174 below); and the inter-relationship between these
provisions and a party’s right to seek a stay for arbitration or adjudication (paragraphs
2.175–2.179 below).
Payment Due Under the Contract

There was for many years after the 1996 Act came into force a debate about the right approach 2.155
to the payee’s entitlement to a payment due under the contract. These debates principally
arose under those contracts which did not contain a regime by which interim payments
were certified or authorised by the employer’s agent. The most extreme position adopted by
the payee was that, if it claimed £X under the contract, and there was no notice under
s110(2) or no withholding notice from the payer in accordance with s111, it was said that
the payee was entitled to £X. At the other extreme, it was said by the payer that a payment
that was ‘due’ could only be identified as such following a detailed investigation by the
adjudicator, and the court, as to whether the sums claimed were actually due. This, of course,
would have allowed the payer a broad licence to investigate every element of the sum claimed,
both in the adjudication and in court on the enforcement application, on the basis that, if
it was not due, s110(2) could not apply. Eventually, it has been demonstrated that, as a
generality, neither of these extreme positions is right, and that everything turns on the terms
of the contact and, in particular, whether or not the contract provides for a payment mechanism
by reference to the certificates or valuations of a third party.
The high watermark of the payee’s approach, to the effect that, in the absence of a withhold- 2.156
ing notice, a sum claimed was a sum due under the contract in accordance with s110, can be
found in the decision of HHJ Bowsher QC in Northern Developments (Cumbria) Ltd v J&J
Nichol.179 In that case the contractor made an application for payment and 14 days later the
employer sent a withholding notice. Thereafter, the contract was terminated and the
employer made a claim for repudiation. The adjudicator refused to consider the alleged
repudiation because it was not a matter within the withholding notice. Judge Bowsher
agreed with that. However, in his judgment he appeared to suggest that a contractor was
entitled to the sum claimed, save for any points expressly raised by the employer in a with-
holding notice. At paragraph 29 he said:
The intention of the statute is clearly that if there is to be a dispute about the amount of the
payment required by section 111, that dispute is to be mentioned in a notice of intention to
withhold payment not later than five days after the due date for payment . . . There is to be no
dispute about any matter not raised in a notice of intention to withhold payment. Accordingly,
in my view, the Adjudicator had no jurisdiction to consider any matter not raised in the notice
of intention to withhold payment in this case.
That passage in the judgment of Judge Bowsher was interpreted by some as meaning that any 2.157
disputes as to payment, including whether or not a particular part of the claim was due under
the contract, had to be identified in a withholding notice and, if it was not in a withholding
notice, it could not be raised by the employer. However, that interpretation of Judge
179
[2000] BLR 158.
71
Bowsher’s judgment missed the simple point that, if the claim was based simply on a contractor’s
application for payment, it was open to the employer to challenge the application on the
basis that at least some of the sums claimed were not due under the contract. This was not a
question of withholding anything from sums otherwise due; it was making the point that
some of the sums claimed were simply not due in the first place. This distinction was explained
by Lord MacFadyen in SL Timber Systems v Carillion Construction Ltd.180 In that case, the
adjudicator decided that the main contractors had failed to serve notices in accordance with
s110(2) and that therefore the sub-contractors were entitled to the sums that they claimed
without any scrutiny of the substance of their applications. Lord MacFadyen concluded that
that approach was wrong in principle. As to s111 he said:
The section is not, in my opinion, concerned with every refusal on the part of one party to pay a
sum claimed by the other. It is concerned, rather, with the situation where a sum is due under the
contract, and the party by whom that sum is due seeks to withhold payment on some separate
ground. Much of the discussion of the section in the cases has been concerned with what circum-
stances involve ‘withholding’ payment and therefore require a notice. Without the benefit of
authority, I would have been inclined to say that a dispute about whether the work in respect
of which the claim was made had been done, or about whether it was properly measured or
valued, or about whether some other event on which a contractual liability to make payment
depended had occurred, went to the question of whether the sum claimed was due under the
contract, therefore did not involve an attempt to ‘withhold . . . a sum due under the contract’,
and therefore did not require the giving of a notice of intention to withhold payment. On the
other hand, where there was no dispute that the work had been done and was correctly measured
and valued, or that the other relevant event had occurred, but the party from whom payment was
claimed wished to advance some separate ground for withholding the payment, such as a right
of retention in respect of a counterclaim, that would constitute an attempt to ‘withhold . . . a sum
due under the contract’, and would require a notice of intention to withhold payment.
The judge considered what Judge Bowsher had said in Northern Developments. He concluded
that if Judge Bowsher meant that, without a s111 notice, there could be no dispute of any
sort as to whether the sum claimed was properly due, the judge had taken too broad a view
of the effect of s111.181
2.158 The distinction between the case where the payee’s claim was based simply on an application
for payment, the detail of which might be legitimately disputed by the payer, and the case
where the payee’s claim was based on a certificate or valuation authorised by the employer’s
agent, in which case there could be no legitimate complaint that, under the contract, the
sums certified were due, was made in clear terms by Sheriff J A Taylor in Clark Contracts Ltd
v The Burrell Co (Construction Management) Ltd.182 In that case, the main contractor’s claim
180
[2001] BLR 516.
181
It should be noted that precisely the same conclusion was arrived at by HHJ Gilliland QC in Millers
Specialist Joinery Co Ltd v Nobles Construction Ltd [2001] CILL 1770–1773. In his judgment in that case, Judge
Gilliland said at paragraph 22: ‘If it were correct that the effect of a failure to serve a valid note of intention to
withhold payment under s111 was that the amount of the valuation or invoice was to be regarded as a sum “due
under the contract”, the consequence would appear to be that neither an adjudicator nor the court could properly
refuse to order payment in full even though it might be perfectly clear, for example, that the work or the materials
claimed for had not been carried out or supplied, or that the wrong rate or price had been claimed or that there
had been some other error in the invoice or valuation. If the effect of a failure to serve a notice under the section
is to deprive the payer of the right to refuse payment on the basis that the sum from which the deduction is sought
to be made is not properly due and payable, it is difficult to see on what basis the court could refuse to give judg-
ment for the full amount or what course of action the payer would subsequently have to recover the payment.’
182 [2002] SLT 103.
72
was based on an interim certificate. Accordingly, Sheriff Taylor distinguished the situation
under consideration in SL Timber because, in Clark, there was no dispute that the architect
had issued an interim certificate. The certificate functioned as a notice under s110(2). The
sheriff found that the contractors became entitled to payment of the sum certified within
14 days of the certificate being issued and that amounted to an entitlement to payment of a
sum due under the contract. Thus, if the employers wanted to avoid a liability to make that
payment, they had to issue a notice in accordance with s111(1) of the 1996 Act. There was
no such notice and therefore the sum was due.183
This distinction, between sums claimed on the one hand and sums certified on the other, was 2.159
emphasised by the Court of Appeal in Rupert Morgan Building Services (LLC) Ltd v Jervis &
Anor.184 In that case, there was a certificate. Jacob LJ referred to Sheriff Taylor’s analysis in
Clark and concluded that, if a sum had been certified under the contract, it was therefore
‘due’ and could not be opened up by the adjudicator, and if an employer wanted to withhold
money from a certified sum, he had to serve notice in accordance with s111. Jacob LJ also
pointed out that, not only was Sheriff Taylor’s analysis obviously right, it had a series of
advantages. It avoided difficult distinctions between sums due, counterclaims and abatement.
It provided a fair solution, because the money was held, at least temporarily, by the party in
whose favour the certificate had been issued, but did not prevent later repayment if it was
subsequently shown that the sum certified was not due. It meant that a valid withholding
notice provided following the issue of a certificate had to be clear and specific. And it
provided relief to the sub-contractor against the potentially overbearing actions of the main
contractor, which was one of the principal purposes of the 1996 Act in the first place. The
relevant passage from the judgment of Jacob LJ can be found at paragraph 9.12 below. This
approach was subsequently adopted by HHJ Lloyd QC in Alstom Signalling Ltd v Jervis
Facilities Ltd:185 see in particular paragraphs 23 and 27 and 31–36 of his judgment. The
distinction between sums certified and sums simply claimed under the contract is of
particular importance in the context of abatement and set-off, and is dealt with in greater
detail in Chapter 9 below.
Accordingly, under a contract that provides for interim certificates, the certificate is itself 2.160
likely to operate as a notice under s110(2) of the Act, because the certificate specifies ‘the
amount of the payment made or proposed to be made, and the basis on which that amount
was calculated’. Indeed, as a result of this perceived duplication, the 2009 Act, at s143,
expressly allows a payer’s notice to be given by a specified person.186 It may be that, in taking
up this point, they were prompted by the remarks of Lord Hoffmann in Melville Dundas Ltd
(in receivership) and others v George Wimpey UK Ltd and another,187 when he said that:
Serving a notice under section 110(2) seems to have no consequences (except that it may
stand as a notice under section 111(1)) and there is no penalty for not doing so. The purpose
of section 110(2) is therefore something of a puzzle. It seems to have dropped from heaven
into the legislative process on its last day in the House of Commons . . . the amendment by
which it was inserted was neither explained nor debated.
183
See also Re A Company (No 1299 of 2001) (2001) CILL 1745.
184
[2004] 1 WLR 1867.
185
[2004] EWHC 1232 (TCC); [2004] 95 Con LR 55.
187 [2007] UKHL 18; [2007] 1 WLR 1136. This important case is addressed in greater detail in paragraphs
2.169–2.173.
73
2.161 Whilst a notice under s110(2) is superfluous under a contract with a certificate regime, it
is suggested that it is an important document for a construction contract under which the
contractor makes a monthly claim for an interim payment, the employer considers the
detail of that claim, and then decides what is due. Once the employer has reached his
conclusion as to what is due, the contractor is entitled to know what he is being paid, and
how that figure has been arrived at. That is the information that the s110(2) notice must
contain and that is why it is so important: it fixes the amount of the sum due. It should
again be noted that sections 142–144 of the 2009 Act, addressed at paragraphs 4.22–4.26
below, streamline these provisions and limit the scope of the decision in Melville
Dundas.
Set-Off
2.162 One of the most common situations arising in and after adjudication proceedings is the
attempt by the payer to raise a set-off in respect of sums otherwise due. This has generated a
large amount of case law, which is analysed in greater detail in Chapter 10 below. The prin-
cipal difficulty arises when a paying party seeks to raise a set-off, in circumstances where there
has been no effective withholding notice in accordance with s111(1). This issue first came
before the courts in VHE Construction Plc v RBSTB Trust Co Ltd.188 The second adjudicator
found a net sum due to the contractors. Thereafter, the employer’s project manager notified
the contractors that they intended to deduct the vast majority of the sum otherwise awarded
by the adjudicator by reference to their cross-claim for liquidated damages for delay. The
employer paid the difference and the contractor issued proceedings for the sum that had
been deducted. HHJ Hicks QC said that he was quite clear that s111(1) excluded the right
to deduct money in exercise of a claim to set-off in the absence of an effective notice of inten-
tion to withhold payment. He concluded that the words ‘may not withhold payment’ are
ample in which to have the effect of excluding set-offs and there was no reason why they
should not mean what they say.
2.163 This point has been reiterated on a number of occasions. HHJ Gilliland QC came to
the same conclusion in Millers Specialist Joinery.189 HHJ Seymour QC also decided the
point in the same way in both Solland International Ltd v Daraydan Holdings Ltd 190 and
in Harwood Construction Ltd v Lantrode Ltd.191 In the latter case, the judge said that: ‘if
a set-off was not excluded by section 111 it is difficult to see how the scheme has any
practical value’.
Nature and Timing of Withholding Notice

2.164 In order to comply with s111, a withholding notice must be in writing. In Strathmore
Building Services Ltd v Colin Scott Greig (Trading as Hestia Far Side Design)192 Lord
Hamilton in the Court of Session said that, although the words ‘in writing’ are not
expressly used in s111, it was unmistakable that writing in some form was required. A
telephone message, even one referring to a particular letter of earlier date, will not, there-
fore, suffice.
188
[2000] BLR 187.
189
[2001] CILL 1770–1773.
190 [2002] EWHC 220 (TCC); [2002] 83 Con LR 109.
191 Unreported, 24 November 2000.
192 [2001] 17 Const LJ 72.
74
An effective withholding notice cannot be provided prior to the making of the relevant 2.165
application for payment. In Strathmore Building Services Ltd, it was submitted that,
whilst s111(2) provided that a notice must be given not later than a particular time, it did
not prohibit a valid notice from being served at any earlier time, even before the relevant
application for payment. Lord Hamilton rejected that submission. He said that the purpose
of s111 was to provide a statutory mechanism on compliance with which (but only on
compliance with which) a party otherwise due to make a payment may withhold such
payment. He said it clearly envisaged a notice being a considered response to the application
for payment, in which response it was specified how much of the sum applied for it was
proposed to withhold, and the ground or grounds for withholding such an amount.
He concluded that such a response could not effectually be made prior to receipt of the
application for payment itself.
Clearly, if a withholding notice was not issued the requisite time before the final date for 2.166
payment, it was ineffective: see VHE v RBSTB;193 and a number of other cases that reached
the same conclusion.194 But, on the unusual facts of Shimizu Europe Ltd v LBJ Fabrications
Ltd 195 HHJ Kirkham was able to distinguish these cases and find that a much later with-
holding notice was valid. The reason was that, in his decision, the adjudicator decided that
Shimizu must pay LBJ a particular sum not later than 28 days after LBJ had delivered a VAT
invoice. On 21 February 2003, LBJ, who accepted that payment did not become due until
after delivery by them of a VAT invoice, submitted an invoice for the awarded sum. Four
days later, on 25 February 2003, Shimizu gave notice of their intention to withhold pay-
ment on the grounds of set-off. The judge concluded that, unlike the circumstances in VHE,
Shimizu had served a valid withholding notice after the decision but before the final date for
payment. She concluded that Shimizu had a statutory right to withhold (provided that the
correct steps were taken) including the giving of an effective withholding notice no later
than the prescribed period before the final date for payment. Thus Shimizu was not a case of
a contractual provision overriding the effect of an adjudicator’s decision. In that case Shimizu
were exercising a right given to them by the Act to withhold against a sum which an adju-
dicator had decided would, in the future, become due. On the basis of the adjudicator’s
decision, there remained 28 days after the provision of the invoice in which a withholding
notice could be served. Since it was served in that time, Shimizu were entitled to rely on it.
The courts will take a commonsense, practical view of the contents of a withholding notice 2.167
and will not adopt an unnecessarily restrictive interpretation of such a notice. A good
example of this is another decision of HHJ Kirkham, Thomas Vale Construction Plc v
Brookside Syston Ltd 196 in which the claimant, TVC, sought a declaration that the with-
holding notice was invalid. The judge went through the various criticisms, and rejected
them one by one, describing them as ‘artificial and contrived’. It is thought that, provided
that the notice makes tolerably clear what is being withheld and why, the court will not
strive to intervene or endeavour to find reasons that would render such a notice invalid or
ineffective.
193
[2000] BLR 187.
194
See, for example, Ferson Contractors Ltd v Levolux [2002] EWCA Civ 11; [2002] CLC 605; The
Construction Centre Group Ltd v Highland Council [2002] BLR 476; and Bovis Lend Lease Ltd v Triangle
Development Ltd [2003] BLR 31.
195 [2003] BLR 381.
196 [2006] EWHC 3637 (TCC); (2009) 25 Const LJ 675.
75
2.168 In Windglass Windows Ltd v Capital Skyline Construction Ltd and Another197 Capital
sought to resist the enforcement of an adjudicator’s decision on the basis that he had
exceeded his jurisdiction when he concluded that the withholding notices that they had
served were invalid, because they did not set out any valid ground for withholding. It
was argued that s111 did not require that the ground for withholding payment set out
in the notice should be valid in order for that notice to be an effective withholding
notice. The TCC judge summarised the applicable principles as to withholding notices
as follows:
14. . . . (a) To be effective a withholding notice must be in writing: Strathmore.
(b) To be effective a withholding notice must be issued a requisite time before the final
date for payment: VHE v RBSTB.
(c) The courts will take a practical view of the contents of a withholding notice and will
not allow complaints as to form which might be described as artificial and con-
trived: Thomas Vale.
The judge concluded that it was for the adjudicator to say whether or not the withhold-
ing notices were effective and the court could not interfere with that decision on an
enforcement application. But he also said that he did not accept the proposition that
s111 did not require a withholding notice to set out valid grounds for withholding
money otherwise due. The section required an effective withholding notice and s111(2)
identified what was required for the notice to be effective. There was no distinction
between a ‘valid’ notice and an ‘effective’ notice: thus, in order to be effective, the notice
had to set out valid grounds for witholding. Finally the judge said that s111 did not
permit a party to put in an ineffective withholding notice and then, in the subsequent
adjudication, seek to put together an entirely different justification for withholding
payment. The judge said that
such a ‘foot in the door’ approach was contrary to the 1996 Act, which emphasised the obligation
on the paying party to give good reasons, there and then, and in advance of the date for
payment, if any part of a sum otherwise due was not going to be paid.
Relationship with Other Terms

2.169 Because the provisions of the Act at ss 109–111 must apply to all construction contracts,
there can sometimes be difficulties in correlating the provisions of those sections with the
particular contract terms themselves. Of course, if a contract clause falls outside the terms
of ss 110 and 111, then it is the Act that must prevail. An example of these difficulties arose
starkly in Melville Dundas Ltd (in receivership) v George Wimpey UK Ltd,198 the only
adjudication case thus far to go to the House of Lords. There the contractors sought almost
£400,000 against the employers, despite the fact that, by the time they commenced their
proceedings, they were in receivership. The final date for payment of the sum due was
16 May 2003. No withholding notice was served: the final date for such a notice would have
been 11 May. Administrative receivers of the contractors were appointed on 22 May, and
the employer determined the contractors’ employment under the contract on 30 May. The
employer relied on Clause 27.6.5.1 of the JCT Standard Form of building contract, which
provided, subject to certain provisos, that the provisions of the contract which required any
197
[2009] EWHC 2022 (TCC); [2009] 126 Con LR 118.
198 Outer House of the Court of Session: [2005] SLT 24. House of Lords: [2007] UKHL 18; [2007] 1 WLR
1136.
76
further payment to the contractors ‘shall not apply’. The contractors argued that this clause
was, in effect, providing for a scheme for withholding payment but that, since no withhold-
ing notice in accordance with s111 had been given, the clause was not in accordance with
the 1996 Act, and the employers could not withhold the payment in question. The contrac-
tors argued that the clause of the contract dealing with the position on termination had to
be read to avoid conflict with s111. In the Outer House of the Court of Session, Lord
Clarke concluded that s111 did not subvert the contractual arrangement. The clause dealing
with termination was an entirely separate mechanism and that ss 109–111, being concerned
with cash flow, were not intended to apply in such circumstances. The judge also held that,
by reference to s110(1), the parties had agreed that the original date for payment of sums
due under the contract could be altered in the event of the contract being determined so
that ‘the final date for payment’ of the sum in question had not yet arrived.
His decision was reversed by the Inner House, but reinstated by the House of Lords, by a 2.170
majority of 3:2, on slightly different grounds. Lord Hoffmann concluded that, on the facts
of that case, there were two particular factors which led him to conclude that the clause in
question fell within the scope of ss 110 and 111 of the 1996 Act: the insolvency of the
contractors, which meant that any payment by the employer might not be recovered subse-
quently, and the fact that it was impossible for the employers to have issued a withholding
notice prior to 16 May, because the receivership had not occurred at that date. As to the
importance of the insolvency, he said at paragraph 13:
A provision such as clause 27.6.5.1, which gives the employer a limited right to retain funds
by way of security for his cross-claims, seems to me a reasonable compromise between dis-
couraging employers from retaining interim payments against the possibility that a contractor
who is performing the contract might become insolvent at some future date (which may well
be self-fulfilling) and allowing the interim payments system to be used for a purpose for which
it was never intended, namely to improve the position of an insolvent contractor’s secured or
unsecured creditors against the employer.
As to the impossibility point, Lord Hoffmann said at paragraph 20: 2.171
In the case of clause 27.6.5.1 the contractor will have been given notice of why the payment
is being withheld because he will have received the notice of determination. But the retrospective
operation of the clause means that he will not have received it within the time stipulated in
the statute. It seems to me, however, that it would be absurd to impute to Parliament an inten-
tion to nullify clauses like 27.6.5.1, not by express provision in the statute, but by the device
of providing a notice of requirement with which the employer can never comply. Section
111(1) must be construed in a way which is compatible with the operation of clause
27.6.5.1.
And at paragraph 22 he reiterated that:
The problem arises because I very much doubt whether Parliament, in enacting section
111(1), took into account that parties would enter into contracts under which the ground for
withholding a payment might arise after the final date for payment. One cannot therefore find
an answer in a close examination of the language of the section. I would prefer simply to lex
non cogit ad impossibilia and that on this ground section 111(1) should be construed as not
applying to a lawful ground for withholding payment of which it was in the nature of
things not possible for notice to have been given within the statutory time frame. That may
not be particularly elegant, but the alternative is to hold that the parties’ substantive freedom
of contract has been indirectly curtailed by a mere piece of machinery, the operation of which
would serve no practical purpose. This I find even less attractive.
77
2.172 The two dissenting speeches were given by Lord Mance and Lord Neuberger of Abbotsbury.
At paragraph 77 Lord Neuberger said this:
In addition, it seems to me that it would cut across the purpose of section 111(1) if what
appeared to be a final date for payment with its concomitant prohibition on refusal to pay,
could somehow be retrospectively vitiated simply because the contract has been brought to an
end. If, as I see it, the purpose of sections 110 and 111 is to assist the cash flow for contractors
and subcontractors, then it seems to me that it would be inconsistent with the way in which
section 111 is expressed and also with its purpose, if it ceased effectively to be effective on the
determination of the contract, at least in a case such as this, where the determination occurs
after the final date for payment has passed.
There are a number of commentators who consider that this approach is more consistent
with the underlying purpose of the 1996 Act. It was not, however, the view of the
majority.
2.173 Thus, under the JCT Standard Form (and the other forms with similar terms), it seems
clear that the insolvency of the contractor will operate to prevent further payments, even
if those payments were due under the contract at the time of the insolvency or the appoint-
ment of administrators. The absence of a withholding notice will be no bar to the employer
withholding further payments if it was impossible for a notice specifying the insol-
vency/administration, and the consequential determination, to be served in time.
However, the difficulty with the majority view in Melville Dundas is the possible extent
of its effect in cases of determination; on one view, taken to its logical conclusion, a
clause like 27.6.5.1 could operate to allow an employer who had not paid sums due
under the contract, and who had not served any withholding notices, subsequently to
determine that contract, and rely on the clause to justify a position that no further
money was payable. The 2009 Act limits the application of the case to circumstances of
bankruptcy and liquidation.199
2.174 Currently, the only reported case in which the effect of the decision in Melville Dundas has
been considered is Pierce Design International Limited v Mark Johnston and Another.200
In that case, sums were due to the contractors and not paid. There had been no with-
holding notices. Subsequently, there were disputes about defects and delay, and the
employers determined the contract. They relied on Clause 27.6.5.1 as a defence to the
claim for the sums due, and relied on the approach in Melville Dundas. The contractor
argued that, in the absence of the contractor’s insolvency or any impossibility in serving
withholding notices, the clause could not operate to prevent the contractor from enforcing
his entitlement to the interim payments that were due: if it did, it fell foul of s111. This
argument was rejected by the TCC judge, who pointed out that the House of Lords had
decided that the clause complied with the Act, and it could not therefore be argued to the
contrary. However, he went on to hold that the proviso to the clause, that it could not be
used to prevent the enforcement of amounts that the employer ‘has unreasonably not
paid . . . and which have accrued 28 days or more before the date of determination of the
employment of the contractor . . .’ (which proviso had not been relevant on the facts in
Melville Dundas), took effect in circumstances where there had been no withholding
notices in respect of the sums which had fallen due months before the determination.

200 [2007] EWHC 1691 (TCC); [2007] BLR 381.
78
He concluded that, in such circumstances, the contractors were entitled to recover those
sums by way of summary judgment.201
Stay For Arbitration

It is sometimes argued by the payer seeking to avoid the consequences of an unfavourable 2.175
adjudicator’s decision that the action to enforce that decision should be stayed for arbitration
because there is a dispute as to whether the sum claimed is due. In the ordinary case, such an
argument could not succeed. The whole purpose of the Act is to ensure that the decision is
binding until it is challenged in arbitration or in court. Accordingly, in the ordinary case, the
sum awarded by an adjudicator must be paid by the paying party and he cannot seek to avoid
that result by staying the enforcement proceedings for arbitration. In Shaw v Massey
Foundation & Pilings Ltd ,202 the TCC judge dismissed the employer’s suggestion that the
claimant/contractor’s failure to apply instantly for summary judgment was in some way fatal
to their claim on the adjudicator’s decision, and meant that the stay for arbitration should
automatically be granted. He said that the employers were taking advantage of their own
failure to pay, and seeking to stay the enforcement claim as if the adjudicator’s decision had
never been made. The stay was refused.
In David McLean Housing Contractors Ltd v Swansea Housing Association Ltd203 the position 2.176
was more complicated. The claimant contractors had made a claim for a variety of matters
including loss and expense and an extension of time. Once the adjudicator had reached his
decision, the employer issued a certificate in accordance with that decision but, on the same
day, notified the contractors that their claim for liquidated and ascertained damages would
be deducted from the payment due. The contractors sought summary judgment on the sums
found due to them by the adjudicator and the defendant counterclaimed for liquidated
damages. The contractor alleged that the employer’s counterclaim for liquidated damages
should be stayed for arbitration. HHJ LLoyd QC dismissed that application on the grounds
that the actions taken by the contractors to invoke the assistance of the court to enforce the
adjudicator’s decision, which were intimately connected with the subject matter of the
counterclaim, and to have the counterclaim struck out, constituted steps in the action.
He concluded that they were inconsistent with the right to have a dispute arbitrated and had
to be regarded as steps in the proceedings. Thus he dismissed the application for a stay.
There was a different result in Collins (Contractors) Ltd v Baltic Quay Management (1994) 2.177
Ltd.204 In that case the contract was in the JCT minor works form. The employer failed to
pay on interim certificate 5, by which time practical completion had been achieved. The
contractors purported to determine the contract and at the same time wrote a letter enclosing
their final account. The employer did not pay either the sum due under certificate 5 or the
sums claimed in the final account, but their solicitors maintained that the dispute had to be
resolved by adjudication or arbitration. However, when the contractors started proceedings, it
was in the courts. The claim included the assertion that s111 applied to the contract and that
201 Unsurprisingly, perhaps, the decision in Melville Dundas has been relied on by defendants seeking to
avoid payment when the contact has come to an end, regardless of issues of bankruptcy or liquidation. Such
attempts ignore the very particular circumstances with which Melville Dundas was concerned, and have been
unsuccessful: see, by way of example, Westwood Structural Services Ltd v Blyth Wood Park Management Co Ltd
[2008] EWHC 3138 (TCC); [2009] CILL 2666.
202
[2009] EWHC 493 (TCC), paragraphs 16-19
203
[2002] BLR 125.
204 [2004] EWCA Civ 1757; [2005] BLR 63.
79
no withholding notice had been served. The employer sought a stay of the proceedings under
s9 of the Arbitration Act and the judge at first instance granted the stay. The contractors
appealed. In the Court of Appeal, the contractors argued that the effect of s111 was that
where, as here, a notice of intention to withhold payment had not been given by an employer,
the employer was not entitled to withhold payment and the contractors were accordingly
entitled to judgment in the amount wrongfully withheld. The Court of Appeal rejected that
submission, finding that the arbitration clause was in very wide terms and that, if there was
a dispute or difference, the court was obliged to grant a stay. Clarke LJ (as he then was) said
that, assuming that the employer had no defence to the claim under certificate 5, there
was nothing in s111 to deprive the employer of his right to a stay. He said that s111 was
concerned only with the substantive rights of the parties and was not concerned with the
question whether the claim for the monies wrongfully withheld should be determined by
the court or by an arbitrator.205
2.178 Of course, what went wrong in Collins was that the contractors failed to pursue their claims
in adjudication. On the facts of the case, it would appear that the employer had no defence
to the claim based on certificate 5 and that therefore the adjudicator would have been bound
to award the contractors the sum due on that certificate in any event. If the employers still
failed to pay, the contractors could then have commenced enforcement proceedings in the
TCC, which could not have been defeated by an application for a stay.
Stay For Adjudication

2.179 On a slightly different, but related point, the court can sometimes be asked to stay existing
court or arbitration proceedings, in order to allow an adjudication to take place. The general
position appears to be that, if there is a binding adjudication agreement between the parties,
it will be for the party resisting the stay to show why a stay should not be granted. This point
is dealt with in detail in paragraphs 16.49–16.57 below.
Sections 112–115
2.180 These miscellaneous provisions of the 1996 Act provide as follows:
112–(1) Where a sum due under a construction contract is not paid in full by the final date
for payment and no effective notice to withhold payment has been given, the person
to whom the sum is due has the right (without prejudice to any other right or rem-
edy) to suspend performance of his obligations under the contract to the party by
whom payment ought to have been made (‘the party in default’).
(2) The right may not be exercised without first giving to the party in default at least
seven day’s notice of intention to suspend performance stating the ground or grounds
on which it is intended to suspend performance.
(3) The right to suspend performance ceases when the party in default makes payment
in full of the amount due.
(4) Any period during which performance is suspended in pursuance of the right con-
ferred by this section shall be disregarded in computing for the purposes of any
contractual time limit the time taken, by the party exercising the right or by a third
205 The Court of Appeal followed the approach in Hayter v Nelson [1990] 2 Lloyd’s Rep 265 and The Halki
[1998] 1 WLR 726 to the effect that, even if one party to arbitration agreement claims that there is no dispute
because he is entitled to the sum sought, the matter still has to go to arbitration because there is still ‘a dispute’.
80
party, to complete any work directly or indirectly affected by the exercise of the
right.
Where the contractual time limit is set by reference to a date rather than a period, the
date shall be adjusted accordingly.
113–(1) A provision making payment under a construction contract conditional on the
payer receiving payment from a third person is ineffective, unless that third person,
or any other person payment by whom is under the contract (directly or indirectly)
a condition of payment by that third person, is insolvent.
[Sub-sections (2), (3) and (4) are concerned with the test for insolvency for a
company, a partnership and an individual.]
114–(1) The Minister shall by Regulations make a scheme (‘the Scheme for Construction
Contracts’) containing provision about the matters referred to in the preceding
provisions of this Part.
(2) Before making any Regulations under this section the Minister shall consult such
persons as he thinks fit.
(3) In this section ‘the Minister’ means—
(a) for England and Wales, the Secretary of State, and
(b) for Scotland, the Lord Advocate.
(4) Where any provisions of the Scheme for Construction Contracts apply by virtue of
this Part in default of contractual provision agreed by the parties, they have effect as
implied terms of the contract concerned.
(5) Regulations under this section shall not be made unless a draft of them has been
approved by resolution of each House of Parliament.
115–(1) The parties are free to agree on the manner of service of any notice or other docu-
ment required or authorised to be served in pursuance of the construction contract
or for any of the purposes of this Part.
(2) If or to the extent that there is no such agreement the following provisions apply.
(3) A notice or other document may be served on a person by any effective means.
(4) If a notice or other document is addressed, pre-paid and delivered by post—
(a) to the addressee’s last known principal residence or, if he is or has been carrying
on a trade, professional business, his last known principal business address, or
(b) where the addressee is a body corporate, to the body’s registered or principal
office,
it shall be treated as effectively served.
(5) This section does not apply to the service of documents for the purposes of legal
proceedings, for which provision is made by rules of the court.

(6) References in this part to a notice or other document include any form of commu-
nication in writing and references to service shall be construed accordingly.
Section 112: Suspension of Work

At common law, the position is that, if an employer fails to pay one instalment or stage payment 2.181
in accordance with the contract, it is a question in each case whether such failure amounts to a
repudiation of the contract. Generally, the courts have held that failure to pay one instalment
out of many due under the terms of a contract is not ordinarily sufficient to amount to a repu-
diation of the contract.206 In addition, the courts have said that a failure to pay a stage payment
is less likely to amount to repudiation if the failure occurs towards the end of the contract.207
206
See Mersey Steel & Iron Co Ltd v Naylor [1884] 9 App Cas 434, HL; Decro-Wall International S.A. v
Practitioners in Marketing [1971] 1 WLR 361, CA; Lakshmijit v Faiz Sherani [1974] AC 605, PC; and Afovos
Shipping v Pagnan [1983] 1 WLR 195, HL.
207 Cornwall v Henson [1900] 2 Ch 298, CA.
81
2.182 Thus, the principal purpose of s112 was to allow the contractor who had not been paid in
accordance with the contract the right to suspend work until payment was made, but
avoiding any question of repudiation of the contract itself. This provides a neat solution to
the ‘all-or-nothing’ arguments that arise if a contractor, who has not been paid a stage or
instalment, walks off site.
2.183 It is important, however, to note that s112(2) makes any such suspension of work condi-
tional upon the provision by the contractor to the employer of a notice of intention to
suspend performance. In Palmers Ltd v ABB Power Construction Ltd 208 HHJ Lloyd QC
stressed the importance of the notification provisions and said that the statutory right to
suspend must be preceded by such a notice. In that case, there was a dispute about the
validity of the suspension notice. The judge said that he would not determine such
issues, leaving them instead to the adjudicator, on the basis that ‘the dispute as to whether
Palmers had complied with the statutory precondition to a lawful suspension of work
will fall within the jurisdiction of the adjudicator when appointed and it is more appro-
priate for Palmers, in the first instance, to have recourse to that dispute resolution
procedure’.
2.184 In Balfour Beatty Construction Northern Ltd v Modus Corovest (Blackpool) Ltd 209 one of the
numerous issues that arose was whether, if the employer had a claim for liquidated damages
that was not paid, the employer could suspend the carrying out of the works by, say, refus-
ing access. The TCC judge rejected that submission. He noted that ss 109–111 of the
1996 Act were aimed at ensuring that the party carrying out the works receives properly
staged payments and that s112 allows that same party to suspend work if the sums were
not paid. Moreover, s112(4) provides that the period of suspension has to be discounted
in considering questions of delay. The judge held that those provisions could only make
sense if it was the contractor—the person doing the work, and being paid for doing the
work—who was the party permitted to suspend the work if not paid. It was impossible to
read that section of the Act as permitting suspensions on the part of the employer. The
judge went on to find that a proper interpretation of the Scheme led to precisely the same
conclusions.
2.185 There are few reported instances of contractors suspending work in the way envisaged by s112.
There are two reasons for this. One is the inherent caution that all contractors have about taking
such a potentially radical step. Even though the Act encourages the contractor to suspend work
due to non-payment, the contractor is acutely aware that some sort of procedural error—the
failure to serve a notice for example—might lead to allegations that he wrongfully repudiated
the contract. The other is the sheer inconvenience, disruption and cost of suspending work,
only for the employer belatedly to pay up, so that re-mobilisation then has to take place. The
2009 Act will make it easier to suspend work (or a defined part of it), and ensures proper com-
pensation for the consequences of remobilisation: see paragraphs 4.27–4.28 below.
Section 113: ‘Pay-When-Paid’ Clauses

2.186 During the late 1980s and the early 1990s, ‘pay-when-paid’ clauses became common in
construction and engineering contracts and sub-contracts. They were a way in which, in
208 [1999] BLR 426.

209
[2008] EWHC 3029 (TCC); [2009] CILL 2660.
82
particular, the main contractor passed down the contractual chain the risk that, during the
currency of the project, the employer might no longer be in a position to meet its obligations
when they fell due. This was, on one view, grotesquely unfair because, although the main
contractor was often in a position to carry out a financial check on the employer and, if
concerned, able to obtain bonds and other financial security, the sub-contractors down
the contractual chain could do neither. They faced a stark choice: carry out the work and risk
not getting paid for reasons that had nothing to do with either them or their direct employers,
or lose the contract. The courts endeavoured to provide such assistance as they could in
circumstances where the employer had gone into liquidation with the sub-contractors having
not been paid and the main contractor arguing that the ‘pay-when-paid’ provision provided
it with a complete defence. One common argument was the suggestion that the ‘pay-when-paid’
provisions only applied during the currency of the contract and, once the contract had come
to an end, the payment of the sub-contractor was no longer dependent on whether or not
the main contractor had itself been paid.
The difficulty with this approach was that it was very often a contrived attempt to provide 2.187
the sub-contractor with a remedy in a situation where the sub-contractor had all the merits,
but where the clause of the contract that the sub-contractor had signed did, on its face,
provide a complete defence. As a result of these difficulties and concerns, the Latham Report
came to the unequivocal conclusion that ‘pay-when-paid’ clauses should be prohibited.
However, the 1996 Act was not quite so clear cut. It is true that s113(1) made ineffective any
provision in a construction contract that made payment conditional on the payer receiving
payment from a third party. However, that wide provision was then subject to a potentially
wide exception, namely that the provision was not ineffective if the third person who was
making the original payment was insolvent. This might be regarded as a rather significant
exception, given that the principal problem with ‘pay-when-paid’ clauses was that they were
triggered, not by a simple refusal to pay by the employer up the contractual chain, but
because that employer had gone into receivership or liquidation. In other words, the principal
problem identified in the Latham Report, of sub-contractors going unpaid because of
financial events about which they could do nothing, remained a risk enshrined in the
exception to s113(1).
It is interesting to record, however, that (with two exceptions, addressed below) s113 has not 2.188
directly generated any reported cases. It would appear that most parties within the construction
industry are operating on the basis that the 1996 Act outlaws ‘pay-when-paid’ provisions and
that, as a result, no such provisions are being drafted or included in the contracts that are
actually being let. Thus it appears that the Latham Report has had the desired effect, and has,
in practice, outlawed ‘pay-when-paid’ provisions, even though, for the reasons set out above,
it might be thought that this has happened in a rather roundabout way.
The first exception referred to above is the case of Durabella Ltd v J Jarvis & Sons Ltd.210 The 2.189
judgment of HHJ Lloyd QC needs to be treated carefully because, following the late settlement
of the case, he only delivered part of the full judgment that he would otherwise have handed
down. The judge concluded that the contract contained a pay-when-paid clause. Durabella
purported to attack the clause on the basis of the Unfair Contract Terms Act 1977. In developing
this submission, it was suggested that s113 of the 1996 Act was relevant to the consideration
210
[2001] 83 Con LR 145.
83
of reasonableness. This submission was rejected by the judge. This was mainly because, as he
pointed out, the 1996 Act had been carefully drawn up to exempt particular construction
operations, because certain sectors of the construction industry had been found to be already
so well organised that no regulation of any of their contracts or sub-contracts (including
the use of ‘pay-when-paid’ clauses) was needed. Thus the judge said that it was difficult to
conclude that, but for s113(1), the ‘pay-when-paid’ clause was perceived throughout the
construction industry as unreasonable in itself. If it were then Parliament would have
prohibited it throughout the industry; the absence of such an industry-wide prohibition
strongly suggested that in some areas ‘pay-when-paid’ provisions were not only regarded
as not unreasonable, but as a fair apportionment of some of the common risks of con-
tracting. In addition, the judge noted that s113(1) only made such a clause ineffective as
regards financing the work, and did not affect its application in the event of insolvency.
For all these reasons, the judge declined to say that the ‘pay-when-paid’ provision under
consideration, in so far as it was conditional on payment being received by Jarvis from
another, was unreasonable in itself although, as he pointed out, particular circumstances
might lead it to be unreasonable.
2.190 Section 113, and the interaction between adjudication and ‘pay-when-paid’ clauses, also
arose directly in William Hare Ltd v Shepherd Construction Ltd.211 The principal issue in that
case was whether a term of the sub-contract, which maintained a pay-when-paid arrangement
in particular circumstances of the employer’s insolvency, had been triggered. The TCC judge
concluded that it had not (because the type of insolvency was not caught by the express terms
of the sub-contract), and held that therefore the pay-when-paid defence must fail. Although
the judge’s decision was based principally upon a proper interpretation of the contract, one
of the reasons for his conclusion was that, because the pay-when-paid clause was a form of
exclusion clause, which was the subject of the general prohibition in s113, it therefore
required to be construed narrowly. The judge’s decision was upheld in the Court of Appeal.212
The 2009 Act extends the prohibition, although the provisions are rather opaque: see paragraph
4.21 below.
Section 114: The Scheme

2.191 Section 114 introduced The Scheme for Construction Contracts (‘the Scheme’), a detailed series
of provisions containing, in relatively simple terms, all the provisions in ss 109–113. Section
114(4) makes plain that, if the construction contract between the parties does not contain
these or similar provisions, then, by default, the Scheme applies and has the effect of implied
terms of the construction contract. The provisions of the Scheme, and the many authorities
dealing with its provisions, are analysed in detail in Chapter 3 below. The Scheme itself is at
Appendix C.
2.192 In Griffin & Anor (t/a K&D Contractors) v Midas Homes Ltd 213 HHJ Lloyd QC held that the
adjudicator had the jurisdiction to make part of the decision that he did, but not the
remaining part. There then arose a problem in relation to the apportionment of his fees.
The judge referred to the fact that the Scheme took effect as implied terms of the contract
pursuant to s114(4). In those circumstances, the judge concluded that, whilst the claimant
211
[2009] EWHC 1603 (TCC); [2010] BCC 332.
212 [2010] EWCA Civ 283; [2010] BLR 358.
213
[2000] 78 Con LR 152.
84
was entitled to that proportion of the adjudicator’s fees that related to the matter on which
the adjudicator had the jurisdiction to decide in the claimant’s favour, the claimant had not
been entitled to exercise its right to call for adjudication in respect of the other part of the
decision and that, in such circumstances, the claimant had to pay the costs of that element
of the adjudication. In Pring & St Hill Ltd v CJ Hafner (t/a Southern Erectors) 214 the TCC
judge was concerned with paragraph 8(2) of the Scheme, which provided that an adjudicator
could, with the consent of all parties, adjudicate at the same time on related disputes under
different contracts. The judge found that, pursuant to the mechanism at s114(4) of the 1996
Act, that paragraph took effect as a contractual term and therefore entitled the defendant to
give (or withhold) its consent prior to the adjudication of its dispute by a particular
adjudicator.
Section 115: Service of Documents

Section 115 is concerned with the service of documents in and for the purposes of adju- 2.193
dication. The section makes clear that, for the purposes of adjudication, the more formal
provisions of the CPR relating to service of court documents do not apply. Thus, for example,
effective service can be achieved by posting the document in question to the addressee’s last
known principal residence or principal business address.
In practice, this can mean that an adjudication can take place with the responding party not 2.194
even aware of it. However, in M Rohde Construction v Nicholas Markham-David 215 Jackson J
allowed the defendant to set aside judgment in default, which judgment was itself based on
the decision of an adjudicator. The claimant contended that the adjudication documents had
been sent to the defendant’s last-known principal residence and that this constituted
effective service under s115(4) of the 1996 Act. However, Jackson J was concerned that, on
the evidence before him, the defendant could easily have been contacted at another address
altogether and that there was a serious issue between the parties, namely whether the
claimant had available during the adjudication a ready means of contacting the defen-
dant, which the claimant chose neither to use nor to communicate to the adjudicator.
Accordingly, Jackson J set aside the judgment obtained in default on the basis that there
was a triable issue between the parties. He said that if it turned out that the claimant had
taken a deliberate decision, which deprived the defendant of the opportunity to make
representations in the adjudication, then he considered that this might be one of those rare
and exceptional cases in which the court would decline to enforce an adjudicator’s decision
by reason of a breach of natural justice.
In Cubitt Building & Interiors Ltd v Fleetglade Ltd 216 the referring party took a number 2.195
of points about its alleged failure to comply with the seven-day period for the service of
the referral notice. One of the arguments adopted was the suggestion that the Civil
Procedure Rules were incorporated into the adjudication process. This would have meant
that the service of a document by fax after 4 pm would lead to a deemed date for service
on the following business day, which, on the facts of that case, would have meant that
the seven-day period had not been breached. The TCC judge pointed out that s115
made no reference to the CPR, except at sub-s (5), which was concerned with the service
214
[2002] EWHC 1775 (TCC); (2004) 20 Const LJ 402.
215 [2006] EWHC 814 (TCC); [2006] BLR 291.
216
[2006] EWHC 3413 (TCC); [2006] 110 Con LR 36.
85
of enforcement proceedings in the courts. He therefore said that s115 was inconsistent with
the suggestion that the CPR should be incorporated wholesale into the adjudication process:
if that was the intention, s115 would have said so. Although the judge recognised that the
CPR was a set of commonsense, practical rules governing the service of court documents,
and that there might be exceptional adjudications in which it might be appropriate to have
regard to its terms, they were not generally incorporated into the adjudication process.
Furthermore, as the judge pointed out, it was the referring party, Cubitt, who had chosen
to serve the particular document in question at 4.42 pm. If he acceded to their request that
the CPR should apply, so that the deemed time for service of this document was the following
day, then he would effectively be giving Cubitt relief from their own decision to serve the
document at the time that they did. The judge said he would be very reluctant to re-write
history by arriving at a different date for the service of the original notice of adjudication.
2.196 The courts will endeavour to avoid a situation where a purely technical point about service is
relied on to prevent the enforcement of the adjudicator’s decision. In Nageh v Richard
Giddings,217 there had been an adjudicator’s decision against the defendant, and a summary
judgment enforcing that decision. The defendant tried unsuccessfully to set aside judgment
on the grounds that he was unaware of either the adjudication or the court proceedings.
However, the court found that his challenge had been raised many months after he became
aware of them, and therefore much too late. In addition, in the absence of any evidence that
the claimant had deliberately used the wrong address, or knew of some other effective address
for the defendant that could have been utilised, the potential challenge based on M Rohde
did not arise. The application to set aside the summary judgment was dismissed.
2.197 A similar approach is apparent in Primus Build Ltd v Pompey Centre Ltd & Another.218 In that
case, the notice of adjudication was served by post on 5 March and received by Pompey the
following day, 6 March, even though the relevant envelope had been misaddressed. Also on
6 March, the adjudication notice was seen by Pompey’s solicitor, who had been involved in
some of the previous dealings between the parties in relation to the issue in the adjudication.
Despite their receipt of the document, Pompey argued that, pursuant to the particular term
of the contract, the notice should have been provided either by way of personal delivery,
which they equated to personal service, or by fax, and because it was not, service was invalid
and the adjudicator did not have the necessary jurisdiction. The TCC judge referred to the
authorities noted above, and confirmed that, because the adjudicator derived his jurisdiction
from the notice of adjudication, if it was not validly served, that would generally operate to
deprive the adjudicator of jurisdiction.219 On the facts, he held that actual delivery to the
named address, and to an appropriate person at that address, amounted to the document
having been ‘delivered personally’, which was the contractual obligation. The judge also
issued a warning about the service of such an important document, saying that if the notice
had sat on a reception desk for a week or been lost or even delayed in the post, then it would
not have been properly served in accordance with the contract. Primus, therefore, had been
rather fortunate that their enforcement claim had survived that hurdle.
217 [2006] EWHC 3240 (TCC); [2007] CILL 2420.

218 [2009] EWHC 1487 (TCC); [2009] BLR 437.
219 IDE Contracting Ltd v RG Carter (Cambridge) Ltd [2004] EWHC 36 (TCC).
86
3
THE STATUTORY SCHEME
Introduction 3.01 Costs 3.91

Piecemeal or Wholesale Incorporation? 3.04 Reasons 3.93
Signature 3.98
Part I of the Scheme—Adjudication 3.14
Notice of Adjudication 3.14 Effect of the Decision 3.99
The Appointment of the Adjudicator 3.18 Binding until the Dispute is Finally
The Referral Notice 3.31 Determined 3.100
Referral within 7 Days 3.35 Enforcement of Peremptory Orders 3.109
More than One Dispute 3.41 Fees 3.110
Resignation 3.47 Part II of the Scheme—Payment 3.113
Objection 3.56 Introduction 3.113
Revocation 3.58 Entitlement to and Amount of
Powers of the Adjudicator 3.60 Stage Payments 3.115
Acting Impartially 3.62 Dates for Payment 3.122
Taking the Initiative 3.65 Final Date for Payment 3.126
Consideration of any Relevant Information 3.69 Payment Notices and Withholding
Time Limits 3.76 Notices 3.129
Prohibition of ‘Pay-When-Paid’ 3.132
The Adjudicator’s Decision 3.83
Opening Up, Revising and Reviewing 3.84
Interest 3.87
The essence of an adjudication is that it should be quick . . . as the Minister knows and
as Clause 106 allows, that adjudication produces rough justice, but it is a rough justice
which can be put right at a later stage.
Lord Howie, Hansard, 22.4.06, column 985, proposing an alternative to

the scheme then being proposed
Is this cheap and cheerful, or just quick and dirty?
Lord Lucas, Hansard, 22.4.06, column 996, responding to an alternative
proposal to the scheme as then formulated
Introduction
As noted in Chapter 1, the Scheme as originally proposed attracted a large amount of criticism. 3.01
Following consultation, the revised Scheme, which came into force on 1 May 1998, was
regarded much more favourably. The Scheme, introduced by SI 1998 No 649, is set out in
full at Appendix C. Of course, following the 2009 Act, a new Scheme is in the process of
being prepared, although no draft has yet seen the light of day.
87
3.02 The Scheme is designed as a fall-back position; if the construction contract in question
does not contain the adjudication provisions set out in s108, or if it does not include the
payment provisions set out in s109 of the 1996 Act, then the provisions of the Scheme apply
as implied terms of the contract (s114(4)). Although many of the standard forms of con-
struction and engineering contracts now contain specific adjudication and payment provisions
that comply with the Act, so the parties do not need to have regard to the Scheme, there are
many construction contracts, particularly for smaller works, which do not contain such
provisions. In addition, there are instances of contract clauses which, although they have
been drafted with the intention of meeting the provisions of the 1996 Act, fail to do so. Thus
the provisions within the Scheme remain of significance.
3.03 In order to work out whether or not the adjudication and/or payment provisions of the
Scheme apply, it is necessary to ask a number of related questions. The first question is to
determine whether or not the contract under consideration is a construction contract within
the meaning of s104. That in turn will depend on whether or not the work that is being
carried out pursuant to the contract is a ‘construction operation’ within the meaning of
s105(1). It will also be necessary to consider whether the operation in question is excluded
by s105(2). Assuming that the contract in question is a construction contract, the second
issue is whether that contract contains adjudication provisions of the kind set out in s108
and payment provisions as set out in ss109–111. If the contract contains such provisions
then the Scheme is irrelevant. If, however, the contract does not contain the adjudication and
payment provisions provided for by the 1996 Act, then the Scheme will come into effect as
implied terms of contract.
Piecemeal or Wholesale Incorporation?

3.04 An obvious issue arising out of the interrelationship between any written contract and the
provisions of the Scheme was the extent to which the latter overrode the former. If, for
example, the contract contained some of the payment provisions required by ss109–111 of
the Act, but omitted others, does the Scheme apply in full, regardless of the express terms of
the contract, or does the Scheme apply only to fill in the gaps within the contract itself?
3.05 This question was first raised in C&B Scene Concept Design Ltd v Isobars Ltd.1 In that case,
although Clause 30 of the JCT Standard Form of Building Contract with Contractor’s
Design required the parties to elect between two alternatives for interim payments, the parties
had failed to select one of the two options. At first instance, the Recorder found that the
whole of Clause 30, not just the provisions as to how and when the interim payments were
to be made, fell away and were replaced wholesale by the Scheme. On appeal, the defendant
who had made that submission was no longer represented. The claimant contended that the
Recorder had been wrong to replace the entirety of Clause 30 with the Scheme, relying on
the words in s110(3) that implied the Scheme ‘if or to the extent that a contract’ did not
contain the relevant provision. However, because ultimately it did not affect the outcome of
the appeal, Sir Murray Stuart Smith was content to assume, without deciding, that the
Recorder had been right on that point.
1 The decision of Mr Recorder Moxon Browne QC is reported at [2001] CILL 1781–1783. The decision of
the Court of Appeal is reported at [2002] 1 BLR 93.
88
The Statutory Scheme
The point also arose tangentially in Ballast Plc v The Burrell Company (Construction 3.06
Management) Ltd. 2 In that case the adjudicator decided that he was unable to reach a deci-
sion. The court of Session decided that this decision was itself a nullity and that it was unac-
ceptable for the adjudicator to wash his hands of the dispute that had been referred to him and
refuse to decide it. In arriving at his decision, Lord Reid concluded that the adjudicator was
not exercising a jurisdiction created by statute, and that the adjudicator’s approach would not
be warranted if the adjudication procedure had been one expressly incorporated into the
contract, since the adjudicator’s powers and duties would then be created and defined by the
contract. He went on to say that it was possible that an adjudication might be governed partly
by express contract terms and partly by the Scheme, since the contract might comply only in
part with the requirements of s108(1), (2), (4). This suggested that, in Lord Reid’s opinion,
the provisions of the Scheme would be implied into the contract only and to the extent that
it was necessary so to do, in order to make good the gaps in the original contract framework.
The issue, as to whether the Scheme applied wholesale to a non-compliant contract, or only to 3.07
the extent that it was necessary to fill the gaps, arose starkly in the Scottish case of Hills
Electrical & Mechanical Plc v Dawn Construction Ltd.3 In that case, the sub-contractors main-
tained that the contract between the parties failed to provide dates on which they should make
applications for payment, so that they could be incorporated into the main contractor’s appli-
cation for payment under the main contract with the employer. Therefore, they said, the
Scheme should apply instead. This was important to the sub-contractors because, although
the terms of the contract did expressly provide for a final date of payment of any sums due
under the contract, being 28 days after the day on which the sum fell due, the sub-contractor’s
argument, that the Scheme applied wholesale, meant that the 17-day provision in Part II,
paragraph 8(2), of the Scheme would apply instead. This was crucial because the employer had
gone into administration after the 17-day period had expired but before the expiry of the
28 days. Thus the main contractor would be liable to the sub-contractors if the 17 days, derived
from the Scheme, applied as the final date for payment, but there would be no such liability if
the 28 days in the contract was the applicable term. Lord Clarke had no difficulty in deciding
against the sub-contractors, on the basis that the Scheme only applied to the extent that the
express terms of the contract omitted particular requirements of the 1996 Act. He said:
I approach the question which was raised at the debate from the starting point that it is to be
assumed, as a matter of statutory interpretation, that the legislature intended to innovate on

parties’ freedom of contract only to the extent that this was clearly provided for, either expressly
or by clear implication by the terms of the legislation itself. It appears to me that that approach
is expressly recognised in various parts of the legislation dealing with the payment provisions
in construction contracts . . . s114(4) provides that where any provision of the scheme does
apply to a construction contract, in default of a contractual provision agreed by the parties, the
effect is that the scheme’s provision becomes an implied term of the contract in question. That
sub-section begins with the words ‘where any provisions of the Scheme’. The emphasised
words, in my judgment, clearly envisage that it was not intended by the legislature that
expressly agreed terms relating to the matters covered by the scheme were to be supplanted by
the provisions of the scheme simply because of the fact that the parties had omitted to provide
for one or other of the matters desiderated by the legislation or had failed to deal with it
adequately, having regard to the statutory provisions.
2
[2001] BLR 529.
3
[2004] SLT 477.
89
3.08 It must, however, now be very doubtful as to whether the conclusion in Hills is right, at least
in relation to the adjudication provisions in the 1996 Act and the Scheme. In John Mowlem
Ltd v Hydra-Tight Ltd,4 HHJ Toulmin CMG QC suggested that the extent to which a con-
tractual mechanism failed to comply with the 1996 Act might ultimately be irrelevant
because, if it failed to comply, then the entire machinery was tainted and fell by the wayside.
In those circumstances it would be replaced by the provisions of the Scheme. The following
cases are thought to represent the correct approach.
3.09 As HHJ Havery QC pointed out in Aveat Heating Ltd v Jerram Falkus Construction Ltd,5
although Judge Toulmin had merely indicated that this may be the answer to this issue,
Mowlem had been taken as authority for this proposition in Keating on Construction Contracts
(8th edn, Sweet and Maxwell, 2006), at paragraph 17.014. Judge Havery also observed that
the text of the relevant paragraph was actually at odds with its footnote. He therefore con-
sidered the point afresh and concluded that the words of the 1996 Act were clear: either the
parties agreed their own terms and conditions that complied with the requirements of the
Act, or the provisions of the Scheme applied. He went on:
It is true that the Act does not say that if the Scheme applies, the contractual adjudication
provisions are void. But if they are not void, then the contract contains competing and to some
extent mutually contradictory provisions. One could then make sense of the contract only if,
in the case of every pair of mutually contradictory provisions, only one member of the pair
were to be treated in any given case as prevailing over the other. I unhesitatingly follow Judge
Toulmin in reaching the conclusion that that is not the intention of the legislation. The
solution stated in the text of Keating is simpler. It is that the two sets of adjudication provisions,
contractual and the Scheme, exist as alternative packages, only one of which (at the option of
the party initiating the adjudication) applies in any given case.
For these reasons he concluded that the footnote in Keating was correct and that, if any part
of the contractual mechanism did not comply with the 1996 Act, the Scheme applied
wholesale.
3.10 Two more recent decisions of the TCC in London support the approach of Judge Havery
in Aveat. First, in Banner Holdings Ltd v Colchester Borough Council 6 the TCC judge set out
the difference of approach between Hills and the earlier London TCC cases. Although, on
the facts of that case, he did not need to decide the point, he offered the tentative view that,
at least in relation to the adjudication provisions in s108, the wording of s108(5) suggested
that the whole Scheme replaced the express terms, regardless of how many (or how few) of
those express terms failed to comply with the Act. He went on to say, more generally, that he
did not believe that it should be for the court ‘to have to piece together a compliant set of
provisions from two different sources. That would not make for certainty.’
3.11 Secondly, in Yuanda (UK) Co Ltd v WW Gear Construction Ltd,7 Edwards-Stuart J also dealt
with the same authorities noted above. He reached precisely the same conclusion as the TCC
judge in Banner. He held that the words of the section should be taken to mean what they
said and that if the contract did not comply—in any respect—with sub-ss (1), (2), (3) and (4)
of s108, then the adjudication provisions of the Scheme applied in full. He concluded: ‘So if
4
[2002] 17 Const LJ 358.
5 [2007] EWHC 131 (TCC), [2007] 113 Con LR 13.
6 [2010] EWHC 139 (TCC), [2010] 131 Con LR 77.
7 [2010] EWHC 720 (TCC), [2010] BLR 435 (TCC), [2010] BLR 435.
90
there is any non-compliance, the adjudication provisions in Part 1 of the Scheme are brought
in—lock, stock and barrel’. He also noted that, because the authorities noted above also
supported that conclusion then, so far as non-compliance with s108 of the 1996 Act was
concerned, ‘the position should now be regarded as settled’.
Thus, with one possible exception, dealt with below, it is thought safe to conclude that the 3.12
position has now been resolved and that, if any part of the contractual adjudication
agreement does not comply with the 1996 Act, the Scheme will be incorporated in its
entirety. The possible exception to that proposition arises in respect of the payment provi-
sions of the Scheme, as opposed to the adjudication provisions. The authorities referred to
above, with the exception of Hills, are concerned with the adjudication provisions; Hills was
concerned with payment provisions. Although the TCC judge in Banner formed no concluded
view on the point, the submission was made in that case that, because of that difference, the
decision in Hills may be right on its own facts. The argument was that, unlike s108, s110(3),
which was concerned with the payment provisions, provided that the Scheme applied ‘if or to
the extent that a contract does not contain such provision . . .’. The use of the expression to the
extent that might suggest that, in relation to payment provisions at any rate, the express terms
fall to be amended only to the extent that they do not comply with the Scheme. Since those
words are missing from s108, that provides further support for the conclusion that, if the
adjudication provisions do not comply with the 1996 Act or the Scheme, then they are replaced
in their entirety by the Scheme.
The detailed provisions of the Scheme are divided into two parts. Part I is concerned with the 3.13
detailed provisions as to adjudication. Part II is concerned with the provisions relating to
payment, withholding notices and the like. The specific requirements under each Part of the
Scheme are discussed below.
Part I of the Scheme—Adjudication

Notice of Adjudication
Paragraph 1 of Part 1 of the Scheme provides as follows: 3.14
1–(1) Any party to a construction contract (the ‘referring party’) may give written notice
(the ‘notice of adjudication’) of his intention to refer any dispute arising under the
contract to adjudication.
(2) The notice of adjudication should be given to every other party to the contract.
(3) The notice of adjudication shall set out briefly—
(a) the nature and a brief description of the dispute and of the parties involved,
(b) details of where and when the dispute has arisen,
(c) the nature of the redress which is sought, and
(d) the names and addresses of the parties to the contract (including, where appropri-
ate, the addresses which the parties have specified for the giving of notices).
It is impossible to over-emphasise the importance of the notice of adjudication. It is the 3.15
cornerstone of both the adjudicator’s jurisdiction and the scope and limit of the referring
party’s claim in the adjudication.8 Although the significance of the notice of adjudication
8 See, for example, Ken Griffin v Midas Homes Ltd [2001] 78 Con LR 152 and Jerome Engineering v Lloyd
Morris [2002] CILL1827.
91
is dealt with in greater detail at paragraphs 7.47–7.60 below, it is important to note at this
stage that the notice must identify carefully the dispute and the nature of the redress sought.
Numerous problems in adjudication and adjudication enforcement have arisen out of the
referring party’s failure to provide an adequate notice of adjudication, and his subsequent
attempts to make good that omission in the referral notice (Part 1, paragraph 7) and other
documents served in the adjudication. The courts have made it plain that this is not a legiti-
mate approach.
3.16 In Mecright Ltd v TA Morris Developments Ltd 9 Morris had commenced adjudication pro-
ceedings against Mecright. In Morris’ notice of adjudication, they sought first a declaration
that the sub-contract had been cancelled by them in accordance with the sub-contract and,
secondly, recovery of damages arising out of the cancelled sub-contract. In their response
document, Mecright sought, amongst other things, the value of work at the time that they
were instructed to cease work, and the cost to them of what they said was the wrongful
repudiation by Morris. The adjudicator concluded that Morris had indeed repudiated the
sub-contract and awarded the responding party monies both for works carried out under
the sub-contract and in consequence of the repudiation. Morris contended that the
adjudicator did not have the jurisdiction to arrive at such a decision and relied on the
proposition that the jurisdiction of the adjudicator derived from the terms of the notice of
adjudication set out in paragraph 1 of Part 1 of the Scheme. Mecright argued that, because
paragraph 20 of Part 1 of the Scheme allowed the adjudicator to take into account ‘any
other matters which the parties to the dispute agree should be within the scope of the
adjudication or which are matters under the contract which he considers are necessarily
connected with the dispute’, the adjudicator was entitled to reach the decision he did.
HHJ Seymour QC said:
Grammatically, the language used suggests that what the adjudicator may do is to take these
other matters into account in determining the dispute or disputes otherwise referred to him
for decision. However, it seems to me that, upon proper construction, what the words which
I have quoted mean is that, first, the adjudicator can decide any matters which the parties
to the adjudication agree after all the initial notice of adjudication should be within the
scope of the adjudication but were not originally; and second, that he can decide any matter
arising under the relevant contract which he considers is necessarily connected with the
dispute.
The judge said that the essence of the dispute described in the notice was whether, in the
circumstances, Morris had been entitled to determine its contract with Mecright and, if so,
what sum Morris was entitled to as a consequence. He therefore accepted Morris’ submission
that a dispute as to how much Mecright was entitled to be paid in respect of the execution of
the sub-contract works, or as a result of the wrongful determination of its contract by Morris,
was not, on a proper construction of the notice of adjudication, included within the dispute
that was referred by that notice. He therefore agreed with the submission that the adjudicator
did not have the jurisdiction to reach his decision.
3.17 As to the interrelationship between the notice of adjudication and the matters which the
responding party can raise by way of defence, the position has been restated on a number of
occasions, to the effect that it is not appropriate to construe a notice of adjudication in such
a way as to deprive the responding party of a defence which, but for the wording, would be
9 Unreported, 22 June 2001, a decision of HHJ Seymour QC in the TCC in London.
92
open to that party to raise.10 But that principle cannot be extended so as to include cross-claims
that ought to have been the subject of an effective withholding notice and that, for whatever
reason, were not.11 If, prior to the commencement of the adjudication, a contractor’s claim has
been met with a withholding notice, then, if that claim is subsequently the subject of the notice
of adjudication, the issue as to the validity or otherwise of the withholding notice is also caught
by the notice and is properly the subject of the adjudicator’s decision-making process. If the
adjudicator concludes that no notice was required, or that a notice was required and had been
validly served, then the cross-claim set out in the notice must be taken into account when the
adjudicator arrives at his decision. If, on the other hand, the adjudicator concludes that a
notice was required, and either that there was no notice, or that the notice that was served was
invalid, then the adjudicator is not entitled to take the cross-claim into account when reaching
his decision.12 This restatement of the basic position was also set out in the judgment in
Windglass Windows Ltd v Skyline Construction Ltd.13
The Appointment of the Adjudicator

Paragraphs 2–6 inclusive of Part I of the Scheme provide as follows: 3.18
2–(1) Following the giving of a notice of adjudication and subject to any agreement between
the parties to the dispute as to who shall act as adjudicator—
(a) the referring party shall request the person (if any) specified in the contract to act
as adjudicator, or
(b) if no person is named in the contract or the person named has already indicated
that he is unwilling or unable to act, and the contract provides for a specified nom-
inating body to select a person, the referring party shall request the nominating
body named in the contract to select a person to act as adjudicator, or
(c) where neither paragraph (a) nor (b) above applies, or where the person referred to
in (a) had already indicated that he is unwilling or unable to act and (b) does not
apply, the referring party shall request an adjudicator nominating body to select a
person to act as adjudicator.
(2) A person requested to act as adjudicator in accordance with the provisions of paragraph
(1) shall indicate whether or not he is willing to act within two days of receiving the
request.
(3) In this paragraph, and in paragraphs (5) and (6) below, an ‘adjudicator nominating
body’ shall mean a body (not being a natural person and not being a party to the dis-
pute) which holds itself out publicly as a body which will select an adjudicator when
requested to do so by a referring party.
3 The request referred to in paragraphs 2, 5 and 6 shall be accompanied by a copy of the notice
of adjudication.
4 Any person requested or selected to act as adjudicator in accordance with paragraphs 2,
5 or 6 shall be a natural person acting in his personal capacity. A person requested or
selected to act as an adjudicator shall not be an employee of any of the parties to the dis-
pute and shall declare any interest, financial or otherwise, in any matter relating to the
dispute.
10
See by way of example only, Pilon Ltd v Breyer Group PLC [2010] EWHC 837(TCC), [2010] BLR 452.
11
See, again by way of example, Letchworth Roofing Company v Sterling Building Company [2009] EWHC
1119 (TCC), [2009] CILL 2717 and Balfour Beatty Northern Ltd v Modus Corovest (Blackpool) Ltd [2008]
EWHC 3029 (TCC), [2009] CILL 2660.
12 Paragraph 33 of the judgement in Letchworth.
13 [2009] EWHC 2022 (TCC), [2009] 126 Con LR 118.
93
5–(1) The nominating body referred to in paragraphs 2(1)(b) and 6(1)(b) or the adjudicator
nominating body referred to in paragraphs 2(1)(c), 5(2)(b) and 6(1)(c) must commu-
nicate the selection of an adjudicator to the referring party within five days of receiving
a request to do so.
(2) Where the nominating body or the adjudicator nominating body fails to comply with
paragraph (1), the referring party may—
(a) agree with the other party to the dispute to request a specified person to act as
adjudicator, or
(b) request any other adjudicator nominating body to select a person to act as
adjudicator.
(3) The person requested to act as adjudicator in accordance with the provisions of
paragraphs (1) or (2) shall indicate whether or not he is willing to act within two days
of receiving the request.
6–(1) Where an adjudicator who is named in the contract indicates to the parties that he is
unable or unwilling to act, or where he fails to respond in accordance with paragraph
2(2), the referring party may—
(a) request another person (if any) specified in the contract to act as adjudicator, or
(b) request the nominating body (if any) referred to in the contract to select a person
to act as adjudicator, or
(c) request any other adjudicator nominating body to select a person to act as adjudicator.
(2) The person requested to act in accordance with the provisions of paragraph (1) shall
indicate whether or not he is willing to act within two days of receiving the request.
3.19 At first sight, these provisions relating to the appointment of an adjudicator appear overly
complex. However, given the range of points that have been taken in some of the reported
cases as to the appointment of the adjudicator, it is perhaps sensible that they strive to cover
every eventuality. There is no doubt that the best course for the parties to a construction
contract to adopt is to name the adjudicator in the contract (paragraph 2(1)(a)), with a speci-
fied nominating body also identified in the contract in case the named adjudicator is unable
or unwilling to act. At the very least, it is sensible for the parties to identify a specified nomi-
nating body in the contract. This avoids the sort of unseemly scramble, which has been
known, whereby each party is keen to be the referring party in the adjudication, and they
head off to two different nominating bodies to try and get an adjudicator appointed first.
3.20 The first issue under these provisions is concerned with timing. Paragraph 2(1) makes
plain that the first thing that must happen is the giving of the notice of adjudication. Only
after that does the procedure involving the nominating body come in to play. Thus, in IDE
Contracting Ltd v RG Carter Cambridge Ltd 14 steps were taken in relation to the appointment
of an adjudicator before the notice of adjudication had been served. Judge Havery concluded
that, as a result, the provisions of the Scheme relating to the appointment of the adjudicator
had not been complied with and that such non-compliance deprived the adjudicator of
jurisdiction. By contrast, in Palmac Contracting Ltd v Park Lane Estate Ltd 15 the nomination
preceded the notice of adjudication and was not found to have deprived the adjudicator of
jurisdiction, but this was because, in Palmac, it was not the Scheme that applied, but a dif-
ferent contractual regime that did not stipulate that the application to the nominating body
had to be made after the notice of adjudication had been given.16
14
[2004] EWHC 36 (TCC), [2004] BLR 172.
15 [2005] EWHC 919, [2005] BLR 301.
16 See also Dalkia Energy and Technical Services Ltd v Bell Group UK Ltd [2009] EWHC 73 (TCC), paragraphs
83-84, where the express terms were similar to those in Palmac, and the TCC Judge reached the same conclusion.
94
This issue was considered more recently by Christopher Clarke J in Vision Homes Ltd v Lancsville 3.21
Contruction Ltd.17 There had been a first notice of adjudication, followed by the request to
the nominating body, but the notice was then amended to include an additional claim, and the
parties were agreed that it was the second notice that was the effective notice. The request to
the nominating body therefore preceded the effective notice of adjudication. The judge, ‘not
without some misgiving’, accepted that the adjudicator had no jurisdiction. He said that it
was not possible to regard the request to the nominating body as continuing, so that it could
be regarded as having been made both before, and after, the second notice. He said that
paragraphs 2(1) and (3) of the Scheme referred to a request in writing that accompanied, rather
than preceded, the relevant notice of adjudication. Further, the judge was persuaded, as was
Judge Havery in IDE, that if the provisions that established the jurisdiction of the adjudicator
were not complied with, it was irrelevant whether or not the other party had suffered preju-
dice by that non-compliance. That was, in many ways, a harsh decision on the facts, not only
because the original notice had been served in advance of the request to the nominating body,
but also because the notice was subsequently altered simply to add a claim for the adjudicator’s
fees. But Christopher Clarke J said that, where one notice is served, and a nomination is
sought, but then a second notice follows, the adjudication proceeds pursuant to that
second notice, so that the question of jurisdiction could not be decided by the importance
(or otherwise) of the claim which had been added to the second notice.18
Pursuant to paragraph 2(2) a person requested to act as adjudicator (either because he is 3.22
named in the contract or because he has been selected by an adjudicator nominating body)
must indicate within two days of receiving the request whether or not he is willing to act.
Paragraph 4 makes clear that any such adjudicator cannot be an employee of any of the
parties and must declare any financial or other interest that he may have in any matter relating
to the dispute.
Under paragraph 5 of Part 1 of the Scheme, the nominating body must communicate the 3.23
selection of an adjudicator to the referring party within five days of receiving the request. It
is extremely important that the nominating body complies with (or even endeavours to
improve upon) this period, because the referring party only has seven days from the date of
the notice of adjudication to provide the referral notice (as required by paragraph 7(1) of the
Scheme). If they fail to comply with that timescale, the referring party may go elsewhere, or
agree the appointment of a particular person with the other side. Paragraph 6 is designed to
deal with the position where the adjudicator named in a contract is unable or unwilling to
act, or does not respond within two days. In those circumstances the referring party can go either
to another person, or the nominating body set out in the contract, or they can request any
other nominating body to select an adjudicator.
There have been a number of cases where an adjudicator has been named in the contract and, 3.24
for whatever reason, he has been unable to act as adjudicator. In Amec Projects Ltd v Whitefriars
City Estates Ltd 19 HHJ Toulmin CMG QC was dealing with a contract where the person
named in the contract was a Mr George Ashworth. This should have been a reference to a
17
[2009] EWHC 2042 (TCC), [2009] BLR 525.
18
A different result may have ensued if the technical failure had not affected the notice of adjudication, but
some subsequent, and less important, part of the process: see the comments of Ramsey J in PT Building Ltd v
ROK Euro Build Ltd [2008] EWHC 3434 (TCC), referred to in paragraph 3.34.
19 [2004] EWHC 393 (TCC),(2004) 20 Const LJ 338.
95
Mr Geoffrey Ashworth. The contract allowed the managing partner of Mr Ashworth’s firm
to select a replacement if he was unavailable to deal with a dispute that was referred to him.
Mr Ashworth had died by the time that the dispute was referred. The referring party argued
that there was no machinery under the contract for appointing an adjudicator as a result of
the death of Mr Ashworth, and that in consequence, pursuant to paragraph 2(1)(c), it could
request an adjudicator nominating body to select a person to act as adjudicator. The referring
party obtained an adjudicator nominated by the RIBA. The responding party argued that,
because the terms of the contract specified that, if the individual named as the adjudicator
was unavailable, either party could apply to the managing partner for a replacement, that
is what should have happened and that the adjudicator appointed by the RIBA had no
jurisdiction.
3.25 Judge Toulmin held that, because Mr Ashworth had died before the matter was referred, the
contractual provisions did not apply; the reference to the managing partner was intended
only to occur if, during an ongoing adjudication, the adjudicator ‘dies or becomes ill or is
unavailable for some other cause’. In consequence, the judge concluded that the death
of Mr Ashworth meant that the contract provisions were no longer workable and the
Scheme applied instead. Thus the adjudicator had been rightly appointed in accordance
with paragraph 2(1)(c) of Part 1 of the Scheme. This part of the judgment was upheld in
the Court of Appeal.20 Dyson LJ agreed that the provisions in the contract relating to the
possibility of a reference to the managing partner or director could not apply before the
person originally named had been appointed as the adjudicator.
3.26 Precisely the same approach to the nomination provisions had been adopted in two earlier
cases. In Watson Building Services Ltd v Harrison21 the Outer House (Lady Paton) was dealing
with a dispute as to the incorporation of certain adjudication and other provisions into the
contract between the parties which, so it was said by the responding party, meant that the
adjudicator, appointed under the Scheme, had no jurisdiction. She concluded that, whatever
clauses might or might not have been incorporated into the sub-contract, a set of adjudi-
cation provisions had not been incorporated. She therefore concluded that the provisions of
the Scheme applied. This, in turn, meant that the adjudicator had been properly appointed
and had the jurisdiction to deal with the dispute referred to him. Similarly, in David McLean
Housing Ltd v Swansea Housing Association Ltd 22 there was a dispute over the appointment of
an adjudicator, who was selected by the RICS in accordance with the Scheme. The defendant
argued that, pursuant to the contract, the correct appointing body was the Chartered
Institute of Arbitrators. HHJ Lloyd QC held that, on a proper construction of the contract
documents, there was no provision to which the reference to the Chartered Institute of
Arbitrators could attach. Accordingly, the contract did not contain a valid appointment
mechanism and the Scheme applied. Thus the appointment of the adjudicator was in accord-
ance with the implied terms of the contract.
3.27 It is important that, if the person named in the contract is unwilling or unable to act as
adjudicator, he must make that clear to all parties. In IDE Contracting Ltd v RG Carter
Cambridge Ltd 23 the person named in the contract made it clear to the referring party that
20
[2004] EWCA Civ 1418, [2005] BLR 1.
21 [2001] SLT 846.
22 [2002] BLR 125.
23 [2004] BLR 172.
96
his other work commitments meant that he was unable to act. Thus the referring party’s
notice of adjudication informed the responding party that the Chartered Institute of
Arbitrators would be requested to nominate an adjudicator and that the named person
had declined to act. The responding party did not want an adjudicator selected at random
and proposed various alternative adjudicators but that offer was not taken up. The Chartered
Institute of Arbitrators named a Mr Smalley. The responding party therefore made clear that
it was their case that Mr Smalley had no jurisdiction.
HHJ Havery QC had to consider the detailed provisions of paragraph 2(1)(b) of Part 1 of 3.28
the Scheme. He said:
9. . . . What is intended, in my judgment, is that the notice of adjudication comes first. Then
the referring party is to request the person specified in the contract to act as adjudicator, unless
he has already indicated to the parties that he is unwilling or unable to act. The request must
doubtless be in writing since it must be accompanied by a copy of the notice of adjudication.
The person specified must indicate within two days whether or not he is willing to act. If he
indicates that he is not, then provided that that indication is made to all parties the referring
party may proceed under paragraph 6(1)(b) to request the nominating body to select a person
to act as adjudicator. What happened here is that no request at all was made under paragraph
2(a). The procedure was bypassed. And it is in my judgment implicit in paragraph 2(b), as it
is explicit in paragraph 6, that the unwillingness or inability of the specified person to act
should be indicated to all parties.
In consequence, the judge concluded that the referring party’s failure to comply with these
provisions deprived the adjudicator of jurisdiction.
Sometimes the problems can arise because the contract documents have not been properly 3.29
put together so that, when the dispute arises, the parties find that there are two different
appointment mechanisms referred to in the contract. Usually these conflicts are capable of
being resolved by the proper construction of the contract itself, usually with the assistance
of a hierarchy provision, as happened in Bovis Lend Lease Ltd v Cofely Engineering Services.24
But in that case, the judge noted that, if there had been a straightforward conflict between
two contrary provisions and it had not been possible properly to construe the contract,
then the Scheme would be implied into the contract instead. On the particular facts of that
case, if the Scheme had been implied, it so happened that the same adjudicator would have
been appointed, and the judge rejected the submission that the mere fact that the adjudicator
had been appointed under express terms, when he should have been appointed under the
implied Scheme, could have deprived him of jurisdiction. On the other hand, had there
been two different and competing nominating bodies, who would have appointed differ-
ent adjudicators, enforcement of a decision appointed by one of them would have been
much less likely: see the Court of Appeal decision in Lead Technical Services Ltd v CMS
Medical Ltd.25
Where an adjudicator resigns in the erroneous belief that the proceedings are fatally flawed, 3.30
the adjudicator’s inability to adjudicate on the dispute will be cured by a further referral,
provided that the second referral occurs within the necessary time limits: see Tracy Bennett v
FMK Construction Ltd.26
24 [2009] EWHC 1120 (TCC).

25 [2007] EWCA (Civ) 316, [2007] BLR 251.
26 [2005] EWHC 1268 (TCC), [2005] 101 Con LR 92.
97
The Referral Notice

3.31 Paragraph 7 of Part 1 provides as follows:
7–(1) Where an adjudicator has been selected in accordance with paragraphs 2, 5 or 6, the
referring party shall, not later than seven days from the date of the notice of adjudica-
tion, refer the dispute in writing (the ‘referral notice’) to the adjudicator.
(2) The referral notice shall be accompanied by copies of, or relevant extracts from, the
construction contract and such other documents as the referring party intends to rely
upon.
(3) The referring party shall, at the same time as he sends to the adjudicator the documents
referred to in paragraphs (1) and (2), send copies of those documents to every other
party to the dispute.
3.32 The referral notice is the referring party’s principal opportunity to set out in detail its
claim or case. In larger adjudications, such a document is not unlike a detailed statement
of claim, with appendices containing copies of the relevant extracts from the contract,
and other documents that the referring party considers are important or helpful to its
case. It is important that the referring party makes every effort to ensure that the referral
notice is as full as possible. Not unreasonably, adjudicators, and responding parties,
are unhappy when, following the production of the responding party’s response to the
referral notice, the referring party seeks permission from the adjudicator to put in a reply,
which very often contains material which could and should have formed part of the
referral notice.
3.33 Although it is important for the referring party to ensure that the referral notice is as clear
and detailed as possible, it is important to ensure that, unless there is express agreement
otherwise, the referral notice does not seek to enlarge the dispute that was the subject of the
notice of adjudication. The following cases are relevant on this point:
1. In KNS Industrial Services (Birmingham) Ltd v Sindall Ltd 27 HHJ Lloyd QC expressly
warned that the further documents that came into existence following the notice of
adjudication, such as the referral notice, ‘do not cut down or, indeed, enlarge the dispute
(unless they contain an agreement to do so)’.
2. Precisely the same conclusion was reached by HHJ Seymour QC in Mecright Ltd v
TA Morris Developments Ltd,28 the case already referred to at paragraph 3.16 above,
where Mecright’s cross-claims, which had not been identified in the notice of adjudica-
tion, were subsequently upheld by the adjudicator. The judge declined to enforce the
award because, he said, the adjudicator did not have the jurisdiction to decide claims that
were not identified as part of the dispute set out in the notice of adjudication. Mecright
had argued that the scope of the dispute referred to the adjudicator could be ascertained
not simply from the notice of adjudication but also from the referral notice and the
response. Judge Seymour rejected that argument. He said:
The basic scheme of adjudication, in accordance with the Scheme, is that what is referred is a
single dispute. Paragraph 8 of Part 1 of the Scheme provides for an adjudicator, with the consent
of all parties, to deal with more than one dispute at a time, although he is not bound to do so.
That provision seems to me directed principally at an agreement made at the stage before
adjudication procedure really gets underway for, as I have already pointed out, paragraph 20
27 [2001] 17 Const LJ 170.

28 Unreported, 22.6.01, HHJ Seymour QC sitting at the TCC in London.
98
seems to deal with the position if an agreement is made to expand the scope of an adjudication
once it is in progress. Nevertheless, at whatever stage the consent or agreement of all parties is
relevant, it seems to me that such consent or agreement must be express, and is not to be
implied from conduct or in some other way. . . . While, as I have pointed out, my view and that
of other Judges is that those who describe a dispute which they wish to refer to adjudication in
vague terms have only themselves to blame if the scope of what has been referred appears to
be wider than what they may have thought, it seems to me to be wrong in principle to expose
those involved in an expeditious process such as adjudication to the requirement to take care
to express themselves during the process in such a way that it cannot be said that, by words or
conduct, they have unintentionally consented or agreed to some process other than that upon
which they were initially engaged.
That said, technical procedural points relating to the referral notice are generally treated with 3.34
scepticism by the courts. For example, in PT Building Services Ltd v ROK Euro Build Ltd 29
one of the many points taken by the defendant was that the claimant failed to provide copies
of the relevant construction contract with the referral notice, in breach of paragraph 7(2) of
the Scheme. It appears that the relevant contract was provided eight days after the notice of
adjudication. Ramsey J rejected the submission that, in consequence, the adjudicator did
not have the necessary jurisdiction, holding that it was undesirable that every breach of the
terms of the Scheme, no matter how trivial, should be seized upon to impeach the process of
adjudication. To do so, he said, would increase the tendency of parties to take a fine tooth-
comb to every aspect of the adjudication in the hope of finding some breach of the Scheme
on which to impeach an otherwise valid adjudication decision. He said that the failure to
include the relevant construction contracts until a day later did not affect the validity of the
adjudication process or amount to a breach of natural justice. It is thought that this import-
ant statement of principle should be kept in mind when considering the detailed workings
of paragraph 7 of Part I of the Scheme.
Referral within 7 Days
Section 108(2)(b) of the 1996 Act provides that the contract ‘shall provide a timetable with the 3.35
object of securing the appointment of the adjudicator and referral of the dispute to him within
7 days of such notice’. Paragraph 7(1) of the Scheme is couched in stronger language: ‘. . . the
referring party shall, not later than seven days from the date of the notice of adjudication, refer
the dispute . . . to the adjudicator’ (emphasis added).

The first point to note is that there is a debate as to whether the referral means the dispatch 3.36
of the notice to the adjudicator, or his or her receipt of that notice.30 In Aveat Heating Ltd v
Jerram Falkus Construction Ltd,31 HHJ Havery QC said that ‘a thing is not referred to another
unless that other receives it . . . the word is unambiguous. Referral takes place upon receipt
of the notice by the adjudicator’. It is therefore prudent to assume that what matters is not
the sending of the document but its receipt by the adjudicator.
The more important question concerns the language of paragraph 7(1) of the Scheme and, 3.37
in particular, whether those words are directory or mandatory. In Hart Investments Ltd v
29 [2008] EWHC 3434 (TCC).

30 See the discussion at paragraph 2.118.
31 [2007] EWHC 131 (TCC), [2007] 113 Con LR 13.
99
Fidler & Anor 32 the TCC judge concluded that they were mandatory. He said that, although
his initial reaction was that it might be harsh to say that a delay of, say, one day in the
provision of the referral notice rendered the adjudication a nullity, even if the objection was
taken at the time, on a more detailed analysis, all kinds of difficult questions arose if the
failure to comply with the time period was ignored. What if the delay was not one day, but
one month? What if important events occurred during the period of any delay in the provision
of a referral notice, which put the responding party in a much worse position as against the
referring party than it would have been if there had been no delay? If the words ‘not later than
7 days’ are to be qualified in some way, then how is such a qualification to be formulated,
let alone assessed?
3.38 The judge repeated the point made numerous times before, that the whole purpose of
adjudication was that speed was given precedence over accuracy and that what mattered was
a quick decision, not necessarily a correct one. If the timetable could be extended without
consent, even at the beginning, let alone at the end of the relevant period, there was a great
danger of uncertainty and of a watering-down of the critical importance of the timetable on
which the entire adjudication process was based. He therefore found that the word ‘shall’ in the
Scheme was mandatory and that the referring party had therefore to serve the referral notice on
the adjudicator within seven days. Moreover, as the judge pointed out in Hart, if there was a
delay in the provision of the referral notice, the responding party might well consent, expressly
or by implication, to waive the irregularity. The important point in Hart was that there was
no such waiver and the responding party immediately took the point as to delay. The referring
party therefore had the opportunity to start again but he failed to take it, thereby taking the
risk that, as turned out to be the case, the adjudicator’s decision was a nullity.33
3.39 In PT Building, already noted in paragraph 3.34 above, Ramsey J did not uphold the
submission that the failure to serve a copy of the contract with the referral notice until eight days
after the notice of adjudication deprived the adjudicator of jurisdiction. He differentiated
between the failure in Hart, which was a breach of paragraph 7(1) of the Scheme (service
of the referral itself ), and the failure in that case, which was a breach of paragraph 7(2)
(accompanying documents). He said that paragraph 7(1) of the Scheme, deriving as it did
from s108(2)(b) of the 1996 Act, was one of the fundamental provisions in the process of
adjudication. Thus the decision in Hart, and a late referral notice under paragraph 7(1) of the
Scheme that took the process outside the Scheme so as to make a decision unenforceable,
could be distinguished from a breach of paragraph 7(2), which simply referred to an associated
procedural requirement.
3.40 The same judge returned to this topic in Linnett v Halliwells LLP.34 He said that where the
parties have agreed, either expressly or by the terms implied by the Scheme, that the dispute
32 [2006] EWHC 2857 (TCC); [2007] BLR 30.

33 Clause 41A of the JCT Standard Form of Building Contract is in similar form to the Scheme and again
requires that the party giving notice ‘shall refer the dispute or difference to the Adjudicator within 7 days of the
notice’. In Cubitt Building & Interiors Ltd v Fleetglade Ltd [2006] EWHC 3413 (TCC), [2006] 110 Con LR 36
the TCC judge concluded that the word ‘shall’ was mandatory and was not merely a provision allowing the referr-
ing party to use his best endeavours to take those steps within the specified period. He said that the requirement
was that those events shall happen within a certain timeframe and that therefore the provisions were mandatory.
In reaching this conclusion he distinguished the decision of HHJ Thornton QC in William Verry v North West
London Communal Mikva [2004] BLR 3008, which he said was a particular decision on its own facts.
34 [2009] EWHC 319 (TCC); [2009] BLR 312.
100
shall be referred to the adjudicator within seven days, then the court should uphold that
agreement. Generally, this will mean that the court will treat the service of the referral within
that period as being mandatory, so that the failure by the referring party to serve it in that
period will be regarded as making the referral a nullity, because it was not what the parties
intended. In such cases the adjudicator will have no jurisdiction. On the facts in Linnett,
although the referral was served within time, there was a failure to deliver the accompanying
documents on the adjudicator, although not on the responding party, within seven days.
That was because of a failure in the delivery system. That led to a sensible suggestion that a
further copy should be provided if the first copy did not arrive on the next working day, and
when it did not, a further copy was sent immediately and received by the adjudicator the next
day. The judge concluded that these events were not intended to render the referral a nullity
so as to deprive the adjudicator of jurisdiction.35
More than One Dispute

Paragraph 8 of Part I of the Scheme provides as follows: 3.41
8–(1) The adjudicator may, with the consent of all the parties to those disputes, adjudicate at
the same time on more than one dispute under the same contract.
(2) The adjudicator may, with the consent of all the parties to those disputes, adjudicate at
the same time on related disputes under different contracts, whether or not one or
more of those parties is a party to those disputes.
(3) All the parties in paragraphs (1) and (2) respectively may agree to extend the period
within which the adjudicator may reach a decision in relation to all or any of these
disputes.
(4) Where an adjudicator ceases to act because a dispute is to be adjudicated on by another
person in terms of this paragraph, that adjudicator’s fees and expenses shall be deter-
mined in accordance with paragraph 25.
The obvious point to make when considering these provisions is that they are predicated on 3.42
the basis that, in the absence of consent, only one dispute at a time can be referred to the
adjudicator. Generally, it has been relatively easy for the adjudicator and the courts to
categorise adjudication claims as giving rise to one dispute, either because of the width of
the definition of the word ‘dispute’ adopted in Fastrack Contractors Ltd v Morrison
Construction Ltd; 36 or because, despite the existence of two contracts, the dispute arose
under only one of them;37 or even because, pursuant to the terms agreed, it was possible to
pursue two adjudications at the same time.38 Only in exceptional circumstances, such as
where the underlying dispute concerned mutual claims and set-off under four separate
contracts,39 has it been successfully argued that the adjudicator endeavoured to deal with
more than one dispute and did not have the jurisdiction to do so
35 In reaching this view, Ramsey J expressly agreed with the conclusion of the TCC judge in Cubitt v
Fleetglade that the timetable, even if mandatory, had to be ‘operated in a sensible and businesslike way’.
36 [2000] BLR 168. This principle was applied in Dalkia Energy and Technical Services Ltd v Bell Group UK
Ltd [2009] EWHC 73 (TCC), [2009] 122 Con LR 66 and GPS Marine Contractors Ltd v Ringway Infrastructure
Services Ltd [2010] EWHC 283 (TCC), [2010] BLR 377, at paragraphs 48–50.
37
RWE Npower PLC v Alstom Power Ltd [2010] CILL 2835, paragraphs 34–36.
38 Vision Homes Ltd v Lancsville Construction Ltd [2009] EWHC 2042 (TCC), [2009] BLR 525.
39 Enterprise Managed Services Ltd v Tony McFadden Utilities Ltd [2009] EWHC 3222 (TCC), [2010]
BLR 89.
101
3.43 The intention of paragraph 8 is to allow an adjudicator to deal with more than one dispute
at the same time, and to deal with the same or related disputes under different contracts, if
the underlying subject matter is the same or similar. However, the key ingredient in these
provisions is the consent of all parties. Although the two ways in which the scope of the
decision-making process could be enlarged arise out of common sense and practicality, the
Scheme recognises that such arrangements can only be appropriate when all parties consent.
So, for example, the same dispute, as to who was responsible for a crane collapse which caused
a man’s death and a month’s delay on site, might arise under the main contract, and under one
or more of the sub-contracts. In many ways it makes a lot of sense to have one adjudicator
appointed to decide the question of liability and then to apply that answer across all of the
various contracts to which it might be relevant. But he can only do that if all the parties
consent. The sub-sub-contractor may be unwilling to allow the dispute to be fought out in a
multi-party adjudication and might prefer to deal with the dispute only with the party
with which it had a contract. Without consent, only a single dispute can be referred to
adjudication: see paragraphs 7.78–7.85 below.
3.44 This question of consent was at the heart of the decision of HHJ Lloyd QC in Pring & St Hill
Ltd v CJ Hafner t/a Southern Erectors.40 In that case, the adjudicator had originally been
appointed to decide an adjudication which arose between the main contractor McAlpine,
and their sub-contractor, PSH, in connection with damaged glazing. In that first adjudi-
cation, the adjudicator found that PSH were obliged to pay a sum to McAlpine. Later, PSH
started adjudication proceedings against Southern Erectors (SE) who were, as the judge
found, one of four potential sub-sub-contractors who might have caused or contributed to
the damage to the glazing. The same adjudicator who had decided the dispute between
McAlpine and PSH was appointed to adjudicate the dispute between PSH and SE. He was
also appointed to adjudicate the dispute between PSH and another sub-sub-contractor,
JCH. SE objected to his appointment, both in terms of his previous involvement in the
adjudication between McAlpine and PSH, and also to the proposal that their adjudication
with PSH ran in parallel with PSH’s adjudication with JCH. The adjudicator rejected these
challenges and made a decision against SE. At the enforcement proceedings, SE’s objections
were argued out before HHJ Lloyd QC.
3.45 The first point that arose was the meaning and effect of paragraph 8(2) of Part 1 of the
Scheme. PSH accepted that the dispute between PSH and SE and the dispute between PSH
and JCH were related for the purposes of paragraph 8(2). PSH contended that paragraph
8(2) did not apply, however, because it was directed solely to an adjudicator conducting two
or more adjudications at the same time, in a consolidated manner. On the other hand, SE
argued that the words of paragraph 8(2) were not as narrow as that and were concerned
precisely with the mischief which arose in that case. SE submitted that the purpose of para-
graph 8(2) was to prevent an adjudicator deciding one adjudication, whether consciously or
not, in the light of what he might learn or be told (or find out, carrying out his investigative
powers) in the other, related adjudication. Judge Lloyd said:
16. . . . In my judgment paragraph 8(2) is intended to cover, and does cover, a variety of cir-
cumstances. It is intended to cover all the situations in which there may be related disputes
under different contracts, whether or not the parties are the same and whether or not there
may permissibly be consolidation of the two proceedings. It applies whenever one party needs
40 [2002] EWHC 1775 (TCC), (2004) 20 Const LJ 402.
102
to know or may need to know, before allowing the adjudication to proceed in that way, whether
the adjudicator is going to have to pass on information or may acquire information which
would not be available in the other adjudication to which it is not a party. In other words, they
are all circumstances where, as a matter of principle, a party’s rights to the resolution of a dis-
pute, privately and confidentially, would or might be infringed by the introduction of a third
party, either in the same proceedings or by having the dispute determined by a person who
would or could acquire knowledge from the other proceedings but which could not be used in
the resolution of the dispute, yet might either consciously or unconsciously influence its
outcome.
Accordingly, Judge Lloyd held that, although the appointment of the adjudicator in that case
might have been validly made, it was necessarily a condition of appointment which was
dependent upon the consent of all the parties. Paragraph 8(2) took effect as a contractual
term and SE were entirely within their rights and acting reasonably by withholding their
consent to the appointment of the adjudicator. The adjudicator had erred in going ahead
without the consent of the parties.
In David and Teresa Bothma (In Partnership) T/A DAB Builders v Mayhaven Healthcare 3.46
Limited 41 the judge described the result in Pring as a logical, if harsh, result, because if an
award were produced under the Scheme resolving more than one dispute, it would be impos-
sible to determine by any process of severance which part of the award should be enforced
and which part of the award should be discarded. On the facts of Bothma, where the notice
of adjudication referred to as many as four different ‘disputes’, ranging from sums due by way
of interim payment to the validity of all architect’s instructions to date and the date for
completion of the contract, the judge concluded that the adjudicator did not have the
necessary jurisdiction, in particular because more than one dispute had been referred to him
at the same time, and the defendant had made a proper and timeous objection on that
ground at the outset. Permission to appeal was refused, and the Court of Appeal expressly
agreed with the judge’s approach.42
Resignation
9–(1) An adjudicator may resign at any time on giving notice in writing to the parties to the
dispute.
(2) An adjudicator must resign where the dispute is the same or substantially the same as
one which has previously been referred to adjudication, and a decision has been taken
in that adjudication.
(3) Where an adjudicator ceases to act under paragraph 9(1)—
(a) the referring party may serve a fresh notice under paragraph 1 and shall request an
adjudicator to act in accordance with paragraphs 2 to 7; and
(b) if requested by the new adjudicator and insofar as it is reasonably practicable, the
parties shall supply him with copies of all documents which they had made available
to the previous adjudicator.
(4) Where an adjudicator resigns in the circumstances referred to in paragraph (2), or
where a dispute varies significantly from the dispute referred to him in the referral
41 Unreported, 16 November 2006, a decision of HHJ Havelock-Allan QC, sitting in the TCC in Bristol.
42 [2007] EWCA Civ 527, [2007] 114 Con LR 131.
103
notice and for that reason he is not competent to decide it, the adjudicator shall be
entitled to the payment of such reasonable amount as he may determine by way of fees
and expenses reasonably incurred by him. The parties shall be jointly and severally
liable for any sum which remains outstanding following the making of any determina-
tion on how the payment shall be apportioned.
3.48 Paragraph 9 envisages the resignation of an adjudicator in two distinct circumstances. Under
paragraph 9(1), the adjudicator may resign at any time, merely by giving notice in writing to
the parties. This, obviously, is at the adjudicator’s discretion. He may resign because of ill
health or because of some other unexpected event occurring after his acceptance of the
appointment but before the expiry of the 28 days. The other principal circumstance that may
lead an adjudicator to decide to resign under paragraph 9(1) is if, once the adjudication is up
and running, it becomes apparent to the adjudicator that the issues involved are not capable
of fair resolution within the strict statutory time limit, even if extended by 14 days.
3.49 The courts have pointed out on a number of occasions that, if an adjudicator considers that
he is not able to deliver a fair or just result within the time scale of the adjudication, he should
resign. As HHJ Lloyd QC put it in Balfour Beatty Construction Ltd v The Mayor & Burgesses
of the London Borough of Lambeth,43 if an adjudicator cannot fairly and reasonably arrive at a
decision within the allotted time, and the parties refuse to extend that time, ‘an adjudicator
ought not to make a decision at all and should resign’. This is because what matters is not the
size or complexity of the adjudication itself, but whether or not the adjudicator considers
that he is capable of reaching a fair decision in the statutory (or any agreed extended) period.
This point is explored further in the chapter concerned with fairness, at paragraphs 13.13–
13.35 below.
3.50 The other circumstance in which paragraph 9 contemplates the resignation of the adjudi-
cator is much more specific. If the dispute is the same or substantially the same as one which
has previously been referred to adjudication, and a decision has been taken in that earlier
adjudication, then paragraph 9(2) is unequivocal: in such circumstances, the adjudicator
must resign. Doubtless as a result of this finality, there have been a large number of reported
cases in which the responding party has sought a declaration or a finding that the adjudicator
should have resigned and that, in consequence, he had no jurisdiction to give the decision he
did. This topic is addressed in detail below at paragraphs 7.97–7.106 (jurisdiction) and
14.36–14.44 (enforcement). The following is therefore intended only as a brief outline.

3.51 Perhaps unsurprisingly, the majority of the reported cases dealing with what might be called
attempted readjudication demonstrate a general desire to find that the disputes in question
were not the same or substantially the same, and that, in consequence, the arbitrator was not
obliged to resign. The first of these decisions was that of HHJ Thornton QC in Sherwood &
Casson Ltd v MacKenzie.44 In that case, Sherwood were MacKenzie’s sub-contractor. The first
adjudication concerned Sherwood’s claim by reference to interim application 3, with
MacKenzie submitting two lists of contra charges. The adjudicator decided that dispute.
Thereafter, Sherwood prepared a final account that included a variation account, which
listed the same variations that had been included within application 3, and one or two other
items. Many of the sums were different to those claimed in the first adjudication and additional
43 [2002] BLR 288.

44 [2000] 2 TCLR 418.
104
supporting documentation was provided. The final account was disputed and there was a
second adjudication. The adjudicator decided that a further sum was due to Sherwood;
MacKenzie failed to pay and Sherwood brought a claim for summary judgment. Judge
Thornton made clear that the court could conduct an inquiry ‘for the limited purpose of
ascertaining whether or not two separate disputes are substantially the same’. He said that the
court was not concerned to investigate the merits of the disputes, let alone resolve them. He
emphasised that the court would give considerable weight to the decision of the adjudi-
cator and would only embark on a jurisdictional inquiry in the first place where there were
substantial grounds for concluding that the adjudicator had erred in concluding that there
was no substantial overlap. In that case, having investigated the question of overlap, the
judge concluded that the disputes were not the same or substantially the same. The final
account claim involved a loss and expense claim that had not been made in the first adjudica-
tion and, although the variation claims were similar in factual content, they raised separate
disputes because of the timing and context in which they were raised. He therefore decided
that the disputes were clearly different and the adjudicator had the jurisdiction to arrive at
his second decision.
The problem of overlap between different adjudications can go not only to the subsequent 3.52
adjudicator’s jurisdiction (where the relevant cases are addressed in paragraphs 7.97–7.106
below) but also to broader questions of fairness (where the relevant cases are addressed in
paragraphs 13.58–13.62 below). It is, however, instructive to note at this stage the courts’
general approach to paragraph 9(2) of the Scheme. In Mivan Ltd v Lighting Technology
Projects Ltd 45 LTP issued a notice of adjudication to recover the balance on their interim
payment applications. Mivan said there had been an over-payment but LTP pointed out
that, in the absence of withholding notices, the sums applied for became due. The adjudicator
agreed with that and ordered Mivan to pay the balance. They did so and then, having issued
a valid withholding notice, issued their own notice of adjudication to recover the alleged
overpayment. LTP raised the point at paragraph 9(2) of Part 1 of the Scheme and invited the
adjudicator to resign. He did not do so and found in Mivan’s favour. LTP refused to repay
the money, asserting that the decision was a nullity and unenforceable. On the enforcement
application, LTP contended that the subject matter of the second adjudication was the same
or substantially the same as the first adjudication and that therefore the adjudicator should
have resigned. HHJ Seymour QC disagreed. He said that the dispute in the first adjudication
was whether or not the invoices were payable in the absence of a withholding notice, whereas
the second adjudication was concerned with (different) questions of repayment. The second
adjudication was therefore a separate and distinct dispute and thus the second adjudicator’s
decision was enforced by way of summary judgment. The same reasoning led to the same
result in Holt Insulation Ltd v Colt International Ltd.46 Importantly, one of the reasons for
HHJ MacKay QC’s decision in Holt was that the notices of adjudication in the two adjudi-
cations were ‘crucially different’.
In Skanska Construction UK Ltd v The ERDC Group Ltd & Anor 47 the Outer House (Lady 3.53
Paton) considered a situation where, in the first adjudication, the adjudicator ruled that the
respondents were not due anything because of the lack of sufficient information. The respondents
45 [2001] ADJCS 04/09, a decision of HHJ Seymour QC in the TCC in London on 9 April 2001.
46 Unreported, 23.7.01, a decision of HHJ MacKay QC sitting at the TCC in Liverpool.
47 [2003] SCLR 296.
105
commenced a second adjudication some time later with some similar claims and some new
claims, and with more supporting information. The adjudicator decided that he had the
jurisdiction to deal with the second adjudication and gave a decision in favour of the respon-
dents. The petitioners sought judicial review of that decision. The court concluded that the
dispute referred to the second adjudicator was not substantially the same as the dispute
referred to the first adjudicator. The court held that the situation was similar to that in
Sherwood & Casson Ltd, because a different stage in the contract had been reached and
different contractual provisions applied. The judge also pointed out that considerably more
information was available by the time of the second adjudication and, as she put it, ‘different
considerations and perspectives may apply’.
3.54 However, it should not be thought that it is inevitable that a court will conclude that the
disputes were not the same or substantially the same. In Naylor v Greenacres 48 the first
adjudication had been instigated by the petitioner seeking entitlement to payment in the
sum of £19,484.17. The respondents defended the claim on the basis of defective work to
the concrete ice rink slab, but the adjudicator decided that the petitioner was entitled to the
full amount sought. Shortly thereafter, the respondents initiated a second set of adjudication
proceedings that identified the dispute as the failure to supply and install the slab in
accordance with the contract. The court held that this was the same dispute as had already
been referred to adjudication because it was concerned with the correct execution of the
contract work. Thus the arbitrator did not possess any jurisdiction to decide the second
adjudication.
3.55 Difficulties concerning the adjudicator’s entitlement to fees can arise in circumstances where
the adjudicator has to resign if the circumstances set out in paragraph 9(2) of Part 1 of the
Scheme arose. In Prentice Island Ltd v Castle Contracting Ltd 49 there was a dispute as to
whether or not the adjudicator should have resigned because the dispute was the same or
substantially the same as an earlier dispute that had been resolved in adjudication. Unusually,
the issue as to whether or not the dispute was the same or substantially the same as a previous
reference had still to be argued out, and thus the correctness or otherwise of the assertion to
that effect was not in issue in the reported case, which was concerned solely with the adjudi-
cator’s entitlement to fees. The court concluded that, whatever the position as to resignation,
an adjudicator who is appointed to deal with a second adjudication is a validly appointed
adjudicator, albeit subject to a duty to resign from that office if the circumstances set out in
paragraph 9(2) of Part 1 of the Scheme applied. As the court pointed out, the provisions of
paragraph 9(2) assume a validly appointed adjudicator. Thus the structure of the Scheme
envisages that the adjudicator might have to decide whether or not the dispute is the same or
substantially the same as an earlier dispute which had already been adjudicated. Even if an
adjudicator in good faith fell into error on that question and continued to act in circum-
stances in which he ought to resign, the court concluded that he remained in post as a validly
appointed adjudicator, unless and until he resigned or was stopped from acting by the court.
He was therefore entitled to be remunerated according to the work undertaken by him in the
capacity as adjudicator.50
48
[2001] SLT 1092.
49
Unreported, 15 December 2003, a decision of R A Dunlop QC, Sheriff Principal, Sheriffdom of Tayside
Central and Fife.
50 This conclusion can be taken to have been endorsed by Ramsey J in Linnett v Halliwells LLP [2009]
EWHC 319 (TCC), [2009] BLR 312.
106
Objection
10. Where any party to the dispute objects to the appointment of a particular person as
adjudicator, that objection shall not invalidate the adjudicator’s appointment nor any decision
he may reach in accordance with paragraph 20.
The purpose of this paragraph of the Scheme is clear: the mere fact that one party objects to 3.57
the appointment of a particular person as an adjudicator will not invalidate the appoint-
ment or, therefore, any decision that the adjudicator might make. Anything less, and the
wily responding party could always ensure that the adjudication was ineffective by raising
spurious objections to the appointment of any individual as the adjudicator. In Pring &
St Hill Ltd v CJ Hafner t/a Southern Erectors,51 as already noted, the adjudicator dealt with
the sub-contract adjudication, despite the fact that the responding party objected on the basis
that he had previously dealt with the same underlying issue in an adjudication involving
other parties. The judge concluded that, given the absence of consent, the adjudicator had no
jurisdiction pursuant to paragraph 8(2) of the Scheme. In that case it had also been argued that,
by reference to paragraph 10 of the Scheme, one party could not invalidate the appointment,
even by raising a fundamental objection to the adjudicator’s jurisdiction. This argument was
unsuccessful. The judge concluded that paragraph 10 of Part 1 of the Scheme was concerned
with the consequences of an objection to the appointment of a particular person to be the
adjudicator and had nothing to do with whether that person, if otherwise validly chosen and
appointed, had the necessary jurisdiction. Thus the objections to the adjudicator in that case,
which had been raised at the outset, were not thwarted by paragraph 10.
Revocation
11–(1) The parties to a dispute may at any time agree to revoke the appointment of the
adjudicator. The adjudicator shall be entitled to the payment of such reasonable
amount as he may determine by way of fees and expenses incurred by him. The parties
shall be jointly and severally liable for any sum which remains outstanding following
the making of any determination on how the payment shall be apportioned.
(2) Where the revocation of the appointment of the adjudicator is due to the default or
misconduct of the adjudicator, the parties shall not be liable to pay the adjudicator’s
fees and expenses.
These provisions speak for themselves. In the same way as paragraph 9(1) gives the adjudi- 3.59
cator the ability to resign on notice at any time, so paragraph 11(1) allows the parties to agree
to revoke his appointment at any time. Unless the revocation is due to the default or miscon-
duct of the adjudicator, the parties are jointly and severally liable for his fees. If the revocation
is due to his default or misconduct, then the adjudicator is not entitled to such fees. It is
perhaps noteworthy that there has been no reported case in which the proviso to paragraph
11(2) has been found to operate.
51 [2002] EWHC 1775 (TCC), (2004) 20 Const LJ 402.
107
Powers of the Adjudicator

3.60 The powers of the adjudicator are set out in detail in paragraphs 12–19 inclusive of Part 1 of
the Scheme. They provide as follows:
12. The adjudicator shall—
(a) act impartially in carrying out his duties and shall do so in accordance with any
relevant terms of the contract and shall reach his decision in accordance with the
applicable law in relation to the contract; and
(b) avoid incurring unnecessary expense.
13. The adjudicator may take the initiative in ascertaining the facts and the law necessary to
determine the dispute and shall decide on the procedure to be followed in the adjudication.
In particular he may—
(a) request any party to the contract to supply him with such documents as he may reason-
ably require including, if he so directs, any written statement from any party to the
contract supporting, or supplementing the referral notice and any other documents
given under paragraph 7(2),
(b) decide the language or languages to be used in the adjudication and whether a transla-
tion of any document is to be provided and if so by whom,
(c) meet and question any of the parties to the contract and their representatives,
(d) subject to obtaining any necessary consent from a third party or parties, make such
site visits and inspections as he considers appropriate, whether accompanied by the
parties or not,
(e) subject to obtaining any necessary consent from a third party or parties, carry out any
test or experiments,
(f ) obtain and consider such representations and submissions as he requires, and, pro-
vided he has notified the parties of his intention, appoint experts, assessors or legal
advisers,
(g) give directions as to the timetable for the adjudication, any deadlines, or limits as to
the length of written documents or oral representations to be complied with, and
(h) issue other directions relating to the conduct of the adjudication.
14. The parties shall comply with any request or direction of the adjudicator in relation to the
adjudication.
15. If, without showing sufficient cause, a party fails to comply with any request, direction or
timetable the adjudicator made in accordance with his powers, fails to produce any
document or written statement requested by the adjudicator, or in any other way fails
to comply with a requirement under these provisions relating to the adjudication, the
adjudicator may—
(a) continue the adjudication in the absence of that party or of the document or written
statement requested,
(b) draw such inferences from that failure to comply as circumstances may, in the
adjudicator’s opinion, be justified, and
(c) make a decision on the basis of the information before him attaching such weight as
he thinks fit to any evidence submitted to him outside any period he may have
requested or directed.
16–(1) Subject to any agreement between the parties to the contrary, and to the terms of
paragraph (2) below, any party to the dispute may be assisted by, or represented by,
such advisers or representatives (whether legally qualified or not) as he considers
appropriate.
(2) Where the adjudicator is considering oral evidence or representations, a party to the
dispute may not be represented by more than one person, unless the adjudicator
gives directions to the contrary.
108
17. The adjudicator shall consider any relevant information submitted to him by any of the
parties to the dispute and shall make available to them any information to be taken into
account in reaching his decision.
18. The adjudicator and any party to the dispute shall not disclose to any other person any
information or document provided to him in connection with the adjudication which the
party supplying it has indicated is to be treated as confidential, except to the extent that it
is necessary for the purposes of, or in connection with, the adjudication.
19–(1) The adjudicator shall reach his decision not later than—
(a) twenty eight days after the date of the referral notice mentioned in paragraph
7(1), or
(b) forty two days after the date of the referral notice if the referring party so
consents, or
(c) such period exceeding twenty eight days after the referral notice as the parties to
the dispute may, after the giving of that notice, agree.
(2) Where the adjudicator fails, for any reason, to reach his decision in accordance with
paragraph (1)—
(a) any of the parties to the dispute may serve a fresh notice under paragraph (1)
and shall request the adjudicator to act in accordance with paragraphs 2
to 7; and
(b) if requested by the new adjudicator and insofar as it is reasonably practicable,
the parties shall supply him with copies of all documents which they had made
available to the previous adjudicator.
(3) As soon as possible after he has reached a decision, the adjudicator shall deliver a
copy of that decision to each of the parties to the contract.
A number of particular points need to be made about these paragraphs concerning impartiality 3.61
(paragraphs 3.62–3.64 below); the taking of the initiative by the adjudicator (paragraphs
3.65–3.68 below); the adjudicator’s consideration of any relevant information submitted
to him (paragraphs 3.69–3.75 below); and the time limits referred to in paragraph 19
(paragraphs 3.76–3.82 below). Again, it should be noted that more detailed consideration
of the interface between the rules of natural justice and the constraints of the adjudication
process can be found in Chapter 13 below.
Acting Impartially
This topic is dealt with in detail at Chapters 11-13 below. What follows is a brief introduction 3.62
to the concepts of impartiality and fairness within the constraints of the statutory adjudi-
cation process. In Glencot Development & Design Co Ltd v Ben Barrett & Son (Contractors)
Ltd,52 HHJ Lloyd QC considered the meaning of the word ‘impartially’. He concluded
that it had to be given the same meaning as at common law or in Article 6 of the Human
Rights Convention, as applied by the Human Rights Act 1998. Even though an adjudicator
was not a classic judicial tribunal, in practice an adjudication was probably closer to an
arbitration than an expert determination. It may not take place in public but it had been
instituted by Parliament in order to provide a determination of rights which, albeit the
effect of any decision is ultimately reversible, will nonetheless have immediate practical
and potentially far-reaching impact.
Judge Lloyd went on, at paragraph 20 of his judgment in Glencot, to rule that the adjudicator 3.63
had to conduct the proceedings in accordance with the rules of natural justice or as fairly as
52
[2001] BLR 207.
109
the limitations imposed by Parliament permitted.53 He concluded that the test for apparent
bias was an objective test. The views of the adjudicator were either irrelevant or not deter-
minative. The test was whether the ‘circumstances would lead a fair-minded and informed
observer to conclude that there was a real possibility or a real danger, the two being the same,
that the tribunal was biased’. On the facts of Glencot, the adjudicator conducted a mediation
process that failed to resolve the dispute but which involved him talking privately to repre-
sentatives of both sides. The judge concluded that any fair-minded and informed observer
would have concluded that his participation in these lengthy discussions meant that there
was a real possibility that he was biased.
3.64 In Mott MacDonald Ltd v London & Regional Properties Ltd,54 the adjudicator wrongly sought
to impose a lien on his fees, and made it a pre-condition that the referring party must pay all
his fees before the decision was released. HHJ Thornton QC held that this was a breach of
rule 12(a) and that the adjudicator appeared to lack impartiality by giving at least the
impression, through the operation of this pre-condition, that he was financially beholden to
the referring party.
Taking the Initiative

3.65 Paragraph 13 allows the adjudicator to take the initiative in ascertaining the facts and the
law necessary to determine the dispute and then goes on to identify, at sub-paragraphs
(a)–(h) inclusive, various ways in which this initiative may be taken. However, although this
suggests a relatively wide power on the part of the adjudicator to get to what he considers to
be the heart of the dispute and to decide it, there are in practice a number of important
restraining factors.55 One is the limitation on his jurisdiction created by the notice of
adjudication. A good example of the clash between the power to take the initiative, and the
limitations imposed on the adjudicator by the terms of the notice, is the case of McAlpine
PPS Pipeline Systems Joint Venture v Transco Plc.56 In that case McAlpine commenced an
adjudication claiming interest as a result of Transco’s alleged failure promptly to certify the
amounts due to McAlpine on the occurrence of particular ‘compensation events’. Transco
denied the claim, and argued that no proper details of these events had ever been provided.
In its reply to Transco’s response, McAlpine served in excess of 500 pages of appendices
which sought to argue the underlying compensation events, rather than simply the claim for
interest. It was said that this was necessary in order to deal with Transco’s assertion that
McAlpine had failed to provide the appropriate detail of the factual background for the
compensation events in relation to which interest was claimed. The adjudicator said that, in
order to reach a conclusion as to the entitlement to interest, he had to decide, in respect of
each compensation event, which party was responsible for the delay in certification. The
adjudicator found that McAlpine had to provide considerable further material if he was to
find in their favour. Transco complained that the reply, and the adjudicator’s response, raised
an entirely different case to that in the notice of adjudication, and the adjudicator did not
have the jurisdiction to consider these new issues.
53
For a similar approach, see, amongst others, Discain Project Services Ltd v Opecprime Development Ltd
[2000] BLR 402.
54
[2007] EWHC 1055 (TCC), [2007] 113 Con LR 33.
55 The relevant cases are cited in Chapter 13, and include Pegram, AMEC v Whitefriars, Thomas-Frederic’s,
C&B Scene, and AWG.

56 Unreported, 12 May 2004, a decision of HHJ Toulmin CMG QC sitting at the TCC in London.
110
HHJ Toulmin CMG QC held that the dispute that was referred to the adjudicator was 3.66
McAlpine’s claim for interest payments and that the basis of that claim was that set out in the
notice of adjudication, namely that payments in respect of various compensation events had
not been certified when they ought to have been. He decided that Transco’s response was
legitimate, because it confined its contention to the simple proposition that McAlpine could
not succeed on the basis on which the claim had been put forward. The judge found that the
Transco response deliberately stopped short of setting out an affirmative contention on each
individual claim. The judge found that the adjudicator had been right to conclude that this
was not an ambush by Transco but a reiteration of the stance that they had adopted since the
dispute started. It was not Transco’s fault that McAlpine had not provided sufficient sub-
stantiation originally. The judge went on to conclude that the adjudicator had no jurisdiction
to go beyond the dispute as set out in the notice of adjudication. In the face of Transco’s
submissions on jurisdiction, the adjudicator had no basis for embarking on a consideration
of what he regarded as the real dispute. Despite the provisions of paragraph 13 of the Scheme,
with its express reference to the adjudicator taking the initiative, the adjudicator had no
jurisdiction to embark on a course which was outside the terms of the referral notice without
the agreement of both parties. At paragraph 146 of his judgment, the judge said:
Unfortunately, it is not enough for the adjudicator to say that he was sure that both parties
would want to conclude the matter without recourse to further proceedings. If the existing
referral does not enable him to deal with the dispute in the way in which he wishes, he is
powerless to alter the terms of the referral in the absence of the agreement of both parties.
So long as the dispute remains before him, he must decide only the issues referred to him.
In consequence, the judge found that the adjudicator had gone beyond the terms of the
dispute referred to him and that he had no jurisdiction to do so. He therefore declined to
enforce the decision.
The courts have done more than simply pay lip service to the adjudicator’s power to take the 3.67
initiative in determining the facts and the law. To take just two recent examples, in GPS
Marine Contractors Ltd v Ringway Infrastructure Services Ltd,57 the adjudicator’s decision to
reject both parties’ agreement that the method statement was a contract document was
found to be open to him because he was obliged to take the iniative in detemining the law,
and in Volker Stevin Ltd v Holystone Contracts Ltd,58 the TCC judge said that, not only did the
adjudicator not exceed his jurisdiction by pushing the referring party for further information,
but the adjudicator had a positive duty to seek out all information that he or she believed was
necessary in order to come to a proper decision.
But although it might seem that an adjudicator has wide powers to adopt an inquisitorial 3.68
approach to the dispute, a number of factors mean that, in reality, those powers have to
be exercised with some care. The restraint imposed by the terms of the notice of adjudication
has already been considered. In addition, the adjudicator has a short period in which to
complete his decision, and this tends to mean that, from a practical point of view, it is much
easier for the adjudicator to decide between the opposing cases put forward by the parties
than embark on a lengthy investigation of his own into points not apparently raised by either
side. Further, both paragraph 17 of the Scheme and the rules of natural justice mean that any
57 [2010] EWHC 283 (TCC), [2010] BLR 377.

58 [2010] EWHC 2344 (TCC).
111
new information unearthed or different approach adopted by the adjudicator has to be

shared with the parties prior to the production of the decision itself.59 Again, this tends to
result in a process that is more like a speeded-up arbitration or a case in court than an
inquisitorial, fact-finding exercise.
Consideration of any Relevant Information

3.69 The provision at paragraph 17 of Part 1 of the Scheme is in mandatory terms: the adjudicator
‘shall consider’ any relevant information submitted to him. This has given rise to a number of
attacks on the decisions of adjudicators on the basis that the adjudicator failed to consider a
particular element of relevant information and therefore was in breach of his obligations
identified at paragraph 17. Perhaps the high watermark of this approach can be found in the
decision of HHJ Thornton QC in Buxton Building Contractors Ltd v The Governors of Durand
Primary School.60 In that case, the contract administrator had issued a certificate of making
good defects and a further certificate, described as an interim certificate, which certified that
the second tranche of the retention fund should be released to the contractors, Buxton. He
did not, however, issue a final certificate. Accordingly, Buxton were in difficulties because,
although they obviously wanted to be paid the second tranche of the retention, there was no
contract machinery that allowed the payment of that sum, because there was no final
certificate. There was a sum that was due but which could not be shown to be payable.
In those circumstances, Buxton operated paragraph 8 of Part II of the Scheme, which provided
that a contractor in Buxton’s position could serve a claim on the employer, which then
made the final date for payment 17 days from the service of that claim. Buxton sent an
invoice to trigger the 17-day period. The school had always maintained that no sums were due
because of defects in the work. Prior to the release of the retention certificate the school had
served a general notice of an intention to withhold payment and, before the issue of Buxton’s
invoice and before the date for payment of the invoice sum, they had also served details of
the sum to be withheld and of the reasons for withholding. In the adjudication, Buxton said
that the only issue was whether the certified sum was due and payable and said that the docu-
ments from the school did not amount to a withholding notice under the Scheme. The
adjudicator decided the point in favour of Buxton, concluding that no withholding notice
had been served by the school and that the supervising officer had to be presumed to have
taken the school’s claim into account in computing the sum being certified as due.
3.70 Judge Thornton concluded that the adjudicator’s decision showed that he had not con-
sidered at all the nature, content, validity or quantification of the school’s cross-claim; he
did not investigate the material provided to him by the school; he did not decide whether
the school’s cross-claim had in fact been taken into account by the supervising officer
when certifying but instead made an erroneous assumption that it had been; he did not
consider whether the certificate that was issued had any contractual validity, and instead
wrongly assumed that the certificate was one that was duly authorised by the contract
conditions and that its payment was provided for by those conditions; and he did not take
into account or consider the validity of the correspondence from the school, which
amounted, or arguably amounted, to a valid withholding notice that had been served
timeously. Judge Thornton concluded that there was a fundamental flaw that attached to
59 See in particular paragraphs 13.41-13.53.

60 [2004] EWHC 733 (TCC); [2004] 1 BLR 374.
112
the adjudicator’s decision. That flaw was that the decision had been reached, or must be taken
to have been reached, without the adjudicator having considered or decided upon the
contents of the submissions, documents and issues referred to him by the school. Having
been invited by Buxton to ignore those documents, it appears that that is what the adju-
dicator did. The adjudicator’s failure, said the judge, amounted to a serious irregularity
and a serious failure to conform to paragraph 17 of Part I of the Scheme. The adjudicator’s
decision was therefore not enforced.
The decision in Buxton was considered by Jackson J in the case of Carillion Construction Ltd 3.71
v Royal Devonport Dockyard.61 Devonport were the main contractors and Carillion were
sub-contractors. During the course of the works, Devonport agreed variations to the main
contract with the employer, which gave rise to a number of interim uplifts to the ‘target cost’
payable under the sub- contract. Carillion referred the question of the amount it was entitled
to be paid to an adjudicator. The adjudicator disregarded the negotiations between
Devonport and the employer, saying they were irrelevant to the question of target cost as
between the parties and disregarded an alternative calculation of the target cost put forward
by Devonport. He instead concluded that Carillion were entitled to be paid a sum that
reflected the defects in Carillion’s work, but that Devonport’s cross-claim in respect of
defects should be reduced by 20 percent. The adjudicator made an award in Carillion’s
favour. Devonport refused to pay and Carillion brought enforcement proceedings.
Devonport submitted that the adjudicator had acted without jurisdiction and in breach
of natural justice in declining to consider the matters put forward by Devonport in the
adjudication and that he had failed to give the parties an opportunity to comment on the
reduction to Devonport’s defects claims. In short it was submitted that the adjudicator had
not considered the relevant information submitted to him.
At paragraph 81 of his judgment, Jackson J identified a total of five propositions that he 3.72
considered were relevant to the debate about the adjudicator’s obligations to consider the
evidence and give reasons for his decision. The first two are relevant to the adjudicator’s
powers in respect of evidence: 62
1. If an adjudicator declines to consider evidence which, on his analysis of the facts or the law,
is irrelevant, that is neither (a) a breach of the rules of natural justice nor (b) a failure to
consider relevant material which undermines his decision on Wednesbury grounds or for
breach of paragraph 17 of the Scheme. If the adjudicator’s analysis of the facts or the law
was erroneous, it may follow that he ought to have considered the evidence in question.
The possibility of such error is inherent in the adjudication system. It is not a ground for
refusing to enforce the adjudicator’s decision. I reach this conclusion on the basis of the
Court of Appeal decisions mentioned earlier. This conclusion is also supported by the
reasoning of Steyn J in the context of arbitration in Bill Biakh v Hyundai Corporation.63
2. On a careful reading of His Honour Judge Thornton’s judgment in Buxton Building
Contractors Ltd v Governors of Durand Primary School 64 I do not think that this judg-
ment is inconsistent with proposition 1. If, however, Mr Furst is right and if Buxton is
inconsistent with proposition 1, then I consider that Buxton was wrongly decided and I
decline to follow it . . .
61
[2005] EWHC 778 (TCC), [2005] BLR 310.
62 The other three propositions are set out in paragraph 3.93.
63 [1988] 1 Lloyd’s Rep 187.
64 [2004] 1 BLR 474.
113
3.73 Jackson J then applied these propositions to the facts. He dismissed Devonport’s case that the
adjudicator failed to have regard to all the relevant material. He said that it was clearly an
issue for the adjudicator to decide whether the negotiations between Devonport and the
employer were relevant to the assessment of target cost and, if so, how. The adjudicator
concluded that those negotiations were not relevant and whether he was right or wrong in
that conclusion could not affect the validity of his decision. More generally, Jackson J
pointed to the fact that the adjudicator had received literally hundreds of pages of legal
argument and that he had done ‘a remarkable job in keeping abreast of the battle and in
keeping under control the torrent of incoming material’. The adjudicator had made it plain
in his written decision which arguments he accepted and how his figures were calculated.
There was no need for him to recite and address particular arguments in his decision. The
challenge to the adjudicator’s jurisdiction failed.
3.74 Jackson J’s decision was upheld in the Court of Appeal.65 Chadwick LJ concluded that it was
‘beyond argument’ that the judge was correct to take the view he did of the adjudicator’s
approach to the question of ‘target cost’. Chadwick LJ also held that the judge was right to
reject the attack on the adjudicator for a breach of natural justice. As to the propositions set
out in paragraph 81 of the judgment of Jackson J, Chadwick LJ said that the Court of
Appeal was in broad agreement with those propositions, which were themselves indicative
of the approach that courts should adopt when required to address a challenge to the
decision of an adjudicator appointed under the 1996 Act. However, he made it plain that
the Court of Appeal was less confident than Jackson J had been that the decision in Buxton
could be reconciled with the first of those propositions. The Court of Appeal endorsed that
first proposition and, to the extent that Buxton was inconsistent with it, they said that the
judge was right not to follow it.66
3.75 At a rather more mundane level, this express power on the part of the adjudicator has been
relied on to defeat the argument, sometimes made by the responding party, that the adju-
dicator wrongly had regard to later documents and information provided by the referring
party that amended the value of the claim. A typical example of this occurred in Volker
Stevin Ltd v Holystone Contractors Ltd,67 where, quite late on in the process, the adjudicator
asked the referring party a whole series of questions designed to identify the precise figures
relied on. The argument that the adjudicator was doing the referring party’s work for them
was rejected, the TCC judge noting that, if the adjudicator thought that there was out-
standing information, then he could not stand mutely by, hoping that it might come along:
he had an obligation to chase it himself. The important thing was that the responding
party had been given plenty of opportunity to respond to every piece of further informa-
tion that had been provided by the other side, and never said that they had not had enough
time to deal with it.
Time Limits
3.76 Paragraph 19 of the Scheme provides for three options. Option 1 is the statutory period for
the adjudication, namely 28 days. Option 2 provides for an extension of 14 days to that
65
[2005] EWCA Civ 1358, [2006] BLR 15.
66 Buxton was also doubted in Kier Regional Limited v City & General (Holborn) [2006] EWHC 848 (TCC),
[2006] BLR 315.
67 [2010] EWHC 2344 (TCC).
114
period, at the sole discretion or request of the referring party, making a total of 42 days.
However, that option is only available to the adjudicator if the referring party requests or
consents to it. Option 3 allows for an unlimited extension(s) to the 28-day period, provided
that both parties to the adjudication consent to such extension(s).
The difficulties created by these time limits will usually arise in the larger adjudications. 3.77
There may be some adjudications which, once they are up and running, cannot fairly be
disposed of within the 28 days or, indeed, within the 42 days. In those circumstances, it is
submitted, the adjudicator has a choice. He should seek an appropriate extension of time
from both parties. If he does not get such an extension of time then, if he considers that
he cannot dispose of the adjudication fairly within the time limit that he has been given,
he should resign in accordance with his power under paragraph 9 of Part I of the
Scheme.
The practical difficulty that can arise is where the material that each party is seeking to rely 3.78
on in the adjudication grows over the course of the 28 days. The adjudicator may seek an
extension of time on the basis of one set of materials and then be provided with a further two
dozen lever arch files that make it necessary for him to seek a further extension. In those
circumstances, the parties are placed in a very difficult position. On the one hand, they will
be instinctively unhappy about the extension of the adjudication process, particularly in
circumstances where the adjudicator has no power to award costs.68 On the other hand, if
the parties are, say, three weeks into a lengthy adjudication and they have already spent a
good deal of money on the process, they will naturally be reluctant to deprive the adjudi-
cator of the extension that he requires, thereby rendering all that expenditure futile. In CIB
Properies Ltd v Birse Construction Ltd 69 the adjudicator was faced with a voluminous claim
with an equally voluminous response. The adjudicator sought a number of extensions of
time as the process went on and, mindful of the practical realities of the position, the parties
granted the adjudicator those extensions. Eventually the adjudication process took about
three months.
Difficulties can arise if the adjudicator fails to deliver his decision within the 28-day 3.79
period and no extension has been agreed. There is a full discussion of this topic at paragraphs
2.114–2.132 above. Under the Scheme, the position can be shortly stated. Although, in
Simons Construction Ltd v Aardvark Developments Ltd 70 the adjudicator provided his decision
eight days beyond the 28-day time limit, and HHJ Seymour QC held that the decision was
binding, his reasoning (that a decision was always valid provided only that the adjudication
agreement, if any, had not already been terminated for failure to produce a decision within
the relevant time scale and that a fresh notice of adjudication had not already been given by
one of the parties) was criticised and not followed in Ritchie Brothers (PWC) Ltd v David
Philp (Commercials) Ltd.71 Instead it was held that the adjudicator’s decision was reached
out of time (and that after a purported extension that was also consented to by the pursuers
out of time), and that the adjudicator did not retain his jurisdiction. The court decided that
the true interpretation of paragraph 19 of Part I of the Scheme was that the jurisdiction
ceased on the expiry of the time limit if it had not already been extended in accordance
68
See the discussion at paragraphs 10.01–10.13.
69 [2005] 1 WLR 2252; [2005] BLR 173.
70 [2003] EWHC 2474; [2004] BLR 117.
71 [2005] SLT 341.
115
with paragraph 19(1). The Lord Justice Clerk (Gill) concluded that Judge Seymour’s
interpretation of paragraph 19 could not be justified. Lord Abernethy, who gave a dissenting
judgment, supported the approach of Judge Seymour.
3.80 In Ritchie, there was an alternative argument, to the effect that the failure to provide a
decision within the time limit stipulated by the Scheme was a technical failure rather than a
fundamental error or impropriety. The pursuers relied on the reasoning of Lord Wheatley in
St Andrew’s Bay Development Ltd v HB Management Ltd.72 However, the Lord Justice Clerk
rejected this argument as well, pointing out that it provided no hard and fast criteria by
which a court could determine for how long after the time limit a failure to reach a decision
could be considered to be merely technical, or in what circumstances the jurisdiction could
be said to come to an end. In reaching this view, the judge relied in part on HHJ Lloyd QC’s
judgment in Barnes & Elliott Ltd v Taylor Woodrow Holdings Ltd.73 In that case there was a
decision within the time limit, but a failure to communicate it until the following day. Judge
Lloyd held that the decision had been arrived at timeously. The Lord Justice Clerk pointed
out that this meant that, on the facts, Barnes & Elliott was distinguishable from Ritchie, but
that in any event he considered that Judge Lloyd was correct to say that s108 of the 1996 Act
only conferred authority to make a decision within the 28-day period or such other period
as it provides.
3.81 The approach in Ritchie has been expressly adopted by the TCC judges in London, including
in AC Yule & Son v Speedwell Roofing and Cladding Ltd,74 which was also a dispute under the
Scheme. There, the TCC judge rejected the contention that the most important factor in
deciding whether a decision produced out of time was a nullity was the consequence of
non-compliance, as opposed to the mandatory language of the Scheme itself. Other cases in
which the TCC have adopted the approach in Ritchie are listed below.75 Accordingly, it would
seem clear that, as things presently stand, the adjudicator must reach his decision within the
28-day period set out in paragraph 19(1) of the 1996 Act or, alternatively, within any extended
period agreed by the parties. If the decision is not reached within that period, the decision is a
nullity (see Ritchie and the cases cited in paragraphs 2.119–2.128 above). If the decision is
completed within the correct period, and is communicated the following day, then the
decision is probably not a nullity (see Barnes & Elliott and Cubitt Building & Interiors Ltd
v Fleetglade Ltd ).
3.82 Paragraph 19(3) of the Scheme requires the adjudicator to deliver his decision to the parties
‘as soon as possible after he has reached a decision’. In Mott MacDonald,76 the decision
was completed on about 8 December, but was not sent to the parties until 13 December. The
delay arose out of the adjudicator’s unjustified insistence on being paid his fees before
he communicated the decision. It was held that this delay was contrary to rule 19(3) and, in
72 [2003] SLT, particularly at page 744 F–G.

73 [2003] EWHC 3100; [2004] BLR 111.
74
[2007] EWHC 1360 (TCC), [2007] BLR 499.
75
See, for example, Hart v Fidler and Anor [2006] EWHC 2857 (TCC), [2007] BLR 30; Cubitt Building &
Interiors Ltd v Fleetglade Ltd [2006] EWHC 3413 (TCC), [2006] 110 Con LR 36; Epping Electrical Co Ltd v
Briggs and Forrester (Plumbing Services) Ltd [2007] EWHC 4 (TCC), [2007] BLR 126; Aveat Heating Ltd v
Jerram Falkus Construction Ltd [2007] EWHC 131 (TCC), [2007] 113 Con LR 13; and AC Yule & Son Limited
v Speedwell Roofing & Cladding Limited [2007] EWHC 1360 (TCC), [2007] BLR 499. These cases are
discussed in detail in paragraphs 2.119–2.128.
76 [2007] EWHC 1055 (TCC), [2007] 113 Con LR 33.
116
part for this reason, the decision was not enforced. Similarly, in Lee v Chartered Properties
(Building) Ltd,77 an unexplained delay of three days between the conclusion of the decision
and its issue to the parties meant that the decision was unenforceable.
The Adjudicator’s Decision

Paragraphs 20–22 of Part I of the Scheme provide as follows: 3.83
20. The adjudicator shall decide the matters in dispute. He may take into account any other
matters which the parties to the dispute agree should be within the scope of the adjudica-
tion or which are matters under the contract which he considers are necessarily connected
with the dispute. In particular he may—
(a) open up, revise and review any decision taken or any certificate given by any person
referred to in the contract unless the contract states that the decision or certificate is
final and conclusive,
(b) decide that any of the parties to the dispute is liable to make a payment under the
contract whether in sterling or some other currency and, subject to Section 111(4) of
the Act, when that payment is due and the final date for payment,
(c) having regard to any term of the contract relating to the payment of interest decide
the circumstances in which, and the rates at which, and the periods for which simple
or compound rates of interest shall be paid.
21. In the absence of any directions by the adjudicator relating to the time for performance of
his decision, the parties shall be required to comply with any decision of the adjudicator
immediately on delivery of the decision to the parties in accordance with this paragraph.
22. If requested by one of the parties to the dispute, the adjudicator shall provide reasons for
his decision.
Opening Up, Revising and Reviewing

Paragraph 20(a) of Part 1 of the Scheme gives the adjudicator the same express powers as an 3.84
arbitrator under the standard forms of building contract to open up, revise and review
previous decisions of the contract administrator or architect. This is obviously an extremely
important power, because it allows the adjudicator to correct errors that he may perceive in
previous interim payment certificates or previous awards of extensions of time and/or loss
and expense. Indeed, taken to its logical conclusion, this power could allow an adjudicator
to declare that, say, a practical completion certificate must be issued, in circumstances

where the contract administrator or architect has refused to issue such a certificate. It must
be questionable whether, save in exceptional circumstances, it can ever be appropriate for
an adjudicator, appointed to consider a dispute within 28 days, to substitute his own view
on a matter such as practical completion, particularly in circumstances where the contract
administrator has been involved in the day-to-day detail throughout the currency of the
contract.
In Vaultrise Ltd v Paul Cook 78 the claimant contractor made a final account claim, pointing 3.85
out that there should have been a final certificate but none had been issued. The adjudicator
found for the claimant. In the enforcement proceedings, the defendant asserted that his
obligation to pay was triggered only by certificates issued under the contract and that, since
77 [2010] EWHC 1540 (TCC), [2010] BLR 500.

78 [2004] Adj CS 04/06.
117
there was no final certificate, the adjudicator had no power to issue such a certificate. The
judge rejected that submission, finding that an adjudicator could consider whether or not a
certificate should have been issued and, if a certificate was outstanding, he could determine
the appropriate sum due. The judge said that the adjudicator had the jurisdiction to find, as
he had done, that a final certificate should have been issued on or before a particular date and
to determine the amount due from the defendant to the claimant. There was no reason why
a dispute as to whether or not a certificate should have been issued (and, if so, what the
certificate should say) should not be referred to adjudication.79
3.86 It is also important for the parties to make clear to the adjudicator precisely what previous
decisions they want opened up and reviewed and how any sums that are sought are made
up. In Martin Girt v Page Bentley 80 the contractor claimed some £60,000 from the employer,
who said that in fact there had been an overpayment. The adjudicator set out what should
have happened and referred to the relevant tax considerations. The adjudicator was con-
cerned that, since it was unclear that the claimant had the necessary registration cards and tax
certificates, he should only award the claimant a sum due net of tax. Accordingly the sum of
just £18,000 was awarded to the claimant. The defendant argued that the whole investi-
gation into the tax position was a frolic of the adjudicator’s own making and that this foray
outside his jurisdiction fatally tainted the award. Judge Wilcox pointed out that, if anybody
had suffered as a result of the tax point, it was the claimant, because the appropriate certifi-
cate would have enabled a gross payment to have been made, and there was such a certificate
produced and filed with the Revenue. The judge found that the adjudicator had the
jurisdiction to reach the decision that he did and that, in any event, any prejudice resulting
from the arguable breach of natural justice was visited on the claimant, not the defendant.
Since the claimant did not seek to impugn the award, the decision would be enforced.
Interest
3.87 One of the many issues in Carillion Construction Ltd v Devonport Royal Dockyard 81 was the
nature and scope of paragraph 20(c) of Part 1 of the Scheme. Devonport argued that this
provision only allowed the adjudicator to award interest if the underlying contract between
the parties provided that such interest was payable. Carillion argued that paragraph 20(c)
created a free-standing right on the part of the adjudicator to award interest. Jackson J
concluded that paragraph 20(c) did indeed create a free-standing right to award interest.
There were, he said at paragraph 123 of his judgment, five reasons for this decision:
1. As a matter of impression this seems to me to be the more natural meaning of sub-
paragraph (c), when read in the context of the whole of paragraph 20 of the Scheme.
2. In my view it is reading too much into the second and third sentences of paragraph 20 to
hold that everything in sub-paragraphs (a), (b) and (c) must arise from some other express
term of the contract.
3. It makes obvious commercial sense for an adjudicator to have the power to award interest.
The Scheme takes effect as a set of implied terms in many construction contracts pursuant
to Section 114(4) of the 1996 Act. I would certainly expect the Scheme to include a
power to award interest.
79
In Banner Holdings Ltd v Colchester Borough Council [2010] EWHC 139 (TCC), [2010] 131 Con LR 77,
the TCC judge doubted whether there could be any real limit on the type of dispute referred to adjudication,
provided it arose under or in connection with the construction contract.
80 [2002] EWHC 2434.
81 [2005] EWHC 778 (TCC), [2005] BLR 310.
118
4. In my view, the phrase in paragraph 20(c) ‘having regard to any term of the contract
relating to the payment of interest . . .’ means that if there is any such term, the adjudi-
cator must have regard to it. In other words, the free-standing right conferred by
paragraph 20(c) does not override any express term of the contract dealing with interest.
5. If paragraph 20(c) had the meaning for which Mr Furst contends, it would be unnecessary.
The clause would be saying that which was self-evident.
In the Court of Appeal,82 Chadwick LJ, giving the judgment of the court, said that the 3.88
court had reached the same conclusion as Jackson J on the question of interest. However,
their reasons were very different. Chadwick LJ did not accept that, if paragraph 20(c) had
the meaning for which Devonport contended, it would be unnecessary. It would, for example,
enable the adjudicator to decide whether the circumstances in which the contract provided
for the payment of interest had arisen, the date from which interest was payable under the
contractual provisions and, if not specified in the contract, the rate at which and the basis
on which interest should be paid. Chadwick LJ said that the real question was the effect to
be given to the words ‘in particular’, which precede the three sub-paragraphs (a)–(c) in
paragraph 20 Part 1 of the Scheme. He thought that the words ‘in particular’ should bear
their usual and natural meaning so that what came after them was intended to be a particular-
isation of what had gone before. It elaborated and explained what had gone before but it
did not add to it. Thus he concluded that the adjudicator could decide questions as to inter-
est but only if those questions were matters in dispute that had been properly referred to
him or were questions that the parties had agreed were within the scope of the adjudication
or were questions which the adjudicator considered to be ‘necessarily connected with the
dispute’. Thus, contrary to the judgment of Jackson J, he concluded that there was no free-
standing power to award interest. However, he went on to find that, in that case, the parties
to the dispute agreed that the question of whether interest should be paid on monies out-
standing was within the scope of the adjudication and the parties had conferred on the
adjudicator the jurisdiction to award interest.83
Accordingly, in one sense, the position in relation to interest under paragraph 20(c) has 3.89
been clarified by the decision of the Court of Appeal in Carillion: there remains no free-
standing power on the part of the adjudicator to award interest and paragraph 20(c)
does not provide it. Thus the adjudicator only has the power to award interest if that
issue had been referred to him or had been agreed by the parties to be within the scope of
the adjudication, or was a matter which the adjudicator considered to be necessarily
connected with the dispute. The parties can, as they did in Carillion, give the adjudicator
the jurisdiction to consider questions of interest and, in so doing, confer on an adjudicator
a jurisdiction to award interest that he would not otherwise have had. Otherwise, as in Allen
Wilson Joinery Ltd v Privetgrange Construction Ltd,84 the adjudicator does not have the
jurisdiction to award interest. In that case there was no contractual term permitting
the imposition of interest, it did not arise as a matter of law, and objection was taken by the
responding party at the outset to the referring party’s entitlement to interest.
The decisions in Carillion and Allen Wilson do not address the different question of whether 3.90
an adjudicator has the inherent power to award interest in any event, regardless of paragraph 20.
82 [2005] EWCA Civ 1358, [2006] BLR 15.

83 It is worth noting that this agreement was inferred by the Court of Appeal from relatively scant material.
84 [2008] EWHC 2802 (TCC), [2008] 123 Con LR 1, paragraphs 33–37
119
It may be that a referring party could seek interest in reliance upon the Late Payment of
Commercial Debts (Interest) Act 1998, or as damages for late payment in accordance
with the principle in FG Minter v Dawnays.85 There is, however, no authority as yet for
either proposition.
Costs
3.91 The present position on costs is dealt with in detail in Chapter 10 below, although it is to
be noted that, under the 2009 Act, the law has been significantly altered.86 In short, at
present, an adjudicator does not have the power to order one side to pay the other side’s costs.
In Northern Developments (Cumbria) Ltd v J&J Nichol 87 HHJ Bowsher QC considered an
award of costs made by an adjudicator. The judge concluded that, pursuant to the Scheme,
an adjudicator had no jurisdiction to decide that one party’s costs of the adjudication be
paid by another party. It is respectfully submitted that this is a correct interpretation of the
Scheme: certainly neither paragraph 20 nor, for that matter, paragraph 25, which deals with
fees and expenses, makes any reference to the question of costs. By analogy with the reason-
ing of Chadwick LJ in Carillion, there is therefore nothing in the scheme that gives the
adjudicator a free-standing right to award costs.88
3.92 But, just as the Court of Appeal in Carillion found that the parties had agreed, in that case,
and on those facts, that the adjudicator did have the jurisdiction to decide interest, so, in
Northern Developments, the parties were found by Judge Bowsher to have agreed that the
adjudicator should deal with the question of costs. The judge said at paragraph 44:
Provided they do not detract from the requirements of the Act and the Scheme, the parties
are free to add their own terms and there is no reason why they should not expressly agree that
the Adjudicator should have power to order one party to an adjudication to pay the costs of
the other party. There would be no difficulty if such an agreement were made expressly and
in writing. From a policy point of view, there is much to be said for a requirement that such
an agreement can only be made expressly and in writing.
The judge then went on to conclude that, in the circumstances of that case, there was an implied
agreement between the parties that the adjudicator should have jurisdiction to award costs.
Reasons
3.93 At paragraph 81 of his judgment in Carillion, Jackson J identified three principles relevant
to paragraph 22 of Part 1 of the Scheme, namely the provision by the adjudicator of reasons.
These three propositions follow on from propositions 1 and 2 identified at paragraph 3.72
above. They were:
3. It is often not practicable for an adjudicator to put to the parties his provisional conclusions
for comment. Very often those provisional conclusions will represent some intermediate
position, for which neither party was contending. It will only be in an exceptional case
such as Balfour Beatty Construction Ltd v The Mayor & Burgesses of the London Borough of
Lambeth 89 that an adjudicator’s failure to put his provisional conclusions to the parties
will constitute such a serious breach of the rules of natural justice that the court will
decline to enforce his decision.
85 13 BLR 1.
86
Chapter 4, paragraphs 4.12–4.15.
87
[2000] BLR 158.
88
Aveat is also authority for the general proposition that the adjudicator has no general power to award costs.
89 [2002] EWHC 597 (TCC), [2002] BLR 288.
120
4. During argument, my attention has been drawn to certain decisions on the duty to give
reasons in a planning context. See in particular Save Britain’s Heritage v No 1 Poultry Ltd 90
and South Bucks BC & Anor v Porter (No 2).91 In my view, the principles stated in these cases
are only of limited relevance to adjudicators’ decisions. I reach this conclusion for three
reasons:
(a) Adjudicators’ decisions do not finally determine the rights of the parties (unless all
parties so wish).
(b) If reasons are given and they prove to be erroneous, that does not generally enable the
adjudicator’s decision to be challenged.
(c) Adjudicators often are not required to give reasons at all.
5. If an adjudicator is requested to give reasons pursuant to paragraph 22 of this Scheme, in
my view a brief statement of those reasons will suffice. The reasons should be sufficient to
show that the adjudicator has dealt with the issues remitted to him and what his conclu-
sions are on those issues. It will only be in extreme circumstances, such as those described
by the Lord Justice Clerk in Gillies Ramsay,92 that the court will decline to enforce an
otherwise invalid adjudicator’s decision because of the inadequacy of the reasons given.
The complainant would need to show that the reasons were absent or unintelligible and
that, as a result, he had suffered substantial prejudice.
These three propositions represent clear guidance, both to adjudicators and to those 3.94
involved in adjudication, as to what needs to be included within the adjudicator’s reasons
and what course the adjudicator should follow to make sure that his decision is clear and
intelligible. These propositions were endorsed by Chadwick LJ in the Court of Appeal.93
It should be noted that, subsequently, in Multiplex Constructions (UK) Ltd v West India Quay
Development Co (Eastern) Ltd,94 Ramsey J confirmed that there was no duty to give reasons
unless asked, and that, even if there were, such reasons could be cursory.
It is not uncommon for the unsuccessful party in an adjudication to seek to resist enforce- 3.95
ment on the ground that the adjudicator’s reasons are inadequate. These submissions usually
miss the essential point that, as set out by the Lord Justice Clerk in Gillies Ramsay Diamond
and others v PJW Enterprises Ltd 95 ‘a challenge to the intelligibility of stated reasons can
succeed only if the reasons are so incoherent that it is impossible for the reasonable reader to
make sense of them’. That is a high hurdle to overcome when resisting enforcement. But in
Thermal Energy Construction Ltd v AE & E Lentjes UK Ltd 96 the adjudicator failed to have
any regard to the set-off and counterclaim advanced by the defendant and, in what was
described as a lengthy and carefully-structured decision, he made no express reference at all

to that being one of the issues which he recognised he had to decide. Neither did he say that
it was an issue that he had in fact decided, nor was it included in his written summary of
items decided. The judge therefore concluded that the adjudicator had failed to comply
with his obligation to give reasons for this critical decision. It is submitted that it can some-
times be easier to demonstrate a breach of this obligation when the adjudicator has provided
no reason at all, as opposed to the situation where there are at least some reasons, however
poorly expressed.
90 [1991] 1 WLR 153.

91
[2004] 1 WLR 1953.
92
[2003] BLR 48.
93
[2005] EWCA Civ 1358, [2006] BLR 15, at paragraph 84.
94 [2006] EWHC 1569 (TCC), [2006] 111 Con LR 33.
95 [2003]BLR48.
96 [2009] EWHC 408 (TCC).
121
3.96 There was a significant dispute about the adequacy or otherwise of the adjudicator’s reasons
in Balfour Beatty Engineering Services (HY) Ltd v Shepherd Construction Ltd.97 Having dealt
with a number of the authorities noted above, at paragraph 48 of his judgment, Akenhead J
summarised the current position in these terms:
(a) The decision needs to be intelligible so that parties, objectively, can know what the
adjudicator has decided and why.’
(b) A decision which is wholly unreasoned but which is required to be reasoned is not a
decision for the purposes of the Scheme or under contractual machinery which
requires a reasoned decision. It would therefore not be enforceable as such.
(c) Because the courts have said time and again that the decision cannot be challenged
on the grunds that the adjudicator answered the questions, which he or she was
required to address wrongly, the fact that the reasons given are, demonstrably or
otherwise, wrong in fact or in law or even in terms of emphasis will not give rise to
any effective challenge.
(d) The fact that the adjudicator does not deal with every single argument of fact or law
will not mean that the decision is necessarily unreasoned. He or she should deal with
those arguments which are sufficient to establish the route by which the decision is
reached.
(e) The failure to give reasons is not a breach of natural justice.
(f ) The reasons can be expressed simply. If the reasons are so incoherent that it is impos-
sible for the reasonable reader to make sense of them, it will not be a reasoned
decision.
(g) Adjudicators are not to be judged too strictly, for instance by the standards of judges
or arbitrators, in terms of the reasoning. This reflects the fact that decisions often
have to be reached in a short period of time and adjudicators are often not legally
qualified. It certainly reflects the fact that there has not been a full judicial or arbitral
type process.
(h) The fact that reasoning in a decision is repetitive, diffuse or even ambiguous does not
mean that the decision is unreasoned.
The observation at (d), to the effect that the adjudicator is not required to deal with every
single argument of fact or law, is one that has been repeated in a number of cases. In Amec
Group Ltd v Thames Water Utilities Ltd,98 the TCC judge said that the adjudicator was not
obliged to provide an answer to each and every issue that may be raised in the parties’
submissions, and concluded that it would be absurd to suggest that a failure to address a
particular issue (no matter how trivial) on the face of a written decision amounted to an
automatic breach of natural justice. The judge went on to say that, on an enforcement
application, it was not for the court to pick through every pleaded issue to see if each had
been answered in some way by the adjudicator. What mattered was whether the adjudicator
had attempted fairly to answer the broad question that he had been asked.
3.97 Whether or not the adjudicator has produced a reasoned decision will depend on a proper
interpretation of the document itself, and will not turn on how the adjudicator himself
described it. In Balfour Beatty Construction Northern Ltd v Modus Corovest (Blackpool)
Ltd 99 the contract documents were something of a muddle and the adjudicator’s obliga-
tion to give reasons was buried away in bulky volume of documents and was not expressly
drawn to his attention. Thus, although the adjudicator produced a written decision that
97 [2009] EWHC 2218 (TCC), [2009] 127 Con LR 110.

98 [2010] EWHC 419 (TCC).
99 [2008] EWHC 3029 (TCC), [2009] CILL 2660.
122
contained six or seven pages of typed reasons, he himself said that it was not a reasoned
decision. The TCC judge looked at the detail of the decision to see if it was, in substance,
something different to that for which the parties had contracted. He said that the adjudi-
cator’s own description was not conclusive and that, viewed objectively, the decision
was a reasoned decision that explained clearly how the adjudicator had reached his
conclusions.
Signature
In Treasure & Son Ltd v Martin Dawes 100 the point was taken that, because the adjudicator’s 3.98
decision had not been signed, it was not a valid decision. The argument was put as a matter
of contractual implication. However, Akenhead J concluded that it was simply not neces-
sary on any commercial or practical basis to infer into the contract a term that a decision
that clearly was that of the particular adjudicator had to be signed in order to be effective.
He observed that it was generally desirable for decisions to be signed and, indeed, the vast
majority of decisions that were the subject of court proceedings had been signed. But there
was no need to infer that the parties must have intended that decisions had to be signed
before they could be considered as valid adjudication decisions. The argument was there-
fore rejected.
Effect of the Decision

Paragraphs 23–26 of Part 1 of the Scheme provide as follows: 3.99
23–(1) In his decision, the adjudicator may, if he thinks fit, order any of the parties to comply
peremptorily with his decision or any part of it.
(2) The decision of the adjudicator shall be binding on the parties, and they should
comply with it until the dispute is finally determined by legal proceedings, by
arbitration (if the contract provides for arbitration or the parties otherwise agree to
arbitration) or by agreement between the parties.
24. Section 42 of the Arbitration Act 1996 shall apply to this Scheme subject to the following
modifications—
(a) in sub-section (2) for the word ‘tribunal’ wherever it appears there shall be substituted
the word ‘adjudicator’,
(b) in sub-paragraph (b) of sub-section (2) for the words ‘arbitral proceedings’ there shall
be substituted the word ‘adjudication’,
(c) sub-paragraph (c) of sub-section (2) shall be deleted, and
(d) sub-section (3) shall be deleted.
25. The adjudicator shall be entitled to the payment of such reasonable amount as he may
determine by way of fees and expenses reasonably incurred by him. The parties shall be
jointly and severally liable for any sum which remains outstanding following the making
of any determination on how the payment shall be apportioned.
26. The adjudicator shall not be liable for anything done or omitted in the discharge or
purported discharge of his functions as adjudicator unless the act or omission is in bad
faith, and any employee or agent of the adjudicator shall be similarly protected from
liability.
100 [2007] EWHC 2420 (TCC), [2008] BLR 24.
123
Binding until the Dispute is Finally Determined

3.100 The concept of ‘temporary finality’ has been discussed at paragraphs 2.138–2.143 above.
It is the essence of the adjudication process, as set out in Part 1 of the Scheme, that the
adjudicator’s decision is binding on the parties until it is reviewed either in court or in
arbitration. This is one of the principal reasons why the courts have endeavoured to ensure
that, if the adjudicator has fairly answered the right question, then his decision will be
enforced, no matter whether the court might have come to a different decision on the facts
or on the law.
3.101 In the early days of the adjudication process, the point was sometimes taken that, if the
loser disputed the adjudicator’s decision, that was a dispute within the meaning of s9 of the
Arbitration Act and therefore there should be a stay for arbitration. In the earliest decision
on this point, Absolute Rentals Ltd v Glencor Enterprises Ltd,101 HHJ Wilcox concluded that
by virtue of the 1996 Act and the Statutory Scheme, the determination of the adjudicator
and its enforcement was entirely without prejudice to the final merits and determination
by the arbitrator. As a result, he concluded that no stay for arbitration was appropriate.
He said that the suggestion that the enforcement judgment should be stayed pending the
outcome of the claim because of the claimant’s potentially perilous financial position was
not appropriate because it would frustrate the Scheme. In refusing to grant the stay for
arbitration or to stay the judgment, Judge Wilcox memorably described adjudication as
‘a robust and summary procedure and there may be casualties . . .’.
3.102 Judge Wilcox’s clear reasons for the enforcement of the adjudicator’s decision, and his
refusal to grant a stay for arbitration, were, it is submitted, entirely in accordance with the
principal purpose of the 1996 Act in general and the Scheme in particular. It would
plainly make a nonsense of the adjudication process if the losing party could avoid the
consequences of an adjudicator’s decision by claiming that he disputed that decision and
that that dispute should be referred to arbitration. Although some views have been
expressed to the contrary, it is thought that this principle is entirely unaffected by the
more recent decision of the Court of Appeal in Collins (Contractors) Ltd v Baltic Quay
Management (1994) Ltd,102 previously referred to at paragraph 2.177 above. In that
case, the claim that was stayed for arbitration was an ordinary civil action for sums due
under the final account. For reasons that were unexplained, the contractors had not
pursued their claims in an adjudication. Thus the Court of Appeal had a relatively simple
task in concluding that, because of the clear provisions of the arbitration agreement,
which the parties had agreed, the court proceedings should be stayed pursuant to s9 of
the Arbitration Act. Although there was some discussion in the judgment about s111 of the
1996 Act, this was on a separate point and was wholly unconcerned with the enforcement
of an adjudicator’s decision.
3.103 In the vast majority of cases, the decision that is binding in accordance with paragraph
23(2) is the decision communicated by the adjudicator to the parties. It is submitted that it
is a very rare case that would allow an adjudicator to legitimately revise his original decision
as a result of ‘an obvious slip’. However, as discussed in paragraphs 2.139–2.140 above, the
particular circumstances of Bloor Construction (UK) Ltd v Bowmer & Kirkland (London)
101 CILL July–August 2000, pages 1637–1638.

102 [2004] EWCA Civ 1757, [2005] BLR 63.
124
Ltd 103 persuaded HHJ Toulmin CMG QC that there was an implied term allowing an
adjudicator to correct an error arising from an accidental slip or omission and that the
correction being made within three hours of the incorrect decision was acceptable in all the
circumstances.
Furthermore, there can be no doubt that the parties are obliged to comply with that binding 3.104
decision.104 That is what paragraph 23(2) says in express terms. Although some standard
forms of building contract incorporate provisions that appear to make the adjudicator’s
decision binding, they do not always expressly provide that the parties must comply with it.
However, as HHJ Seymour QC pointed out in Solland International Ltd v Daraydan Holdings
Ltd 105 such provisions can only be sensibly construed as meaning that the decision is binding
and the parties are obliged to comply with it. He relied, as part of his reasoning, on the clear
words of paragraph 23(2).
One area in which it has often been argued that the decision is not binding is where it is 3.105
suggested that the adjudicator had regard to the wrong terms of the contract. In Joinery Plus
Ltd v Laing Ltd 106 HHJ Thornton QC drew a distinction between a situation where the
correct contractual provisions were misconstrued by the adjudicator and where the adjudi-
cator construed and applied the wrong conditions. In the former case, he said, the parties
were clearly bound by the adjudicator’s decision and he explained the Court of Appeal
decision in C&B Scene107 as being such a case. In Joinery Plus, Judge Thornton concluded
that he was dealing with a case where the adjudicator had construed and applied the wrong
conditions and that, as a consequence, the decision was a nullity.
It is difficult not to be sympathetic to Judge Thornton’s proposition in Joinery Plus that, 3.106
given that the adjudicator had decided the case by reference to the wrong set of conditions
and without recourse to the correct contractual documentation, his errors went to the heart
of his jurisdiction and were so fundamental that they meant that he had not merely answered
the right question in the wrong way, but had answered the wrong question altogether. On
the other hand, the problem with this approach is that there may be a fine line between an
error of law that the adjudicator had the jurisdiction to make, and an error of law that meant
that his ultimate decision was outside his jurisdiction. After all, it may be said that a mis-
taken decision, say, as to the extent of the work scope under a contract was not an error of
law but one that went to the fundamental question that an adjudicator should be asking
himself. In addition, it is not easy to reconcile Judge Thornton’s reasoning with the decision
of the Court of Appeal in C&B Scene Concept v Isobars.108 Although Judge Thornton said
that that was a decision where the adjudicator incorrectly applied the agreed terms, that may
not necessarily be an accurate summation of the point in issue in C&B Scene. Moreover,
C&B Scene is itself in some ways an unsatisfactory decision, because some of the important
points that it raised were not fully argued out because only one party was represented.
It is submitted that, save in perhaps exceptional cases, it is inappropriate for a court being 3.107
asked to enforce the decision of an adjudicator to embark on a lengthy investigation into
103
[2000] BLR 314.
104
See, in particular, Chapters 7 and 15.
105
[2002] EWHC 220 (TCC), [2002] 83 Con LR 109.
106 [2003] BLR 184.
107 [2002] BLR 93.
108 [2002] BLR 93.
125
the adjudicator’s consideration of the relevant terms of the contract. It is thought that the
approach of the Court of Appeal in C&B Scene is the one that is applicable in the vast
majority of cases. In that case, the adjudicator had to resolve as a matter of law whether
particular clauses applied or not and, if they did, what their effect was. Even if the adjudi-
cator was wrong as to the application of those clauses, that was not a matter that prevented
the enforcement of the decision. In Allen Wilson Shop Fitters v Anthony Buckingham109
there was a dispute about how the claimant’s financial entitlement arose because of the
employer’s decision to sack the contract administrator. The claim in the adjudication was
put by reference to the payment provisions in the Scheme, rather than the payment
mechanism in the contract. The TCC judge concluded that the precise nature of the
contractual payment machinery was an issue that did not and could not affect the enforce-
ment proceedings; it was a matter for the adjudicator and, whether he was right or wrong,
the court could not review the correctness of that decision in enforcement proceedings.
The TCC judge followed the Court of Appeal in C&B Scene. It is submitted that Joinery
Plus is perhaps best treated as a case on exceptional facts, and not a decision of general
application.
3.108 Paragraph 23(2) of Part I of the Scheme arose in a novel way in GPS Marine Contractors Ltd
v Ringway Infrastructure Services Ltd.110 In that case, Ringway argued that the adjudicator’s
decision was contrary to a position agreed between the parties and that, accordingly, the
court should ratify that agreement as a final determination of the dispute under paragraph
23(2). They sought a declaration under CPR Part 8 to that effect. Ramsey J rejected that
submission, saying that the highest that it could be put was that the adjudicator had made an
error of fact or law that did not deprive him of jurisdiction. Whilst Part 8 proceedings might
be issued in parallel with enforcement proceedings, if the issue under Part 8 was a disputed
matter of fact or law within the adjudicator’s decision, then the existence of those proceedings
would not permit the unsuccessful party to avoid the consequences of the adjudicator’s
decision. It will only give rise to such a result if there was an issue that enabled the court
to come to a final determination of the dispute under Part 8. Only then would the provisions
at paragraph 23(2) and s108(3) of the Act lead to the adjudicator’s decision losing its
temporary binding nature and being replaced by the court’s final determination.111 On the
facts, the judge concluded that the parties had not reached agreement on the dispute as to
payment due for dredging works, and the court could not determine that dispute under
Part 8. At most the parties were agreed that the adjudicator had made an error of fact or law,
but that did not affect the temporarily binding nature of his decision.
Enforcement of Peremptory Orders

3.109 Paragraph 24 of Part 1 of the Scheme incorporates the provisions of s42 of the Arbitration
Act 1996. Section 42 is concerned with the court’s power to make an order requiring a party
to comply with the peremptory order of an arbitrator. Those powers are therefore expressly
provided to the court to ensure that parties comply with decisions of the adjudicator. The
TCC has now developed its own summary procedure by which the decisions of adjudicators
109
[2005] 102 Con LR 154.
110 [2010] EWHC 283 (TCC), [2010] BLR 377.
111 That is precisely what happened in the very particular circumstances of Geoffrey Osborne v Atkins Rail Ltd
[2009] EWHC 2425(TCC), [2010] BLR 363, discussed at paragraphs 14.34-14.35.
126
can be enforced, and the reasons for non-compliance can be examined. This is discussed in
detail in Chapter 16 below.
Fees
Chapter 10 deals in detail with the principles concerned with the adjudicator’s entitlement 3.110
to fees, and their calculation. In respect of adjudications under the Scheme, paragraph 25
of Part 1 sets out the adjudicator’s entitlement to the payment of his fees. In London &
Amsterdam Properties Ltd v Waterman Partnership Ltd 112 there was a complaint about the
adjudicator’s fee proposals, it being argued that the adjudicator’s appointment was at variance
with the Scheme and that therefore the adjudicator had no jurisdiction. HHJ Wilcox
accepted that the adjudicator’s fee proposal included the words ‘for each hour during which
I engage myself upon this adjudication’ which did not appear in the Scheme. However, he
found that, as a yardstick to ascertaining the final entitlement of the adjudicator, an hourly
rate for time actually spent was both sensible and reasonable. Whilst the judge accepted
that the arrangement was notionally open-ended and could therefore be abused by an
inexperienced adjudicator, he concluded that the adjudicator in the instant case was an
experienced professional nominated by the RICS, whose fee proposals were clearly ‘modest
and reasonable by any token’. The judge therefore rejected the submission that the adjudi-
cator’s fee proposals made after his appointment were at variance with the Scheme.
The provisions of paragraph 25 also arose for consideration in Prentice Island Ltd v Castle 3.111
Contracting Ltd.113 In that case the sheriff had concluded that the adjudicator was properly
appointed and that, even if he was wrong about that, so that the adjudicator should have
resigned pursuant to paragraph 9(2) of the Scheme, that did not affect his entitlement to
fees. The sheriff said that it was to be expected that paragraph 25 should be found in that part
of the Scheme dealing with the effects of the decision, since it was the issue of the decision
that exhausted the referral process, and it was at that stage that the adjudicator became
entitled to determine his fee. He considered that it was because of that association that
special provision was made in paragraph 9(4) for the circumstances in which the referral does
not run its full course, thus making it clear that the adjudicator was nevertheless entitled to
be remunerated for the process on which he had been engaged up until that point. Essentially,
the sheriff rejected the suggestion that the adjudicator’s entitlement to fees under paragraph
25 was in any way conditional on the validity of the adjudicator’s decision. Where a decision
was issued, thus bringing to an end the process in respect of which the adjudicator was
appointed, and marking the first occasion on which he could determine the reasonable
amount of his fees and expenses incurred by him in that process, the communication of the
decision triggered the adjudicator’s entitlement to be paid his fees.114
The adjudicator’s entitlement to fees in almost any circumstance that may commonly arise 3.112
is now the subject of the detailed judgment of Ramsey J in Linnett v Halliwells LLP, which
is set out in detail in Chapter 10, paragraphs 10.16 and 10.19–10.20 below. That can now
confidently be said to be the leading case on the adjudicator’s wide-ranging entitlement to
recover his or her fees.
112
[2004] BLR 179.
113
Unreported, 15 December 2003, a decision of R A Dunlop QC, Sheriff Principal in the Sheriffdom of
Tayside Central and Fife.
114 A similar conclusion, albeit for rather different reasons, was reached by Ramsey J in Linnett v Halliwells
LLP [2009] EWHC 319 (TCC), [2009] BLR 312.
127
Part II of the Scheme—Payment

Introduction
3.113 Two points need to be made at the outset. First, although the Scheme set out below remains
in force, and will do so for the foreseeable future, it will eventually be changed to bring it
into line with the new provisions of the 2009 Act. The changes thereby introduced are
dealt with in Chapter 4 below.
3.114 Secondly, the point has already been made that there has been a debate as to whether the
specific provisions within Parts I and II of the Scheme apply to construction contracts as
a means of filling in any gaps in those contacts, or by way of wholesale replacement. This
is particularly important in relation to the provisions in Part II of the Scheme, relating to
payment. It is quite common for construction contracts to include a number of provisions
in relation to payment but to omit one or perhaps two of the specific detailed provisions
set out in Part II. Whilst the point must await final resolution by the Court of Appeal, the
analysis at paragraphs 3.04–3.12 above makes clear that, in any case of non-compliance,
in relation to the adjudication provisions, the Scheme will be implied in its entirety but
that, for the reasons noted in Banner Holdings Ltd v Colchester Borough Council,115 a different
result, namely piecemeal replacement, may be appropriate in respect of the non-compliant
payment provisions.116 That said, by analogy with the operation of the Unfair Contract Terms
Act 1977, it might be argued that a non-compliant term brings down the whole contractual
mechanism, and requires the implication of all the payment terms in the Scheme. Under
UCTA, if a term is unfair, it is struck out altogether. The court does not attempt to redraft
the contract term in question, seeing what can be salvaged and what must be deleted
because it is unfair. If the same approach is adopted here, a contract with, say, payment
terms that did not comply with the 1996 Act in a particular respect could be made subject
to the implication of the Scheme in its totality, rather than leaving the parties with their
rights and liabilities to be the subject of a contract which was created, essentially, by the
court, as a mixture of the terms that had been agreed (where they complied with the Act),
and the terms to be implied from the Scheme (where the express terms did not comply
with the 1996 Act).
Entitlement to and Amount of Stage Payments

3.115 Paragraphs 1 and 2 of Part II of the Scheme provide as follows:
1. Where the parties to a relevant construction contract fail to agree—
(a) the amount of any instalment or stage or periodic payment for any work under the
contract, or
(b) the intervals at which, or circumstances in which, such payments become due under
that contract, or
(c) both of the matters mentioned in sub-paragraphs (a) and (b) above, the relevant provi-
sions of paragraphs 2 to 4 below shall apply.
115 [2010] EWHC 139 (TCC), [2010] 131 Con LR 77.

116 Paragraph 3.12.
128
2–(1) The amount of any payment by way of instalments or stage or periodic payments in
respect of a relevant period shall be the difference between the amount determined
in accordance with sub-paragraph (2) and the amount determined in accordance
with sub-paragraph (3).
(2) The aggregate of the following amounts—
(a) an amount equal to the value of any work performed in accordance with the relevant
construction contract during the period from the commencement of the contract
to the end of the relevant period (excluding any amount calculated in accordance
with sub-paragraph (b)),
(b) where the contract provides for payment for materials, an amount equal to the
value of any materials manufactured on site or brought onto site for the purposes
of the works during the period from the commencement of the contract to the end
of the relevant period, and
(c) any other amount or sum which the contract specifies shall be payable during or in
respect of the period from the commencement of the contract to the end of the
relevant period.
(3) The aggregate of any sums which have been paid or are due for payment by way of
instalments, stage or periodic payments during the period from the commencement of
the contract to the end of the relevant period.
(4) An amount calculated in accordance with this paragraph shall not exceed the difference
between—
(a) the contract price, and
(b) the aggregate of the instalments or stage or periodic payments which have
become due.
Paragraph 1 of Part II of the Scheme emphasises the importance of stage payments. All 3.116
construction contracts must include provisions relating to the amount of such stage pay-
ments, and the intervals at which and the circumstances in which such payments become
due. If the construction contractor does not include some or all of these provisions, then
the detailed provisions in paragraphs 2, 3 and 4 of the Scheme will be implied into the
contract.
Paragraph 2 is concerned with the amount of such stage payments. Put shortly, the amount 3.117
is to be the difference between the amount calculated in accordance with sub-paragraph (2) and
the amount that has been paid, or is due for payment (sub-paragraph (3)). Sub-paragraph (2)
calculates the value of the work done to date, including, where relevant, payments for materials
and other matters specified in the contract. What is the ‘value of work?’ That is defined in
paragraph 12 of Part II of the Scheme as meaning:
An amount determined in accordance with the construction contract under which the
work is performed or where the contract contains no such provision, the cost of any work
performed in accordance with that contract together with an amount equal to any overhead
or profit included in the contract price.
Paragraph 2(2)(a) and paragraph 12 of Part II of the Scheme were considered by HHJ Lloyd 3.118
QC, in Alstom Signalling Ltd v Jarvis Facilities Ltd.117 Judge Lloyd QC commented that, for
the purposes of the Scheme, the value of the work carried out is the value placed upon it by
the proper operation of the construction contract. Under the particular contract in that case,
which involved a certification process, the amount was the amount that Alstom considered
117 [2004] EWHC 1232 (TCC), [2004] 95 Con LR 55.
129
should be included in a certificate, having taken into account any answers to any questions
or queries that they may have had as to the build up of each interim account.
3.119 Most construction and engineering contracts provide for a process by which a third party,
usually the architect or the contract administrator, will issue a certificate identifying the
sum to be paid on an interim basis by the employer. There will usually be a mechanism that
allows the contractor to identify the sums that the contractor says should be included
within that certificate and a period in which the architect or contract administrator con-
siders the claim by the contractor and arrives at his own certification. The sum certified is then
due and must be paid no later than the date specified in the contract. Such an arrangement
would obviate the implication of paragraphs 1 and 2 of the Scheme because it provides for
a system of stage payments.118 Other common forms of contract that would again obviate
paragraphs 1 and 2 of Part II of the Scheme are those that provide for a lump sum payment,
specified in the contract, on a monthly or periodic basis. Other, more simple contracts,
may not make it clear how the stage payments are to be calculated, and it is those contracts in
respect of which paragraphs 1 and 2 of the Scheme are now principally relevant. It is
worth noting that, as a result of the definition of ‘value of work’ in paragraph 12, if the
construction contract contains no provision that would allow the parties to arrive at the
‘value of work’, then the default position is that the contractor is entitled to the cost of the work
that he has performed, together with overheads and profit. Thus, it is plainly in the
employer’s interest to ensure that there is a workable mechanism by which the value of
work can be objectively ascertained. If it cannot, then the employer runs the risk that the
default position will apply, and the contractor will be entitled to his costs, plus an allowance
for overheads and profit.
3.120 Paragraph 2(4) seeks to provide a cap on the amount of any stage payments. The cap is said
to be the difference between the contract price and the aggregate of the instalments
for stage payments. It is slightly unclear what the purpose of paragraph 2(4) really is. If
it is intended to state that the total amount of interim payments cannot be greater
than the contract price, it might not be thought to have added very much, particularly as
paragraph 12 defines the ‘contract price’ as ‘the entire sum payable under the construction
contract in respect of the work’. As Judge Lloyd QC pointed out in Alstom, the use of the
word ‘entire’ is unfortunate because it has connotations of ‘entire contracts’. Judge Lloyd
went on:
It means the final sum due. The Scheme has to cover a wide variety of contracts. It is not to
be assumed that in promulgating Part II of the Scheme the Government was unaware of
re-measurement contracts or other contracts in which the contract price is no more than the
tender sum and the ‘price’ is arrived at by the application of rates and prices to the quantities
of work executed. In order to find out what is meant by the ‘entire sum’ it is necessary to
examine the construction contract, to ascertain the work done under it and then to deter-
mine what is payable for that work. The buffer [the total amount of interim payments could
not be greater than the contract price] may still apply e.g. where interim payments prove to
be over-estimates or other mistaken assessments. It is probably directed to mundane situa-
tions where a contractor or sub-contractor is paid generally on account what is asked for
(e.g. by way of ‘drawings’) which then get close to the total sum payable. It is aimed at
over-payments which are always difficult to recover.
118
This is now expressly recognised by s143 of the 2009 Act.
130
Accordingly, adopting this common sense analysis, Judge Lloyd concluded that, in that case,
the ‘entire sum’ was what turned out to be payable to Jarvis, the contractors, in accordance
with the detailed provisions of the contract.
As noted above, by reason of ss 142–143 of the 2009 Act,119 all of these provisions will have 3.121
to be altered when the new Act (and the new Scheme) come into force. Whilst the new
provisions are perhaps simpler and clearer, the changes will inevitably result in uncertainty,
as well as wholesale amendments to the standard forms. There must also be the risk of a
possible ‘year zero’ effect on all cases decided under the old provisions.
Dates for Payment

Paragraphs 3–7 inclusive of Part II of the Scheme provide as follows: 3.122
3. Where the parties to a construction contract fail to provide an adequate mechanism
for determining either what payments become due under the contract, or when they
become due for payment, or both, the relevant provisions of paragraphs 4 to 7 shall
apply.
4. Any payments of a kind mentioned in paragraph 2 above shall become due on whichever
of the following dates occurs later—
(a) the expiry of seven days following the relevant period mentioned in paragraph 2(1)
above, or
(b) the making of a claim by the payee.
5. The final payment payable under a relevant construction contract, namely the payment of
an amount equal to the difference (if any) between—
(b) the aggregate of any instalment or stage or periodic payments which have become due
under the contract,
shall become due on the expiry of—
(a) 30 days following completion of the work, or
(b) the making of a claim by the payee, whichever is the later.
6. Payment of the contract price under a construction contract (not being a relevant construc-
tion contract) shall become due on
(a) the expiry of 30 days following the completion of the work, or
(b) the making of a claim by the payee, whichever is the later.
7. Any other payment under a construction contract shall become due
(a) on the expiry of seven days following the completion of the work to which the
payment relates or
(b) the making of a claim by the payee,
These paragraphs are implied into a construction contract where that contract does not 3.123
have an adequate mechanism for determining what payments become due under the con-
tract and/or when they become due. Paragraph 4 provides that stage payments become
due on the later of two dates: the expiry of seven days following the relevant period, or
the making of a claim by the payee. The relevant period is defined in paragraph 12 of the
Scheme as being either the period specified in the contract or, if there is no such period, a
period of 28 days. Thus, pursuant to paragraph 4 an interim payment will become due on
the latest of two dates, either the expiry of seven days after the 28-day period, or when the
payee makes a claim for the stage payment.
119
See paragraphs 4.16-4.26.
131
3.124 Paragraph 5 deals with final payments, and provides that the final payment will be due on
the later of two dates: the making of the claim or 30 days following completion of the
work. Paragraph 5 applies to what is called a ‘relevant construction contract’, which is
defined in paragraph 12 as a construction contract ‘other than one which specifies that the
duration of the work is to be less than 45 days or in respect of which the parties agree that
the duration of the work is estimated to be less than 45 days’. Curiously, paragraph 6 applies
to construction contracts that are not relevant construction contracts, which must mean
contracts that specify the duration at less than 45 days or where the parties agree that the
work will take less than 45 days. However, paragraph 6 appears not to differ from paragraph
5 in any relevant particular, providing again that the final date for payment is 30 days after
the completion of the work, or on the date of the making of the claim by the payee, which-
ever is the later.
3.125 Paragraph 7 of Part II of the Scheme appears to be a catch-all provision, which states
generally that any other payment under a construction contract becomes due on the
expiry of seven days following the completion of the work to which the payment relates.
To that extent, therefore, it is consistent with paragraph 4(a), which also refers to the
expiry of seven days following the relevant period. These provisions are also amended by
the 2009 Act: see paragraphs 4.16–4.26 below.
Final Date for Payment
3.126 Paragraph 8 of Part II of the Scheme provides as follows:
8–(1) Where the parties to a construction contract fail to provide a final date for payment in
relation to any sum which becomes due under a construction contract, the provisions
of this paragraph shall apply.
(2) The final date for the making of any payment of the kind mentioned in paragraphs 2,
5, 6 or 7 shall be 17 days from the date that payment becomes due.
3.127 Paragraph 8 of Part II provides that a stage payment that is due must be paid no later than
17 days from the date that it became due. Thus, supposing a contractor started work on
1 January, then, pursuant to paragraph 2(1) he would be entitled to a stage payment in
relation to the work carried out up until 28 January. Pursuant to Clause 4(a) that sum
would become due on 4 February (being seven days after the expiry of the 28-day
period) and that payment would have to be made no later than 21 February (17 days
later).
3.128 There are a number of reported cases in which the contract under consideration failed to
provide a final date for payment, and the provisions of paragraph 8 of Part II of the Scheme
had to be applied. Thus, in Buxton Building Contractors Ltd v The Governors of Durand
Primary School 120 there was no final certificate so there was no mechanism under the con-
tract by which the second tranche of the retention monies would become payable. In
those circumstances, Buxton could and did operate paragraph 8 of Part II of the Scheme.
In the absence of a prescribed date for payment, Buxton issued an invoice for the sum due
120 [2004] EWHC 733 (TCC), [2004] BLR 374.
132
(paragraph 5(b)) and the making of that claim triggered the 17-day period in paragraph
8(2). Similarly, in Hills Electrical and Mechanical Plc v Dawn Construction Ltd 121 the
sub-contractors were desperate to ensure that the 17-day period in paragraph 8(2) applied,
rather than the 28-day period allowed for in the contract, since the parties were agreed that
there was only a valid claim if the final date for payment was 17 days after the payment
became due, rather than 28. The court rejected that case on the grounds that the Scheme
was only implied to the extent that the contract did not expressly provide for a particular
element of the relevant payment provisions. Since this contract did include a provision for
the final date for payment (28 days) there was no room or need to imply the 17 days from
the Scheme. The claim therefore failed.
Payment Notices and Withholding Notices

Paragraphs 9 and 10 of Part II of the Scheme provide as follows: 3.129
Notice specifying amount of payment
9. A party to a construction contract shall, not later than five days after the date on which any
payment—
(a) becomes due from him, or
(b) would have become due, if—
(i) the other party had carried out its obligations under the contract, and
(ii) no set-off or abatement was permitted by reference to any sum claimed to be due
under one or more other contract,
give notice to the other party to the contract specifying the amount (if any) of the payment
he has made or proposes to make, specifying to what the payment relates and the basis on
which that amount is calculated.
Notice of intention to withhold payment
10. Any notice of intention to withhold payment mentioned in Section 111 of the Act
shall be given not later than the prescribed period, which is to say not later than seven days
before the final date for payment determined either in accordance with the construction
contract or where no such provision is made in the contract, in accordance with paragraph
8 above.
The principles relating to the notices specifying the amount of payment and withholding 3.130
notices have been discussed at paragraphs 2.147–2.174 above. It is instructive to work
out precisely how these provisions operate. Let us return to the example of the contractor
who started work on the 1 January pursuant to a contract to which the Scheme applied in
full. In those circumstances, the sum was due to the contractor on 4 February. Accordingly,
no later than 9 February, the payer must make plain to him what sum he is going to pay,
specifying to what the payment relates and the basis on which that amount is calculated.
If a sum is to be deducted then it is often appropriate for any such amount to be identified
in that notice. Paragraph 10 of Part II of the Scheme makes plain that, in any event,
any amount that it is to be withheld must be identified not later than seven days
before the final date for payment. In this example, the final date for payment was 21
February (17 days after 4 February). Thus the withholding notice would have to be issued
no later than 14 February.
121 [2004] SLT 477.
133
3.131 The principal area of contention to which these provisions have given rise is the extent
to which an employer can seek to avoid making payments of the sum due by reference to
cross-claims and other matters. In addition, there were numerous disputes about how
the sum due was calculated, particularly under contracts that did not provide for a certi-
fication regime. The cases dealing with these disputes are set out in detail at Chapter 9
below. Again, it must be noted that these provisions will be radically altered by the 2009
Act: see paragraphs 4.22–4.26 below. In particular, the whole concept of a ‘witholding
notice’ will vanish, to be replaced by ‘a notice of the payer’s intention to pay less than the
notified sum’.
Prohibition of ‘Pay-When-Paid’
3.132 Paragraph 11 of Part II of the Scheme provides as follows:
11. Where a provision making payment under a construction contract conditional on the
payer receiving payment from a third party is ineffective as mentioned in Section 113 of
the Act, and the parties have not agreed other terms for payment, the relevant provisions of—
(a) paragraphs 2, 4, 5, 7, 8, 9 and 10 shall apply in the case of a relevant construction
contract; and
(b) paragraphs 6, 7, 8, 9 and 10 shall apply in the case of any other construction contract.
3.133 This paragraph is perhaps rather less complicated than it looks. Essentially it is providing
that, where a contract contains a prohibited ‘pay-when-paid’ mechanism, the Scheme
provisions, discussed above, will apply in full. The only exception to that is that, for con-
struction contracts for less than 45 days, the relevant paragraph is 6 rather than paragraphs
4 and 5, the difference of course being that, for a shorter contract, it is unnecessary to make
provisions for stage and final payments. The provisions of the 1996 Act dealing with
pay-when-paid clauses are dealt with at paragraphs 2.186–2.190 above. Under the 2009
Act, the prohibition is extended further: see paragraph 4.21 below.
134
4
THE LOCAL DEMOCRACY,
ECONOMIC DEVELOPMENT AND
CONSTRUCTION ACT 2009
Introduction 4.01 Amendments to the Payments

Amendments to the Adjudication Provisions 4.16
Provisions 4.04 Payment Notices 4.16
The Power to Disapply 4.04 The Obligation to Pay the Notified
Contracts in Writing 4.06 Sum and Counter-Notices 4.22
The Slip Rule 4.10 The Contractor’s Right to Suspend 4.27
Costs 4.12
Following concerns expressed by the construction industry on unreasonable delays in

payment, the Government will review the operation of the adjudication and payment
provisions in the [1996] Act to identify what improvements can be made.
The Right Honourable Gordon Brown MP, then Chancellor of the Exchequer, 2004
Introduction
In 2004, the review noted above was ordered and, on 17 September of that year, Sir Michael 4.01
Latham’s supplementary report was presented to the then Construction Minister. The report
suggested various amendments to the 1996 Act, some dealing with the adjudication provisions,
and others endeavouring to simplify the payment process.
There was then a lengthy consultation period, which ultimately lasted for almost five years. In the 4.02
end, the vast bulk of the proposals made by Sir Michael Latham in his follow-up report found
their way into new legislation, the Local Democracy, Economic Development and Construction
Act 2009. It is reproduced at Appendix E. It will be referred to hereafter as the 2009 Act.1 However,
just as the 1996 Act did not come into force until the Scheme had been finalised, two years later,
so the 2009 Act is not currently in force, and will not be until the appropriate revisions have been
made to the Scheme. At the time of writing, no definite date for that has been identified.
Furthermore, even when the new Act comes into force, it will only apply to construction con-
tracts that were entered into on or after that date. Inevitably, therefore, the unamended provisions
of the 1996 Act, addressed in Chapter 2 above, will remain relevant for some years to come.
1
The construction industry remains the UK’s largest single industry. It would be nice to think that one day
it might have its own piece of legislation.
135
4.03 The main changes fall into two categories: changes to the adjudication provisions in the 1996
Act, and changes to the payment provisions. In the former category are:
1. a wide-ranging power on the part of the Secretary of State to disapply the adjudication
provisions;
2. the abolition of the requirement for construction contracts to be in writing;
3. the introduction of an express ‘slip rule’ to allow adjudicators to correct clerical errors;
4. the introduction of a limited right to allocate the costs of adjudication.
The changes in relation to payment provisions include:
1. the replacement of the three-stage notice provisions with a simpler two-stage process;
2. the abolition of the withholding notice and their replacement with ‘a notice of the payer’s
intention to pay less than the notified sum’;
3. clarifying and effectively limiting the scope of the decision in Melville Dundas v George
Wimpey2 in relation to the giving of notice to an insolvent contractor;
4. the widening of the prohibition on pay-when-paid clauses; to supplement and enhance
the contractor’s right to suspend work in the event of non-payment.
Amendments to the Adjudication Provisions

The Power to Disapply
138 Application of construction contracts legislation
(1) The Housing Grants, Construction and Regeneration Act 1996 (c. 53) is amended as
follows.
(2) In section 106 (provisions not applicable to contract with residential occupiers), in
subsection (1), omit paragraph (b) and the preceding ‘or’.
(3) After that section insert—
‘106 A Power to disapply provisions of this Part
(1) The Secretary of State may by order provide that any or all of the provisions of this Part,
so far as extending to England and Wales, shall not apply to any description of construction
contract relating to the carrying out of construction operations (not being operations in
Wales) which is specified in the order.
(2) The Welsh Ministers may by order provide that any or all of the provisions of this Part, so
far as extending to England and Wales, shall not apply to any description of construction
contract relating to the carrying out of construction operations in Wales which is specified
in the order.
(3) The Scottish Ministers may by order provide that any or all of the provisions of this Part,
so far as extending to Scotland, shall not apply to any description of construction contract
which is specified in the order.
(4) An order under this section shall not be made unless a draft of it has been laid before and
approved by resolution of—
(a) in the case of an order under subsection (1), each House of Parliament;
(b) in the case of an order under subsection (2), the National Assembly for Wales;
(c) in the case of an order under subsection (3), the Scottish Parliament.’
2 [2007] UKHL 18, [2007] BLR 257.
136
The Local Democracy, Economic Development and Construction Act 2009
(4) In section 146 (orders etc)—

(a) in subsection (2), for ‘Secretary of State’ substitute ‘ the authority making them’;
(b) in subsection (3)(a), after ‘106(4)’ insert ‘, 106A’.
Section 106 of the 1996 Act excluded contracts with residential occupiers from the scope of 4.05
the 1996 Act. Although s138 of the 2009 Act purports to be an amendment to this provision,
in truth the basic exclusion remains unamended. Instead, the amendments to s106, which
are in the form of a new s106A, give the Secretary of State the power to provide ‘by order’ that
any or all of the adjudication provisions of the 1996 Act ‘shall not apply to any description
of construction contract relating to the carrying out of construction operations . . . which is
specified in the order’. On the face of it, this is a very wide power. It seems odd that the
Secretary of State should wish to reserve the power to order, presumably by statutory instrument,
that contracts that would otherwise be the subject of the adjudication process will, for whatever
reason, not be the subject of the adjudication process. It is not clear why such a power was
thought to be necessary in the light of s106(1)(b) of the 1996 Act. Moreover, if adjudication
in the construction industry has been the success that most commentators believe, why is it
necessary to preserve the possibility of taking particular construction contracts outside the
adjudication regime altogether?
Contracts in Writing
Section 139 of the 2009 Act provides as follows: 4.06
139 Requirement for construction contracts to be in writing
(1) In the Housing Grants, Construction and Regeneration Act 1996, section 107 (provi-
sions applicable only to contracts in writing) is repealed.
(2) In section 108 of that Act (right to refer disputes to adjudication)—
(a) in subsection (2), after ‘The contract shall’ insert ‘ include provision in writing so as to’;
(b) in subsections (3) and (4), after ‘provide’ insert ‘ in writing’.
This is the long-awaited amendment whereby the present restriction, that adjudication only 4.07
applies to construction contracts in writing, is abolished altogether. Superficially, it might be
thought that this was a good idea, because of the unintended complexity that has surrounded
the debate about whether or not a particular contract was in writing.3 The requirement for
construction contracts to be in writing is deleted in its entirety. Thus, the consequential changes
to s108 are that the construction contract must contain the adjudication provisions in writing;
if the contract does not contain those provisions, then the Scheme will be implied.
The underlying difficulty with this amendment has been ventilated in a variety of places, but 4.08
never satisfactorily addressed. Whilst it is thought that adjudicators will not have any particular
difficulty in dealing with a typical dispute about whether or not a particular term was agreed
orally, commercial judges know that disputes over oral terms or variations often flow seamlessly
into a dispute about whether or not there was a binding contract at all. Disputes about
whether or not an important term or condition was ever agreed often bring with them the
contention by one or other party that, if that term was not agreed, there was no intention to
create legal relations. Of course, if there was no binding contract between the parties, so that
there was no construction contract at all, the adjudicator would have no jurisdiction.
3 That complexity can, perhaps, be illustrated by the fact that even a summary of the cases on this topic runs
to 35 paragraphs, at paragraphs 2.51–2.86.
137
4.09 Accordingly, there can be no doubt that this new provision will add a considerable burden to
the work of adjudicators, and indeed the courts that are asked to enforce their decisions. In
a complex case, with assertion and counter-assertion as to what was agreed at meetings that
may have been scantily minuted, and potentially complex arguments about contract/no
contract, the adjudicator will probably have to hold a hearing, with oral evidence and cross-
examination (because otherwise there will be no way of satisfactorily testing whether or not
there has been an oral agreement) and reach a conclusion as to the existence or otherwise of
a contract and its terms, before then going on to assess the actual claim being made. In some
cases, it may be impossible to undertake that task fairly within the 28-day timetable. In addition,
there will doubtless be occasions when the adjudicator, having undertaken that task, will be
bound to conclude that there was no contract, and therefore he or she has no jurisdiction
whatsoever. Presumably they would then resign.
The Slip Rule

140 Adjudicator’s power to make corrections
In the Housing Grants, Construction and Regeneration Act 1996 (c. 53), in section 108 (right
to refer disputes to adjudication), after subsection (3) insert—
‘(3A) The contract shall include provision in writing permitting the adjudicator to correct his
decision so as to remove a clerical or typographical error arising by accident or omission.’
4.11 It was probably sensible for the slip rule, discussed at paragraphs 8.26–8.35 below, to be set
out in statutory form, although the necessity for doing so must be questionable given that,
following the decision in Bloor Construction (UK) Ltd v Bowmer & Kirkland (London) Ltd,4
the existence of such a rule has never been doubted. It is also surprising that, given that it
was thought necessary to add this provision to s108 of the 1996 Act, a time period during
which this right could be exercised was not expressly identified. The courts have operated on
the basis that, if a party wished to exercise its right under the slip rule, it had to do so
promptly. It would have been helpful if such a provision had been expressly identified in
s140. It is to be hoped that the revised Scheme includes a specific time period during which
this right can be exercised.
Costs
141 Adjudication costs
In the Housing Grants, Construction and Regeneration Act 1996, after section 108 insert—
‘108A Adjudication costs: effectiveness of provision
(1) This section applies in relation to any contractual provision made between the parties to
a construction contract which concerns the allocation as between those parties of costs
relating to the adjudication of a dispute arising under the construction contract.
(2) The contractual provision referred to in subsection (1) is ineffective unless—
(a) it is made in writing, is contained in the construction contract and confers power on
the adjudicator to allocate his fees and expenses as between the parties, or
(b) it is made in writing after the giving of notice of intention to refer the dispute to
adjudication.’
4
[2000] BLR 314.
138
These are, on their face, curious provisions. They seem designed, at least in part, to deal with 4.13
the unfortunate problem that arose in Bridgeway Construction Ltd v Tolent Construction
Ltd 5 where a party who wished to bring a claim in adjudication proceedings had to pay the
other side’s costs of making that claim, whether it was successful or not. But that position has
now been resolved by the decision of Edwards-Stuart J in Yuanda (UK) Co Ltd v WW Gear
Construction Ltd,6 which arguably renders the need for this amendment redundant.
Furthermore, it is not quite clear what sort of provision is being outlawed, and what sort of 4.14
provision the parties can agree. The new s108A(1) refers to a contractual provision concerning
the allocation of costs. That might cover, for example, a written agreement between the parties
(either in the contract or after the adjudication notice) that the adjudicator should have the
power to award to the winner his costs to be paid by the loser. On one view of sub-s (2), such
a provision may not be ineffective, provided that it was in writing and it also allowed the
adjudicator to allocate his fees and expenses as between the parties. But such an argument is
perhaps contrary to the original aim of the new legislation, which was apparently to outlaw
the parties’ ability to pre-allocate costs.
An agreement to allow the adjudicator to allocate costs on the basis of the result, or the adju- 4.15
dicator’s perception of the result, may be thought to be a commercially sensible result, but it
may be that s108A(2)(a) was intended to be limited to an agreement as to the adjudicator’s
fees, rather than the costs as a whole. If so, the clause could have been put in rather different
terms. There is an internal inconsistency in the wording adopted, because sub-s (1) talks
about the ‘costs relating to the adjudication’, whilst sub-s (2) refers to the adjudicator’s ‘fees
and expenses’, which can often be only a small part of those costs. Doubtless these and other
difficulties will only emerge on disputed enforcement applications.
Amendments to the Payment Provisions

Payment Notices
Sections 142 and 143 of the 2009 Act provide as follows: 4.16
142 Determination of payments due
(1) In the Housing Grants, Construction and Regeneration Act 1996, section 110 (dates for
payment) is amended as follows.

(2) After subsection (1) insert—
‘(1A) The requirement in subsection (1)(a) to provide an adequate mechanism for deter-
mining what payments become due under the contract, or when, is not satisfied where
a construction contract makes payment conditional on—
(a) the performance of obligations under another contract, or
(b) a decision by any person as to whether obligations under another contract have
been performed.
(1B) In subsection (1A)(a) and (b) the references to obligations do not include obligations
to make payments (but see section 113).
(1C) Subsection (1A) does not apply where—
(a) the construction contract is an agreement between the parties for the carrying
out of construction operations by another person, whether under sub-contract or
otherwise, and
5
[2000] CILL 1662.
6
[2010] EWHC 720 (TCC), [2010] BLR 435.
139
(b) the obligations referred to in that subsection are obligations on that other per-
son to carry out those operations.’
(3) After subsection (1C) (as inserted by subsection (2) above) insert—
‘(1D) The requirement in subsection (1)(a) to provide an adequate mechanism for deter-
mining when payments become due under the contract is not satisfied where a con-
struction contract provides for the date on which a payment becomes due to be
determined by reference to the giving to the person to whom the payment is due of
a notice which relates to what payments are due under the contract.’
143 Notices relating to payment
(1) In the Housing Grants, Construction and Regeneration Act 1996 (c. 53), in section 109
(entitlement to stage payments), in subsection (4), for ‘under the contract’ substitute
‘provided for by the contract’.
(2) In section 110 of that Act (dates for payment), omit the following—
(a) subsection (2), and
(b) in subsection (3), ‘or (2)’.
(3) After section 110 of that Act insert—
110A Payment notices: contractual requirements
(1) A construction contract shall, in relation to every payment provided for by the
contract—
(a) require the payer or a specified person to give a notice complying with subsection
(2) to the payee not later than five days after the payment due date, or
(b) require the payee to give a notice complying with subsection (3) to the payer or a
specified person not later than five days after the payment due date.
(2) A notice complies with this subsection if it specifies—
(a) in a case where the notice is given by the payer—
(i) the sum that the payer considers to be or to have been due at the payment due
date in respect of the payment, and
(ii) the basis on which that sum is calculated;
(b) in a case where the notice is given by a specified person—
(i) the sum that the payer or the specified person considers to be or to have been
due at the payment due date in respect of the payment, and
(ii) the basis on which that sum is calculated.
(a) the sum that the payee considers to be or to have been due at the payment due
date in respect of the payment, and

(b) the basis on which that sum is calculated.
(4) For the purposes of this section, it is immaterial that the sum referred to in subsection
(2)(a) or (b) or (3)(a) may be zero.
(5) If or to the extent that a contract does not comply with subsection (1), the relevant
provisions of the Scheme for Construction Contracts apply.
(6) In this and the following sections, in relation to any payment provided for by a
construction contract—
• “payee” means the person to whom the payment is due;
• “payer” means the person from whom the payment is due;
• “payment due date” means the date provided for by the contract as the date on
which the payment is due;
• “specified person” means a person specified in or determined in accordance with
the provisions of the contract.
110B Payment notices: payee’s notice in default of payer’s notice
(1) This section applies in a case where, in relation to any payment provided for by a con-
struction contract—
140
(a) the contract requires the payer or a specified person to give the payee a notice
complying with section 110A(2) not later than five days after the payment due
date, but
(b) notice is not given as so required.
(2) Subject to subsection (4), the payee may give to the payer a notice complying with
section 110A(3) at any time after the date on which the notice referred to in subsec-
tion (1)(a) was required by the contract to be given.
(3) Where pursuant to subsection (2) the payee gives a notice complying with section
110A(3), the final date for payment of the sum specified in the notice shall for all
purposes be regarded as postponed by the same number of days as the number of days
after the date referred to in subsection (2) that the notice was given.
(4) If—
(a) the contract permits or requires the payee, before the date on which the notice
referred to in subsection (1)(a) is required by the contract to be given, to notify
the payer or a specified person of—
(i) the sum that the payee considers will become due on the payment due date in
respect of the payment, and
(ii) the basis on which that sum is calculated, and
(b) the payee gives such notification in accordance with the contract, that notification
is to be regarded as a notice complying with section 110A(3) given pursuant to
subsection (2) (and the payee may not give another such notice pursuant to that
subsection).’
The basic entitlement of a party to receive regular payments under a construction contract 4.17
has not been altered by these provisions. The construction contract still needs to provide an
adequate mechanism for determining what payments are due and to provide a final date for
the payment of each amount. However, these changes do introduce a new payment procedure
and, so it is thought, they provide a clearer and more certain regime.
The effect of these amendments will be the introduction of a two- (or potentially three-) stage 4.18
process. Stage 1 requires the payer (ie the employer, or the main contractor under a sub-
contract) to give a payer’s notice, specifying the sum considered to be due. The notice must
identify not only the amount due but the basis on which that sum has been calculated. It
then becomes a notified sum. The notice must be served not later than five days after the
payment due date in the contract. Importantly, the payer notice can be given by a third party
(‘a specified person’), so under large contracts, this notice will be given either with or in the
form of an architect’s certificate or a quantity surveyor’s evaluation. The sum due becomes
the ‘notified sum’. A payer’s notice is required even if the amount due is zero.
If there is no payment notice from the employer or the main contractor in accordance with the 4.19
contract, then the process moves to stage 2: the payee (ie the contractor or sub-contractor
under a sub-contract) can provide its own notice pursuant to the new s110B. The payee’s
notice will identify the sum claimed to be due and the basis on which that sum is calculated.
It must be served promptly, because the final date for payment is postponed by the number of
days that it took the payee to issue the notice following the payer’s failure to provide a payer’s
notice. The provisions make plain that, in the absence of a payee’s notice, sums are not due and
the payee will not be entitled to exercise collateral rights such as its right to suspend perfor-
mance. Thus, the payee must, in its own interests, serve a payee notice. In practice, it is likely
that the payee will be able to comply easily with this arrangement because he will probably have
already submitted a payment application (as part of the valuation/payment process) to the
141
employer or the main contractor. In those circumstances, that payment application is deemed
to be the payee notice, and the payee will not be required to issue a separate payee notice.
4.20 It is thought that these provisions will constitute an improvement on the existing regime.
On any larger contract there will be a valuation/payment process and the regular issue of
payer notices, accompanied by certificates and detailed evaluations, will form the basis of
the contractor’s entitlement to interim payments. But the provisions make plain that the
employer or main contractor (and/or his team) will need to make sure that payer notices are
issued promptly because otherwise the payee will become entitled to the sum for which it
originally applied, no matter how exaggerated the payer might say that was.
4.21 In the context of payment and notice, it should be noted that the new s110(1A) seeks to
outlaw provisions in a construction contract that make payment conditional on the perfor-
mance of obligations under another contract or conditional upon a decision by any person
as to whether obligations under another contract have been performed. Thus, a payment
mechanism cannot now seek to link the right to be paid to obligations owed under another
contract. This is a potentially important expansion of the original prohibition on pay-when-
paid arrangements. On the face of it, this might include the situation where the main con-
tractor is not paid for the sub-contractor’s work under the main contract, but where the
sub-contractor claims the right to be paid under the sub-contract (because, for example,
there is no payer notice). However, it appears that another new section, namely s110(1C), is
designed to exclude from the prohibition that sort of situation. It is not easy to differentiate
between sub-s (2)(1A) and sub-s (2)(1C), and it is thought that these provisions are likely to
fall to be considered by the courts sooner rather than later.
The Obligation to Pay the Notified Sum and Counter-Notices

144 Requirement to pay notified sum
(1) In the Housing Grants, Construction and Regeneration Act 1996 (c. 53), for section 111
(notice of intention to withhold payment) substitute—
‘111 Requirement to pay notified sum
(1) Subject as follows, where a payment is provided for by a construction contract, the
payer must pay the notified sum (to the extent not already paid) on or before the final
date for payment.
(2) For the purposes of this section, the “notified sum” in relation to any payment pro-
vided for by a construction contract means—
(a) in a case where a notice complying with section 110A(2) has been given pursuant
to and in accordance with a requirement of the contract, the amount specified in
that notice;
(b) in a case where a notice complying with section 110A(3) has been given pursuant
to and in accordance with a requirement of the contract, the amount specified in
that notice;
(c) in a case where a notice complying with section 110A(3) has been given pursuant
to and in accordance with section 110B(2), the amount specified in that notice.
(3) The payer or a specified person may in accordance with this section give to the payee
a notice of the payer’s intention to pay less than the notified sum.
(4) A notice under subsection (3) must specify—
(a) the sum that the payer considers to be due on the date the notice is served, and
142
It is immaterial for the purposes of this subsection that the sum referred to in
paragraph (a) or (b) may be zero.
(5) A notice under subsection (3)—
(a) must be given not later than the prescribed period before the final date for payment, and
(b) in a case referred to in subsection (2)(b) or (c), may not be given before the notice by
reference to which the notified sum is determined.
(6) Where a notice is given under subsection (3), subsection (1) applies only in respect of the
sum specified pursuant to subsection (4)(a).
(7) In subsection (5), “prescribed period” means—
(a) such period as the parties may agree, or
(b) in the absence of such agreement, the period provided by the Scheme for Construction
Contracts.
(8) Subsection (9) applies where in respect of a payment—
(a) a notice complying with section 110A(2) has been given pursuant to and in accor-
dance with a requirement of the contract (and no notice under subsection (3) is
given), or
(b) a notice under subsection (3) is given in accordance with this section, but on the
matter being referred to adjudication the adjudicator decides that more than the
sum specified in the notice should be paid.
(9) In a case where this subsection applies, the decision of the adjudicator referred to in
subsection (8) shall be construed as requiring payment of the additional amount not
later than—
(10) Subsection (1) does not apply in relation to a payment provided for by a construction
contract where—
(a) the contract provides that, if the payee becomes insolvent the payer need not pay any
sum due in respect of the payment, and
(b) the payee has become insolvent after the prescribed period referred to in subsection
(5)(a).
(11) Subsections (2) to (5) of section 113 apply for the purposes of subsection (10) of this
section as they apply for the purposes of that section.’
(2) In section 112 of that Act (right to suspend performance for non-payment)—
(a) in subsection (1), for the words from ‘Where’ to ‘given’ substitute ‘Where the
requirement in section 111(1) applies in relation to any sum but is not complied
with,’;
(b) in subsection (3), for ‘the amount due’ substitute ‘the sum referred to in subsection (1)’.
The basic obligation on the part of the payer to pay the notified sum on or before the final 4.23
date for payment remains unchanged. But where there is a change is in relation to withholding
notices. There was a complaint that was recognised in the second Latham Report that
employers were being penalised, and being required to pay exaggerated claims, because of
their failure to serve withholding notices, although many thought this was a critical part of
the original thinking behind the first Report and the Act. In any event, the new s111 was
designed to provide a more balanced system.
In essence, there are five critical elements of the new provision: 4.24
1. Whatever the dispute may be in relation to the sum payable, the payer must pay the
notified sum on or before the final date for payment, unless the payer issues under s111
143
‘a notice of the payer’s intention to pay less than the notified sum’. This unsnappily-titled
document is referred to below as ‘a counter-notice’.
2. The counter-notice must be given not later than the prescribed period, which is either
that agreed by the parties or, in default of agreement, that set out in the Scheme. The
counter-notice must set out the sum that the payer considers due and the basis for the
calculation of that sum.
3. The payer will be required to pay the amount that it considers due, that is to say the
amount identified in the counter-notice, before the final date for payment.
4. Where the amount of payment is disputed, and the adjudicator determines that a further
amount is due, that sum must be paid not later than seven days after the adjudicator’s
decision, or the date which would have been the final date for payment, whichever is the
later. It is thought that in the vast majority of cases that would be seven days after the
adjudicator’s decision.
5. The current provisions, which entitle a payer to serve a notice that serves both as a payment
notice and a withholding notice, are deleted. Thus, the payer must serve both a payer’s notice
and a counter-notice in accordance with the new s111 within the periods identified.
4.25 In essence, therefore, the withholding notice regime will go and be replaced by a new regime
of notices ‘to pay less than the notified sum’. Notwithstanding that change, it is thought
likely that the authorities dealing with withholding notices, and in particular the importance
of their provision within the times identified in the Scheme or in the contract, will remain of
relevance. But there is also a potential for confusion, with the payer providing two notices, a
few days apart, with different figures, each of which will purport to be the sum that the payer
considers to be due.
4.26 Finally, it should be noted that new s111(10) also seeks to clarify the scope of the decision of
the House of Lords in Melville Dundas Ltd (in receivership) v George Wimpey.7 That was the
case in which, somewhat surprisingly, the House of Lords decided that monies could be
withheld notwithstanding the absence of a s111 notice, where the payee became insolvent
during the prescribed period for payment. The new provision makes plain that that right is
not automatic, and that the paying party can only withhold money in such circumstances if
its right so to do is made expressly plain in the written construction contract. Under the new
provisions, the payer will be entitled to avoid paying the notified sum in insolvency situa-
tions where that is expressly permitted by the contract and the insolvency occurred after the
expiry of the time for the giving of the counter-notice. In this way, the scope of the decision
in Melville Dundas has been restricted, as suggested in the subsequent case of Pierce Design
International Ltd v Mark Johnston and Another.8
The Contractor’s Right to Suspend

145 Suspension of performance for non-payment
(1) In the Housing Grants, Construction and Regeneration Act 1996 (c. 53), section 112
(right to suspend performance for non-payment) is amended as follows.
(2) In subsection (1), after ’performance of ’ insert ‘ any or all of ’.
7 [2007] UKHL 18, [2007] BLR 257.

8 [2007] EWHC 1691 (TCC), [2007] BLR 381.
144

‘(3A) Where the right conferred by this section is exercised, the party in default shall be
liable to pay to the party exercising the right a reasonable amount in respect of
costs and expenses reasonably incurred by that party as a result of the exercise of
the right.’
(4) In subsection (4), after ‘pursuance of ’ insert ‘, or in consequence of the exercise of ’.
The contractor retains the right to suspend work and under the new s112 that right has been 4.28
enhanced in three ways. First, the contractor can choose whether to suspend all of the works
or just part of the works. Secondly, the contractor has the express right to recover the costs
and expenses reasonably incurred as a result of the suspension of work. That will now include
demobilisation and remobilisation costs; on a large contract, such costs are not insignificant.
Thirdly, the contractor has an additional entitlement to extra time for the consequential
delays of the suspension. The extension of time will cover not only the period of suspension
but the time that may be required to return the contractor’s operations to full capacity once
the suspension has come to an end. That is a significantly enhanced right.
145
Part II
OTHER FORMS OF ADJUDICATION
5. Contractual Adjudication 149

6. Ad Hoc Adjudication 185
5
CONTRACTUAL ADJUDICATION
The Importance of the Contractual The JCT Adjudication Agreement 5.42

Provisions 5.01 The Standard Forms of Sub-Contracts 5.44
The JCT 1998 Form 5.08 DOM/1 5.44
Nomination and Appointment 5.09 DOM/2 5.55
Referral within 7 Days 5.13 Other Standard Forms of Contract 5.64
More than one Dispute 5.19 GC/Works 5.64
‘Impartially’ 5.20 The ICE form of Engineering Contract 5.68
Non-Compliance 5.21 NEC/2 5.74
28 Days 5.23 NEC/3 5.75
‘Binding’ 5.27 Contracts for Professional Services 5.76
Final Certificates 5.29
Adjudication Rules 5.77
Determination 5.30
The TeCSA Rules 5.77
Oral Variations 5.31
The CEDR Rules 5.87
Payment Provisions 5.32
The CIC Model Adjudication Procedure 5.88
Other Forms of JCT Contract 5.36
It seems to me that if the contractual adjudication provisions comply with the Act,
then they must be at the forefront of the court’s consideration of the parties’ respective
rights and liabilities. I would respectfully venture the opinion that, in some of the
reported cases, the focus has been too much on the 1996 Act (and s.108 in particular)
and not enough on the relevant terms of the parties’ contract.
His Honour Judge Coulson QC in Cubitt Building and
Interiors Ltd v Fleetglade Ltd 1
The Importance of the Contractual Provisions

The 1996 Act requires all construction contracts to have an adjudication procedure that 5.01
complies with s108: see s108(5). The same section makes plain that if the construction con-
tract in question does not contain adjudication provisions that comply with s108 (1)–(4),
then the Scheme for Construction Contracts will apply. It is therefore envisaged that the
construction contract will include its own adjudication provisions. All of the standard forms
of building and engineering contracts have been amended to include provisions, which can
often be quite lengthy, to provide for adjudication. Some of those provisions, and the
adjudication rules that have also been produced for incorporation into such contracts,
are dealt with below. However, before dealing with some of the points that have arisen on
1 [2006] EWHC 3413 (TCC), [2006] 110 Con LR 36.
149
Other Forms of Adjudication
those express terms and particular rules, it is important first to consider the interplay between
the contractual provisions, the 1996 Act and the Scheme.
5.02 If a construction contract contains a set of adjudication provisions, the first question to be
asked is whether those provisions comply with s108 (1)–(4) of the 1996 Act. If they do
not, the Scheme applies.2 If, on the other hand, the adjudication provisions in the con-
struction contract do comply with s108, those contractual provisions become determinative
of the parties’ rights and obligations in respect of adjudication. In Cubitt Building and
Interiors Ltd v Fleetglade Ltd,3 the parties were agreed that the contract contained provisions
which complied with the 1996 Act and that, in those circumstances, all that mattered were
those contractual provisions. The TCC judge expressly accepted the proposition that, whilst
the parties could not contract out of the 1996 Act, if the contractual provisions complied
with the Act, then they had to be at the forefront of the court’s consideration of the parties’
respective rights and liabilities. The judge went on to suggest that, in some at least of the
reported cases, too great an emphasis had been placed upon the operation of s108, and not
enough on the relevant contractual provisions.4
5.03 Accordingly, provided that the relevant contractual provisions comply with s108 of the
1996 Act, it does not matter if they contain additional or supplementary provisions. The
mere fact that the contractual provisions contain terms that are different to those envisaged
by the 1996 Act does not matter, provided always that the requirements of the 1996 Act
are included within those provisions. Provisions that add to the basic requirements of the
Act are perfectly acceptable; provisions that alter or omit those basic requirements are not.
5.04 On the other hand, the fact that the parties have agreed a particular form of contract
that contains a compliant adjudication procedure means that it is not necessary for that
contract to meet the other requirements of the 1996 Act. For example, a contract may contain
a fully-operable adjudication mechanism, but it may also have been made in part orally, or
subject to significant oral variations. Such a contract would not comply with s107 of the Act,
but such non-compliance will simply not matter. Thus in Treasure and Sons Ltd v Dawes 5
the judge concluded that, where there was a contractual agreement to adjudicate, that adju-
dication process was not undermined, jurisdictionally or otherwise, by the fact that the terms
of the original contract were orally varied. He held that the parties had agreed that disputes
would be referable to adjudication so that, if there was some oral variation to the terms of
their contract, that did not itself undermine the binding effect of the adjudication process
set out in the contract.6
5.05 It will sometimes be the case that, although the parties have contracted on a standard form,
which has been amended in an attempt to comply with the 1996 Act, that contract may, on
analysis, fail to comply with the basic requirements of the Act, in which case the Scheme will
2 At paragraphs 3.04-3.12 there is a discussion of whether, if some terms comply and some do not, the
Scheme is incorporated piecemeal or in full. At least in relation to the adjudication provisions, the answer is now
plain: even if the non-compliance is partial, the incorporation of the Scheme will be ‘lock, stock and barrel’.
3 [2006] EWHC 3413 (TCC), [2006] 110 Con LR 36,
4
For example, in William Verry v North West London Communal Mikva [2004] BLR 3008, the TCC judge’s
approach was based on a careful analysis of s108, not the operative words of the contract which, potentially at
any rate, had a different emphasis.
5 [2007] EWHC 2420 (TCC), [2008] BLR 24.
6 That view was confirmed by Ramsey J in Linnett v Halliwells LLP [2009] EWHC 319 (TCC), [2009]
BLR 312.
150
Contractual Adjudication
apply. So, in David McLean Housing Contractors Ltd v Swansea Housing Association Ltd,7 the
parties contracted on the JCT 1981 form (with Contractor’s Design), which had been
amended to allow for adjudication. However, the unfortunate manner in which the contract
documents were compiled, which included deletions, additions and various omissions, led
the judge to conclude that the contract did not meet the requirements of s108 of the 1996
Act and the Scheme took effect instead.
The failure of the contract to comply with the 1996 Act will not be limited to the precise 5.06
adjudication provisions that it contains. It is, of course, necessary for all construction con-
tracts to contain the relevant provisions for interim and final payment set out in ss109
and 110. Thus, in the same way, a standard form contract may, on the face of it, comply
with those provisions, but may have been amended or otherwise altered such that the
contract actually made does not comply with the 1996 Act. In that event the Scheme for
Construction Contracts would be incorporated into the contract instead. Thus, in C & B
Scene Concept Design Ltd v Isobars Ltd,8 the payment provisions in the JCT form required the
parties to elect which of two alternatives for interim payments they had chosen. The parties
failed to make that choice and, therefore, there were no contractual provisions as to how
much should be paid by interim payments and when those payments should be made. Thus
the Scheme was implied.9 A different sort of difficulty arose in Buxton Building Contractors
Ltd v The Governors of Durand Primary School.10 There, although the contract envisaged that
the second tranche of the retention fund would be released by way of a final certificate, the
contract administrator chose not to issue a final certificate, but instead issued an interim
certificate requiring the employer to pay the second tranche of the retention monies. That
was not a certificate authorised by the JCT form. In those circumstances, as the judge noted,
the contractor operated paragraph 8 of Part II of the Scheme for Construction Contracts,
which applied to claims for payment where there were no adequate contractual payment
provisions.11
There is one last, but potentially very important, general point to be made about contractual 5.07
adjudication. A view has been expressed that, whilst an adjudicator can make errors of law
and fact in statutory adjudications, which will not affect the validity and enforceability of the
decision, the same is not true of a decision in a purely contractual adjudication. The high
watermark of this argument can be seen in Steve Domsalla (t/a Domsalla Building Services)
Ltd v Kenneth Dyason,12 where HHJ Thornton QC decided that what he called the
‘unreviewable error doctrine’ arose out of the statutory underpinning of adjudication, so as
to give effect to the statutory policy of a contractor’s cash flow. He said that a consumer
contract was not subject to that same policy. The obvious difficulty with this approach is that
it would give rise to major differences on enforcement, depending solely on the original basis
of the appointment of the adjudicator. In addition, this view might be said to ignore the
7 [2002] BLR 125.

8 [2002] BLR 93.
9 A similar result eventuated in Allen Wilson v Buckingham [2005] EWHC 1165 (TCC), [2005] 102 Con
LR 154. In both cases, this potential confusion formed the basis of a plea by the losing party that the adjudicator
lacked jurisdiction to reach the decision that he did. In both cases, this argument failed.
10
[2004] EWHC 733 (TCC), [2004] BLR 374.
11
The correctness of the decision in Buxton was doubted by the Court of Appeal in Carillion. However, the
TCC judge’s analysis of the interplay between the contractual provisions and the Scheme was not the subject of
scrutiny.
12 [2007] EWHC 1174 (TCC), [2007] BLR 348.
151
point that statutory adjudication operates by way of the implication of the Scheme into the
construction contract. On that basis, it has repeatedly been said that all adjudication is
contractual, in one way or another, and that no distinction between the various types should
be drawn for the purposes of enforcement. It is thought that this is the correct approach, and
that the reasoning in Domsalla should not be followed.13
The JCT 1998 Form

5.08 The JCT Standard Form of contract in most common use is the 1998 Edition, which also
forms the basis of the With Contractor’s Design version of the same terms. Although there
are a number of minor variations to the JCT provisions, depending on which version is being
used, it is perhaps helpful to set out in full Clause 41A of those provisions:
41A Adjudication
41A-1 Clause 41A applies where, pursuant to article 5, either Party refers any dispute or dif-
ference arising under this Contract to adjudication.
41A-2 The Adjudicator to decide the dispute or difference shall be either an individual agreed
by the Parties or, on the application of either Party, an individual to be nominated as the
Adjudicator by the person named in the Appendix (‘the nominator’). Provided that
41A-2.1 no Adjudicator shall be agreed or nominated under clause 41A-2 or clause 41A-3
who will not execute the Standard Agreement for the appointment of an Adjudicator issued
by the JCT (the ‘JCT Adjudication Agreement’) with the Parties; and
41A-2.2 where either Party has given notice of his intention to refer a dispute or difference to
adjudication then
any agreement by the Parties on the appointment of an adjudicator must be reached with the
object of securing the appointment of, and the referral of the dispute or difference to, the
Adjudicator within 7 days of the date of the notice of intention to refer (see clause 41A-4.1);
any application to the nominator must be made with the object of securing the appointment
of, and the referral of the dispute or difference to, the Adjudicator within 7 days of the date of
the notice of intention to refer.
Upon agreement by the Parties on the appointment of the Adjudicator or upon receipt by
the Parties from the nominator of the name of the nominated Adjudicator the Parties shall
thereupon execute with the Adjudicator the JCT Adjudication Agreement.

41A-3 If the Adjudicator dies or becomes ill or is unavailable for some other cause and is thus
unable to adjudicate on a dispute or difference referred to him, the Parties may either agree
upon an individual to replace the Adjudicator or either Party may apply to the nominator for
the nomination of an adjudicator to adjudicate that dispute or difference; and the Parties shall
execute the JCT Adjudication Agreement with the agreed or nominated Adjudicator.
41A-4.1 When pursuant to article 5 a Party requires a dispute or difference to be referred to
adjudication then that Party shall give notice to the other Party of his intention to refer the
dispute or difference, briefly identified in the notice, to adjudication. If an Adjudicator is
agreed or appointed within 7 days of the notice then the Party giving the notice shall refer the
dispute or difference to the Adjudicator (‘the referral’) within 7 days of the notice. If an
Adjudicator is not agreed or appointed within 7 days of the notice the referral shall be made
13
Although permission to appeal was granted in Domsalla, the dispute was settled before the appeal was
heard. However, although that means that this important point remains to be definitively decided, it is thought
that the conclusion set out above is consistent with the views expressed in a number of recent TCC cases, such
as Treasure v Dawes and Linnett v Halliwells, already referred to.
152
immediately on such agreement or appointment. The said Party shall include with that referral
particulars of the dispute or difference together with a summary of the contentions on which
he relies, a statement of the relief or remedy which is sought and any material he wishes the
Adjudicator to consider. The referral and its accompanying documentation shall be copied
simultaneously to the other Party.
41A-4.2 The referral by a Party with its accompanying documentation to the Adjudicator
and the copies thereof to be provided to the other Party shall be given by actual delivery or by
FAX or by special delivery or recorded delivery. If given by FAX then, for record purposes, the
referral and its accompanying documentation must forthwith be sent by first class post or
given by actual delivery. If sent by special delivery or recorded delivery the referral and its
accompanying documentation shall, subject to proof to the contrary, be deemed to have
been received 48 hours after the date of posting subject to the exclusion of Sundays and any
Public Holiday.
41A-5.1 The Adjudicator shall immediately upon receipt of the referral and its accompanying
documentation confirm the date of that receipt to the Parties.
41A-5.2 The Party not making the referral may, by the same means stated in clause 41A-4.2,
send to the Adjudicator within 7 days of the date of the referral, with a copy to the other Party,
a written statement of the contentions on which he relies and any material he wishes the
Adjudicator to consider.
41A-5.3 The Adjudicator shall within 28 days of the referral under clause 41A-4.1 and acting as
an Adjudicator for the purposes of S.108 of the Housing Grants, Construction and Regeneration
Act 1996 and not as an expert or an arbitrator reach his decision and forthwith send that decision
in writing to the Parties. Provided that the Party who has made the referral may consent to
allowing the Adjudicator to extend the period of 28 days by up to 14 days; and that by
agreement between the Parties after the referral has been made a longer period than 28 days
may be notified jointly by the Parties to the Adjudicator within which to reach his decision.
41A-5.4 The Adjudicator shall not be obliged to give reasons for his decision.
41A-5.5 In reaching his decision the Adjudicator shall act impartially and set his own
procedure; and at his absolute discretion may take the initiative in ascertaining the facts and
the law as he considers necessary in respect of the referral which may include the following:
-5.1 using his own knowledge and/or experience;
-5.2 subject to clause 30.9, opening up, reviewing and revising any certificate, opinion, decision,
requirement or notice issued, given or made under the Contract as if no such certificate, opinion,
decision, requirement or notice had been issued, given or made;

-5.3 requiring from the Parties further information than that contained in the notice of
referral and its accompanying documentation or in any written statement provided by the
Parties including the results of any tests that have been made or of any opening up;
-5.4 requiring the Parties to carry out tests or additional tests or to open up work or further
open up work;
-5.5 visiting the site of the Works or any workshop where work is being or has been prepared
for the Contract;
-5.6 obtaining such information as he considers necessary from any employee or representative
of the Parties provided that before obtaining information from an employee of a Party he has
given prior notice to that Party;
-5.7 obtaining from others such information and advice as he considers necessary on technical
and on legal matters subject to giving prior notice to the Parties together with a statement or
estimate of the cost involved;
-5.8 having regard to any term of the Contract relating to the payment of interest, deciding
the circumstances in which or the period for which a simple rate of interest shall be paid.
153
41A-5.6 Any failure by either Party to enter into the JCT Adjudication Agreement or to
comply with any requirement of the Adjudicator under clause 41A-5.5 or with any provision
in or requirement under clause 41A shall not invalidate the decision of the Adjudicator.
41A-5.7 The Parties shall meet their own costs of the adjudication except that the Adjudicator
may direct as to who should pay the cost of any test or opening up if required pursuant to
clause 41A-5.5.4.
41A-5.8 Where any dispute or difference arises under clause 8-4.4 as to whether an instruction
issued thereunder is reasonable in all the circumstances the following provisions shall apply:
-8.1 The Adjudicator to decide such dispute or difference shall (where practicable) be an
individual with appropriate expertise and experience in the specialist area or discipline relevant
to the instruction or issue in dispute.
-8.2 Where the Adjudicator does not have the appropriate expertise and experience referred
to in clause 41A-5.8.1 above the Adjudicator shall appoint an independent expert with such
relevant expertise and experience to advise and report in writing on whether or not any
instruction issued under clause 8-4.4 is reasonable in all the circumstances.
-8.3 here an expert has been appointed by the Adjudicator pursuant to clause 41A-5.8.2
above the Parties shall be jointly and severally responsible for the expert’s fees and expenses
but, in his decision, the Adjudicator shall direct as to who should pay the fees and expenses
of such expert or the proportion in which such fees and expenses are to be shared between
the Parties.
-8.4 Notwithstanding the provisions of clause 41A-5.4 above, where an independent expert
has been appointed by the Adjudicator pursuant to clause 41A-5.8.2 above, copies of the
Adjudicator’s instructions to the expert and any written advice or reports received from such
expert shall be supplied to the Parties as soon as practicable.
41A-6.1 The Adjudicator in his decision shall state how payment of his fee and reasonable
expenses is to be apportioned as between the Parties. In default of such statement the Parties
shall bear the cost of the Adjudicator’s fee and reasonable expenses in equal proportions.
41A-6.2 The Parties shall be jointly and severally liable to the Adjudicator for his fee and for
all expenses reasonably incurred by the Adjudicator pursuant to the adjudication.
41A-7.1 The decision of the Adjudicator shall be binding on the Parties until the dispute or
difference is finally determined by arbitration or by legal proceedings or by an agreement in
writing between the Parties made after the decision of the Adjudicator has been given.
41A-7.2 The Parties shall, without prejudice to their other rights under this Contract,
comply with the decision of the Adjudicator; and the Employer and the Contractor shall
ensure that the decision of the Adjudicator is given effect.
41A-7.3 If either Party does not comply with the decision of the Adjudicator the other Party
shall be entitled to take legal proceedings to secure such compliance pending any final
determination of the referred dispute or difference pursuant to clause 41A-7.1
41A-8 The Adjudicator shall not be liable for anything done or omitted in the discharge or
purported discharge of his functions as Adjudicator unless the act or omission is in bad faith
and this protection from liability shall similarly extend to any employee or agent of the
Adjudicator.
Nomination and Appointment

5.09 The nomination of the adjudicator under these provisions can happen in one of two ways.
The more usual path to nomination is that envisaged in Clause 41A.2 above, whereby the
parties either agree a particular person to act as the adjudicator, or the adjudicator is nominated
by a person or body named in the contract and referred to as ‘the nominator’. In most cases,
the nominator will be a professional body, such as the RICS and the ACIA, or TeCSA and
154
TECBAR. Given the tight timetable applicable to adjudications, the nominator needs to
nominate an adjudicator promptly, and difficulties might arise if there are any delays.14
There will sometimes be disputes about the person nominated by the nominator to act as 5.10
the adjudicator. This is a particular problem on major contracts where there has been a long-
running series of individual disputes that have been referred to adjudication. Often a party
who was successful in an earlier adjudication wants the same adjudicator to be nominated
again, whilst the party who was unsuccessful will seek to have somebody else appointed in
their stead. Both parties will make their cases to the nominator, who then has to decide
who to nominate. There is only one case that touches on this problem and the way in
which the nominator should deal with it.15 It is suggested that, where points are raised about
the nomination of a particular person to act as adjudicator, the nominator has an obligation
to consider all such points fully. Ultimately, however, it will be up to the nominator to weigh
in the balance the advantages inherent in the nomination of an adjudicator who is already
familiar with the basic contractual landscape, and the problems of nominating an individual
against whom one party has raised an express objection. It is thought that, unless the
objection is obviously spurious, it may well be the best course for the nominator to nominate
a new adjudicator.
The other way in which adjudicators are appointed is when they are expressly named in the 5.11
contract. Many of the large infrastructure projects of recent years, such as the contracts in
connection with the design and construction of Wembley Stadium, provided for named
adjudicators. The advantage of that process is that the nomination exercise is unnecessary,
which saves time and potential dispute. The disadvantage can be if one or other of the parties
to the contract forms the view that the adjudicator named in the contract is either not up to the
task, or has apparently reached an unreasonably adverse opinion of that party’s overall position.
If the named adjudicator is unable to accept the appointment, the JCT Form contains an 5.12
express provision to deal with such an eventuality:
If the Adjudicator dies or becomes ill or is unavailable for some other cause, and is thus unable
to adjudicate on a dispute or difference referred to him then
1. Either party may apply to the individual named as the Adjudicator in Appendix 1 to
replace the Adjudicator to adjudicate that dispute or difference, save that
2. If the individual named as the Adjudicator in Appendix 1 is unavailable then either Party
may apply to the partner or director who is managing (for the time being) the practice of
such named individual . . .
In Amec Projects Ltd v Whitefriars City Estates Ltd,16 the adjudicator named in the JCT
contract had died before the adjudication. The TCC judge found that there was no one else
who was qualified to act as the adjudicator under the terms of the contract and that, in
any event, since the dispute had not been referred to the adjudicator prior to his death, the
contractual provisions noted above, as to the making of an application to the manager of
14
See for example the judgment in Cubitt Building and Interiors Ltd v Fleetglade Ltd [2006] EWHC 3413
(TCC), [2006] 110 Con LR 36, in particular paragraph 46.
15
In Makers UK Ltd v London Borough of Camden [2008] EWHC 1836 (TCC), [2008] BLR 470, Akenhead
J said that nominators ‘might sensibly consider their rules as to nominations and as to whether they do or not
welcome or accept suggestions from one or more parties as to the attributes or even identities of the person to
be nominated.’
16
[2004] EWHC 393 (TCC), (2004) 20 Const LJ 338.
155
the practice, did not apply. Accordingly, the nomination provisions in the Scheme for
Construction Contracts were applicable. That part of the decision was upheld by the
Court of Appeal.17
Referral within 7 Days

5.13 In order to ensure that the adjudication follows an appropriately tight timetable, Clause 41A
is designed to ensure that the dispute is referred to the adjudicator within seven days of the
original notice of intention to refer. This can be seen in Clause 41A.2.2 (‘with the object of
securing the appointment of, and the referral of the dispute or difference to, the Adjudicator
within 7 days of the date of the notice of intention to refer . . . ’) and Clause 41A.4.1 (‘If an
Adjudicator is agreed or appointed within 7 days of the notice then the Party giving the
notice shall refer the dispute or difference to the Adjudicator (“the referral”) within 7 days of
the notice’). These latter provisions have created a certain amount of difficulty.
5.14 In William Verry v North West London Communal Mikva18 HHJ Thornton QC was dealing
with a dispute that had arisen under these provisions. The adjudicator had been appointed
promptly and given directions that required the referring party to serve the referral notice
eight days after the adjudication notice. The referring party complied with that order. After
the adjudication, the responding party subsequently objected, saying that the referral notice
was invalid because it was provided more than seven days after the notice of intention to
refer. The judge rejected that argument. It is clear from paragraph 30 of his judgment that,
perhaps unsurprisingly, one of the principal reasons for his decision was that the referral
notice had been served in accordance with the adjudicator’s directions and, since no point
had been taken on the validity of the directions themselves, it was difficult to say that a
referral notice served in accordance with the adjudicator’s directions was somehow invalid.
It appears that the judge’s analysis of the position concentrated on s108 of the 1996 Act,
and not the words of the contract itself.
5.15 The decision in William Verry was considered in Cubitt Building & Interiors Ltd v Fleetglade
Ltd,19 another case about these JCT Conditions. There, the TCC judge concluded that, on
the particular facts of William Verry, the decision was entirely reasonable and sensible, but
was, for various reasons, to be regarded as a case on its own particular facts. Further, to the
extent that Judge Thornton suggested that the seven-day period referred to in Clause 41A
was directory, the judge in Cubitt came to a different view. He said that the requirement in
Clause 42A 4.1 that the referring party ‘shall refer the dispute or difference . . . within 7 days
of the notice’ was a mandatory requirement. He said that the language admitted of no
other conclusion, because the word used was ‘shall’ not ‘may’. It was not a provision allowing
the referring party to use his best endeavours to take these steps within the specified period.
The requirement was that these events shall happen within a certain time frame. For these
reasons, he concluded that the provisions in Clause 41A 4.1 were mandatory. He summarised
his conclusion as follows:
28. In my judgment, a necessary ingredient of the swift adjudication process is certainty.
Parties need to know where they stand, who must do what, and by when. Once the process is
up and running, it should run like clockwork. Clause 41A is plainly designed to achieve that.
17 [2004] EWCA Civ 1418, [2005] BLR 1.

18 [2004] BLR 308.
19 [2006] EWHC 3413 (TCC), [2006] 110 Con LR 36.
156
Take for example its provisions in respect of the referral notice. The Clause envisages two very
common situations. The first is when the adjudicator has been appointed within seven days of
the adjudication notice. If that has happened, the referral notice, which triggers the adjudicator’s
power to issue directions and so on, must be served within that period. But unlike the Scheme
for Construction Contracts, Clause 41A expressly recognises that sometimes, because of
the involvement of a nominating body and the delays that that can bring, the adjudicator
may not be appointed until after the seven day period has expired. Under Clause 41A that
does not invalidate the adjudication; it simply means that the referral notice must be served
immediately on the appointment of the adjudicator . . .
29. The specific point of principle raised by Issue 1 is, of course, whether the words in Clause
41A.4.1 are mandatory or discretionary; and, if mandatory, how they are to be interpreted.
I am in no doubt that the words are mandatory. The language admits of no other conclusion.
The word that is used repeatedly is the word ‘shall’. It is not ‘may’; it is not a provision allowing
the referring party to use his best endeavours to take these steps within the specified
period. The requirement is that these events shall happen within a certain time frame. I consider
therefore that the provisions are mandatory.
In Linnett v Halliwells20 Ramsey J reached the same conclusion on Clause 41A 4.1, finding 5.16
that, where the parties had agreed that ‘a dispute shall be referred to the adjudicator within
7 days’, then the court should uphold that agreement. That would usually mean that the
failure to serve within the period would make the referral a nullity, as not being what the
parties intended, thus depriving the adjudicator of jurisdiction. However he noted that,
in the result in Cubitt, the judge had concluded that the timetable had to be operated in a
sensible and businesslike way and that the delay of one day in the service of the referral did
not render it a nullity. He expressly agreed with that. Thus, in Linnett, where the referral had
been served within time but the accompanying documents had not been delivered to the
arbitrator in the same time period as a result of a failure in the delivery system, Ramsey J
concluded that the courts should be slow to find that such a failure to comply with the
detailed procedural aspects of Clause 41A rendered the relevant part of the process a nullity
and held that, objectively, it cannot have been the intention of the parties that this failure
should render the referral a nullity so as to deprive the adjudicator of jurisdiction.
It is of course much easier to see how and why the words in Clause 41A.2.2 (‘with the object 5.17
of securing’) have been regarded as directory, not mandatory. In Mr Tracy Bennett v FMA
Construction Ltd 21 the concerns about the validity of the notice of adjudication were
heightened by the fact that the dispute concerned a final certificate, so that there was the risk
that, if the adjudication was invalid, the final certificate would be binding. In that case, the
contractor’s solicitors served a notice of intention to refer on 6 April 2005 but did not apply
to the nominator until 13 April. An adjudicator was nominated on 14 April 2005 but the
referral notice was not sent to him until 18 April. The supporting documents were then sent
the following day. The employer took the point that Clause 41A.2.2 had not been complied
with, because the application to the nominator was not made until the afternoon of the
seventh day after the service of the notice of intention to refer the dispute to adjudication.
The adjudicator concluded that the adjudication was probably fatally flawed and resigned on
21 April 2005. The following day, the notice of intention to refer was re-served and the
same adjudicator was re-appointed on 26 April. The original referral notice was deemed to
20 [2009] EWHC 319 (TCC), [2009] BLR 312.

21 [2005] EWHC 1268 (TCC), [2005] 101 Con LR 92.
157
have been re-served on 28 April. The delay allowed the employer to contend that the second
notice of intention to refer was served more than 28 days after the date of the final certificate
and thus the final certificate was binding. HHJ Havery QC rejected that submission, finding
that the words in Clause 41A.2.2 were ‘merely directory’ and that the first notice of intention
to refer was sufficient to comply with the contractual provisions so as to prevent the final
certificate from being conclusive evidence in respect of those matters that the contractors
wished to challenge. It does not appear that the arguments in Bennett dealt with Clause
41A.4.1, although it would appear that it was that provision that was of particular relevance
to the seven-day period.
5.18 Accordingly, the operation of the seven-day period envisaged in Clause 41A is not entirely
free from doubt. Whilst the words in Clause 41A.2.2 were plainly directory (as Judge Havery
found in Bennett) the words in Clause 41A.4.1, which were not considered in Bennett, were
treated as mandatory in Cubitt and Linnett (albeit with the qualification that the timetable
had to be applied in a sensible and businesslike way). However, given the authorities that
have highlighted the importance of complying with the strict timetables in adjudication,22
it is thought that the courts will be likely in future to treat the word ‘shall’ in such contract
provisions as mandatory, providing a requirement which must be complied with, unless
(as in Linnett) the failure can properly be described as technical only. Parties whose contracts
incorporate Clause 41A or similar should endeavour to ensure that the referral notice is ready
to be served at the same time or shortly after the notice of intention to refer.
More than one Dispute

5.19 One of the fundamental principles of statutory adjudication is that only one dispute can
be referred to the adjudicator at any one time.23 That is made plain in the 1996 Act and is
one of the features of the Scheme for Construction Contracts. There has, however, been some
suggestion that Clause 41A allows ‘any number of disparate disputes can simultaneously be
the subject of one notice of adjudication’: see paragraph 41 of the judgment of HHJ
Seymour QC in R Durtnell and Sons Ltd v Kaduna Ltd.24 Although it is not immediately
apparent from the judgment what part of Clause 41A the judge considered permitted such
an interpretation, and the decision in Durtnell should perhaps be treated with considerable
caution anyway,25 there is no reason in principle why an adjudicator who derives his
jurisdiction from a set of express adjudication provisions should not have the power to
decide more than one dispute at the same time, if that is what the terms permit.
‘Impartially’
5.20 Clause 41A.5.5 requires the adjudicator to act ‘impartially’. As a consequence of this express
provision, HHJ Lloyd QC in Balfour Beatty Construction Ltd v The Mayor and Burgesses of the
London Borough of Lambeth 26 found that the adjudicator had to conduct the proceedings in
accordance with the rules of natural justice or as fairly as the limitations imposed by
22 See, for example, Richie Brothers v David Philip [2005] BLR 384 and the various subsequent decisions of
the TCC referred to in paragraphs 2.119–2.128.

23
See the full discussion of this point at paragraphs 7.78–7.85.
24
[2003] BLR 225.
25
It should also be noted that the main thrust of the decision in Durtnell, to the effect that there could be no
dispute relating to extensions of time until the architect had considered further applications for an extension of
time under the contract, is the subject of considerable criticism in the commentary in the BLR.
26 [2002] EWHC 597 (TCC), [2002] BLR 288.
158
Parliament permit.27 In Balfour Beatty, Judge Lloyd concluded that, although ‘the purpose of
adjudication is not to be thwarted by an overly sensitive concern for procedural niceties’, the
provisions of Clause 41A ‘envisage that some basic procedural principles have to be applied
in order that each party is treated fairly’. He held that although the adjudicator had the
power to set his own procedure, he could not do so without first informing the parties of
the procedure that he was going to adopt. And although the adjudicator had to take the
initiative in ascertaining the facts and the law, he was obliged in principle to inform the parties
of the information that he obtained from his own knowledge and experience or from other
sources, and of the conclusions that he might reach having taken those sources into account.
Fairness and impartially are dealt with in greater detail in Chapters 11–13 below.
Non-Compliance
Clause 41A.5.6 expressly provides that a failure to comply with any of the adjudicator’s 5.21
requirements, or with any provision or requirement under Clause 41A, ‘shall not invalidate
the decision of the adjudicator’. At first sight, this looks to be a wide saving provision, which,
if taken to its logical conclusion, could excuse extensive delay on the part of either the
referring or the responding party. Indeed, it has been argued that the provision could operate
to provide an adjudicator with the necessary jurisdiction even if, for example, he was not
appointed until long after the seven-day period had expired. However, the authorities make
clear that Clause 41A.5.6 cannot be interpreted in this way. In Palmac Contracting Ltd v Park
Lane Estates Ltd,28 HHJ Kirkham QC held that the effect of the clause was not such as to validate
the appointment of an adjudicator invalidly appointed. She said that its scope was limited to
procedural steps within a validly constituted adjudication. That view was echoed in Cubitt 29
where the judge referred to Palmac, and concluded that Clause 41A.5.6 was concerned with
procedural relief, and could not confer jurisdiction on an adjudicator who did not have the
necessary jurisdiction in the first place. If, for example, there was no valid referral, then
Clause 41A.5.6 could not rescue the situation; it would make a nonsense of the whole
adjudication process if the referring party could rely on Clause 41A.5.6 to argue that a
much-delayed referral notice had not invalidated the decision of the adjudicator.
Clause 41A.5.6 was reviewed by Ramsey J in Linnett v Halliwells,30 together with the cases 5.22
noted above. He said that, although the purpose of the clause was evidently to avoid argu-
ments that non-compliance with the provisions or requirements of s41A invalidated the
decision of the adjudicator, such a broad provision must have limitations. He concluded at
paragraph 105 of his judgment:
It would not, in my judgment, overcome a fundamental non-compliance with the appoint-
ment of an adjudicator. For instance if the parties agreed one adjudicator and the referring
party obtained the appointment of another then I cannot see that it has any application.
I respectfully agree with Judge Kirkham [in Palmac] that it applies to procedural non-compliance
and is limited to procedural steps within a validly constituted adjudication. In my judgment,
it would be apt to cover the failure to serve the accompanying documents on the adjudicator
within 7 days, as occurred in this case.
27
In expressing that conclusion, Judge Lloyd was referring to a previous decision of his, namely Glencot
Developments v Ben Barrett [2001] BLR 207 and a number of other cases including Discain Projects Services Ltd
v Opec Prime Ltd [2000] BLR 402.
28 [2005] EWHC 919 (TCC), [2005] BLR 301.
29 [2006] EWHC 3413 (TCC), [2006] 110 Con LR 36, paragraphs 49 and 50.
30 [2009] EWHC 319 (TCC), [2009] BLR 312.
159
28 Days
5.23 As previously noted, under the 1998 Act, an adjudicator has 28 days to produce his decision,
or longer if an extended period is agreed by the parties. Clause 41A.5.3 of the JCT provisions
reflects this requirement. This provision has been the subject of a number of reported cases,
each stemming from the adjudicator’s failure to produce his decision within the 28 days or
the agreed extended period. The cases are analysed at paragraphs 2.114–2.132 above. In
summary, it is possible to trace a clear development in the courts’ attitude to adjudicators
who unilaterally grant themselves more time to complete their decision than is permitted by
the JCT Conditions.
5.24 In St Andrews Bay Development Ltd v HBG Management Ltd,31 where the contract incor-
porated the JCT Conditions, With Contractor’s Design (including Clause 41A), the
adjudicator should have reached her decision on 5 March but did not provide the decision
until 7 March, with the reasons being communicated three days later on 10 March. It was
contended that, since the decision was out of time, it was ultra vires. Lord Wheatley agreed
that the adjudicator was not entitled to delay communication of the decision until her fees
were paid.32 However, he went on to find that the delay, although a serious matter, was not
of sufficient significance to render the decision a nullity. He said that the production of a
decision two days outwith the time limit provided was not such a fundamental error or
impropriety that it should eviscerate the entire decision. By contrast, in Barnes & Elliott Ltd
v Taylor Woodrow Holdings Ltd,33 HHJ Lloyd QC had to deal with a situation where the
decision had been reached within the agreed time scale, but was not communicated to the
parties until the following day. Here too it was argued that that decision was a nullity. Again
the judge refused to accept that proposition and found that there should be some flexibility
in the communication of the decision. However, Judge Lloyd made it clear that this was
because the decision had been arrived at in time and was therefore, in principle, authorised
and valid. He stressed that this form of contract only conferred authority on the adjudicator
to make a decision within the 28-day period, or such other period as was agreed. This,
therefore, appeared to differentiate between a decision not reached within the 28 days,
which was, prima facie, outside the contractual provisions, and a decision reached within the
28 days but communicated thereafter which, on the facts of that case, Judge Lloyd held was
within the contract.
5.25 A number of subsequent decisions have emphasised the importance of the 28-day period in
these and similar contractual provisions.34 Richie Brothers (PWC) Ltd v David Philip
(Commercials) Ltd 35 has already been referred to at paragraph 2.122. Likewise Cubitt Building
& Interiors Ltd v Fleetglade Limited,36 a case where the contract incorporated the JCT
Conditions (and where the TCC judge concluded that adjudicators did not have the juris-
diction to grant themselves extensions of time without the express consent of both parties),
is referred to in detail in paragraph 2.123 above. On the facts of that case, he concluded
that the decision was reached within the agreed extended period and its communication the
31 [2003] SLT 740.

32
For a fuller discussion of an adjudicator’s ability (or lack of it) to exercise a lien on the decision in respect
of his fees, see paragraphs 10.24-10.29.
33
[2004] 1 BLR 111.
34 They are cited at paragraph 3.81 (footnote 75).
35 [2005] 1 BLR 384.
36 [2006] EWHC 3413 (TCC), [2006] 110 Con LR 36.
160
following day complied with the requirement ‘forthwith’ to send the decision to the parties.
The adjudicator’s decision was therefore not a nullity. Finally, AC Yule & Sons Ltd v Speedwell
Roofing & Cladding Ltd 37 reiterates the same approach and explains why it is the mandatory
nature of the statutory period, rather than the consequences of non-compliance with that
period, that matters most.
Although Yule was a decision under the Scheme, both Barnes & Elliott and Cubitt were 5.26
concerned expressly with Clause 41A of the JCT Contract. It is thought that there is no
substantive difference between the JCT Conditions and the Scheme on this point. As to the
need for communication ‘forthwith’, given the immediacy of electronic communication,
any decision reached under Clause 41A ought to be completed and communicated to the
parties by the end of the last day of the extended period, and certainly not later than part-way
through the following day.
‘Binding’
Clause 41A.7.1 makes plain that the decision of the adjudicator ‘shall be binding on the 5.27
parties until the dispute or difference is finally determined by arbitration or by legal
proceedings’. This concept of temporary finality is discussed in detail below at paragraphs
14.30–14.44. A point that has risen under these provisions is the status of the adjudicator’s
decision in any subsequent proceedings. In City Inn Ltd v Shepherd Construction Ltd 38 it
was argued that the effect of the adjudicator’s decision was to throw onto the responding
party the burden of showing that the extension of time that the adjudicator awarded was
not justified. It was argued that the binding quality of the adjudicator’s decision continued,
not merely until the dispute was made the subject of litigation, but until the court proceedings
were finally determined, so that during the proceedings the adjudicator’s decision remained
binding and had to be rebutted by the party arguing for a different result.39 This argument
was rejected by the court. It was held to be no part of the function of an adjudicator’s decision
to reverse the onus of proof in any subsequent arbitration or litigation to which the parties
resort to obtain a final determination of the dispute between them. It was held that such
an approach read too much into the words ‘binding until the dispute or difference is finally
determined’. The court concluded that the burden of proof in any such subsequent
arbitration or litigation lay where the law placed it, and was unaffected by the terms of the
Clause 41A.7.1, and its equivalent in other JCT Forms (such as Clause 9A.7.1 in the JCT 5.28
Management Contract) provides that the adjudicator’s decision shall be binding until the
dispute is finally determined in court, arbitration or the agreement of the parties. In SG
South Ltd v Swan Yard (Cirencester) Ltd,40 the claiming party accepted that, following the
adjudicator’s decision, they had discovered that two of their sub-contractors had been
paid direct by the employer and that, as a result, the sum due pursuant to the decision should
be reduced by some £27,000. The TCC judge held that the documents produced for the
enforcement hearing constituted an agreement to that effect pursuant to Clause 9A.7.1, and
that, up to that amount, the parties had agreed that the decision was not to be enforced.
37
[2007] EWHC 1360 (TCC), [2007] BLR 499, as discussed in paragraphs 2.124-2.128.
38 [2002] SLT 781.
39 See also Citex Professional Services Ltd v Kenmore Developments Ltd [2004] Scot CS 20; A1195/02.
40 [2010] EWHC 376 (TCC).
161
Final Certificates
5.29 In common with many standard forms of building and engineering contracts, the JCT
Forms include provisions for final certificates, which, if not challenged within a specified
period, becoming conclusive evidence on a range of matters. One way in which they can be
challenged is by a reference to adjudication. In Castle Inns (Stirling) Limited v Clark Contracts
Limited,41 the issue was slightly different, although the underlying problem was the same.
The particular clause of the Scottish version of the JCT Standard Form in issue allowed disputes,
on which an adjudicator had given a decision after the final certificate, to be finally determined
in arbitration or court proceedings, provided that they were commenced within 28 days of
the decision. This time bar only operated on disputes that had been decided by an adjudicator;
there was no equivalent bar on disputes that had not been decided by the adjudicator. The
pursuers needed to demonstrate that their claim in court raised an issue that the adjudicator
had not decided (so the time bar was irrelevant). Lord Drummond Young decided that,
although the adjudication had been concerned with a delay claim, which was also the subject
matter of the litigation, the former related to payments of loss and expense to a shopfitting
contractor, whilst the latter comprised the pursuers’ claim for loss of profit in consequence
of the late opening of the store. There was therefore no time bar. Of course, if the detailed
analysis had been resolved the other way, it would have left the pursuers without a claim.
Determination
5.30 The House of Lords case of Melville Dundas v George Wimpey UK Ltd 42 has already been
considered in detail in paragraphs 2.169–2.174 above. Their Lordships, by a majority,
decided on the facts of that case that Clause 27.6.5.1 of the JCT Standard Form was not
inconsistent with s111 of the 1996 Act in permitting an employer to rely on the provision
that no further payment was required following determination, in circumstances where the
claimant contractor was insolvent and it had been impossible for withholding notices to
be served in time. In Pierce Design International Limited v Mark Johnston and Another,43 the
TCC judge held that this ruling in respect of Clause 27.6.5.1 could not be distinguished
merely because there was no insolvency, and (arguably at any rate) no impossibility in serving
proper withholding notices. However, he concluded that the proviso to the clause, which
prohibited the employer from relying on it to prevent enforcement of sums due which
were ‘unreasonably not paid’ by the employer, meant that, on the facts of that case (unlike
the situation in Melville Dundas), the clause did not provide a defence to the claim, since the
failure to pay sums which were due under the contract, and in respect of which there had
been no withholding notices, was an unreasonable non-payment on the part of the employer.
In that case, the proviso operated to ensure that the contractor was not prevented from
recovering the outstanding interim payments.44
Oral Variations
5.31 In Treasure and Son Ltd v Martin Dawes 45 there was a JCT Prime Cost Form, which included
the broad equivalent of Clause 41A. There were, however, oral variations to the contract.
41 [2007] CSOH 21.

42
[2007] UKHL 18; [2007] 1 WLR 1136.
43
[2007] EWHC 1691 (TCC), [2007] BLR 381.
44
The scope of the decision in Melville Dundas is significantly restricted by the 2009 Act: see paragraph
4.26.
45
[2007] EWHC 2420 (TCC), [2008] BLR 24.
162
The issue arose as to whether, given that this was a contractual adjudication, it mattered that
there was an oral variation to the contract which meant that there was no written contract in
accordance with the rules set down in RJT Consulting Engineers Ltd v DM Engineering
(Northern Ireland) Ltd.46 Akenhead J concluded that, where there was a contractual agree-
ment to adjudicate, that adjudication process was not undermined, jurisdictionally or
otherwise, by the fact that the terms of the original contract that contained an adjudication
agreement had been orally varied. The parties had agreed that disputes would be referable to
adjudication and, if there was some oral variation to the terms of the contract, that did not
itself undermine the contractual enforceability of the adjudication process. He distinguished
RJT on the basis that, in that case, there was only a statutory right to adjudication. There was
nothing in the written contract in Treasure v Dawes that required the adjudication agreement
in it to be treated as other than a straightforward contractual agreement, even though the
adjudication provisions might not have been in the standard form agreement at all but for
the 1996 Act. In Linnett v Halliwells47 Ramsey J endorsed this approach and concluded that
an oral variation to the building contract would not affect the jurisdiction of the adjudicator
under Clause 41A.
Payment Provisions
Of course, the JCT 1998 Form includes a detailed series of payment provisions, which are 5.32
designed, amongst other things, to comply with ss 109–111 of the 1996 Act, and such
provisions often have to be read in conjunction with the adjudication provisions at Clause
41A. Although there are some variations, in general terms Clause 30 of the 1998 Form
provides for a four-stage process; first, an application by the contractor for an interim payment;
secondly, not less than seven days after the receipt of that application, a written notice by the
employer specifying the amount of payment proposed (Clause 30.3.3); thirdly, not later
than five days before the final date for payment, the employer may give a written notice
specifying any amount proposed to be withheld and/or deducted (Clause 30.3.4); and
finally, the payment of the sum specified in the notice of payment (less any amount that is
the subject of a valid withholding notice). Where there is no notice of payment under Clause
30.3.3 and no withholding notice under Clause 3.4, the employer is liable to pay the
contractor the amount originally applied for (Clause 30.3.5).
This last provision has led to a number of disputes because of its potentially draconian effect; 5.33
if by an oversight there was no notice of payment or no withholding notice then, on the face
of it, the contractor becomes entitled to everything he applied for, no matter how tenuous
the claim. Ringway Infastructure Services Ltd v Vauxhall Motors Ltd 48 is a typical example. In
that case there was some correspondence in March 2006 relating to Ringway’s draft final
account. The matter then went into abeyance for a year and in 2007, following the resumption
of correspondence, Ringway sent Vauxhall a letter entitled ‘interim application 11’, with a
lengthy attachment running to almost 350 pages. No payment notice or withholding notice
in accordance with Clauses 30.3.3 and 30.3.4 was served by Vauxhall, and Ringway referred
the dispute to adjudication, saying that Vauxhall’s failure to provide the necessary notices
entitled them to the sum claimed in interim application 11. The adjudicator found that no
notices had been served and that accordingly Vauxhall were obliged to pay Ringway the
46
[2002] BLR 217.
47 [2009] EWHC 319 (TCC), [2009] BLR 312.
48
[2007] EWHC 2421 (TCC).
163
amount stated in the application. His decision was enforced by the court. Akenhead J rejected
Vauxhall’s submission that application 11 was not a claim for the payment of money and
noted that, when a contractor makes an application for an interim payment, he is claiming
that he is entitled to be paid the sum sought. It was impossible to construe the application as
anything other than a claim for the payment. The other argument advanced by Vauxhall,
to the effect that, by necessary implication, an invoice had to be served by Ringway before
they were entitled to be paid, was rejected as being contrary to the provisions of the JCT
Form which, at Clause 30.3.5, made it clear that the obligation to pay fell due immediately
following the seven-day period after receipt of an application for payment. It was not neces-
sary for the contractor, having failed to receive from the employer a payment notice, to
submit a further claim or request for immediate payment before it was entitled to be paid.
5.34 Fenice Investments Inc v Jerram Falkus Construction Ltd 49 was another case in which the
dispute turned on the timetable for notices, this time set out in Clause 4.10 of the JCT
Design and Build Contract 2007, but where the provisions at Clauses 4.10.3–4.10.5 were
precisely as noted above. There, JFC argued that, in accordance with the Clause 4.10
timetable, the final date for payment was 27 August, which meant that a withholding
notice, to be valid, had to be issued no later than 22 August. Because the purported with-
holding notice was not issued until 25 August, they said it was too late to be effective. Both
the adjudicator and the TCC judge concluded that this analysis was correct and they rejected
Fenice’s contention that a provision in the Employer’s Requirements, which suggested a
different timetable, should somehow take preference. Clause 1.3 of that version of the
JCT Standard Form made plain that, if there was a conflict between different contract
documents, it had to be resolved in favour of the express terms themselves. Such ‘hierarchy’
clauses are often the best way of identifying which of two competing and conflicting clauses
should take effect.50
5.35 Another case in which a whole series of issues arose in respect of the JCT payment provisions
was Balfour Beatty Construction Northern Ltd v Modus Corovest (Blackpool) Ltd.51 In that
case the employer/defendant issued a notice of payment pursuant to Clause 30.3.3, with the
effect that £1 million was due by 26 September 2008. The TCC judge concluded that, in the
absence of any other notices, Balfour Beatty were entitled to summary judgment for that
amount. He rejected the contention that the words ‘properly due’ in Clause 30.3.5 allowed
Modus to rely, in the absence of a withholding notice, on their alleged set-off and counter-
claim for £2 million by way of liquidated damages. First, he concluded that Modus were
entitled to be paid the sum set out in the written notice specifying the amount of the pro-
posed payment and that, as such,Clause 30.3.5 (which only came into play if there was no
payment notice), was irrelevant. Secondly he said that the use of Clause 30.3.5 in that way
would allow any employer to avoid the consequences of their failure to serve a withholding
notice, which would be contrary to the whole contractual scheme. It would also mean that
the JCT Standard Form did not comply with the 1996 Act. Thirdly, at paragraphs 82–89 of
his judgment, the judge rejected the contention that Modus were entitled to rely on the
alleged set-off and counterclaim to avoid summary judgment. To the extent that the claim
was based on an adjudicator’s decision, Modus were obliged to comply with that decision
49 [2009] EWHC 3272 (TCC), [2009] 128 Con LR 124.

50 See for example the discussion at paragraph 5.57.
51 [2008] EWHC 3029 (TCC), [2009] CILL 2660.
164
pursuant to Clause 41A, and to the extent that sums were due by way of summary judgment,
the JCT provisions at Clause 30.3 meant that there could be no set-off.
Other Forms of JCT Contract

All of the other JCT forms of main contract contain the same or very similar adjudication 5.36
provisions. However, a number of important decisions relating to particular clauses of
particular JCT forms have played a role in the development of the practice and principle of
adjudication and enforcement of adjudicator’s decisions. Some of the more important are
noted below.
The JCT Minor Works Form is commonly used for lower value works, and is thus often used 5.37
for contracts concerned with the refurbishment and extension of domestic dwellings. In
Lovell Projects Ltd v Legg & Carver52 the judge held that the supplemental adjudication
procedures added to the form by way of condition D complied with the 1996 Act. Thus,
although the work related to the refurbishment of a dwelling house by a residential occupier,
(which was of course exempted by the 1996 Act) the fact that the contract expressly provided
for adjudication meant that the employer could not argue that the adjudication provisions
were somehow inapplicable.53 Similarly, in Mohammed v Dr Michael Bowles,54 although the
applicant argued that the contract was exempt because it was with a residential occupier, the
argument was rejected by the registrar who concluded that the contract, in the JCT Minor
Works Form, adopted the framework of the dispute resolution procedure contained in the
1996 Act. He concluded that the adjudicator had determined the issue as to the appropriate
contract terms, and it was not for the court to look behind the adjudicator’s decision.
A similar argument, that a residential occupier who had agreed the JCT Minor Works Form 5.38
should not be bound by the adjudication provisions therein, was rejected by HHJ Thornton
QC in Steve Domsalla (t/a Domsalla Building Services) v Kenneth Dyason.55 The judge also
rejected the contention that the adjudication provisions were rendered unfair by the Unfair
Terms in Consumer Contracts Regulations, saying at paragraph 93 of his judgment that they
did not substantially alter the balance of the parties’ rights and obligations. However, on the
particular facts of that case, where the contract had been negotiated by Mr Dyason’s insurers
(who had also appointed the contract administrator) and he was simply the titular employer,
the judge found that the withholding notice provisions of the Minor Works Form were
unfair and thus not binding on him as the employer.
Clause 2.3 of the Minor Works Form deals with liquidated damages and permits the 5.39
employer to deduct liquidated damages from any monies due to the contractor. In Dumarc
Building Services Ltd v Salvador Rico56 the judge refused to allow the employer to set off
against an adjudicator’s award an amount of liquidated damages. He said that the effect of
the employer’s submissions was to add into Clause 2.3 the words ‘including sums owed
52 [2003] BLR 452.

53
In Lovell, there was also an argument that, pursuant to the Unfair Terms in Consumer Contracts
Regulations 1999, the adjudication provisions were unfair because they had not been individually negotiated.
The argument failed. The issues raised by the 1999 Regulations are dealt with at paragraphs 13.71–13.80.
54 2002, a decision of the Bankruptcy Registrar.
55 [2007] EWHC 1174 (TCC), [2007] BLR 348.
56 In the Epsom County Court, decision of His Honour Judge Hull QC.
165
under an adjudication’. He concluded that there was no right to set off for liquidated damages
provided by Clause 2.3 and to hold otherwise ‘would drive a coach and horses’ through the
1996 Act and the detailed provisions the parties had agreed upon to resolve disputes by way
of adjudication. The judge in Lovell reached the same conclusion, deciding that, although
the starting presumption was that each party was entitled to a set off as per Modern Engineering
v Gilbert Ash,57 the amended terms of the Minor Works Form plainly rebutted that presumption.
He concluded that they amounted to clear and unequivocal words whereby the parties agreed
that a set-off would only be permitted when a withholding notice had been served. One of
the many provisions of the Minor Works Form to which the judge had regard in reaching this
conclusion was Supplemental Condition D7.2, which provided that the parties agreed to
comply with the decision of the adjudicator.
5.40 Clause 7.2.3 of the JCT Minor Works Form is concerned with the payment position
following determination by the employer. It provides that the employer should not be bound
to make any further payment to the contractor that may be due under the contract until after
completion of the works and the making good of any defects. In Westwood Structural Services
Ltd v Blyth Wood Park Management Ltd 58 the contractor sought declarations as to practical
completion and the sums outstanding under the contract. Only after the commencement
of the adjudication proceedings did the employer purport to determine the contractor’s
employment under the contract. In the first adjudication, the adjudicator found that
practical completion had been achieved and that an amount of £40,000 was due to the
contractor, together with interest. The interest award was predicated on the assumption that
the sum should have been paid to the contractor in February 2008, well before the alleged
termination by the employer. The employer then commenced a second adjudication
seeking, amongst other things, a ruling that, by reason of Clause 7.2.3, it was under no
obligation to make payment until the works had been finished by an alternative contractor.
The adjudicator rejected that contention, concluding that the expression ‘further payment’
in Clause 7.2.3 meant future payment, and did not apply to any payment that became due
before the determination. The TCC judge concluded that the adjudicator was entitled to
reach the decision that he did and that he may well have been right to do so. The adjudicator
had found that the final date for payment of the sum due was some two and half months
before the purported determination of the contract by the employer, and that it would be
contrary to the Minor Works Form (and the 1996 Act) to conclude that an employer
was entitled to defeat the claim for sums due under the contract, and found due by the
adjudicator, by reference to an event that occurred two and half months after the money
should have been paid.
5.41 The JCT Intermediate Form, known as the IFC, also contains similar provisions to those
discussed above. Also, like all other JCT contracts, it provides a contractual regime whereby
the contract administrators/architect issues certificates and reaches decisions as a result of the
quasi-arbitral role created by the contract. In Vaultrise Ltd v Paul Cook 59 the point was taken
that the issuing of certificates, such as the certificate of practical completion, was a matter for
the contract administrator and only he, or an arbitrator, had the power to open up and revise
such certificates. It was said that an adjudicator did not have that power. The TCC judge
57 [1974] AC 689.
58 [2008] EWHC 3138 (TCC), [2009] CILL 2666.
59 [2004] ADJCS 04/06.
166
concluded otherwise, finding that an adjudicator had the power to consider whether or not
a certificate should have been issued and, if a missing certificate was due, he could determine
the appropriate sum outstanding. In the instant case the adjudicator had found that a
final certificate should have been issued and he went on to determine the amount that that
certificate should have identified. He said that the sum was due from the employer to the
contractor. The judge concluded that the dispute was one that the adjudicator had every
reason to determine, describing it as ‘a perfectly valid dispute fit for adjudication’.
The JCT Adjudication Agreement

The JCT adjudication provisions set out above envisage that, in the event of an adjudication, 5.42
the parties to the contract and the adjudicator will agree a tripartite agreement, in standard
form, referred to as the JCT Adjudication Agreement. This records the appointment of
the adjudicator and the acceptance of that appointment by the parties. It requires the
adjudicator to observe the adjudication provisions that already bind the parties and makes
the parties jointly and severally liable for the adjudicator’s fees. It also contains termination
provisions that allow the parties jointly to terminate the adjudication agreement. There is
an express provision that, if that joint termination was as a result of the failure by the
adjudicator to give his dispute within the time scales in the adjudication provisions or at all,
the adjudicator was not entitled to recover his fees.
The Agreement is important for two reasons. First, it allows the adjudicator a direct route 5.43
against the parties if his fees are not paid, and avoids the rather convoluted reliance on
the Contracts (Rights of Third Parties) Act 1999 which, in Cartwright v Fay 60 provided the
adjudicator’s only route to recovering his fees against the defendant. More importantly, it
binds the adjudicator to the adjudication provisions in the JCT Form. It therefore makes the
adjudicator contractually liable to produce his decision within 28 days or any agreed extended
period. If he does not, he is in breach of contract. Moreover, although Clause 41A.8 appears
to give the adjudicator immunity from anything done in the discharge of his functions, it
must be arguable that his failure to produce a decision within the 28 days or the agreed
extended period would have represented a complete failure on his part to discharge his
functions at all, and the immunity may well be inoperative.61
The Standard Forms of Sub-Contracts

DOM/1
There are often disputes, further down the contractual chain, as to whether the standard 5.44
sub-contract conditions were incorporated. In Maymac Environmental Services v Faraday
Building Services,62 HHJ Toulmin CMG QC found that a sub-contract that incorporated
the DOM/1 terms had come into existence and that, although the terms were modified and
expanded as the work progressed, the adjudicator had the necessary jurisdiction. In any
60
9 February 2005, Bath County Court.
61 See Cubitt Building and Interiors Ltd v Fleetglade Ltd [2006] EWHC 3413, [2006] 110 Con LR 36,
paragraph 91.
62 (2000) 75 Con LR 101.
167
event, Faraday had agreed to the adjudication of the dispute and could not now argue that
they were not bound by the result.
5.45 One of the most important features of the 1996 Act, and the Scheme for Construction
Contracts, was the maintenance of cash flow to domestic sub-contractors, who were perceived
to have suffered significantly as a result of the financial constraints and the tough commercial
line adopted by many main contractors in the early 1990s. Once the Act was in force, the
DOM/1 Sub-Contract Conditions were amended to provide for adjudication.63 In KNS
Industrial Services (Birmingham) Ltd v Sindall Ltd 64 HHJ Humphrey Lloyd QC held that,
not only were the adjudication provisions in accordance with the 1996 Act, but so too
were the contractual provisions concerned with interim payments and withholding notices.
The judge held that the DOM/1 terms met the requirements of the 1996 Act and that,
therefore, the provisions of s110 were no longer relevant, because the terms of the sub-contract
were the material provisions. As for s111, the DOM/1 terms provided that the prescribed
period (ie the final date for a withholding notice before the final date for payment) was five
days before the final date for payment, and incorporated wholesale into Cause 21.3.2
the provisions of s111.
5.46 The adjudication provisions in the DOM/1 Conditions are set out in Clause 38A. In Cubitt
Building and Interiors Ltd v Richardson Roofing (Industrial) Ltd,65 it was held that, on their
true construction, these clauses do not amount to a pre-condition or obligation requiring
either party to refer any disputes to adjudication; they simply conferred a right on a party to
proceed to adjudication at any time, if it so wishes. The detailed requirements of Clause 38A
provide that all relevant notices and other documents served as part of the adjudication must
be sent by fax and first class post forthwith to the address of the other party. In Costain Ltd v
Wescol Steel Ltd 66 the point was taken that the documents were not served in accordance with
this provision and that therefore the reference to adjudication was invalid. The judge rejected
this contention, relying on the words of Clause 38A.5.6 of DOM/1, which provided that
any failure to comply with any requirement under Clause 38A ‘shall not invalidate the decision
of the adjudicator’. The judge held that this rendered the provisions and requirements of
Clause 38A non-mandatory, at least so far as the validity of any decision of the adjudicator
was concerned. It is respectfully suggested that this was a correct application of the proviso
to Clause 38A.5.6, because it was concerned with a potential procedural problem (in that
case, the precise form of service). It is to be contrasted with the decisions in Palmac67 and
Cubitt 68 where the TCC judges made plain that this potentially wide catch-all proviso
could not give an adjudicator jurisdiction in circumstances where, for whatever reason, he
did not have the necessary jurisdiction in the first place.
5.47 Clause 38A of DOM/1 provided that ‘any dispute or difference arising under the sub-
contract may be referred to adjudication’. This, of course, is very similar wording to all other
63 Originally, there was a provision in the DOM/1 conditions which stipulated that the parties had to mediate
before they could refer their dispute to adjudicate. HHJ Thornton QC held in RG Carter v Edmund Nuttall Ltd
[2002] BLR 359 that this pre-condition sought to fetter the unqualified entitlement to adjudication provided
by the 1996 Act, and was therefore unenforceable.
64
[2001] 17 Const LJ 170.
65
[2008] EWHC 1020 (TCC), [2008] BLR 354.
66 [2003] EWHC 312 (TCC).
67 [2005] EWHC 919 (TCC), [2005] BLR 301.
68 [2006] EWHC 3413 (TCC), [2006] 110 Con LR 36.
168
standard forms of sub-contract. However, it is under the DOM/1 provision that there have
been a number of cases in which the proper meaning of the word ‘dispute’ has been canvassed.
The debate concerned an interpretation of the word ‘dispute’, which required the dispute set
out in the notice of intention to refer to a specific dispute that had plainly arisen between the
parties prior to the service of the notice (‘the restricted view’). The alternative argument was
that the word ‘dispute’ had a wider meaning and that a dispute arose once money was claimed
and not admitted or paid (‘the wider approach’). There is a full discussion as to these
competing views, and the clear settlement of this debate in favour of the ‘wider approach’ in
paragraphs 7.61–7.77 below. For present purposes, it is sufficient to identify the two
competing cases arising out of the DOM/1 form.
In Edmund Nuttall Ltd v RG Carter Ltd 69 the referring party sought an entitlement to an 5.48
extension of time from the responding party. Having failed to obtain that extension, the
referring party issued a notice of intention to refer. The referral notice set out a detailed claim
for an extension of time, together with loss and expense. The basis of that claim was
considered by the judge to be materially different to the claim that had been made under the
contract. HHJ Seymour QC concluded that the real question was not whether there was a
dispute at the time of the notice of referral, but whether the dispute that the adjudicator
decided was that which formed the subject matter of the notice. He said that if the adjudicator
had adjudicated on a ‘dispute’ that was not the subject of that notice, he had no jurisdiction
to decide the dispute. The judge said that, for there to be a dispute, there must have been an
opportunity for the protagonists each to consider the position adopted by the other and to
formulate arguments of a reasoned kind. He said that where a party has an opportunity to
consider the position of the opposite party and to formulate arguments in relation to that
position, what constitutes a ‘dispute’ between the parties was not only a ‘claim’ that had been
rejected, but the whole package of arguments advanced and facts relied on by each side. He
concluded that adjudication was only appropriate after there had been attempts to resolve
the dispute by an open exchange of views and that, therefore, a party in adjudication
could not abandon wholesale facts and arguments that had previously been relied on,
even if the claim remained the same. The relevant part of his judgment is set out verbatim at
paragraph 7.66 below.
In consequence of these views, Judge Seymour concluded that the ‘dispute’ advanced in the 5.49
adjudication was different to that which had arisen between the parties and was referred to
in the notice of intention to refer. He therefore concluded that the adjudicator did not have
the necessary jurisdiction and dismissed the claim to enforce the decision.
This decision has been the subject of a certain amount of criticism, and it has not been 5.50
followed in a number of subsequent cases.70 It is, in many ways, the high watermark of
the restricted view of the word ‘dispute’, and it has now been expressly disapproved by
Akenhead J in Cantillon Ltd v Urvasco Ltd.71
The approach in Nuttall is to be contrasted with the approach of HHJ Kirkham in Orange 5.51
EBS Ltd v ABB Ltd.72 In her judgment the judge concluded that she was bound by the
69
[2002] BLR 312.
70 For a fuller discussion of this point, see paragraphs 7.61–7.77.
71 [2008] EWHC 282 (TCC), [2008] BLR 250.
72 [2003] BLR 323.
169
decision of the Court of Appeal in Halki Shipping Corporation v Sopex Oils Ltd,73 namely
that ‘there is a dispute once money is claimed unless and until the defendants admit that
the sum is due and payable’. She therefore found that a dispute had arisen because the
claim had been neither admitted nor paid and that sufficient time had elapsed between
the making of the claim and the issue of the notice of intention to refer. The judge did not
embark on a detailed comparison of the basis of the claim as submitted under the contract
and the claim that was referred to adjudication. This wider approach to the question of
whether or not a ‘dispute’ had crystallised at the time of the notice of adjudication, must be
regarded as the correct analysis in law, for the reasons explained at paragraphs 7.72–7.77
below.
5.52 There have been a number of cases concerned with the operation of the payment and
withholding provisions at Clause 21 of DOM/1. In KNS Industrial Services (Birmingham)
Ltd v Sindall Ltd,74 already referred to in paragraph 5.45 above, KNS contended that the
adjudicator had had no authority to make deductions from sums otherwise due to them
because Sindall had not given notice of intention to withhold in respect of amounts for
non-compliant work. Despite this, the adjudicator had set off against KNS’s gross valuation
sums to reflect these allegations. The judge pointed out that the term ‘withhold’ was used to
cover both the situation where, in arriving at a valuation, the contractor had not taken
account of a countervailing factor, as well as the situation where there was to be a reduction
in or deduction from an amount that had been declared or thought to be due. In the former
case the word ‘withhold’ may not always be correct, for one cannot withhold what is not due.
He concluded that the adjudicator was right to make a deduction for non-compliant work
because there was plainly a dispute about the valuation of the work and KNS were not
entitled to be paid for work that was not in accordance with the contract.
5.53 The DOM/1 Conditions, and Clause 21 in particular, were also at the heart of the decision
in Shimizu Europe Ltd v LBJ Fabrications Ltd,75 previously referred to at paragraph 2.166
above, where the relevant facts are set out. The judge allowed Shimizu to set off a separate
claim against the amount awarded by the adjudicator because the adjudicator had found that
the sum due to LBJ was not to be paid by Shimizu until 28 days after LBJ had delivered a
VAT invoice, as required by Clause 21.2.4. Although the adjudicator had decided that
Shimizu had no right to set off (against the sum which would become due to LBJ) the sums
that Shimizu had identified and claimed in the adjudication, he did not decide that Shimizu
had no future right of set-off. Because he had identified a sum to be paid to LBJ 28 days after
the provision of an invoice, pursuant to Clause 21, Shimizu were able to serve a fresh with-
holding notice in respect of the sum claimed on that invoice. LBJ’s claim was therefore
dismissed. It is clear that this judgment was based entirely on the wording of the adjudicator’s
original decision: had he, for example, found that the sum was due forthwith, there would
have been no opportunity for Shimizu to serve a withholding notice. Generally, adjudicators
tend to require the sum to be paid immediately and thus preclude the possibility of fresh
withholding notices. In addition, it should be noted that most of the arguments in which the
losing party has sought to set up some sort of set-off or cross-claim against the sum decided by
the adjudicator have failed: see the discussion at paragraphs 9.20–9.36 below. In Whiteways
73 [1998] 1 WLR 726.

74 [2001] 17 Const LJ 170.
75 [2003] BLR 381.
170
Contractors (Sussex) Ltd v Impresa Castelli Construction United Kingdom Ltd 76 the judge
rejected the argument that the loser had set up an effective abatement from sums due. It is
interesting to note that the analysis in the judgment is undertaken almost exclusively by
reference to ss 110 and 111 of the 1996 Act, even though the DOM/1 terms of sub-contract
were incorporated. However, on the abatement point, nothing turned on it, because the
provisions were so very similar.
Another feature of the judgment of HHJ Lloyd QC in KNS was its consideration of Clause 5.54
29 of DOM/1, dealing with determination. Clause 29.6.3 provided that in the event of
determination, the contractor was not bound to make any further payment to the sub-
contractor until after completion of the works and the making good of defects, at which
point the sub-contractor had to apply for payment and, if a net sum was due, the contractor
had to pay it. The judge concluded that s111 of the 1996 Act did not apply instead of
Clause 29.6, because the clause was part of a typical, self-contained code applicable when the
sub-contractor was in serious and irreparable default. The adjudicator had, in fact, required
the contractor to make a modest payment to the sub-contractor, notwithstanding the
provisions of Clause 29.6.3; the judge described this as inexplicable but concluded that it
was a mistake that he had the jurisdiction to make. In any event, the point did not matter
because the payment had been made in any event. In addition, it should be noted that
the particular (sub-contract) determination clause in KNS was not very different to the
(main contract) determination clause under consideration in Melville Dundas, and the
conclusion in each case was essentially the same.
DOM/2
The adjudication provisions at Clause 38A of the DOM/2 Standard Form are very similar 5.55
to those incorporated into the DOM/1 Form. In Jerome Engineering Ltd v Lloyd Morris
Electrical Ltd 77 the TCC judge found that, unusually, the contract provisions required the
relief sought to be stated in the referral notice, not within the notice of adjudication. The
point had been taken that the notice of adjudication had referred to a valuation dispute but
had not sought any express relief or any payment award. The referral notice did include an
express claim for £122,604. The TCC judge concluded that, despite this anomaly, the
notice of adjudication could not have left the responding party in any doubt that the
referring party was referring the dispute to adjudication because they wanted payment of
that which, at least on an interim basis, was due to them. However, even if he was wrong
about that, the judge concluded that both the notice of adjudication and the referral
notice were in full compliance with Clause 38A because, pursuant to the contract, it was
only the latter document which had to specify the relief. This decision was based four
square upon the precise terms of DOM/2. It should be noted that, if the adjudication had
occurred under the Scheme for Construction Contracts, the result might have been different
because the Scheme expressly requires the notice of intention to refer to identify the relief
claimed.
Clause 38A5.1.2 provides that the responding party ‘may . . . send to the adjudicator within 5.56
seven days of the date of the referral . . . a written statement of the contentions on which he
relies and any material he wishes the adjudicator to consider’. In CJP Builders Ltd v William
76 [2000] 16 Const LJ 453.

77 [2002] CILL 1827–1828.
171
Verry Ltd 78 the adjudicator concluded that he had no jurisdiction to extend this period.
Akenhead J concluded that there was nothing in the words of Clause 38A that prevented
the adjudicator from giving appropriate extensions of time (the word was ‘may’, not ‘shall’,
after all) and that, as a result of this honest but wrong decision, he had excluded vital material
that he should have considered, and thus failed to apply the rules of natural justice. The decision
was therefore not enforced.
5.57 As with other standard forms of contract, the DOM/2 conditions are susceptible to
homemade amendments, which can have a profound effect on the cogency and coher-
ence of the final version of the contract. In such cases, the existence of a clause like Clause
2.2 of the DOM/2 conditions, which provides for a hierarchy of documents in the event
of a clash, can provide an invaluable tool of construction. In Bovis Lend Lease Ltd v
Cofeley Engineering Services,79 different nominating procedures were set out in the
Appendix and an amended version of Clause 38A. The TCC judge held that the Appendix
prevailed because that was what Clause 2.2 required. It was also the one document that
the parties had filled out themselves. In other cases amendments, or the failure to use the
most up-to-date version of the standard form, can be critical. In William Hare Ltd v
Shepherd Construction Ltd,80 the contract terms were based on an older version of the
DOM/2 conditions, which had not been amended to reflect the substantial changes to
the statutory regime relating to insolvency and administration. The main contractor
sought to rely on a pay-when-paid provision following the employer’s insolvency, to
avoid payment to the contractor, but, because of the particular form of words used in the
older form of sub-contract, upon which the main contractor had insisted, he could not
bring himself within the necessary exception. The defence failed, both before the adjudicator
and the TCC judge on enforcement. The decision was subsequently upheld by the Court
of Appeal.81
5.58 There are a number of cases under these forms of sub-contract in which the loser has
sought to argue that, where a valid objection is taken to part of an adjudicator’s decision,
that part can be regarded as ‘severable’, thus allowing those parts upon which the objec-
tion might bite to be separated out from those parts that are unaffected by the complaint.
In relation to the DOM/2 conditions, this argument was expressly labelled as ‘miscon-
ceived’ by HHJ Seymour QC in RSL (South West) Ltd v Stansell Ltd.82 Judge Lloyd reached
a similar view on the facts of KNS, although he accepted that there might be instances
where the decision can be severed, so that the authorised part can be saved and the unau-
thorised elements set aside. The practical difficulties involved in even attempting such an
exercise will depend on the facts of the particular case, and the nature and form of the
decision itself. The decision by Akenhead J in Cantillon Ltd v Urvasco Ltd,83 discussed in
detail in paragraphs 15.29–15.32 below, must now be regarded as the leading case on this
topic. Even there, the judge, whilst keen to explore the possibility of severance, concluded
that, if one dispute had been referred for decision, it was difficult to see how the decision
could subsequently be severed.
78
[2008] EWHC 2025 (TCC), [2008] BLR 545.
79
[2009] EWHC 1120 (TCC).
80
[2009] EWHC 1603 (TCC), [2009] BLR 447.
81 [2010] EWCA Civ 283; [2010] BLR 358
82 [2003] EWHC 1390 (TCC). This case is referred to in greater detail at paragraph 5.63.
83 [2008] EWHC 282 (TCC), [2008] BLR 250.
172
The DOM/2 Conditions have also featured in a number of cases concerned with jurisdiction.84 5.59
For example, in Joinery Plus Ltd (In Administration) v Laing Ltd 85 HHJ Thornton QC was
faced with an adjudicator’s decision that was expressly based on the JCT Works Sub-Contract.
In fact, the parties were agreed that the sub-contract incorporated the DOM/2 Conditions.
The judge concluded that the decision had been reached by reference to the wrong conditions
of contract and without recourse to the correct contractual documentation and that, as a
consequence, the adjudicator had not decided the dispute that had arisen under the relevant
contract and he had not decided it in accordance with the provisions of that contract. The
judge concluded that these errors went to the heart of the adjudicator’s jurisdiction and that
the decision was therefore a nullity.86
The decision in Bickerton Construction Ltd v Temple Windows Ltd 87 is another case where 5.60
the DOM/2 Conditions applied but where the adjudicator was found to have exceeded
his jurisdiction. The judge found that both parties had understood and proceeded on the
basis that the adjudicator would not be dealing with the final account between them but his
decision was based on a figure that reflected the total value of the work carried out by the
sub-contractor. The adjudicator had the jurisdiction to determine what sums could be validly
withheld from sums otherwise due to the sub-contractor but he had no jurisdiction to decide
the final account figure, the determination of which had been expressly excluded from the
scope of the adjudication. Thus the court concluded that the adjudicator had exceeded his
jurisdiction and he was not entitled to direct that a sum of money be paid by the sub-
contractor to the contractor.
The DOM/2 conditions include detailed provisions, at Clause 11, dealing with delay. On 5.61
any major contract or sub-contract, the parties’ rights and liabilities in relation to delay will
change as delaying events occur. This will often lead to procedural difficulties because a party
may seek an extension of time on one basis, and that claim for an extension may be referred
to an adjudicator. If that party seeks a further extension of time, the second adjudicator
cannot reach any decision that is inconsistent with or cuts across the decision of the first
adjudicator.88 In Emcor Drake & Skull Ltd v Costain Construction Ltd,89 HHJ Havery QC
decided that Clause 11.7 of DOM/2 permitted the main contractor to grant more than
one extension of time and that, accordingly, there could be more than one adjudication on
the issue as to the sub-contractor’s entitlement. As to the main issue of fact, namely whether
the second adjudicator had reconsidered facts and matters that had previously been
adjudicated upon, the judge concluded that he had not.
The decision in Emcor Drake & Skull is important for another reason, although the matter is 5.62
only referred to in passing at the end of the judgment. One of the arguments advanced by the
84
See for example Northern Developments (Cumbria) Ltd v J&J Nichol [2000] BLR 158.
85 [2003] BLR 184.
86 As the editors of the BLR point out, the decision in Joinery Plus might be difficult to reconcile with the
decision of the Court of Appeal in C&B Scene Concept v Isobars [2002] BLR 93. In that case, the adjudicator
may have made an error in relation to the relevant contract terms but the Court of Appeal held that that did not
constitute a decision in excess of the adjudicator’s jurisdiction. Although Judge Thornton described C&B Scene
as a case where the correct contractual provision was misconstrued by the adjudicator, that may not be an
entirely accurate representation of what he did.
87
Unreported, 26 June 2001, TCC.
88 For a more detailed discussion on the problems created by serial adjudications, please see paragraphs
7.97–7.106 and 13.58–13.62.

89 [2004] EWHC 2439, [2004] 97 Con LR 142.
173
contractor in seeking to resist the enforcement of the adjudicator’s decision concerned the
scope of the documentation raised in the adjudication itself. The complaint was that there
was something like 5,000 pages said to be relevant to the referral notice and that, in conse-
quence, it was unfair and an abuse of the adjudication process to require the contractor to
respond to those facts and matters in the second adjudication. Judge Havery rejected this
submission in robust terms:
The necessity to respond quickly to vast quantities of paperwork is one of the well-known
hazards of the adjudication process. That cannot of itself be a ground for contending that there
has been an abuse of process. In my judgment, the fact that the same documentation appears
in two successive adjudications is a wholly insufficient ground for describing what happened
as an abuse of process.
This was just one of a number of occasions when the point as to the size and scale of the
‘dispute’ has led the losing party to claim that the adjudicator’s decision was not enforceable.
There is a wider discussion about this topic in paragraphs 13.13–13.25 below. However,
by reference to the authorities cited there, the present position appears to be that, if the
adjudicator is content that he can reach a fair decision within the 28 days or the agreed
extended period, then the losing party will not be able to avoid enforcement of that decision
on this ground.
5.63 In RSL (South West) Ltd v Stansell Ltd,90 the judge had to consider whether the adjudicator
had acted impartially in accordance with Clause 38A.5.5 in circumstances where, in breach
of an agreement reached with the parties, he had relied on the report of a programming
expert that had not been disclosed to them. The judge held that it was elementary that the
rules of natural justice required that a party to a dispute resolution procedure should know
what the case against him might be and should have an opportunity to meet it. He concluded
that the mere fact that the adjudicator had taken into account, in reaching his decision in
relation to extensions of time, a report that was not disclosed to the parties was sufficient to
conclude that the decision was reached in breach of the rules of natural justice and should
not be enforced. It is important to note that the judge reached this conclusion notwith-
standing the fact that the time constraints were such that it was difficult to see how the
adjudicator could have invited further submissions on the report and still reached his
conclusion within the allotted period.91
Other Standard Forms of Contract

GC/Works
5.64 Many large-scale infrastructure projects carried out on behalf of government departments
and agencies are let on versions of the GC/Works Contract and Sub-Contracts. The decision
of HHJ Wilcox in Levolux A.T. Ltd v Ferson Contractors Ltd 92 was concerned with two
different aspects of the GC/Works Sub-Contract. The defendant failed to pay the sum
awarded by the adjudicator and argued that they were entitled to set-off against that sum
their own claim for the costs of completion. The judge found that, although Clause 38A.11
90 [2003] EWHC 1390 (TCC).

91 For a detailed discussion of the adjudication cases concerned with natural justice, please see Chapter 13.
92 [2002] BLR 341.
174
of the contract form allowed either party to raise ‘any right of set-off, counterclaim or
abatement in connection with the enforcement of an adjudicator’s decision’, the set-off had
to be the subject of a proper withholding notice. Under this form of contract there was no
fresh right to set off following the adjudicator’s decision.93 This decision was upheld by the
Court of Appeal, and is the subject of a detailed analysis at paragraphs 9.26–9.28 below.
Levolux is also important because of the court’s consideration of the determination provisions 5.65
in Clause 29 of the GC/Works sub-contract. The defendant sought to rely on these
provisions to argue that, following the service of the determination notice, it was not bound
to make any further payment to the claimant until after the works and the making good had
been completed. Judge Wilcox rejected this argument, saying that, on the facts, the claimant
was owed monies at the time that work was suspended; that the adjudicator found that the
claimant was entitled to suspend the works; and that the purported determination was
wrongful. In those circumstances, there was no bar on the payment of the sums found due
by the adjudicator. In addition, the judge also concluded that the words in Clause 29.8.1 to
monies ‘that may be due or accruing due from the contractor or to the sub-contractor shall
cease to be due or accrue due . . .’ did not include monies due under an adjudicator’s award
within his jurisdiction.94 This conclusion was also upheld by the Court of Appeal.
The adjudication provisions in the main GC Works/1 Contract are set out in condition 59. 5.66
Somewhat unusually, condition 59(8) purports to set out a list of decisions made by or on
behalf of the employer that an adjudicator did not have the power to vary or overrule, including
decisions by the employer to give the contractor a notice of determination. These provisions
were considered in Banner Holdings Ltd v Colchester Borough Council 95 where Banner were
arguing that an adjudicator had no jurisdiction to decide the dispute which had been referred
to him, because it was caught by that exclusion provision. The TCC judge’s primary finding
was that, on a proper construction of Clause 56(8), the adjudicator was not deprived of the
necessary jurisdiction to deal with the dispute which had been referred to him, because that
dispute focused, not on the decision to determine itself, but on the financial effect of that
decision. However, the TCC judge went on to say that, if that conclusion was wrong,
such that the contract did purport to prevent the council from referring the dispute to
adjudication, then such a provision would appear to fall foul of s108 of the 1996 Act.96 The
judge said that there was nothing in s108 that could justify such limits on the adjudicator’s
powers and jurisdiction, and he noted that s108 contained no qualification or limitation
upon the nature, scope and extent of the disputes that could be referred to adjudication
under a construction contract. On that basis, therefore, he concluded that condition 59(8)
was a non-complaint provision that would have to be replaced by the Scheme, either in
whole or in part. In passing, at paragraph 40 of his judgment, the judge also noted that
condition 59(5) of GC/Works1, which purported to provide that the adjudicator’s decision
remained valid even after the statutory period had expired, was also non-compliant.
93 This, of course, was different to the result in Shimizu v LBJ Fabrications [2003] BLR 381, but as explained
at paragraph 5.53 above, Shimizu turned on the particular terms of the adjudicator’s decision and, in particular,
his ruling that the sum would not be due and payable to the sub-contractor until 28 days after the service of a
VAT invoice. This allowed time for the service of a fresh withholding notice.
94
This decision can be contrasted with KNS although, in reality, each turned on its own particular facts, the
terms of the contracts in question, and the precise terms of the adjudicators’ respective decisions.
95 [2010] EWHC 139 (TCC), [2010] 131 Con LR 77.
96 Paragraph 2.93 onwards.
175
5.67 Clause 38A of the GC/Works Sub-Contract contains the sub-contract adjudication
provisions. Clause 38A.5 provides that ‘the adjudicator shall notify its decision to the
Contractor and the Sub-Contractor not earlier than 10 and not later than 28 days from
receipt of the notice of referral, . . . the adjudicator’s decision shall nevertheless be valid if
issued after the time allowed . . .’ In Aveat Heating Ltd v Jerram Falkus Construction Ltd 97
HHJ Havery QC concluded that this open-ended ability on the part of the adjudicator to
provide a valid decision after the 28 days or any extended period was contrary to s108(2)(c)
of the 1996 Act. As a result, he decided that the contractual adjudication mechanism fell
by the wayside and that it had to be replaced by the Scheme.
The ICE form of Engineering Contract

5.68 The best-known standard form in respect of civil engineering works is the ICE Conditions.
Following the 1996 Act, supplementary provisions were drafted to include expressly for
adjudication. The terms of the ICE conditions that have arisen most often in adjudication
cases are Clause 60 (concerned with interim payments, withholding notices and the like) and
Clause 66 (the procedure whereby the parties seek the engineer’s decision on a particular
dispute between them).
5.69 In Barr Ltd v Law Mining Ltd,98 the ICE Conditions 5th Edition were incorporated into the
contract, but they had been modified by a letter that provided that payment for work would
be 30 days after certification. The parties disagreed how this would work in practice. In his
decision the adjudicator identified the competing arguments and then went on to find that
both payment mechanisms put before him failed to comply with s110 of the 1996 Act,
because they failed to provide a mechanism for determining when a payment became due
under the contract. He therefore concluded that the Scheme had to be implied. The court
concluded that, in arriving at this conclusion, the adjudicator did not exceed his jurisdiction,
even if his decision might be wrong in law. His decision did not result from his failure to
address the correct question, and his decision was therefore upheld.
5.70 As to the operation of Clause 66, that vital component of the dispute resolution mechanism
offered by the ICE Conditions, there are a trio of cases dealing with the interaction between
adjudication, the engineer’s decision, and arbitration. In JT Mackley & Co Ltd v Gosport
Marina Ltd 99 there had been two adjudications that had resulted in decisions in principle
favourable to the contractor. Subsequently, the contractor sought and obtained an engineer’s
decision as to the value of their works. Three months later, the employer’s solicitors
purported to serve a joint notice of dispute and notice to refer to arbitration on both the
contractor and the engineer. The employer’s complaint was that the works had not been
properly designed and/or carried out by the engineer and the contractor. The contractor
contended that the joint notice to refer was invalid because a decision of the engineer was a
condition precedent to the entitlement of any party to refer a dispute to arbitration, and the
employer could not somehow attempt to do both simultaneously. The employer contended
that an engineer’s decision was not required where what the party issuing the arbitration
notice wanted to do was to challenge the decision of an adjudicator. The judge rejected the
employer’s argument, deciding that the fact of a previous adjudication and the existence of
97 [2007] EWHC 131 (TCC), [2007] 113 Con LR 13.

98 [2001] Scot CS 152; 80 Con LR 134.
99 [2002] BLR 367.
176
an adjudicator’s decision had nothing to do with any subsequent arbitration in which the
correctness of that decision might be disputed. The judge pointed out that the adjudicator’s
decision was temporarily binding until there was a later arbitration and any such arbitration
had to be carried out in accordance with the arbitration clause in the contract. That required
that there had first to be a decision of the engineer under Clause 66. The judge therefore
granted a declaration that the joint notice to refer was invalid.
In The Construction Centre v Highland Council 100 the defenders failed to pay the sum found 5.71
due by the adjudicator of more than £5.5 million and, instead, within seven days of his
decision, served a notice of intention to withhold. They argued that the arbitration provi-
sions of the contract did not permit the arbitrator to take account of a final decree of the
court pronounced in accordance with the adjudicator’s decision, and that therefore they
would be irredeemably prejudiced if there was judgment against them for the £5.5 million.
This argument was rejected by Lord MacFadyen who ruled that the pursuers were con-
tractually entitled to require the defenders to implement the adjudicator’s provisional
determination of the dispute, whether it be right or wrong. In consequence, any decree
pronounced in that action was not a finding by the court that the adjudicator was right and
it would therefore have no effect on the final determination of the dispute by the arbitrator.
In line with other decisions101 the court held that the service of a withholding notice after the
publication of the adjudicator’s decision did not entitle the defenders to withhold payment
and that s111 was intended to apply only to the withholding of payments in respect of
which the contract provided a final date for payment; it did not apply to payments due in
consequence of an adjudicator’s decision.
The decision in The Construction Group Centre Ltd is also important for another reason. 5.72
The claim which was the subject of the (invalid) withholding notice was a set-off in respect
of liquidated damages. The court held that, whilst the scope of an adjudication was
defined by the notice of adjudication, any ground that justified non-payment of the sum
sought fell within the scope of the adjudication. Thus the court ruled that the adjudicator
could not have declined to allow the defenders to plead the cross-claim for liquidated
damages had they chosen to do so. Their failure to raise the matter in the adjudication was
another reason why they were not entitled, after the event, to rely on their alleged cross-
claim.
The third case concerned with Clause 66 of the ICE Conditions of Contract is another 5.73
Scottish case, Peterhead Harbour Trustees v Lilley Construction Ltd.102 There, the employer
argued that, because the payment dispute had been referred to adjudication, and that
adjudication had taken place, the terms of Clause 66 did not admit the possibility of
subsequent arbitration in respect of the same subject matter and that by triggering the
adjudication, the contractor had stepped outside the provisions of Clause 66. This argument
was rejected by the court in similar terms to the decision in The Construction Centre Group.
The adjudicator’s decision in favour of the contractor had been paid. There remained a
dispute as to the extent of the defendant’s contractual entitlement to payment, which was
described by the court as a dispute ‘that can competently be resolved in accordance with the
provisions of clause 66’. Moreover the court held that there was nothing in the provisions of
100 [2002] BLR 476.

101 See paragraphs 9.20–9.34.
102 Scots Law Times, 2003, 731.
177
Clause 66 that would preclude the contractor from serving a notice of dispute in the terms
of Clause 66(2) as a necessary preliminary step to having the dispute between the parties
resolved by arbitration. The earlier decision of the engineer was not a final determination of
the dispute between the parties.103
NEC/2
5.74 One of the many NEC family of standard form building and engineering contracts is the
clumsily titled Option Y (UK) 2. These provisions were the subject of a close analysis by HHJ
Toulmin CMG QC in John Mowlem & Co Plc v Hydra-Tight & Co Plc.104 The judge
concluded that Clauses 90.1–90.4 of Y (UK) 2 did not comply with s108(1) and (2)(a) of
the 1996 Act because they did not give the parties an immediate right to refer at any time
(or to give notice of an intention to refer) a dispute to adjudication. The contractual mechanism
there set out was described as a notification of dissatisfaction that delayed a referral to
adjudication for four weeks, during which time the parties had an opportunity to meet
and resolve their differences. During that time the parties were to endeavour to agree that a
dispute ‘shall not have arisen’ and that therefore there was no matter that could be referred
to adjudication. That was plainly different to the 1996 Act, which provided that a party to a
construction contract must have an immediate right to give notice of an intention to refer a
dispute to adjudication. In addition, the judge concluded that Clause 90.1 and following did
not provide a timetable for the securing of the appointment of an adjudicator, and referral of
a dispute to him, within seven days. For these reasons, the judge concluded that the Scheme
for Construction Contracts must apply. The judge considered whether, if some parts of
the sub-contract complied with the 1996 Act, they could be retained and the Act only used
to substitute for or fill in those parts of the sub-contract that were contrary to the Act.
He concluded that the words of the 1996 Act were clear and that, if any part of the sub-
contract does not comply with the Act, s108(1), (2), (4) and/or the provisions of the Scheme
must apply instead.105
NEC/3
5.75 The new NEC/3 form has not yet generated any case-law. Although the form has been
criticised in some quarters for its loose, not to say rather generalised wording (which the
NEC prefer to call ‘ordinary language’ in their guidance notes), there is nothing to indicate
that the adjudication provisions are not generally compliant with the 1996 Act.
Contracts for Professional Services

5.76 The standard forms of contract governing the engagement of construction professionals also
contain adjudication provisions. Thus the ACE Conditions of Engagement incorporate
adjudication provisions and stipulate that any adjudication will take place in accordance
with the Construction Industry Council Model Adjudication Procedure. A number of
particular aspects of that procedure are discussed in paragraphs 5.89–5.91 below. Similarly,
the RIBA Conditions of Engagement in respect of the engagement of architects contain an
103
It should also be noted that there is an ICE adjudication procedure. This has not been considered in detail
in any enforcement dispute. Although in Amec Group Ltd v Thames Water Utilities Ltd [2010] EWHC 419
(TCC) an argument was raised to the effect that the procedure did not comply with the 1996 Act, the issue did
not arise for decision because the procedure had been expressly agreed by the parties.
104 [2001] 17 Const LJ 358.
105 See paragraphs 3.04–3.12.
178
adjudication clause. In Picardi v Cuniberti & Cuniberti 106 the judge concluded that, contrary
to the claimant’s submissions, the RIBA conditions of engagement were never agreed by the
defendants. However, even if he had concluded that the contract incorporated the RIBA
Conditions, the judge indicated that he would have decided that the adjudication provisions
would have been excluded pursuant to the Unfair Terms in Consumer Contracts Regulations
1999 on the basis that adjudication was an unusual procedure which, in the 1996 Act,
specifically excluded private dwelling houses. Thus, if the claimant had wanted to obtain the
defendant’s agreement to adjudicate disputes related to works carried out at private dwelling
houses, the particular adjudication provisions of the RIBA Conditions of Engagement
would have had to have been drawn to the defendant’s attention.
Adjudication Rules
The TeCSA Rules
Following the change of name of the Official Referee’s Court to the Technology and 5.77
Construction Court, the specialist solicitors practising in that field changed their name from
ORSA to TeCSA. In both guises, they have created specific rules for the prompt and efficient
resolution of disputes by way of adjudication. Large parts of those rules reflect the 1996 Act
and the Scheme. However, some of the specific rules have been the subject of particular
comment by the courts.
Rules 11 and 12 of Version 1.3 of these rules seek to add an important gloss on the provisions 5.78
of the 1996 Act. They provide as follows:
11. The scope of the adjudication shall be the matters identified in the notice requiring
adjudication, together with:
(1) any further matters which all Parties agree should be within the scope of the adjudication;
(2) any further matters which the Adjudicator determines must be included in order that the
adjudication may be effective and/or meaningful.
12. . . . The Adjudicator may rule upon his own substantive jurisdiction and as to the scope
of the Adjudication.
As explained in more detail in paragraphs 7.47–7.60 below, the notice of intention to refer
a dispute to adjudication is commonly regarded as the sole source of the adjudicator’s
jurisdiction, so that a dispute not identified there cannot be later raised by the claimants
during the adjudication. It will be seen that rule 11 of the TeCSA Rules gives the adjudicator
the power to widen the scope of the adjudication if he considers that to be ‘effective and/or
meaningful’. This is potentially a significant power, which an adjudicator under these
Rules may be able to use to address other related matters and which, by way of contrast, an
adjudicator under the Scheme for Construction Contracts would not have.
Furthermore, it is generally accepted that an adjudicator cannot issue a binding decision on 5.79
his own jurisdiction unless the parties have expressly agreed to be bound by that decision.107
106
[2003] BLR 487. For a fuller discussion of the Unfair Terms in Consumer Contracts Regulations 1999,
please see paragraphs 13.71-13.80.
107 See, for example, Nordot v Siemens [2001] CILL 1778–1779. This topic is addressed in paragraphs
7.09–7.16.
179
However, it has been argued that rule 12 allows the adjudicator to make a binding decision
on his own jurisdiction. In Farebrother Building Services Ltd v Frogmore Investments Ltd 108
HHJ Gilliland QC concluded that rule 12 meant that an adjudicator’s decision that a
particular issue was within his jurisdiction was binding on the parties. He distinguished
the decision in Bouygues109 on the grounds that that did not apply to adjudications carried
out pursuant to the TeCSA Rules. He concluded that if, by mistake, the adjudicator
decided that something was within his jurisdiction when, on the proper construction of
the notice, it was not, then the rules provided that he could rule on his substantive juris-
diction and it was not a matter with which the court could interfere. Thus he ruled that
such a decision was binding until it was set aside, and the court could not intervene at the
enforcement stage.
5.80 The decision in Farebrother is difficult to reconcile with the conclusion of HHJ Kirkham in
Shimizu Europe Ltd v LBJ Fabrications Ltd,110 a case already referred to at paragraphs 2.166
and 5.53 above. Judge Kirkham considered rules 11 and 12, and also rule 33, which provides
that, save in the case of bad faith on the part of the adjudicator, no party shall make any
application to the court whatsoever in relation to the conduct of the adjudication or the
decision of the adjudicator until such time as the adjudicator has made his decision and until
the party making the application has complied with any such decision. She concluded that
the rules did not have the effect of preventing a party from asking the court to construe a
decision and the rules could not oust the jurisdiction of the court. She said, at paragraph 48
of her judgment:
The [TeCSA] Rules presuppose that the decision would be one validly made within an
adjudicator’s jurisdiction. So, for example, if LBJ were to make a claim for summary judgment
to enforce the decision, the rules would not prevent Shimizu raising a jurisdictional argument
as a defence; if the decision is without jurisdiction, it will not be summarily enforced. In
circumstances where a party is able to persuade the court that the adjudicator did not have
jurisdiction, it would at the least be harsh, and in my judgment contradictory and inappropriate,
to require that party first to comply with the decision.
5.81 As a matter of principle it is respectfully suggested that Judge Kirkham’s approach is to be
preferred. Whilst rule 12 allows the adjudicator to rule on his own substantive jurisdiction,
there is nothing in the TeCSA Rules to indicate that such a decision is to be treated as binding
and/or not open to review by the court. The wording of rule 12 allows the adjudicator to rule
on his own jurisdiction and in most cases it is appropriate for the adjudicator to do just that.
But if one party takes a jurisdictional objection, both to the adjudicator and, in any enforce-
ment proceedings, to the court, then the court is obliged to review that jurisdictional
challenge and, if the court concludes that the jurisdictional challenge is valid, then that
would be enough to render the decision unenforceable. It would be inappropriate to
conclude that rule 12 somehow provides the necessary jurisdiction to an adjudicator who,
without rule 12, would not have the jurisdiction to entertain the dispute. Such a view is
also consistent with general principle, as noted at paragraphs 7.09–7.16 below.
5.82 It should also be noted at this point that paragraph 32 of the TeCSA Rules expressly gives the
adjudicator the right to correct any clerical mistake or error within five days of the date of the
108 [2001] CILL 1762–1764.

109 [2000] BLR 49.
110 [2003] BLR 381.
180
decision. In Thermal Energy Contruction Ltd v AE and E Lentjes UK Ltd111 the claimant in the
enforcement proceedings said that, in consequence of this provision, the defendant/responding
party could not complain about the deficiencies in the adjudicator’s decision, because no
attempt had been made to invoke the slip rule. Effectively, as HHJ Stephen Davies noted,
the argument sought to draw an analogy with ss 57 and 70 of the Arbitration Act 1996,
which require a party dissatisfied with the arbitral award to exhaust any available recourse to
the tribunal before seeking relief from the court. The judge rejected that argument as a
matter of construction of the TeCSA Rules. In particular, he held that paragraph 32 was
limited to clerical mistakes or errors, and could not encompass, for example, a failure by the
adjudicator to address in his decision a substantial element of the defence raised by the
responding party to the claims in the adjudication. The judge said that it would require very
clear words for a party to lose the right it would otherwise have to raise a legitimate
jurisdictional ground for opposing an enforcement action, on the basis that it was obliged to
exercise a different remedy. There was nothing in paragraph 32 that suggested that such an
obligation existed under this procedure.
In A v B112 the court was concerned with the TeCSA Rules relating to enforcement. Rule 14 5.83
provides that the adjudicator’s decision ‘shall be binding until the dispute is finally
determined by legal proceedings, by arbitration . . . or by agreement’, and rule 28A expressly
states that:
Every decision of the Adjudicator shall be implemented without delay. The parties shall be
entitled to such reliefs and remedies as are set out in the decision, and shall be entitled to
summary enforcement thereof, regardless of whether such decision is or is to be the subject of
any challenge or review. No party shall be entitled to raise any right of set-off, counterclaim or
abatement in connection with any enforcement proceedings.
In addition, paragraph 2.1 of Appendix 8 to the Rules provided that:
(f ) Notwithstanding rules 14 and 33, no party shall, save in the case of bad faith on the part of
the Adjudicator make any application whatsoever to a competent court in relation to the
conduct of the Adjudication or the decision of the Adjudicator until the earlier of the Actual
Completion date of the last Phase or termination of this sub-contract . . .
This was similar to the provision considered by HHJ Kirkham in Shimizu.
The defenders in A v B113 argued that paragraph 2.1(f ) prevented the pursuers from 5.84
enforcing the adjudicator’s decision because actual completion had not taken place. The
court rejected this argument on two alternative grounds. If paragraph 2.1(f ) of Appendix
8 had the effect contended for by the defenders, it was incompatible with s108(3) of the
1996 Act, and was accordingly of no legal effect. But, in the alternative, as a matter of con-
struction, paragraph 2.1(f ) of Appendix 8 was to be construed as relating only to judicial
review of an adjudicator’s decision, and not to proceedings to enforce such a decision.
Rule 21A of the TeCSA Rules allows the adjudicator to make awards of costs (or, in Scotland, 5.85
judicial expenses). In Deko Scotland Ltd v Edinburgh Royal Joint Venture114 the adjudicator
had taken advantage of this power to include, along with the decision awarding sums to the
111
[2009] EWHC 408 (TCC).
112 17 December 2002, Outer House, Court of Session; (2002) CA 110/02.
113 (2002) CA 110/02.
114 Scots Law Times 2003, 727.
181
contractors, a ruling that the employer was to pay half of the contractor’s costs. The reason
the costs were reduced to half was that the adjudicator concluded that much of the time spent
in connection with the adjudication was taken up with matters for which the contractor was
wholly unsuccessful, and he said that he had apportioned the costs accordingly. The contractor
pursued a claim for its expenses in court. The employer successfully attacked the claim on
two grounds. First, it was argued that the claim had to be limited to legal costs and should
not include the fees of a claims consultant and a surveyor. Secondly, they also argued that any
award of expenses by an adjudicator was subject to taxation and that any proceedings for
enforcement had to be based on an account of expenses that had either been taxed or had
been agreed. The court upheld both of these submissions. The case is of relevance because of
the clear equation between (English) costs and (Scottish) expenses in the judgment of Lord
Drummond Young. The judge also concluded that the provisional nature of an adjudicator’s
decision had no bearing on the need for taxation, which was required in order to prevent
successful parties to legal proceedings from making excessive claims for expenses. He said
that that requirement existed whether or not the result of the legal proceedings was fully
determinative of the party’s rights and was liable to be undone by other proceedings.
5.86 It remains an open question as to whether an adjudicator appointed under the TeCSA Rules
is obliged to give reasons if the parties do not agree that he should. In Hurst Stores and
Interiors Ltd v ML Europe Property Ltd,115 a substantive judgment dealing with a challenge to
the earlier findings of an adjudicator, the adjudicator had said that, pursuant to rule 27 of the
TeCSA Rules, he was not obliged to give reasons because, although one party had requested
such reasons, the other party had not agreed to the provision of such reasons.
The CEDR Rules

5.87 There are fewer reported cases on the CEDR Rules. One of them is Stiell Ltd v Riema Control
Systems Ltd 116 That was directly concerned with paragraphs 12 and 13 of the CEDR Rules,
which provided that the decision of the adjudicator was final and binding upon the
parties unless one or other of the parties issued, within the specified time, a written notice of
its dissatisfaction. If such a notice of dissatisfaction was provided, the dispute would be
finally determined by court proceedings or by reference to arbitration and, in such proceedings,
neither the court nor the arbitrator would be bound by the decision of the adjudicator, and
indeed would have the power to review and revise such a decision. This led to an unsatisfactory
situation in Stiell because, although the pursuers had been partially successful, they were
obliged to issue a notice of dissatisfaction in respect of that part of the decision, which was
adverse to them. The defendant paid the sum identified by the adjudicator. Thereafter the
defendant sought to discharge the interim protective measures, namely the warrant for
arrestment on the defendant, whose underlying basis was the proposition that the defendant
did, or even might, owe the pursuer more than it had then paid. Surprisingly, the court
decided that the decision of the adjudicator did not change matters and that the pursuer’s
claim for the sums (which the adjudicator had determined were not due) was a pure debt and
not dependent upon a contingency. The interim measures therefore remained in place. It is
difficult not to agree with the learned commentators of the Technology and Construction
Law Reports that in England and Wales a different approach would have been adopted.
115 [2003] BLR 391.

116 [2001] 3 TCLR 9. See also paragraph 14.50.
182
The CIC Model Adjudication Procedure

Reference has already been made to the CIC Model Adjudication Procedure. A number of 5.88
the more important paragraphs of this procedure are set out in the judgment of Dyson J in
Bouygues.117 They include paragraph 1, which stipulates that the object of adjudication is to
reach a fair, rapid and inexpensive decision upon a dispute arising under the contract;
paragraph 4, which provides that the decision shall be binding until the dispute is finally
determined by legal proceedings, arbitration or agreement; paragraph 5, which provides that
the adjudicator’s decision shall be implemented by the parties without delay whether or not
the dispute was to be referred to legal proceedings or arbitration; and paragraphs 8 and 14,
which contain familiar provisions in relation to the notice of intention to refer and the
referral notice. Paragraph 20 allows the adjudicator to deal with matters other than those set
out in the notice, but only if those matters are agreed by the parties and the adjudicator, and
not otherwise. In accordance with those rules, Dyson J concluded that the adjudicator’s
jurisdiction to decide the disputes derived from the Model Procedure and, to the extent that
he purported to decide matters that did not fall within the scope of paragraph 20 (and which
therefore had not been referred to him), his decision did not come within paragraphs 4
and 5 and was void.
Certain aspects of the CIC Procedure have been called into serious doubt as a result of two 5.89
decisions of HHJ Havery QC in the London TCC. In the first, Epping Electrical Co Ltd v
Briggs & Forrester (Plumbing Services) Ltd 118 the judge had to consider rule 25 of the CIC
Procedure which provided that ‘if the adjudicator fails to reach his decision within the
time permitted by this procedure, his decision shall nonetheless be effective if reached
before the referral of the dispute to any replacement adjudicator . . .’ Judge Havery said
that the apparent effect of this rule, which would allow the adjudicator to reach an effec-
tive decision beyond the 28-day period, was inconsistent with s108(2) of the Act. As a
result, he concluded that the CIC Procedure was not compliant and that the Scheme must
apply instead.119 He revisited that decision in Aveat Heating Ltd v Jerram Falkus Construction
Ltd 120 (which was not concerned with the CIC Procedure but a particular provision of
GC/Works Sub-Contract Conditions which also purported to suggest that the adjudi-
cator’s decision would be valid if issued after the time allowed). Again Judge Havery
concluded that such a provision was not in accordance with the Act and that, in consequence,
the Scheme must apply.121 As discussed in greater detail at paragraph 2.132 above, it
would appear that Aveat can be regarded as wrong on this particular point, because the
term under consideration there was dealing with the possible late issue of the decision
(which may be permissible) whilst Epping was concerned with rule 35 of the CIC
Procedure, which purported to extend the validity of a decision generally (which is never
permissible).
Another of the unusual features of at least one version of the CIC Model Procedure was that 5.90
it expressly permitted the adjudicator to conduct separate interviews with the parties and
117 [2000] BLR 49.

118
[2007] EWHC 4 (TCC), [2007] BLR 126.
119
In Banner Holdings, a similar view was expressed about a similar term in the GC/Works 1 Form.
120
[2007] EWHC 131 (TCC), [2007] 113 Con LR 13.
121 Although the CIC Procedure was also utilised in Primus Build Ltd v Pompey Centre Ltd [2009] EWHC
1487 (TCC), [2009] BLR 437, the issues concerned the contract and the adjudicator’s handling of the
adjudication, not the procedure itself.
183
their respective experts. In Dean & Dyball Construction Ltd v Kenneth Grubb Associates Ltd 122
the defendant objected to the adjudicator’s decision on the grounds that he had followed
an unfair procedure, notwithstanding that it was a procedure expressly permitted by the CIC
Model Adjudication Procedure. HHJ Seymour QC said that if there was no express
provision in the relevant adjudication procedure that allowed this course, he had ‘some
doubts’ that such a course could ever be proper without the tribunal indicating to the absent
party what had been said. However, the judge decided that, on the material before him, the
defendants’ argument really amounted to no more than ‘the somewhat unpromising
proposition that the procedure, if operated in accordance with its express terms, could be
operated unfairly’. The judge went on to conclude that, on the material before him, there had
been no unfairness and that there was no suggestion that the adjudicator had regard to any
evidence given on behalf of the claimant of which the defendant was unaware or which it did
not have an opportunity to answer.
5.91 The CIC Procedure, at paragraphs 28 and 29, makes plain that the parties must bear their
own costs and expenses incurred in the adjudication and that the parties would be jointly
and severally liable for the adjudicator’s fees and expenses. In Bridgeway Construction Ltd v
Tolent Construction Ltd 123 the parties had deleted those paragraphs and instead agreed that
the party serving the notice of adjudication would bear all the costs and expenses incurred
by both parties and all of the adjudicator’s fees and expenses. Bridgeway served a notice of
adjudication and were successful but, in accordance with the contract, the adjudicator
required them to pay the costs. Tolent paid the sum ordered under the adjudication decision,
less its own legal costs and other expenses. Bridgeway were then obliged to contend that
the amendments to the contract to which they had agreed were ineffective because they
inhibited parties from pursuing the remedies provided by the adjudication procedure. This
argument was rejected by HHJ MacKay QC, who decided that the contracting parties could
agree what they liked and that it was not for a disappointed party to seek to argue that the
contract which he had freely agreed was in some way wrong or invalid. The decision of the
adjudicator was therefore upheld. However in Yuanda (UK) Co Ltd v WW Gear Construction
Ltd,124 Edwards-Stuart J concluded that the decision of Judge MacKay was wrong and that a
similar clause was inoperable because it inhibited a party in the position of Bridgeway from
pursuing its contractual remedies. His important judgment is analysed in greater detail in
122 [2003] EWHC 2465 (TCC), [2003] 100 Con LR 92.

123 [2000] CILL 1662–1664.
124 [2010] EWHC 720 (TCC), [2010] BLR 435.
184
6
AD HOC ADJUDICATION
Introduction 6.01 Estoppel 6.18

The Earlier Authorities 6.03 Conclusions 6.20
The Reservation of the Right to Challenge 6.12
I can see no reason, as a matter of law, why parties cannot agree to abide by the decision
of a third party if they so wish. Clearly that is appropriate in the case of arbitration.
Why should it not be appropriate in the case of adjudication, I ask?
His Honour Judge Gilliland QC in Nordot
Engineering Services Ltd v Siemens Plc 1
Introduction
In addition to statutory adjudication under the 1996 Act, and contractual adjudication 6.01
pursuant to the terms of the contract in question, there is a third way in which parties to a
contract can agree, or be deemed to have agreed, to submit their dispute to adjudication.
The authorities refer to this as ‘ad hoc adjudication’, a process whereby the parties agree to
confer jurisdiction on an adjudicator to decide the particular dispute that has arisen between
them. Because this is a matter entirely for the agreement of the parties, such an adjudication
may arise under contracts other than construction contracts, or under contracts for the
provision of work and services that would otherwise be excluded by the provisions of the
1996 Act.2 For the avoidance of doubt, however, the point needs to be made at the outset
that the question of ad hoc adjudication has most commonly arisen when one party has
acquiesced in the appointment of an adjudicator and then realised, much too late, that he
had not been obliged or required to do so.
It has long been the position that an arbitrator can derive a full jurisdiction from the ad hoc 6.02
agreement of the parties. In Westminster Chemicals and Produce Ltd v Eicholz & Loeser,3
Devlin J (as he then was) was concerned with a situation where it was said that the arbitrator
had ad hoc jurisdiction to deal with the dispute. The judge said that if two people agreed to
submit a dispute to a third person, then the parties agreed to accept the award of that
1
SF00901 TCC 16/00; CILL, September 2001.
2 See the detailed discussion as to construction operations excluded by the 1996 Act at paragraphs
2.24–2.41.
3 [1954] 1 LLR 99 at 105–106
185
person, or, putting it another way, they had conferred jurisdiction on that third person to
determine their dispute. If, however, one of the parties thinks that the dispute that has
arisen is outside the agreement to refer disputes to a third person, then that party can protest
the jurisdiction of the arbitrator, and to contend that he had not agreed to abide by the
award. It was held that a party who had made that position clear at the outset can then take
part in the arbitration without losing his rights to reactivate the jurisdiction argument at an
appropriate stage. For obvious reasons, the approach and reasoning in Westminster Chemicals
has been considered and applied in a number of the adjudication cases concerned with ad
hoc jurisdiction, dealt with in broad chronological order below.
The Earlier Authorities

6.03 The first adjudication dispute in which the question of ad hoc jurisdiction arose was The
Project Consultancy Group v The Trustees of The Gray Trust.4 In that case there was a dispute as
to whether the contract in question was a construction contract or had been entered into
before 1 May 1998 (the starting date for the 1996 Act). Dyson J (as he then was) rejected the
claimant’s first argument, to the effect that the defendant could not challenge the adjudi-
cator’s decision on his own jurisdiction. Much of the judgment is concerned with the
subsidiary contention by the claimant, to the effect that there was an ad hoc submission of
the jurisdiction issue to the adjudicator, with the result that his decision was binding. It was
argued that the defendant had submitted that question to the adjudicator for his decision
and had agreed to be bound by it. Dyson J expressly confirmed that the principles enunciated
by Devlin J in Westminster Chemicals were ‘equally applicable to an adjudication’. In other
words, it was open to the parties to a contract to confer an ad hoc jurisdiction on an adjudi-
cator and that, if that is what they had done, they would be bound by the result. The judge
then turned to consider the facts in order to ascertain whether or not the parties had given
the adjudicator the necessary ad hoc jurisdiction. He concluded that they had not. He
pointed to the defendant’s solicitors’ letter of 9 March 1999, which said in terms that the
1996 Act did not apply and that the notice of reference to adjudication was invalid. The letter
went on to make plain that, if the claiming party proceeded with the adjudication, the defen-
dant would dispute the adjudicator’s jurisdiction and that, if a decision was made despite
such objections, the defendant would not comply with any such decision on the basis that it
had been made without jurisdiction. It might be thought that the effect of such a letter was
entirely obvious. However, as can often be the case, the position was muddled by the formal
documents exchanged in the adjudication in which, amongst other things, the defendant
had set out in detail its case on the jurisdictional issue. The claimant (referring party) relied
on that document as demonstrating that the responding party was conferring ad hoc
jurisdiction on the adjudicator to decide the issue.
6.04 Dyson J rejected that contention in a passage of his judgment that is equally applicable to
the majority of cases in which a submission of ad hoc jurisdiction is maintained by the referr-
ing party, despite the evidence of clear antecedent objections from the responding party:
15. In my view, the defendant’s solicitors’ letter of 9 March 1999 stated in the clearest terms
that the defendants protested the adjudicator’s jurisdiction, and that they would not recognise
4 [1999] BLR 377.
186
Ad Hoc Adjudication
and comply with any decision to award money to the claimant. The letter also made it clear
that, if the adjudication proceeded, they reserved their right to participate, but without
prejudice to their contention that there was no jurisdiction. I do not consider that there can
be any reasonable doubt as to the meaning of the letter. The only real question is whether,
by participating in the adjudication process, the defendants waived the jurisdiction point,
and agreed to submit to abide by the decision of the adjudicator on that issue. The only
material relied on by Ms Rawley is the content of the defendant’s response to which I have
already referred. But, in their response, the defendants continued to assert that the adjudi-
cator had no jurisdiction. This stance was entirely consistent with what was said in the letter
of 9 March. It is a question of fact whether a person submits to the jurisdiction of a third
person . . . In my view, the defendants never departed from the position which they expressed
very clearly in their solicitor’s letter of 9 March 1999. They did not submit to the jurisdiction
of the adjudicator.
The next case in time was Christiani & Nielsen Ltd v The Lowry Centre Development Co 6.05
Ltd.5 This was a case in which HHJ Thornton QC found that the adjudicator had the
necessary jurisdiction because the contract was caught by the provisions of the 1996 Act.
However, he considered at the outset of his judgment whether the parties had agreed to
vest in the adjudicator an ad hoc jurisdiction, to determine his own jurisdiction, which
decision would then be binding. Judge Thornton agreed, at paragraph 14 of his judg-
ment, that the parties could have agreed to vest the adjudicator with the power to decide
whether or not the relevant contract under which the dispute arose was entered into
before 1 May 1998 (and was thus not caught by the 1996 Act), although he warned that
the status of such a decision, and the extent to which it could be challenged, could only
be decided following a consideration of the express and implied terms of the agreement
to confer such ad hoc jurisdiction. He considered the facts and the correspondence and,
in a similar way to Dyson J in Project Consultancy, concluded that the documents
exchanged between the parties and provided to the adjudicator setting out their respective
submissions on the jurisdiction issue did not amount to an agreement between the parties
to confer an ad hoc jurisdiction on the adjudicator. He concluded that the provision
of such submissions had to be seen against the background of the responding party’s
continuing protest as to jurisdiction and he decided that the responding party had not
agreed to confer on the adjudicator the necessary jurisdiction to enable him to decide his
own jurisdiction. This was despite the fact that the adjudicator apparently thought that
that is what had happened.

These two decisions are to be contrasted with the decision of HHJ Gilliland QC in Nordot 6.06
Engineering Services Ltd v Siemens Plc.6 In that case, it was suggested that the work that was
the subject matter of the contract was not a construction operation as defined by s105(1) of
the 1996 Act. It was argued by Siemens that, because the 1996 Act had expressly excluded
contracts such as the one between themselves and Nordot (because, so they said, the work
that was the subject matter of that contract was not a construction operation within the
meaning of the Act) it was not open to the parties to confer an ad hoc jurisdiction on the
adjudicator. Judge Gilliland rejected that contention. He said:
. . . It seems to me that the submission that it is not open to the parties to confer jurisdiction
on an adjudicator is not sound in principle. I can see no reason, as a matter of law, why parties
5
HHJ Thornton QC, 29 June 2000 (TCC). The case was not reported until [2004] TCLR 2.
6
(SF00901 TCC 16/00) dated 14 April 2000. Also reported at CILL, September 2001.
187
cannot agree to abide by the decision of a third party if they so wish. Clearly that is appropriate
in a case of arbitration. Why should it not be appropriate in the case of adjudication I ask? If
the parties with their eyes open enter into an agreement to the effect that ‘the adjudicator will
decide this question and we will be bound by his decision’, why should the court not give effect
to that agreement? There can be no public policy against that and the mere fact that the system
of adjudication is established by statute does not, it seems to me, make any difference. One
could say exactly the same thing, as a matter of principle, in relation to the question of arbi-
tration. There is no obligation to agree to arbitration before the parties agree to it. Similarly if
parties wish to resolve a dispute and submit it to an adjudicator who derives his jurisdiction
from the statute nevertheless, it seems to me, it is open to the parties to confer that jurisdiction
on him by agreement should they wish.
6.07 Judge Gilliland also emphasised the need for a clear jurisdictional objection to be lodged
by the party who did not wish to enter into such an agreement. He then went on to consider,
on the facts of the case, whether it could properly be said that there had been a submission
to the ad hoc jurisdiction of the adjudicator. He said that such a finding depended on the
fair reading and interpretation of the correspondence that passed between the parties. He
concluded that, in all the circumstances, the parties had agreed to confer an ad hoc juris-
diction on the adjudicator. This was principally because the responding party had written
to the adjudicator and, having made the point that they did not consider that the work
was a construction operation under the 1996 Act, went on to say in clear terms: ‘We will,
however, abide by your decision in this matter and will comply with whatever direction
you deem appropriate.’ In the circumstances, the judge concluded that the statement that
the defendant would abide by the adjudicator’s decision in the matter was clear and
unequivocal, and that it amounted to an agreement that the adjudicator had the ad hoc
jurisdiction to decide the point.
6.08 There were a number of other reported cases during the early days of adjudication in
which it was concluded that the adjudicator had been given an ad hoc jurisdiction, and
the parties were bound by the result. In Parsons Plastics (Research and Development) Ltd v
Purac Ltd 7 there was a dispute as to whether the subject matter of the contract was a con-
struction operation. However, the parties agreed to submit to an ad hoc adjudication
under the terms of the contract between them. The referring party was successful but,
instead of paying the sum awarded by the adjudicator, the responding party issued a with-
holding notice. The referring party argued that, although the adjudication was an ad hoc
referral, the decision was final and binding and should be enforced as if it had been made
under the Act. Their enforcement application failed, both at first instance and in the
Court of Appeal. However, it is clear from the judgment of Pill LJ that the referring party’s
failure was not due to the nature of the adjudication itself (the ad hoc nature of the adju-
dication did not appear to be in issue), but to the fact that, pursuant to the particular
terms of the contract in question, the responding party had a right to set off its counter-
claim against the sums awarded by the adjudicator.8
6.09 In Galliford Try Construction Ltd v Michael Heal Associates Ltd 9 there were a whole series of
issues for the judge to decide. In the end he refused to give summary judgment to enforce the
7
[2002] BLR 334, CA.
8 For the importance of this decision in connection with a losing party’s ability to set off against the sum
awarded by the adjudicator, see paragraphs 9.23 and 9.24.
9 [2003] EWHC 2886 (TCC), [2003] 99 Con LR 19.
188
Ad Hoc Adjudication
adjudicator’s claim, principally because the formation and terms of the contract which
the referring party had urged on the adjudicator was very different to the terms of the con-
tract that they maintained at the enforcement hearing.10 However, along the way, HHJ
Seymour QC decided that the referring party was correct in its submission that, by reference
to the correspondence, there was a clear agreement between the party’s respective solicitors
that, if the mediation failed, the disputes would be submitted to the adjudication of a
named adjudicator. In particular, he decided that the expression ‘without prejudice to our
contentions on jurisdiction’ was, in all the circumstances, insufficient to amount to an
objection to the adjudicator reaching a binding decision on the point in question. He also
found that, in any event, that reservation had been overtaken by the subsequent course of the
correspondence.
The decision in Galliford Try is also important because Judge Seymour made the point that 6.10
it was not just a question of working out whether or not the adjudicator had the necessary
ad hoc jurisdiction, but, if so, what the terms were of that agreement. What is it that the
parties were getting?11 Judge Seymour said:
42. There is no reason in law why parties to a dispute may not agree, if they wish, to submit
disputes which have already arisen to adjudication, even if otherwise the agreement between
the parties made no provision for adjudication and the provisions of the 1996 Act were
inapplicable. Adjudication may be a useful means of seeking to resolve disputes in areas quite
outside the construction industry. However, it remains to consider what is the effect in law of
agreeing to submit to adjudication disputes which have already arisen. In other words, what
exactly is it the parties agree to if they agree to submit disputes to adjudication?
In addition to Project Consultancy, perhaps the most important decision on ad hoc jurisdic- 6.11
tion is the Court of Appeal case of Thomas-Fredric’s (Construction) Ltd v Keith Wilson.12 In
that case, the claimant contractor asserted that there had been an ad hoc adjudication,
and that the defendant/appellant had agreed to be bound by the result. The Court of Appeal
found that the adjudicator had reached the wrong conclusion on the underlying issues as to
the true identity of the contracting parties. However, as noted in paragraph 16 of his
judgment, Simon Brown LJ went on to say that, nevertheless, such a decision would be
binding and enforceable if it could be shown that the appellant had agreed to accept that
ruling. Having referred to Project Consultancy and Nordot, Simon Brown LJ then turned to
the facts and documents in the case and, having reviewed them, concluded that it was impos-
sible to say that the appellant had submitted to the jurisdiction of the adjudicator in the full
sense described by Judge Gilliland in Nordot. Instead, he decided that the appellant’s position
was very similar to the objection taken by the responding party in Project Consultancy. He
concluded that the adjudicator had not been asked to make a decision on the jurisdictional
10 Judge Seymour was particularly damming of this process and said: ‘Galliford thus seems to be playing fast
and loose with the process of adjudication, shifting its ground opportunistically to meet the challenge of the
moment. No court can be expected to treat phlegmatically a case in which a successful party to an adjudication
comes before it saying: “I know that I have succeeded in the adjudication on a basis which I now recognise was wrong
in law, but the adjudicator decided what he was asked to decide and it is just tough luck for the defendant”. That
attitude seems to come very close to an abuse of the process of adjudication.’ A similar result, albeit expressed in
less extravagant language, can be found in Redworth Construction Limited v Brookdale Healthcare Limited [2006]
EWHC 1994 (TCC), [2006] BLR 366, a decision of HHJ Havery QC.
11 This echoed the similar question raised by Judge Thornton in Christiani & Neilson at paragraph 20 of his
judgment.
12 [2003] EWCA Civ 1494, [2004] BLR 23.
189
issue, and had certainly not been asked in such a way as to indicate that the appellant would
then accept the adjudicator’s ruling upon it. He was therefore entitled to challenge the deci-
sion as one which had been made without the necessary jurisdiction, and the Court of
Appeal concluded that, because he had a more than respectable case that he was not a party
to the underlying contract, the decision would not be enforced.
The Reservation of the Right to Challenge

6.12 As noted at the outset of this chapter, the authorities concerned with the creation or
otherwise of an ad hoc jurisdiction in construction adjudication have usually arisen in
circumstances where an adjudicator may not otherwise have had the necessary jurisdiction
to decide the dispute, but where the parties, by their conduct, agreed to or otherwise created
that jurisdiction. When, in subsequent enforcement proceedings, a responding party
wishing to avoid judgment seeks to argue that the adjudicator did not have the necessary
jurisdiction, it is necessary not only to investigate the merits of the challenge, but also to see
when the challenge was first raised, and whether the challengor reserved the right to chal-
lenge the adjudicator’s jurisdiction, whatever the adjudicator’s conclusion. The authorities
show that the failure by a responding party at the outset to reserve its right to challenge the
adjudicator’s jurisdiction can lead to the result that an adjudicator, who might not otherwise
have had jurisdiction under the terms of the contract or the operation of the 1996 Act, will
be found to have been given jurisdiction by the parties, and it is too late for the responding
party to complain at the enforcement stage.13
6.13 Three particular cases should be noted in which the defendant failed adequately to reserve its
position, with the result that it was prevented from raising any subsequent jurisdictional
challenge. In Harris Calnan Construction Co Ltd v Ridgewood (Kensington) Ltd,14 there was a
dispute about whether the contract was in writing, and the parties made their respective
submissions to the adjudicator, who concluded that there was a contract in writing such that
he had the necessary jurisdiction. At no stage thereafter had the defendant, who had origin-
ally suggested that there was no contract in writing and therefore no jurisdiction, ever
reserved its position on jurisdiction. Instead, the judge found on the evidence that the defend-
ant had been happy for the adjudicator to decide the point, and equally content to be
bound by his decision. The situation was, therefore, very similar to that in Nordot Engineering.
In RC Pillar & Son v The Camber (Portsmouth) Ltd,15 although Camber had originally said
that the adjudicator had no jurisdiction, their subsequent request to Pillar to allow the
adjudicator to consider their cross-claims, even though there was no withholding notice,
which offer Pillar accepted, amounted to an agreement between the parties that the adjudi-
cator would have an ad hoc jurisdiction to deal with all matters, which was fatal to Camber’s
subsequent attempt to resurrect the original jurisdiction objections at the enforcement
13 Take, for example, a notice of adjudication served in a dispute where the subject matter of the contract is
an excluded operation under the 1996 Act. If the responding party does not challenge the adjudicator’s juris-
diction at the outset, or fails adequately to reserve its right to raise the point subsequently, and instead plays a
full part in the adjudication, then a subsequent attempt to avoid the result in enforcement proceedings will
probably fail on the grounds that its failure to challenge or reserve its position gave the adjudicator the necessary
ad hoc jurisdiction.
14 [2007] EWHC 2738 (TCC), [2008] BLR 132.
15 [2007] EWHC 1626 (TCC); (2007) 115 Con LR 102
190
Ad Hoc Adjudication
hearing. And in OSC Building Services Ltd v Interior Dimensions Contracts Ltd,16 Ramsey J
ruled that, as a matter of principle, if jurisdiction remained in issue, there had to be a protest
against the continuing adjudication and a clear statement that the adjudicator did not have
the jurisdiction to deal with a particular dispute. If there was no protest from the responding
party, then it could be inferred that it accepted the submission of that dispute to the juris-
diction of the adjudicator. On the facts of that case, the defendant had not reserved its
position, and proceeded to play a full part in the adjudication, responding in detail to the
claims made. The judge concluded that the defendant had therefore submitted to the
adjudicator’s jurisdiction.
A variation on this theme arose in Bovis Lend Lease Ltd v Cofely Engineering Services.17 In 6.14
that case, there were multiple adjudications. In adjudication 2, Cofely were the claiming
party and a Mr Bingham was appointed as adjudicator. Bovis challenged his jurisdiction.
Once the adjudicator concluded that he had the necessary jurisdiction, Bovis played a full
part in the adjudication, and, although they continued to reserve their position, they later
asked the adjudicator to make corrections to his decision. When Mr Bingham was
appointed in adjudications 3 and 4, Bovis did not object. Adjudication 5 was commenced
by Cofely and again Mr Bingham was appointed as the adjudicator but, simultaneously,
Bovis started adjudication 6 with another adjudicator. The primary issue was whether
Cofely were right to say that Mr Bingham had been properly appointed in adjudication 5
in accordance with the contract. The TCC judge concluded that, on the proper construc-
tion of the contract, he had been properly appointed. However he went on to say that, if
he had reached a different conclusion, he would not have accepted Cofely’s secondary
argument that, because Mr Bingham had decided the issue of jurisdiction in adjudication 2,
that decision was binding on Bovis at the time of adjudication 5. The judge found that,
because Mr Bingham’s decision in adjudication 2 was the subject of a subsequent appli-
cation by Bovis to make corrections, it could properly be argued that, whatever the earlier
reservation, the parties had agreed to be bound by his decision in adjudication 2. The
judge cited the example of Nordot. But he said that there was nothing to indicate that, by
so doing, the parties were also agreeing that Mr Bingham had the jurisdiction to deal with
any future disputes. His jurisdiction to deal with any future disputes would have had to
have been considered when and if those future disputes arose, not least because of the
general principles which explain the close correlation between the particular dispute to be
referred and the jurisdiction of the adjudicator. The events in relation to adjudication 2
therefore had no prospective effect on Mr Bingham’s jurisdiction to decide any subsequent
disputes.
It follows from those cases already analysed that the creation of an ad hoc jurisdiction 6.15
can turn on whether or not a party has properly reserved its right to challenge the juris-
diction of the adjudicator.18 That will depend on the words used and the timing of the
reservation. So in Dalkia Energy and Technical Services Ltd v Bell Group Uk Ltd 19 the
TCC judge set out the relevant correspondence and reached the clear conclusion that, as
a result of Dalkia’s initial reservation of their position at the outset of the adjudication
16
[2009] EWHC 248 (TCC), [2009] CILL 2688.
17 [2009] EWHC 1120 (TCC).
18 See also paragraphs 7.17–7.22.
19 [2009] EWHC 73 (TCC), [2009] 122 Con LR 66.
191
(which made clear the nature of the jurisdictional challenge and the scope of the reser-
vation), from which Dalkia had never resiled, and Dalkia’s repeated insistence that the
adjudicator did not have the necessary jurisdiction to decide the dispute, there was no ad
hoc agreement of the sort found in Nordot. By contrast, in Allied P&L Ltd v Paradigm
Housing Group Limited 20 the argument was whether or not a dispute had crystallised
prior to the commencement of the adjudication. In a careful analysis of a number of the
letters and formal documents in the adjudication, at paragraph 43 of his judgment,
Akenhead J was able to demonstrate that there was in effect and in practice no valid or
effective jurisdictional reservation, concluding that Paradigm had not only failed to make
any effective reservation regarding the jurisdiction of the adjudicator, but had also
acceeded to his jurisdiction in such a way that their subsequent challenge was simply not
open to them.
6.16 An important matter that arises in this connection is whether a general reservation of
rights is sufficient to enable a subsequent challenge. Three recent cases reveal a slight dif-
ference of emphasis on this topic, although the general answer appears to be that a general
reservation may well be sufficient. In the short judgment of Waller LJ, when refusing the
application for permission to appeal in Bothma (t/a DAB Builders) v Mayhaven Healthcare
Ltd,21 it was noted that at no time had the employer ever expressely reserved his position
as to the adjudiactor’s jurisdiction to deal with more than one dispute. However, Waller LJ
found that, because the employer had made it clear that he reserved his position in relation
to jurisdiction ‘in very wide terms’ the argument that the employer had in some way con-
sented or waived any question of jurisdiction on that basis was properly not pursued. By
contrast, in Allied P&L v Paradigm22 Akenhead J left open the question as to whether a
general reservation as to jurisdiction, without any hint or suggestion as to what the grounds
are, can be effective. He said that the purported reservation may be so indefinite as to be
meaningless and ineffective but, on the other hand, it might be that, in the particular
context, a general reservation was sufficient. More importantly, perhaps, he went on to say
that counsel had accepted, he believed correctly, that if a specific reservation was made on
one ground, and it was established that the ground in question was invalid, the party in
question must be taken to have acceeded to the adjudicator’s jurisdiction subject only to
the specific (failed) ground, such that that party will be taken tohave submitted to jurisdic-
tion, even if there were other good grounds of objection that existed but which had never
been mentioned.
6.17 Finally, in GPS Marine Contractors Ltd v Ringway Infastructure Services Ltd,23 Ramsey J
concluded that, in general terms, a party who wished to do so could object to the jurisdiction
of the adjudicator either in general terms or by making a reservation on a specific matter.
What mattered was whether a party participating in the adjudication had waived his right to
object on grounds of jurisdiction. If that party did not raise any objection, or participated in
the adjudication then, even if there was a defect in the jurisdiction of the adjudicator, that
party will create an ad hoc jurisdiction for the adjudicator, and will have lost the right to
object to any decision on jurisdictional grounds. If a party raised specific jurisdiction
20
[2009] EWHC 2890 (TCC), [2010] BLR 59.
21 [2007] EWCA Civ 527, [2007] 114 Con LR 131.
23 [2010] EWHC 283 (TCC), [2010] BLR 377.
192
Ad Hoc Adjudication
objections, and those objections were found to be invalid, then that party was precluded
from raising other grounds that were available to it, if in the meantime it had participated in
the adjudication, because that participation conferred an ad hoc jurisdiction.24 As to the
efficacy of general reservations, the judge pointed out the practical difficulties that they
created, including the fact that the adjudicator could not investigate the objection if it was
not specified, and the other party could not decide whether to take steps to remedy the
potential problem. But he said that, whilst those practical difficulties suggested that the use
of a general reservation was undesirable, that did not answer the question of whether or not
a general jurisdictional reservation permitted a party to participate in adjudication without
thereby waiving his right to object on jurisdictional grounds. By refernce to two arbitration
cases,25 and Bothma, Ramsey J concluded that general words of reservation could be suf-
ficient, and that the question in each case was whether words of general reservation were
sufficiently clear to prevent the objector’s subsequent participation in the adjudication from
amounting to an ad hoc submission to the adjudicator’s jurisdiction. On the very general
words used in the letters under review in GPS Marine, he concluded that the reservation was
sufficient and that, consequently, there was no ad hoc submission to jurisdiction.
Estoppel
Unsurprisingly perhaps, as an alternative to the suggestion that the parties conferred an 6.18
ad hoc jurisdiction on the adjudicator to decide the dispute between them, referring parties
have, in the alternative, contended that the loser is now estopped from denying that the
adjudicator had the necessary jurisdiction. In Maymac Environmental Services Ltd v Faraday
Building Services Ltd 26 the principal dispute was whether or not there was a construction
contract between the parties. HHJ Toulmin CMG QC held that there was. However, even
assuming that he was wrong about that, the judge had no hesitation in going on to conclude
that Faraday were estopped by representation and convention from now arguing that the
1996 Act and the Scheme did not apply. The judge found that Faraday had consented to
submit to the adjudication and, in so doing, had admitted that there was a contract to which
the Act and the Scheme applied. The adjudication was conducted on that basis. Thus Faraday
could not now argue that the Act and the Scheme did not apply. Assuming that no contract
existed and that the referral was not under the Act, the referral had still been made on the
basis that the adjudication would take place, by agreement between the parties, on the same
terms as the Act and the Scheme. Such an agreement was enforceable on the same basis as if
the Act had applied.
Similarly, in William Oakley & David Oakley v Airclear Environmental Ltd and Airclear TS 6.19
Ltd 27 Etherton J (as he then was) upheld the county court judge’s view that there was an
estoppel by convention and that the two parties had proceeded under a mutual assumption
(which had been communicated between them) that a code of dispute resolution was
available to resolve a dispute that had arisen between them. On the particular facts of that
case there was a common assumption by the first respondent and the appellants that their
24
This confirmed the finding made by Akenhead J in Allied P&L, referred to in the previous paragraph.
25
Compania Maritima Zorroza SA v Sesostris SA (The Marques de Bolarque) [1984] 1 Lloyd’s Rep 652 and
Allied Vision Limited v VBS Film Entertainment Gmbh [1991] I Lloyd’s Rep 392.
26 [2001] CILL 1685.
27 [2002] CILL 1824.
193
contractual relations were governed by the NAAM/T and NAM/SC forms of contract,
including the express adjudication provisions contained therein.
Conclusions
6.20 The message from the authorities discussed above is clear. If the responding party
objects to the jurisdiction of the adjudicator, then such objection should be identified in
clear terms in the immediate response to the notice of intention to refer. Although a
general reservation may be sufficient, that may depend on the circumstances, so a general
reservation is therefore both unsatisfactory and potentially risky. Thereafter, even if the
adjudicator calls for detailed arguments as to the jurisdiction position, the responding
party can participate in such a process, provided that he makes clear reference to the fact
that his participation and submissions are without prejudice to his primary position that
the adjudicator does not have the requisite jurisdiction. Any suggestion that the responding
party will accept or abide by the result (as happened in Nordot) may well be fatal to the
objection and may well be taken to confer ad hoc jurisdiction on the adjudicator.
6.21 Concern has been expressed that jurisdictional challenges by the responding party, whether
general or specific, might give rise to extensive difficulties with the enforcement of adjudi-
cator’s decisions. This concern was articulated by the editors of the Building Law Reports
in their editorial on Project Consultancy: 28
The possibilities of challenging the jurisdiction of an adjudicator are broad if not infinite.
This decision confirms that any arguable challenge to the jurisdiction of the adjudicator will
secure that the decision of the adjudicator is summarily unenforceable. If the decision is not
enforceable immediately, the underlying dispute going to the jurisdiction of the adjudicator
has to be resolved either by the court or in a ppropriate cases by the arbitrator. Accordingly
one of the principal objects of the 1996 Act, namely the prompt resolution of disputes, is
necessarily but effectively undermined.
This gloomy prognosis has not come to pass, although it is right to say that the volume of
jurisdiction points that arise on enforcement applications remains stubbornly high, and so
the argument that the responding party waived such difficulties by agreeing to confer upon
the adjudicator an ad hoc jurisdiction still arises with surprising frequency. In Thomas-
Fredric’s, Simon Brown LJ summarised the proper approach to allegations of ad hoc
jurisdiction in two propositions:
(1) If a defendant to a Part 24(2) application has submitted to the adjudicator’s jurisdiction
in the full sense of having agreed not only that the adjudicator should rule on the issue of
jurisdiction but also that he would then be bound by that ruling, then he is liable to
enforcement in the short term, even if the adjudicator was plainly wrong on the issue.
(2) Even if the defendant has not submitted to the adjudicator’s jurisdiction in that sense,
then he is still liable to a Part 24(2) summary judgment upon the award if the adjudicator’s
ruling on the jurisdictional issue was plainly right.
It is thought that, in the light of this clear statement of principle, following as it did the
remarks of Dyson J, to similar effect, in Project Consultancy, it will only be in clear cases, such
as Nordot, Galliford Try, Harris Calnan and Allied P&L where the court will be persuaded
28 [1999] BLR 377 at 379.
194
Ad Hoc Adjudication
that, despite earlier protests, the responding party eventually submitted to the adjudicator’s
jurisdiction (in the full sense of being bound by his decision on jurisdiction), by way of an
ad hoc agreement. Moreover, despite both the risks and the practical difficulties thereby
created, the decision in GPS Marine is authority for the proposition that a general reser-
vation of position may be sufficient to allow the challenge to be renewed at the enforcement
hearing.
195
Part III
THE ADJUDICATOR’S JURISDICTION
7. General Principles 199

8. Errors of Law and Fact 253
9. Abatement and Set-Off 271
10. Costs and Fees 293
7
GENERAL PRINCIPLES
Introduction 7.01 Had that Dispute Crystallised Between

What Happens if there is a Jurisdictional the Parties Prior to the Notice to Refer? 7.61
Issue? 7.05 Was the Dispute Referred to Adjudication
a Single Dispute? 7.78
The Adjudicator’s Power to Investigate Insufficient Connection between the
His Own Jurisdiction 7.09 Dispute Referred and the Adjudicator’s
Adequate Reservation of Position 7.17 Decision 7.86
The Court’s Investigation 7.23 The Relevance of Earlier Adjudication
Fundamental Principle 7.26 Decisions 7.97
Was the Adjudicator Validly Appointed? 7.28 Ousting the Jurisdiction of the
Was there a Construction Contract? 7.28 Adjudicator in Other Ways 7.107
Was the Appointment in Accordance Making a Valid Objection on
With the Contract? 7.33 Jurisdiction 7.110
Was the Contract in Writing? 7.39
Summary of Principles Relating to
Correct Parties 7.44
Jurisdiction 7.111
The Dispute 7.47
What was the Scope and Extent of the
Dispute in the Notice of Adjudication? 7.47
. . . an adjudicator has jurisdiction to make a mistake, as long as he asks himself a question

or questions which have actually been referred to him for decision and seeks to answer
such question or questions.
His Honour Judge Seymour QC in Shimizu Europe Ltd v Automajor Ltd 1
Introduction
The TCC and the Court of Appeal have repeatedly made it plain that errors of fact, errors of 7.01
law and procedural errors will not, without more, justify a failure to comply with the adju-
dicator’s decision.2 As a result, the grounds for impeaching such a decision are extremely
limited. By far the most common attack on the decision of an adjudicator is the submission
1 [2002] BLR 113.

2 Neither this chapter, nor Chapters 8 (Errors of Law and Fact) and 15 (Principles of Enforcement) endeav-
ours to draw any distinction between errors of law and fact made in statutory adjudication and errors of law and
fact in contractual adjudication. All three Chapters assume that what HHJ Thornton QC in Steve Domsalla (t/a
Domsalla Building Services) v Kenneth Dyason [2007] EWHC 1174 (TCC); [2007] BLR 348 called ‘the doctrine
of unreviewable error of an adjudicator within jurisdiction’ applies equally to both types of adjudication.
Permission to appeal was given on the judge’s finding in that case that there was a significant difference between
the two. Such a view is contrary to the more recent decisions in the TCC.
199
The Adjudicator’s Jurisdiction
that the adjudicator had no jurisdiction to reach that decision. Because courts have been
clear that a decision will be summarily enforced unless it is one that the adjudicator did not
have the jurisdiction to reach, commercial necessity has led defendants to take all manner of
points to support the proposition that the adjudicator had no relevant jurisdiction.
7.02 Once the 1996 Act came into force, there was concern that imaginative defendants would
be able to invent spurious arguments that would call into question the adjudicator’s
jurisdiction, thereby defeating the claimant’s enforcement application under CPR Part 24.
In one of the earliest cases, The Project Consultancy Group v The Trustees of the Gray Trust,3
previously noted at paragraphs 6.03–6.04 above in the context of ad hoc jurisdiction, Dyson
J concluded that such fears were exaggerated. He said that he thought that it would only be
in comparatively few cases that jurisdiction arguments would even be possible and, when-
ever they were advanced, both the adjudicator and the court would be ‘vigilant to examine
the arguments critically’. However, despite this, he concluded that it must be open to a
defendant in enforcement proceedings to challenge the decision of an adjudicator on the
grounds that he was not empowered by the 1996 Act (or the contract) to make the decision.
The editors of the Building Law Reports, in their commentary on the case, expressed their
concern about this conclusion, stating that ‘the possibilities of challenging the jurisdiction of
an adjudicator are broad, if not infinite’.4 They went on to say that, in their view, the decision
in Project Consultancy confirmed that any arguable challenge to the jurisdiction of the
adjudicator would ensure that the decision was summarily unenforceable and that, as a
result, one of the principal objects of the 1996 Act was effectively undermined.
7.03 Although the worst fears of the editors of the Building Law Reports have not been realised,
no disputed enforcement application is complete without a jurisdiction point, whether
good, bad or laughable. Inevitably, there are now a large number of reported cases in which
the court has concluded that the adjudicator did not have the necessary jurisdiction to
reach his decision and, although such results are significantly outweighed by the cases in which
such jurisdictional challenges have failed, it remains a common debate on enforcement.5
In Thomas Fredric’s (Construction) Ltd v Keith Wilson6 Simon Brown LJ (as he then was) readily
recognised the concern that the adjudication process might be emasculated by jurisdictional
challenges, but he repeated the views of Dyson J in Project Consultancy, and concluded that
it was only if the defendant had advanced a properly arguable jurisdictional objection,
with a realistic prospect of success, that he could hope to resist the summary enforcement
of an adjudicator’s decision. He said that a defendant who had agreed to be bound by the
adjudicator’s ruling on the issue of jurisdiction would be liable to enforcement in the short
term, even if the adjudicator was plainly wrong on the jurisdiction point. Furthermore, even
if the defendant had not submitted to the adjudicator’s jurisdiction in that sense, he was still
liable for summary judgment if the adjudicator’s ruling on the jurisdictional issue was plainly
3 [1999] BLR 377.

4 The full text of this passage can be found at paragraph 6.21.
5 Prior to the Court of Appeal decisions in Amec v Whitefriars [2004] EWCA Civ 1418; [2005] BLR 1 and
Carillion Construction Ltd v Devonport Royal Dockyard Ltd [2005] EWCA Civ 1358; [2006] BLR 15, there were
more first instance decisions in which the adjudicator’s decision was not enforced because of a breach of the rules
of natural justice of one sort or another than there were decisions in which it was concluded that the adjudicator
had exceeded his jurisdiction. More recently, the reasons why enforcement was refused divide equally between
the two broad types.
6 [2003] EWCA Civ 1494; [2004] BLR 23. This case has already been referred to, again in the context of ad
hoc jurisdiction, in paragraph 6.11 and 6.21.
200
General Principles
right. But, as both these cases acknowledged, that approach would still leave a handful of
cases where, even in the short term, an adjudicator’s decision did not bind the parties, namely
those situations in which, as Simon Brown LJ put it, ‘a respectable case has been made out
for disputing the adjudicator’s jurisdiction’.
The importance of a jurisdictional challenge to the adjudicator’s decision (as opposed to 7.04
complaints about errors of law or fact) can be seen in the four general principles identified by
Jackson J at paragraph 80 of his judgment in Carillion Construction v Devonport Royal
Dockyard Ltd. 7 These four general principles were based on five decisions of the Court of
Appeal and two decisions of the TCC.8 They were formulated as follows:
1. The adjudication procedure does not involve the final determination of anybody’s rights
(unless all the parties so wish).
2. The Court of Appeal has repeatedly emphasised that adjudicator’s decisions must be
enforced, even if they result from errors of procedure, fact or law: see Bouygues, C&B
Scene and Levolux.
3. Where an adjudicator has acted in excess of his jurisdiction or in serious breach of the
rules of natural justice, the court will not enforce his decision: see Discain, Balfour Beatty
and Pegram Shopfitters.
4. Judges must be astute to examine technical defences with a degree of scepticism con-
sonant with the policy of the 1996 Act. Errors of law, fact or procedure by an adjudi-
cator must be examined critically before the court accepts that such errors constitute
excessive jurisdiction or serious breaches of the rules of natural justice: see Pegram
Shopfitters and Amec.
In the Court of Appeal9 Chadwick LJ said at paragraph 52 that he did not understand there
to be any challenge to those principles and they were fully supported by the authorities, as
demonstrated by Jackson J in his judgment. They make a convenient starting point for any
consideration of the significance, range and limits of the adjudicator’s jurisdiction.
What Happens if there is a Jurisdictional Issue?

If the responding party challenges the jurisdiction of the adjudicator, it has four options.10 7.05
Firstly, the responding party can agree to refer the dispute as to the adjudicator’s jurisdiction
to the same adjudicator, and to be bound by the result. If the responding party agrees to that
course, and the appointed adjudicator accepts the reference to him of this secondary dispute,
the jurisdiction of the adjudicator can then be resolved as part of the reference. The important
thing about this option is that the responding party is bound by the adjudicator’s decision
and cannot subsequently challenge it, or seek to resist enforcement on the grounds that the
7 [2005] BLR 310.

8 The cases were: Bouygues (UK) Ltd v Dahl-Jenson (UK) Ltd [2001] All ER (Comm) 1041; [2000] BLR
522; C&B Scene Concept Design Ltd v Isobars Ltd [2002] BLR 93; Levolux AT Ltd v Ferson Contractors Ltd [2003]
EWCA Civ 11; 86 Con LR 98; Pegram Shopfitters Ltd v Tally Weijl (UK) Ltd [2003] EWCA Civ 1750; [2004]
1 All ER 818; Amec Projects Ltd v Whitefriars City Estates Ltd [2004] EWCA Civ 1418, [2005] BLR 1, Discain
Project Services Ltd v Opec Prime Development Ltd [2000] BLR 402 and Balfour Beatty Construction Ltd v
Lambeth London Borough Council [2002] BLR 288.
9 [2005] EWCA Civ 1358; [2006] BLR 15.
10 The four options are discussed in paragraph 31 of the judgment of HHJ Thornton QC in Fastrack
Contractors Ltd v Morrison Construction Ltd [2000] BLR 168.
201
adjudicator lacked the necessary jurisdiction. In consequence, there have been a large number
of cases in which the claimant has argued that the defendant agreed to be bound by the adju-
dicator’s decision on jurisdiction, and the defendant has denied such an agreement. Those
cases are analysed in paragraphs 7.09–7.16 below.
7.06 Secondly, the referring party can seek to refer the dispute as to jurisdiction to a second adju-
dicator but, since that would not halt the first adjudication, and since that first adjudication
has to be completed within the 28-day timescale, this is not an option that is commonly
pursued. Thirdly, the referring party can seek a declaration from the TCC that the proposed
adjudicator lacked jurisdiction. This is the procedure that was followed in a number of the
reported cases and the TCC is often able to deal with such disputes at short notice: see
paragraphs 16.01–16.11 below. However, it is an option that requires a certain amount of
co-operation between the parties to the adjudication and the adjudicator himself.
7.07 The final option is perhaps the one most commonly adopted. The responding party, who
does not accept the jurisdiction of the adjudicator, can set out in clear terms the grounds of its
objection. Thereafter, having fully reserved its position, the responding party can participate
in the adjudication, and will, if the adjudicator requires it, make submissions as to how and
why it is said that the adjudicator does not have the necessary jurisdiction. Thereafter, if the
referring party is successful in both its jurisdictional and its substantive case, and seeks to
enforce the decision, the responding party, having properly reserved its position, can seek to
challenge the validity of the adjudicator’s decision on the grounds of his lack of jurisdiction.
7.08 It is the potential blurring of the divide between the first and the final option of those noted
above which has given rise to so many of the reported cases. Project Consultancy11 is a good
example of this trend. The defendant made plain at the outset that it did not accept that
the adjudicator had any jurisdiction, because the contract was concluded before 1 May 1998
and the 1996 Act therefore did not apply to it. The defendant’s solicitors wrote in clear
terms to say that the adjudicator had no jurisdiction, inviting the claimant to withdraw the
reference and warning the claimant that if it proceeded with the adjudication, the defendant
would not comply with any award and would raise the jurisdiction point on enforcement.
That is exactly what happened. The referring party/claimant argued that, because the
adjudicator had asked for, and the parties had provided, submissions on the jurisdiction
question, there had been an ad hoc agreement between the parties that they would be bound
by the adjudicator’s decision. In other words, the argument was that the parties had taken the
first option noted in paragraph 7.05 above. Dyson J rejected that argument and said that, on
the facts, the position was as set out in the fourth and final option, set out in paragraph 7.07
above. He found that the defendant’s solicitors had written in the clearest terms to explain
why, on their analysis, the adjudicator did not have the necessary jurisdiction and to warn
that the claimant that they would not recognise and comply with any decision that the
adjudicator reached. The judge then went on to consider the facts and stated that the
question of whether, and if so when, a contract was ever concluded between the parties was
by no means straightforward. He found it impossible to resolve the issues with any degree of
confidence because he had not seen all the relevant documents and did not know the full
story. Therefore, because it was impossible to resolve those issues at a summary hearing,
he dismissed the application to enforce the adjudicator’s decision.
11 [1999] BLR 377.
202
General Principles
The Adjudicator’s Power to Investigate His Own Jurisdiction

There is no doubt that an adjudicator can, and indeed should, investigate any partial or full 7.09
challenge to his jurisdiction.12 If, following such an investigation, the adjudicator considers
that the challenge was well-founded, he must then decline to adjudicate on the dispute. If he
concludes that the challenge should fail, and that he has the necessary jurisdiction to
decide the dispute, he must then proceed with the substance of the adjudication. But, unless
the parties had agreed to be bound by the result of the adjudicator’s investigation into his
own jurisdiction, the adjudicator’s ruling on the jurisdiction issue will not be determinative
and the challenger can defeat the enforcement proceedings by showing a respectable case
that the adjudicator did not have the necessary jurisdiction, and was wrong to conclude to
the contrary.13 The parties can agree to be bound by express agreement; implied agreement
(often where the jurisdiction dispute has been referred to the adjudicator for determination
and no objection or reservation has been made);14 or unilateral waiver of any jurisdictional
objections.
This fine line, between an agreement to allow the adjudicator to reach a conclusion on the 7.10
jurisdiction point, and an agreement to be bound by that conclusion, explains why there
are so many cases in which the successful party has sought to argue that the loser agreed to
be bound by the adjudicator’s decision on jurisdiction. To some extent at least, such argu-
ments have been assisted by a lack of clarity in one or two of the reported cases as to the
precise reasons for the court’s conclusion that, notwithstanding the jurisdiction argument,
the adjudicator’s decision should be enforced. In particular, there was, in the early days,
a failure properly to differentiate between, on the one hand, the adjudicator’s power
to investigate and rule on his own jurisdiction and, on the other, his (much more limited)
ability to produce a binding determination on such an issue. A number of these decisions
were based on a finding, sometimes not expressly made clear, that the parties had reached
an ad hoc agreement to be bound by the adjudicator’s conclusion as to jurisdiction. Thus,
in Watson Building Services Ltd v Harrison,15 a decision of the Outer House, Lady Paton
construed the formal documents exchanged in the adjudication as confirming that,
although at the outset the employer had challenged the adjudicator’s jurisdiction, he had
also agreed that, if the adjudicator concluded that he did have the necessary jurisdiction, he
could and should proceed to determine the merits of the parties’ disputes. She concluded
that, considering the employer’s actions and the terms of his formal response in the adjudi-
cation, it was not open to the employer later to seek to challenge the adjudicator’s decision
on his jurisdiction. In other words, any earlier reservation of the employer’s position on the
jurisdiction point had been lost, and a subsequent agreement to be bound by the decision
had been reached.
In two earlier English cases, the court concluded, again on the construction of the relevant 7.11
documents, that the parties had reached an ad hoc agreement to be bound by the adjudicator’s
12
See Fastrack Contractors Ltd v Morrison Construction Ltd [2000] BLR 168, paragraph 32.
13
Authority for this proposition can be found in Grovedeck v Capital Demolitions [2000] BLR 181; Homer
Burgess v Chirex [2000] BLR 124; and at paragraph 10 of the judgment of May LJ in Pegram Shopfitters Ltd v
Tally Weijl (UK) Ltd [2003] EWCA Civ 1750; [2004] 1 WLR 2082.
14 See Chapter 6.
15 [2002] Scots Law Times 846.
203
decision on his own jurisdiction.16 In JW Hughes Building Contractors Ltd v GB Metal Work
Ltd 17 Forbes J decided that both parties agreed, by their conduct, to the adjudicator having
the necessary jurisdiction to deal with all issues relating to his jurisdiction in accordance with
the terms and conditions that he had proposed. The judge accepted the submission that, by
reason of the way in which the matter was dealt with before the adjudicator, there was an ad
hoc agreement by the parties to the effect that the adjudicator had jurisdiction to make a
binding decision on the issue.18 Similarly, in Nordot Engineering Services Ltd Siemens Plc,19
HHJ Gilliland QC concluded that the responding party’s express agreement to ‘abide by
your decision in this matter [the decision on jurisdiction]’ amounted to an ad hoc agreement
on their part to accept the result of the adjudicator’s determination of their jurisdictional
challenge.20
7.12 It rapidly became apparent that there was a significant difference between those cases in
which the parties had agreed to be bound by the adjudicator’s decision on jurisdiction and
those (much more common) cases, such as Project Consultancy, where the challenger was
happy for the adjudicator to investigate and rule on the issue but made it plain that, since he
challenged the adjudicator’s jurisdiction in any event, he would not (indeed, logically could
not) be bound by the result of that investigation. Thus, in Ballast Plc v The Burrell Company
(Construction Management) Ltd 21 the Outer House was again concerned with the validity of
an adjudicator’s ruling on his own jurisdiction. Lord Reid distinguished Watson on the basis
that that was a case where the parties had requested the adjudicator to determine the validity
of his own appointment and, in effect, his own jurisdiction. He said that situation raised
specific issues as to the effect of the parties’ agreement, rather than illustrating any general
point as to the extent to which an adjudicator’s decision on a jurisdictional challenge will
have binding effect. As a general principle, Lord Reid concluded that the adjudicator could
not determine with binding effect the extent of his own jurisdiction, because the limits of
that jurisdiction were determined by the notice of adjudication and the provisions of the
Scheme, and could not be narrowed or extended by the adjudicator’s misconstruction of
those limits. It is respectfully suggested that this must be right as a matter of law. Lord Reid
concluded on the facts of Ballast that the adjudicator had misconstrued his powers and failed
to exercise his jurisdiction to determine the referred dispute. As a result, he found that the
adjudicator’s decision was a nullity.22
16 For a full discussion of the adjudicator’s ad hoc jurisdiction, please see Chapter 6.
17 [2003] EWHC 2421 (TCC).
18
This is perhaps one of the rulings on this topic which is less than clear. There was no dispute that both
parties had asked the adjudicator to rule on his jurisdiction. The question was whether the parties had agreed to
be bound by the result. The difference between the adjudicator’s investigation into his jurisdiction and the
binding nature of his determination of that issue is not explored in the judgment in JW Hughes.
19
[2001] CILL 1778.
20 A further example of the situation where one party transmuted an agreement to ask the adjudicator to
investigate the jurisdictional issue into an agreement to be bound by his decision on the point is Whiteways
Contractors (Sussex) Ltd v Impresa Castelli Construction United Kingdom Ltd [2000] 16 Const LJ 453. HHJ
Bowsher QC concluded that the adjudicator’s decision on jurisdiction was simply part of his overall decision
and was therefore binding on the parties until the dispute or difference was finally determined by arbitration
or legal proceedings. He made no separate finding of any ad hoc agreement. The subsequent cases have
demonstrated that this is perhaps too simplistic an approach.
21
[2001] BLR 529.
22 Lord Reid’s reasoning relied on the decision of the House of Lords in Anisminic Ltd v Foreign Compensation
Commission [1969] 2 AC 147 and their Lordship’s conclusion that it could not be for the Commission to
determine the limits of its own powers. The decision in Ballast is analysed further at paragraph 8.12.
204
General Principles
There are a number of decisions in which the courts have restated the principle that, in the 7.13
ordinary case and without specific agreement, the adjudicator does not have jurisdiction
to decide his own jurisdiction. In Grovedeck Ltd v Capital Demolition Ltd 23 HHJ Bowsher
QC said that a party who protested the jurisdiction of the adjudicator may invite him to
enquire into his jurisdiction, but not to decide it. Similarly, in Homer Burgess Ltd v Chirex
(Annan) Ltd 24 Lord MacFadyen ruled that the temporarily binding quality accorded to
decisions of an adjudicator was accorded only to decisions on matters of dispute arising
under a construction contract. Thus, if there was an issue as to whether a particular dispute
arose under a construction contract or not, that was a preliminary issue that the adjudicator
had to address, but was not itself a dispute arising under a construction contract. Therefore,
he concluded that a decision by an adjudicator, as to whether a particular dispute or a
particular aspect of a dispute fell within his jurisdiction, was not one that was exempted
from review by the courts.25 Furthermore, the courts have been quick to emphasise, when
conducting such a review, that the alleged agreement to the adjudicator reaching a binding
decision on the jurisdiction point must be looked at realistically. Thus, in R Durtnell &
Sons Ltd v Kaduna Ltd 26 the dispute was whether, in his decision, the adjudicator had
exceeded his jurisdiction because, so it was said, he had dealt with extensions of time in
circumstances where no such dispute had arisen between the parties. The claimant argued
that the defendant had agreed to the adjudicator determining the issues relating to exten-
sions of time. The TCC judge concluded that the adjudicator had had no jurisdiction to
make the assessments that he purported to make regarding the grant of an extension of
time for completion of the works. He also found that the defendant had not waived his
right to raise the jurisdictional objection, principally because, prior to the issue of the
decision, the defendant had no way of knowing that the extension point was going to be
dealt with at all.
It follows that, if a jurisdictional challenge arises at the outset of the adjudication, the adju- 7.14
dicator ought to deal with it as best he can, either in advance of his decision, or as part of that
decision. An adjudicator is not entitled to say that, simply because he has been appointed, he
has the jurisdiction to decide the dispute.27 Neither should an adjudicator endeavour to duck
the jurisdictional question altogether by saying that, because he or she cannot issue a binding
decision on his or her own jurisdiction, they ought not to express a view at all. In Enterprise
Managed Services Ltd v Tony McFadden Utilities Ltd,28 the TCC judge noted that the adjudi-
cator had made a difficult situation worse by failing to address the jurisdictional points raised
fairly and squarely by Enterprise. The judge noted that, whilst the adjudicator was right to
say that he could not make a binding decision in his own jurisdiction, it was nevertheless vital
for an adjudicator to consider and express a view on the jurisdictional issue at an early stage.
That was particularly important where, as in that case, the jurisdictional debate overlapped
with case management decisions concerned with the size, volume and timing issues raised by
the presentation of a very large claim. The judge concluded that the adjudicator’s failure to
23 [2000] BLR 181.

24 [2000] BLR 124 at 134.
25
Lord MacFadyen’s approach was, of course, echoed by Lord Reid in Ballast.
26
[2003] BLR 225.
27
For this reason, it is suggested that, although the adjudicator in Ringway Infrastructure Services Ltd v
Vauxhall Motors Ltd [2007] EWHC 2421 (TCC) was found to have the necessary jurisdiction, his simplistic
approach to the issue outlined in paragraph 14 of Akenhead J’s judgement was incorrect.
28 [2009] EWHC 3222 (TCC); [2010] BLR 89.
205
address the jurisdictional question was part of his failure to get a grip on the adjudication
from the outset.
7.15 It is important to note that, if the defendant identifies and maintains a clear challenge to
the adjudicator’s jurisdiction, and can demonstrate an arguable case to this effect in any
subsequent CPR Part 24 proceedings, then the decision of the adjudicator will not be
summarily enforced, even if the defendant had not suffered prejudice as a result of the
process. In IDE Contracting Ltd v RG Carter Cambridge Ltd 29 HHJ Havery QC concluded
that the contractual provisions relating to the appointment of the adjudicator had not been
complied with and that such non-compliance deprived the adjudicator of the requisite
jurisdiction. He also found that the defendant had not submitted to the adjudicator’s
jurisdiction in the full sense of having agreed, not only that the adjudicator should rule on
the issue of jurisdiction, but also that it would be bound by that ruling. The judge went on to
say that, although the defendant alleged that it had been prejudiced as a consequence of
the adjudicator’s decision, the state of the evidence was not such as to show convincingly
that such prejudice had occurred. However, although the judge was not satisfied that the
defendant had therefore suffered prejudice, he concluded that it was unnecessary for
the defendant to show actual prejudice, because the defendant had not submitted to the
adjudicator’s jurisdiction. In the circumstances of that case, that was all that was required to
ensure that the decision could not be enforced.30
7.16 Finally on this topic, it is instructive to note that the Court of Appeal ruled in Amec Projects
Ltd v Whitefriars City Estates Ltd 31 that the adjudicator was not obliged by the 1996 Act, or
the general common law, to give the parties the opportunity to make representations to him
on questions of jurisdiction. At paragraph 41 of his judgment in that case, Dyson LJ said:
A more fundamental question was raised as to whether adjudicators are in any event obliged
to give parties the opportunity to make representations in relation to questions of jurisdiction.
I respectfully disagree with the judge’s view that the requirements of natural justice apply
without distinction, whether the issue being considered by the adjudicator is his own
jurisdiction or the merits of the dispute that has been referred to him for decision. The reason
for the common law right to prior notice and an effective opportunity to make representations
is to protect the parties from the risk of decisions being reached unfairly. But it is only directed
at decisions which can affect parties’ rights. Procedural fairness does not require that parties
should have the right to make representations in relation to decisions which do not affect their
rights, still less in relation to ‘decisions’ which are nullities and which cannot affect their rights.
Since the ‘decision’ of an adjudicator as to his jurisdiction is of no legal effect and cannot affect
the rights of the parties, it is difficult to see the logical justification for a rule of law that an
adjudicator can only make such a ‘decision’ after giving the parties an opportunity to make
representations.
Notwithstanding this conclusion, Dyson LJ went on to suggest that, where time permitted,
adjudicators would be well advised to give the parties the opportunity to make representations
on jurisdictional issues: his point was simply that an adjudicator who did not allow parties
such an opportunity would not ordinarily be acting in breach of natural justice. It is thought
that, in a typical case, it is positively helpful (not least for the judge in any subsequent
29
[2004] BLR 172.
30 Christpher Clarke J applied the same reasoning to reach the same conclusion in Vision Homes Ltd v
Lancsville Construction Ltd [2009] EWHC 2042 (TCC); [2009] BLR 525.
31 [2004] EWCA Civ 1418; [2005] BLR 1.
206
General Principles
enforcement dispute) for the adjudicator to invite submissions and give brief reasons for his
decision on jurisdiction. And where the parties have agreed to be bound by the adjudicator’s
ruling on the jurisdiction issue, the adjudicator must invite and consider appropriate
submissions from the parties in order to allow the proper and fair disposition of the
jurisdiction dispute.
Adequate Reservation of Position

It follows from the preceding paragraphs that a very common issue in enforcement disputes 7.17
concerns the adequacy or otherwise of the losing party’s reservation of their position on
jurisdictional questions.32 Time and again, the courts have been asked to decide whether a
party who now wants to raise a jurisdictional objection on enforcement properly raised the
matter at the outset and thereafter reserved his position such that he was entitled to rely on
the jurisdictional objection as a defence to the application for summary judgment under
CPR Part 24.
The trend in the reported cases is generally in favour of the objector: the majority of cases 7.18
involve a situation in which the objector raised the point at the start of the adjudicator and
then adequately reserved his right to maintain that the adjudicator did not have the necessary
jurisdiction. Examples of this result include Air Design (Kent) Ltd v Deerglen (Jersey) Ltd 33 in
which, at paragraph 20 of his judgement, Akenhead J found that Deerglen had made the
clearest possible reservation on jurisdiction at the beginning of their written submissions;
and Euro Construction Scaffolding Ltd v SLLB Construction Ltd,34 where the same judge
reached the same conclusion and noted that the adjudicator had himself read SSLB’s
response as setting out a threshold objection to his jurisdiction. In Dalkia Energy and
Technical Services Ltd v Bell Group UK Ltd,35 the judge noted that the issue as to the adequate
reservation of the position came down to whether the case was in the Project Consultancy
category (where there was an adequate reservation of position) or in the Nordot Engineering
Services Ltd v Siemens PLC 36 category, where the responding party did not reserve his
position and thus gave rise to an ad hoc jurisdiction in the full sense.37 In Dalkia the judge
concluded that Dalkia had properly reserved their position at the outset; had never resiled
from that reservation and repeatedly said that the adjudicator did not have the necessary
jurisdiction; and had never expressly agreed to be bound, or to comply with, the adjudicator’s
ruling on jurisdiction. The same judge reached the same conclusion, albeit on different
facts, in Pilon Ltd v Breyer Group PLC.38
The best and most recent summation of the position as to what the defendant must do to 7.19
reserve his position can be found in the judgment of Akenhead J in Aedifice V Partnership
Ltd v Shar.39 In that case, he noted that, whilst there was no great difficulty about an express
agreement between the parties that the adjudicator should have jurisdiction to produce a
32 See also the discussion at paragraphs 6.12-6.17.

33 [2008] EWHC 3047 (TCC); [2009] CILL 2657.
34
[2008] EWHC 3160 (TCC); [2009] CILL 2679.
35
[2009] EWHC 73 (TCC); [2009] 122 Con LR 66.
36
SF00901 TCC 16/00.
37 The Nordot case is analysed in detail in paragraph 6.06-6.07.
38 [2010] EWHC 837 (TCC); [2010] BLR 452.
39 [2010] EWHC 2106 (TCC); [2010] CILL 2905.
207
binding decision on his own jurisdiction, it was with the implied agreement, or waiver or
abandonment of jurisdictional objections, that parties, and indeed adjudicators, ‘get into
murkier waters’. Having analysed some of the authorities noted above, at paragraph 21 of his
judgement, Akenhead J said this:
(a) An express agreement to give an adjudicator jurisdiction to decide on a binding way
whether he has jurisdiction will fall into the normal category of any agreement; it simply
has to be shown that there was an express agreement.
(b) For there to be an implied agreement giving the adjudicator such jurisdiction, one needs
to look at everything material that was done and said to determine whether one can say
with conviction that the parties must be taken to have agreed that the adjudicator had
such jurisdiction. It will have to be clear that some objection is being taken in relation to
the adjudicator’s jurisdiction because otherwise one could not imply that the adjudicator
was being asked to decide a non-existent jurisdictional issue which neither party had
mentioned.
(c) One principal way of determining that there was no such implied agreement is if at any
material stage shortly before, or, mainly, during the adjudication a clear reservation was
made by the party objecting to the jurisdiction of the adjudicator.
(d) A clear reservation can, and usually will, be made by words expressed by or on behalf of
the objecting party. Words such as ‘I fully reserve my position about your jurisdiction’ or
‘I am only participating in the adjudication under protest’ will usually suffice to make an
effective reservation; these forms of words whilst desirable are not absolutely essential.
One can however look at every relevant thing said and done during the course of the
adjudication to see whether by words and conduct what was clearly intended was a
reservation as to the jurisdiction of the adjudicator. It will be a matter of interpretation
of what was said and done to determine whether an effective reservation was made.
A legitimate question to ask is: was it or should it have been clear to all concerned that a
reservation on jurisdiction was being made?
(e) A waiver can be said to arise where a party, who knows or should have known of grounds
for a jurisdictional objection, participates in the adjudication without any reservation of
any sort; its conduct will be such as to demonstrate that its non-objection on jurisdictional
grounds and its active participation was intended to be and was relied upon by the other
party (and indeed the adjudicator) in proceeding with the adjudication. It would be
difficult to say that there was a waiver if the grounds for objection on a jurisdictional basis
were not known of or capable of being discovered by that party.
7.20 The cases also demonstrate that, depending on the precise facts, very little is required for the
defendant/responding party adequately to reserve his position. The principles that the court
will apply are simple. If a specific reservation was made on one ground only, and it is
established that that ground was an invalid jurisdictional objection, the party in question
will be taken to have aceeded to the jurisdiction, only subject to the specific (and failed)
ground, and will not be permitted to raise any other jurisdictional objection: see paragraph 33
of the judgement of Akenhead J in Allied P&L v Paradigm Housing Group Ltd.40 If a general
reservation is so indefinite as to be meaningless then it could be ineffective: see paragraph 33
of the judgement in Allied P&L. But, in GPS Marine Contractors Ltd v Ringway Infrastructure
Services Ltd,41 Ramsey J found that whilst, for the reasons that he sets out in his judgement,
the use of general reservations was undesirable, he concluded that a reservation as to ‘further
jurisdiction issues which we have not yet had time or opportunity to investigate’ was sufficient
to reserve Ringway’s position on jurisdiction, both in respect of the matters that they had
40 [2009] EWHC 2890 (TCC); [2010] BLR 59. This proposition was approved by Ramsey J in GPS.
41
[2010] EWHC 283 (TCC); [2010] BLR 377.
208
General Principles
specifically raised and other jurisdictional matters that might subsequently become apparent.
Part of his reasoning involved drawing a comparison with arbitration cases, where a general
reservation of position, and subsequent participation in the arbitration, would not, without
more, amount to a waiver or an ad hoc submission.42
It does not mean, however, that every objection will amount to a sufficient reservation of the 7.21
objector’s position. The best recent example of a finding that the position had not been
adequately reserved was in the Allied P & L case itself. There, on the basis of a detailed analysis
of the various documents, Akenhead J concluded that there had been no valid or effective
jurisdictional reservation by Paradigm on the ground that, prior to the adjudicaton, no dispute
had crystallised as to Allied’s claim for the financial consequences of the unlawful termina-
tion of the contract. Whilst Paradigm had raised a number of jurisdictional objections, each
one of which was held to be unfounded, they had not objected to the adjudicator’s jurisdiction
on the crystallisation issue. The judge found that they had aceeded to his jurisdiction to
resolve all the claims which were the subject matter of the referral, including the claim for
damages due to the termination, subject only to the failed objections, which were of no
account. So, although the judge found that they could have objected on the crystallisation
issue, they failed so to so, and therefore gave him jurisdiction on that issue as well. The case
therefore operates as a stark warning to parties in adjudication to ensure that their objections
on jurisdiction are carefully and properly formulated.
But if the objecting party failed adequately to reserve its position or expressly waived its 7.22
objection in relation to a particular adjudication, that would not mean that, in any subse-
quent adjudication, the objector could not raise a valid objection. In Bovis Lend Lease Ltd v
Cofely Engineering Services 43 the judge concluded that adjudicator X, who had already
conducted a number of earlier adjudications, had the necessary jurisdiction to continue with
a subsequent adjudication, and not adjudicator Y. However he reached that view on the
construction of the contract. He expressly rejected Bovis’ alternative submission that,
because adjudicator X had dealt with an earlier adjudication, and reached a decision that
both parties considered to be binding, the objecting party could not now say that that same
adjudicator did not have the necessary jurisdiction to deal with the new dispute. The judge
found that there was nothing to indicate that, by agreeing to the adjudicator’s jurisdiction in
the earlier adjudication, Bovis were also agreeing that he also had the jurisdiction to deal with
any future disputes. The adjudicator’s jurisdiction to deal with any further disputes had to be
considered if and when those further disputes arose, not least because of the close correlation
between the particular dispute that may arise in any given situation, and the jurisdiction of
the adjudicator to decide it.
The Court’s Investigation

What happens when a jurisdictional challenge arises? In ABB Zantingh Ltd v Zedal Building 7.23
Services Ltd 44 there was a jurisdictional challenge to the adjudicator. He adjourned the pro-
ceedings, with the agreement of both parties, pending resolution by the court of the dispute
42 See Compania Maritima Zorroza SA v Sesostris SA (The Marques de Bolarque) [1984] 1 Lloyd’s Rep 652 and
Allied Vision Ltd v VPS Film Company Entertainment Gmbh [1991] 1 Lloyd’s Rep 392.
43 [2009] EWHC 1120 (TCC).
44 [2001] BLR 66.
209
relating to his jurisdiction. HHJ Bowsher QC agreed that this was an entirely proper course
in the circumstances of that case, partly because, if the adjudicator had decided the matter
himself, the dispute would almost inevitably have come to the court and possibly to the
Court of Appeal. However, in more recent years, the trend has been for the adjudicator to
rule on his own jurisdiction and for the challenger, if unsuccessful, to repeat the jurisdictional
challenge on the enforcement application.
7.24 The question then arises: how should the court approach its investigation into the jurisdic-
tional challenge? Almost invariably, the adjudicator’s ruling on his own jurisdiction will be
bound up within his reasoned decision. The general rule, of course, is that the court should
not unpick that decision to gauge whether or not it contains errors of law or fact. On the
other hand, it is necessary for the court, when investigating the validity or otherwise of any
jurisdictional challenge, to examine the detail of the decision. The proper approach of the
courts to such a dispute was addressed by HHJ Thornton QC in Fastrack Contractors Ltd v
Morrison Construction Ltd.45 He concluded that the court would give appropriate weight to
any findings of fact made by the adjudicator and relevant to the jurisdictional challenge, but
would not be bound by them and would either have to hear out the challenge with evidence
or, if that could not be provided, determine the challenge on such material as was available,
and either enforce or decline to enforce summarily the whole or part of the adjudicator’s
decision, depending on the court’s decision on the jurisdictional issue.
7.25 In practice, the mechanics by which the court deals with a jurisdictional challenge have
not given rise to any great difficulty. The principal material considered by the court in
jurisdictional challenges will include the decision, the contract, the documents purporting
to set out the original dispute, and sometimes the correspondence between the parties, and
with the adjudicator. All of this material will be in writing and will be in the bundle before
the judge. It is exceedingly rare for any oral evidence to be necessary on jurisdictional
matters. Indeed, as demonstrated by cases such as Lee v Chartered Properties (Building) Ltd,46
the existence of disputes of fact relevant to jurisdictional issues will almost certainly
mean that the CPR Part 24 enforcement application will fail. In that case, Akenhead J found
that there was a triable issue as to the valid appointment of the adjudicator, and also a triable
issue as to whether or not the parties had settled the underlying claims and cross-claims,
which would again deprive the adjudicator of jurisdiction.
Fundamental Principle
7.26 The fundamental principle that governs all enquiries into the adjudicator’s jurisdiction can
be simply stated. If a dispute has arisen between two parties to a construction contract and
the adjudicator is validly appointed to decide that dispute, then, provided his decision
attempts to answer that dispute, his decision will be binding in accordance with the 1996
Act, regardless of errors of fact or law or procedure. If, on the other hand, he was not validly
appointed, or he decided something other than the dispute that was referred to him, his
decision will be unenforceable because it would have been made without jurisdiction.47
45
[2000] BLR 168, at paragraph 32.
46 [2010] EWHC 1540 (TCC); [2010] BLR 500.
47 See, by way of example only, Macob v Morrison [1999] BLR 93; Bouygues v Dahl-Jenson [2000] BLR 522;
and C&B Scene v Isobars [2002] BLR 93.
210
General Principles
Thus it follows that it is not enough for the defendant to show an error on the part of the
adjudicator. What matters, in the words of Sir Murray Stuart-Smith in C&B Scene, is whether
the error on the part of the adjudicator went to his jurisdiction, or was merely an erroneous
decision of law (or fact) on a matter within his jurisdiction. If it was the former, the decision
would be unenforceable; if it was the latter, the decision would be enforceable by way of
summary judgment.
Therefore the potential issues that might arise on any investigation of the jurisdiction of the 7.27
adjudicator can be sub-divided under a number of separate headings. First, the court may
have to consider whether or not the adjudicator was validly appointed, and this might in turn
involve a consideration of such issues as to whether or not the contract between the parties
was a construction contract; whether or not the appointment was in accordance with the
contractual provisions; and whether or not the contract was in writing. Next, the court may
have to consider the nature, scope and extent of the dispute as stated in the notice of
adjudication, to ensure that it was that dispute, and no other, that the adjudicator decided
in his written decision. This again breaks down into a number of separate issues. What was
the dispute in the notice of adjudication? Had that dispute crystallised between the parties
prior to the service of the notice of adjudication? Was the dispute that was referred to the
adjudicator a single dispute? Furthermore, there are other issues that can be relevant to
jurisdiction, such as whether the decision improperly trespassed on previous adjudication
decisions under the same contract, or whether the adjudicator’s jurisdiction was ousted in
some other way. All of these topics are dealt with below.
Was the Adjudicator Validly Appointed?

Was there a Construction Contract?
If there was no contractual mechanism that expressly allowed for the appointment of an 7.28
adjudicator, then the Scheme for Construction Contracts would be implied, provided of
course that the contract between the parties was a construction contract, in accordance with
s104 and s105 of the 1996 Act.48 Accordingly, in a dispute about the adjudicator’s jurisdiction
to decide a dispute under the Scheme, it may be necessary to consider whether there was a
construction contract in existence. In practice, this might well involve an analysis of the
subject matter of the contract in question, to see whether the operations being carried out
on site meant that the contract was expressly excluded from the 1996 Act by operation of
s105(2). Thus, in ABB Power Construction Ltd v Norwest Holst Engineering Ltd 49 ABB were
carrying out extensive works at a power station that comprised the construction of three new
boiler houses. They sub-contracted the insulation and cladding of the boilers and pipework
to Norwest Holst. Norwest Holst gave a notice of adjudication under the sub-contract. ABB
contended that the adjudicator had no jurisdiction, because the work in question was
expressly exempted from the operation of the 1996 Act by s105(2). Before any further steps
were taken to progress the adjudication, the TCC was asked to rule, by way of a declaration,
as to the adjudicator’s jurisdiction. The judge concluded that great care had been taken in
selecting the construction operations that were to be exempt from the 1996 Act, and that the
48 Please see Chapter 2 and in particular paragraphs 2.19–2.41.

49 [2000] TCLR 831. See the discussion of this case at paragraphs 2.33–2.35.
211
operation in question was one of those operations which were exempted by s105(2).
He therefore held that the adjudicator had no jurisdiction. Thus, although there was no
adjudicator’s decision for the court to consider in that case, the judge still had to embark on
a detailed investigation into precisely what ABB were doing under the main contract, and
what Norwest Holst were doing under the sub-contract, in order to decide the nature of
the operations on site and to see whether they were excluded by s105(2). Moreover, the
complexities involved can be illustrated by the fact that, in North Midland Construction
PLC v AE & E Lentjes,50 Ramsey J concluded that very similar works at a very similar power
station site were not excluded, and he doubted that the broad approach in ABB Power to
the exclusions in s105(2) was correct.51 In that case, therefore, he concluded that there was
a construction contract, and the adjudicator did have the necessary jurisdiction.
7.29 It is often the case that the parties to a construction contract can find themselves embroiled
in disputes from an early stage, and they may seek to resolve such disputes by entering into
a second, settlement agreement which compromises all claims and cross-claims under the
original contract. In such cases, it may be a difficult question of construction as to whether
the second agreement is a construction contract or a contract pursuant to which the
adjudicator has been validly appointed. In Shepherd Construction Ltd v Mecright Ltd 52
there was a dispute about such a settlement agreement, with the referring party contending
that it had entered into that agreement under duress.53 HHJ Lloyd QC held that any
dispute under the settlement agreement could not be a dispute ‘under’ the original contract,
because the original contract had been replaced by the settlement agreement. The judge
therefore granted the declaration that the adjudicator had no jurisdiction. A similar view
to the effect that a settlement agreement was not a construction contract within the meaning
of s108 was expressed by HHJ MacKay QC in Lathom Construction Ltd v Brian Cross and
Ann Cross.54
7.30 However, it is suggested that, in the light of more recent decisions, these cases should be
treated with a certain amount of caution. As Ramsey J pointed out in L Brown & Sons Ltd v
Crosby Homes (North West) Ltd,55 the dispute as to the status of any settlement agreement
breaks down into two separate stages. First, the court must determine whether the second or
settlement agreement was or was not a variation of the original contract. If the second
agreement was simply a variation of the first, then the dispute resolution provisions in the
first agreement continue to be relevant to any dispute under the second agreement. On that
analysis, the second agreement would have no effect upon the adjudicator’s jurisdiction.56
The second stage in the court’s consideration of this issue only arises if it has concluded that
the settlement agreement is not a variation of the original agreement, but is instead a separate
and stand-alone contract. It then becomes a question of whether, as a matter of construction
of that separate agreement, the adjudicator was validly appointed. Even if the settlement
agreement was a separate, stand-alone agreement, the dispute resolution procedures in the
50 [2009] EWHC 1371 (TCC); [2009] BLR 574.

51 See paragraphs 2.38-2.39.
52
[2000] BLR 489.
53
The detailed facts of the case are set out in paragraph 7.107.
54
[2000] CILL 1568.
55 [2005] EWHC 3503 (TCC).
56 As was found in Able Construction (UK) Ltd v Forest Property Development Ltd [2009] EWHC 159 (TCC),
paragraph 10 of the judgment.
212
General Principles
first agreement may still apply to a dispute that arises under the settlement agreement,
provided that the drafting of one or both of them makes that position clear.
On this analysis, whether or not the second settlement agreement allows for adjudication 7.31
will almost always depend on the drafting of the particular agreements in question. Thus, in
Shepherd, HHJ Lloyd QC decided that a provision in the original agreement that permitted
a party to refer to adjudication ‘any dispute or difference arising under it’ was not wide
enough to cover disputes arising in respect of the second agreement,57 whilst in Quarmby v
Larraby 58 HHJ Grenfell decided, again as a matter of construction, that disputes that arose
under the contract that had not been caught by the settlement agreement could still be
adjudicated. Similarly, in L Brown, Ramsey J concluded that a clause which allowed disputes
to be referred to adjudication that arose under, out of, or in connection with the original
contract did allow a party to refer a dispute that arose in respect of the second agreement.
It is respectfully suggested that this distinction is not only right, but it is also entirely in line
with the Court of Appeal decision in Ashville Investments v Elmer Contractors 59 in which it
was held that the words ‘in connection with’ in an arbitration clause were wide enough to
allow an arbitrator to deal with claims for rectification and misrepresentation. These cases
were discussed by Jackson J in McConnell Dowell Constructors (Aust) Pty Ltd v National Grid
Gas Plc.60 In that case, he concluded that the supplemental agreement was simply a variation
of the original agreement, and that therefore the original dispute resolution provisions still
applied. The principal reason for his decision was the continuing existence of obligations
under the original contract. That therefore made it a very different situation to that in
Shepherd, where the second agreement was expressed to be in full and final settlement of all
the referring party’s claims under the original contract.
As already noted, there can be a practical difficulty if the responding party alleges that 7.32
the claim has been compromised, because ‘there cannot be a referable dispute in relation
to issues or claims in respect of which the parties have settled or compromised as they
are no longer capable of being properly disputed’.61 Thus, in GPS Marine Contractors
Ltd v Ringway Infrastructure Services Ltd,62 Ramsey J held that, despite the somewhat
colourful language apparently used by the referring party at a meeting, which was sub-
sequently relied on by the responding party as an agreed withdrawal of the claim, there
was a triable issue as to the alleged compromise that he could not resolve on a summary
judgment application, and he therefore refused to enforce the decision. Akenhead J

reached the same conclusion, again because of the need for oral evidence to resolve the
question as to whether or not the claim had been settled, in Lee v Chartered Properties
(Building) Ltd.63
57
See also Capital Structures v Time & Tide [2006] EWHC 591; [2006] BLR 226, in which HHJ Wilcox
decided that a dispute about economic duress did not arise under the contract.
58 (2003), unreported, Leeds TCC.
59 [1989] QB 488; [1988] 3 WLR 867.
60 [2007] BLR 92.
61 Akenhead J at paragraph 22 of his judgment in Lee v Chartered Properties (Building) Ltd [2010] EWHC
1540 (TCC); [2010] BLR 500.

62
[2010] EWHC 283 (TCC); [2010] BLR 377.
63
[2010] EWHC 1540 (TCC); [2010] BLR 500. In Able Construction, the judge heard some short oral
evidence on one limited point, because in all the circumstances that was a proportionate and flexible response
to the raising of a settlement issue by the party seeking to avoid paying on an adjudicator’s decision, but this will
always be the exception rather than the rule.
213
Was the Appointment in Accordance With the Contract?

7.33 The vast majority of construction and engineering contracts now contain detailed adjudication
provisions. However, this does not mean that there will be no jurisdictional challenge to the
appointment of a particular adjudicator to decide a dispute arising under the contract. There
are a number of cases in which the appointment provisions in the contract have broken
down, or proved impossible to operate: in those cases, the courts have endeavoured to take a
pragmatic view of the appointment provisions, but with the clear understanding that an
appointment that cannot be justified under the contract is invalid, and results in a complete
absence of jurisdiction. Thus, in Amec Projects Ltd v Whitefriars City Estates Ltd 64 both the
TCC judge at first instance and the Court of Appeal construed the contract in a practical
fashion so as to ensure that, because the mechanism of nominating the parties’ first choice
adjudicator had broken down, there was a workable fallback position. Accordingly, in that
case it was held that the adjudicator, who had been appointed following the death of the
adjudicator named in the contract, had the appropriate jurisdiction. That is to be contrasted
with the decision in IDE Contracting Ltd v RG Carter 65 where the appointment of the
adjudicator was patently not in accordance with the express terms of the contract, and
HHJ Havery QC had no realistic alternative but to find that the adjudicator’s decision was
unenforceable.
7.34 In Pring and St Hill Ltd v C J Hafner (trading as Southern Erecters) 66 the Scheme was implied
into the contract. Paragraph 8(2) of the Scheme stipulates that the adjudicator can adjudicate
at the same time on related disputes under different contracts, but the provision made plain
that this could only happen with the consent of all the parties to those disputes. The TCC
judge concluded on the evidence that the defendant had made it clear that it did not want
the adjudicator to deal with two related disputes simultaneously, one of which did not
involve the defendant at all. In the light of that clear statement, the judge found it extremely
difficult to understand how or why the adjudicator could possibly have thought that he
could go ahead and deal with the two disputes together. He therefore concluded that the
adjudicator had not acted in accordance with his appointment (because he had considered
other matters involving other parties) and that, in the light of the clear objection to the
approach he adopted, he lacked the necessary jurisdiction.
7.35 Of course, if there is a real dispute between the parties as to the terms of the contract that they
have agreed then, depending on the precise nature of the dispute, it can often be difficult for
the adjudicator to be validly appointed. The dispute between the parties as to the terms of the
contract between them in Pegram Shopfitters Ltd v Tally Weijl (UK) Ltd 67 meant that it could
not safely be assumed that the adjudicator had been validly appointed, so his decision was
not enforced.68 The Court of Appeal reached a similar conclusion in Lead Technical Services
Ltd v CMS Medical Ltd.69 In that case, there was a dispute between the parties as to the precise
terms of the contract that had been agreed, with CMS, the responding party, arguing that an
earlier agreement had been supplanted by a deed of appointment that contained different
64 [2004] EWCA Civ 1418; [2005] BLR 1.

65
[2004] BLR 172.
66
[2002] EWHC 1775 (TCC); (2004) 20 Const LJ 402. This case has been discussed, in the context of
paragraph 8(2) of the Scheme, at paragraphs 3.44–3.45.
67 [2003] EWCA Civ 1750; [2004] BLR 65.
68 See the full discussion of this case at paragraphs 8.15–8.18.
69 [2007] EWCA Civ 316; [2007] BLR 251.
214
General Principles
terms, and a different adjudicator nominating body. The adjudicator concluded that he had
been appointed in accordance with the earlier contract, and not the subsequent deed of
appointment and that was a view supported by the TCC judge at first instance in Leeds.
However, in the Court of Appeal, Moses LJ demonstrated that CMS had a real prospect of
proving that the agreement between the parties was that which was contained in the subse-
quent deed. If that was so, the adjudicator had no jurisdiction because he had been appointed
by the wrong body. In those circumstances, the Court of Appeal overturned the decision of
the judge and refused to enforce the adjudicator’s decision.
Another type of common issue that can arise when considering the validity or otherwise of 7.36
the adjudicator’s appointment will focus on whether or not the appointment took place in
accordance with the appropriate mechanism. Both the Scheme and the standard forms of
construction and engineering contract provide for detailed procedures for the appointment
of an adjudicator. These procedures often differ in important respects. For example, pursuant
to many forms, the nomination of the adjudicator by the nominating body must precede the
notice of adjudication, but pursuant to the Scheme, the notice of adjudication must come
first.70 These detailed procedures can give rise to highly technical (and frankly unmeritorious)
arguments about whether or not they were complied with, and therefore whether or not
the adjudicator had the necessary jurisdiction. Generally, for the reasons set out in Chapter 3
above, the courts differentiaite between a failure that goes to the heart of the appointment,
which will result in the non-enforcement of the decision,71 and a failure that is procedural
only, which will not affect enforcement.72
A recent example of the problems that can arise if the appointment procedure goes awry is 7.37
Lee v Chartered Properties (Building) Ltd.73 There was a comedy of errors in the appointment
of the adjudicator. The first adjudicator was appointed by the RICS, but he resigned
when he realised that it was the RIBA who was supposed to have appointed him. The second
adjudication was aborted because the referring party failed to serve the referral notice on
time. The dispute that Akenhead J considered on enforcement concerned the third notice of
adjudication, which was sent to the responding party on the same day as the application to
the RIBA for an adjudicator to be nominated. Under the Scheme, the request to the
nominating body can only be made after notice has been given of the intention to refer a
dispute to adjudication. The judge set out at some length the evidence as to the respective
timings on the day in question, and concluded that he could not resolve the factual issue as
to the precise sequence on a summary application. Thus, because there was a triable issue on
a point that went to the adjudicator’s jurisdiction, albeit a highly technical one, the claiming
party was not entitled to summary judgement.
There may also be disputes as to which, if any, of the sets of adjudication rules created by the 7.38
professional bodies apply to the adjudication itself. It has sometimes been argued that, in
circumstances where an adjudicator has conducted an adjudication in accordance with the
allegedly ‘wrong’ set of rules, he has acted without jurisdiction. The success of such an
70
The difficulties created by this particular difference are dealt with in paragraph 3.20.
71
For example, IDE Contracting Ltd v RG Carter Cambridge Ltd [2004] EWHC 36 (TCC); [2004] BLR 172
and Hart Investments Ltd v Fidler [2006] EWHC 2857 (TCC); [2007] BLR 303
72 For example, Cubitt Building Interiors v Fleetglade Ltd [2006] EWHC 3413 (TCC) and Linnett v Halliwells
LLP [2009] EWHC 319 (TCC); [2009] 1 CLC 157.

73 [2010] EWHC 1540 (TCC); [2010] BLR 500.
215
argument will depend on the facts. In Lead Technical, as we have seen, it was ultimately fatal
to the application for enforcement. In CJP Builders Ltd v William Verry Ltd 74 Verry took a
point that the TeCSA rules applied to the adjudication and that, in consequence, the
adjudicator (who had not conducted the adjudication in accordance with those rules),
lacked jurisdiction. However, Akenhead J observed that this point had not been taken until
very late in the adjudication process itself, and even then it had not been said that the
failure to follow the correct rules deprived the adjudicator of jurisdiction. The judge dis-
missed the new contention on the basis that at no point had Verry ever reserved their position
as to jurisdiction on this (or any other) point. Similarly, in Dalkia Energy and Technical
Services Ltd v Bell Group UK Ltd 75 the judge rejected the contention that the adjudicator’s
decision that Dalkia’s terms and conditions applied, as opposed to the Scheme, deprived the
adjudicator of jurisdiction. Reliance was placed on the decision in Pegram. The judge rejected
that submission in these terms:
41. It is, I think, necessary to explore in a little more detail what was actually happening in
Pegram. It seems to me that the critical point in that case was that the defendant, who was
resisting enforcement, had an alternative argument that there was not contact at all between
the parties. The Court of Appeal regarded that argument as having a more than fanciful
prospect of success. Accordingly, there was an important question-mark over the adjudicator’s
jurisdiction: if there was in fact no contract, he would not have had any jurisdiction. That
seems to me to be the principal explanation for the decision by the Court of Appeal to refuse
to enforce the adjudicator’s decision.
42. That critical feature is missing here. As I have said, in the present case there is no dispute
that there was a written construction contract between the parties. Thus, there is no dispute that
an adjudicator would have had to have been appointed, whether under the Bell conditions
or under the Scheme, to decide any dispute that arose between the parties under that contract.
In such circumstances, the adjudicator’s decision as to whether or not a particular set of
contract conditions were incorporated or not would seem to me to be part of the dispute
properly referred to him and would not ordinarily be a matter with which the court could
interfere on enforcement.76
Was the Contract in Writing?

7.39 One of the most important features of the 1996 Act was the stipulation that, in order for the
contract to be a construction contract, it had to be in writing. The cases in which this aspect
of the provisions of s107 has been considered by the courts are set out in detail in Chapter 2
(paragraphs 2.51–2.92 above). The courts have construed the provisions in s107 relatively
strictly, and rejected various attempts to widen the application of the section, in large measure
because the requirement that the terms be in writing was designed to promote certainty.
Thus in Grovedeck Ltd v Capital Demolition Ltd 77 the claimants accepted that the underlying
contracts were oral. However, they maintained that the simple existence of the referral notice,
and the response to the referral notice, brought the oral contracts within the ambit of the
1996 Act. HHJ Bowsher QC acknowledged that, on one reading of s107(5), if one party to
an adjudication alleged the existence of an oral agreement, and the other did not deny the
existence of an oral agreement, then there was an agreement in writing ‘to the effect alleged’,
74
[2008] EWHC 2025 (TCC); [2008] BLR 545.
75
[2009] EWHC 73 (TCC); [2009] 122 Con LR 66.
76 In reaching this conclusion the judge also relied on the decision in Aveat Heating Ltd v Jerram Falkus
Construction Ltd [2007] EWHC 131 (TCC); [2007] TCLR 3.

77 [2000] BLR 181.
216
General Principles
even though the responding party hotly denied, as was the case in Grovedeck, that the
agreement was in the terms alleged. The judge concluded that Parliament cannot have
intended such an unjust result. He went on to find that disputes as to the terms, whether
express or implied, of oral construction agreements were surprisingly common and were
not readily susceptible of resolution by a summary procedure such as adjudication. In
consequence, he said that it was not therefore surprising that Parliament should have
intended that such disputes should not be determined by adjudicators under the 1996 Act.
As noted in paragraphs 2.55–2.60 above, the leading case on this area of the law is the 7.40
Court of Appeal decision in RJT Consulting v DM Engineering.78 In that case, overturning
the decision of the judge at first instance, Ward LJ said that the agreement had to be
evidenced in writing and that meant ‘all of it, not part of it. A record of the agreement also
suggests a complete agreement, not a partial one.’ Although Auld LJ appeared to suggest in
his judgment that it was only the material terms of the agreement that had to be recorded in
writing, this was not the view of the majority. Subsequently, in Trustees of the Stratfield Saye
Estate v AHL Construction Ltd 79 Jackson J dealt expressly with the differing approaches of the
majority and Auld LJ in RJT, and concluded that an agreement is only evidenced in writing
for the purposes of s107(2)–(4) if all the express terms of that agreement are recorded in
writing. He found that it was not sufficient to show that all terms material to the issues
within the adjudication in question had been recorded in writing.80
It is of course incumbent on the party protesting the adjudicator’s jurisdiction on this ground 7.41
to demonstrate at least an arguable case that there were other terms not recorded in writing.
In A.R.T. Consultancy Limited v Navera Trading Limited,81 the defendant alleged that there
were other terms that were agreed orally, thus depriving the adjudicator of jurisdiction. On
analysis, the TCC judge found that this contention related to the design element of the
works, which had been carried out some time earlier. The argument presupposed that this
design element was intended to be part and parcel of the agreed contract for the works
on site. The judge concluded that there was no basis for this assumption and that, on the
evidence, the parties had intended that the construction work itself would be let as a separate
contract. All the terms of that contract were in writing; the existence of a separate, earlier
agreement in relation to the design works, which the adjudicator had ignored for the
purposes of his decision, was irrelevant and did not deprive the adjudicator of jurisdiction.
The decision was therefore enforced.

If all the terms of a construction contract are not in writing, then the contract does not 7.42
comply with the 1996 Act and the adjudicator will not have been validly appointed. Of course,
different considerations will apply in circumstances where there is an agreed contractual
mechanism for adjudication in writing, but where some of the other contract terms are not
in writing. Take, for example, an agreement whereby the parties agree the incorporation of a
standard form that contains an adjudication provision. Prima facie therefore, they have
agreed to adjudicate any disputes that might arise between them. However, it may also be
that some of the other terms of the contract were agreed orally. What then is the position?
78
[2002] BLR 217.
79
[2004] EWHC 3286 (TCC).
80 The same approach was adopted by HHJ Wilcox in Bennett (Electrical) Services Limited v Inviron Limited
[2007] EWHC 49 (TCC).

81 [2007] EWHC 1375 (TCC).
217
It is thought that, whilst such an issue will almost always turn on the facts, an adjudicator
appointed under the agreed adjudication provisions in such a case will have been validly
appointed. This is because, if there was a written agreement between the parties to adjudicate
their disputes, and if the contract complies with the Act (so that, for example, there was
a written agreement to refer disputes to adjudication), then it will be unnecessary to
demonstrate that, in addition, all of the other express terms of the contract were also in
writing. The decision of Akenhead J in Treasure and Son v Dawes 82 is entirely consistent with
the proposition set out in this paragraph.
7.43 It should also be noted that a defendant may be able to avoid the consequences of an
adjudicator’s decision, at least in the short term, if he can demonstrate an arguable case that
the relevant construction contract, even if in writing, was entered into as a result of economic
duress. In this area of the law, the leading case on economic duress is the decision of Dyson J
in DSND Sub-Sea v Petroleum Geoservices,83 which makes clear the practical difficulties faced
by a party who wishes to allege that a contract is voidable as a result of economic duress.
Despite these difficulties, in Capital Structures Plc v Time and Tide Construction Ltd 84
HHJ Wilcox concluded that the defendant had demonstrated ‘an arguable, albeit shadowy,
case as to economic duress’ and an arguable case that they had elected to have the relevant
contract (which was in fact a settlement agreement) set aside. He therefore gave leave to
defend, but only on terms that the defendant company paid into court the amount awarded
by the adjudicator’s decision.
Correct Parties
7.44 Although it may seem trite, the reported cases demonstrate that, in order for an adjudicator
to reach a decision that the courts will subsequently enforce, the parties to the adjudication
must also be the parties to the relevant construction contract. There are a number of authorities
that demonstrate this principle.
1. The Court of Appeal decision referred to above, Thomas-Fredric’s (Construction) Ltd v
Keith Wilson,85 demonstrates that, if there is a respectable case that a defendant can mount
to demonstrate that he was not a party to the relevant contract, and that therefore the
adjudicator had no jurisdiction to make any decision binding on him, then such a decision
will not be enforced.
2. A subsequent example of the same principle can be found in Rok Build Ltd v Harris Woolf
Development Company Limited.86 There, HHJ Wilcox concluded that all but one of the
points taken by the defendants amounted to a ‘mere scramble to find reasons to defeat the
claim for summary judgment’. However, the exception was the argument in respect of
the correct identity of the claimant. The claimant, Rok Build Ltd, had commenced an
adjudication against the defendants, who immediately pointed out that the claimant had
no standing, because the contractor named in the contract was not Rok Build, but Walter
Llewellyn & Sons Ltd. At some stage, there had apparently been a de facto substitution
of Rok Build Ltd for the titular contractor, Walter Llewellyn & Sons Ltd, but there was
no evidence as to when it happened, what the circumstances were that gave rise to it, and
82
[2007] EWHC 2420 (TCC); [2008] BLR 24.
83 [2000] BLR 530.
84
[2006] EWHC 591 (TCC); [2006] BLR 226.
85 [2003] EWCA Civ 1494; [2004] BLR 23.
86
[2006] EWHC 3573 (TCC).
218
General Principles
what agreement or acquiescence was shown by the defendant to the changed state of
affairs. Judge Wilcox concluded that, on the evidence before him, it was reasonably
arguable that the claimant as described in the enforcement proceedings had no right
whatsoever to refer a dispute to adjudication under the contract, and it therefore followed
that it was at least arguable that the claimant was not entitled to summary judgment.
The adjudicator’s decision was therefore not enforced.87
3. In Westdawn Refurbishments Ltd v Roselodge Ltd,88 HHJ McCahill QC had already found
that, because the contract terms were not all in writing, he could not summarily enforce
the adjudicator’s decision. Accordingly he considered, but did not decide, the second
point in the case, which was to the effect that, because the claimant had not been a party
to the original construction contract, but was instead an assignee, he could not invoke the
adjudication process. Having weighed up the competing contentions, and observed that
the fact of an assignment (and the existence of potentially competing rights of assignor
and assignee) made the situation potentially much more complicated than had been
envisaged by the 1996 Act, the judge concluded that ‘the arguments that would deny an
assignee a remedy are not insubstantial’.
However, the authorities also demonstrate that the court will need to be persuaded that there 7.45
is good evidence that the referring party is not the party named in the contract before it will
even consider granting leave to defend in any summary judgment application for the
enforcement of the decision. Thus, in Andrew Wallace Ltd v Artisan Regeneration Ltd 89 the
defendants argued that, since they had contracted with Mr Andrew Wallace as an individual,
and not with his company, the claimant company was not entitled to enforce the adju-
dicator’s decision. The position was muddled by the fact that Mr Wallace had, on occasion,
issued invoices in his own name rather than in the name of the company. However the TCC
judge found that the position was fully explained in the contemporaneous correspondence
and that there was no doubt that the defendants were well aware that the contract was with
the company, not the individual. She found that, on analysis, the invoices were not
inconsistent with that conclusion. Therefore, she held that, on the evidence, the defendants’
prospects of success on this point were fanciful, not real, and she entered summary judgment
against them. A similar result occurred in Michael John Construction Ltd v Golledge & Ors.90
This was an unusual case involving arguments about the capacity of the various parties
pursued by the claimant contractor in two separate adjudications concerning the same out-
standing sums. The facts of the case are set out in paragraph 7.102 below. In the enforcement
hearing, counsel for the various defendants took the point that, having decided the liability
of specific individuals in one capacity, the adjudicator could not decide the second dispute
on a different basis as to capacity. This was described as ‘the jurisdictional bind’ that the
claimant contractor had got itself into. The TCC judge rejected this submission, pointing
out that, in reality, the disputes in the two adjudications had been different, and there was no
question of ‘double jeopardy’. Furthermore, he said that it would be ‘monstrous’ if the
claimant, who had not been told by the defendant the true position as to the identity of the
87 In Enterprise Managed Services Ltd v Tony McFadden Utilities Ltd [2009] EWHC 3222 (TCC); [2010]
BLR 89, an issue arose as to novation. At paragraph 26 of his judgment, the TCC judge contrasted the uncer-
tainty in Rok Build with the clear evidence in Enterprise that the novation was agreed and accepted without
question by all the relevant parties.
88 [2006] Adj LR 04/25.
89
[2006] EWHC 15 (TCC).
90 [2006] EWHC 71 (TCC); [2006] TCLR 3.
219
relevant individuals before the start of the first adjudication, was to be deprived of its
contractual remedy because of that failure, over which it had had no control.
7.46 The most recent example of a dispute as to the proper parties preventing the enforcement of
an adjudicator’s decision is Estor Ltd v Multifit (UK) Ltd.91 In that case the claimant was
Estor, the holding company for what was referred to as The Ginger Group, a number of
companies operating beauty treatment salons. The contract was made between Hub Design
Ltd and The Ginger Group. Subsequently, Hub sub-contracted a sizeable part of the work to
Multifit who eventually took over the works as assignees of Hub. In the subsequent
adjudication, when Multifit pursued a claim for payment against Estor, one of the points
taken by Estor was that the contract was not with them but with The Ginger Group.
Akenhead J analysed the evidence and concluded that there was a realistic prospect of Estor
establishing that it was not the company that entered into the contract with Multifit, and
that the issue could not be resolved without oral evidence. The judge was not persuaded by
the separate argument that there was no contract in writing pursuant to s107 of the 1996
Act, concluding that, if the contract was with Estor, there was a good argument that the
contract was evidenced in writing. However, because of the uncertainty as to the correct
parties, the adjudicator’s decision was not enforced.
The Dispute
What was the Scope and Extent of the Dispute in the Notice of Adjudication?
7.47 Without any doubt, the most important document in the adjudication process is the
notice of intention to refer a dispute to adjudication, commonly known as the notice of
adjudication. The authorities make it clear that any jurisdictional issues will be considered
by reference to the nature, scope and extent of the dispute identified in the notice of
adjudication.92 Unless there is an express agreement by the parties, and the adjudicator,
either to widen or to narrow the extent of the dispute in the notice of adjudication, it is that
dispute alone that the adjudicator has the jurisdiction to decide.
7.48 In Northern Developments (Cumbria) Ltd v J&J Nichol 93 J&JN had made an application for
payment on 13 July. On 29 July NDCL wrote a letter purporting to be a notice of intention
to withhold payment. On 6 August J&JN withdrew from site and NDCL treated this
action as a repudiatory breach of contract. The dispute that was referred to adjudication by
J&JN in their notice of adjudication was in respect of the outstanding monies. Accordingly,
when NDCL responded by seeking to set off the damages that they claimed arose out of
J&JN’s repudiation of the contract, J&JN said that the adjudicator did not have the
jurisdiction to deal with that claim. HHJ Bowsher QC accepted that submission, con-
cluding that the adjudicator had no jurisdiction to consider any matter not raised in the
notice of adjudication, which was itself concerned with the validity or otherwise of the notice
of intention to withhold payment of 29 July. That was the document that triggered the dis-
pute that was subsequently referred to adjudication. The adjudicator had expressly excluded
the repudiation issue from his decision, so it could not be impeached, even though he had in
91 [2009] EWHC 2108 (TCC); [2009] 126 Con LR 40.

92 See also paragraphs 3.14–3.17.
93 [2000] BLR 158.
220
General Principles
fact decided not to consider the repudiation claim for another reason, which was wrong in
law. This error was irrelevant and the decision was enforced.
Similarly, in FW Cook Ltd v Shimizu (UK) Ltd 94 the TCC judge found that the notice of 7.49
adjudication was drafted rather loosely. It appeared to indicate simply that the referring party
wanted to obtain decisions on certain items in dispute, in the hope that other matters might
well be resolved, once the adjudicator’s decision on the specific items had been given.
Accordingly, the judge ruled that the notice to refer did not seek to obtain a definitive
decision from the adjudicator as to how much the next interim payment should be, but
simply sought a decision on a number of elements in the overall final account. Thus, he said,
the adjudicator’s decision did not mean that the sums that he had identified were immedi-
ately payable, because that would involve a consideration of overall liability, and that was
not the question the adjudicator had been asked to decide. For these reasons, the judge
concluded that, if the adjudicator had intended to direct that certain sums should be paid,
then he had done something which he was not authorised to do. He would not have had
the jurisdiction to reach such a decision. However, the judge found on the facts that the
adjudicator had not fallen into error because he had merely provided the parties with the
third party assistance that had been sought in the notice of adjudication.
Also in similar vein was the decision of HHJ Seymour QC in Mecright Ltd v T&A Morris 7.50
Developments Ltd 95 where he analysed the notice of adjudication carefully and concluded
that it did not include a dispute as to how much Mecright was entitled to be paid in respect of
the execution of the sub-contract works, or what was due as a result of the allegedly wrongful
determination of its contract by Morris. The judge therefore found that the adjudicator had
no jurisdiction to decide that a sum was due to Mecright in respect of the execution of the
sub-contract works. The decision was not summarily enforced.
There are a number of reported cases in which the court’s analysis of the dispute contained 7.51
in the notice of adjudication led to the conclusion that the adjudicator had exceeded his
jurisdiction when, in his decision, he considered and purported to decide other issues that
had not been referred to him. In Griffin & Anor (t/a K&D Contractors) v Midas Homes
Ltd,96 HHJ Lloyd QC explained in some detail the purpose and function of a notice of
adjudication. He said:
The purposes of such a notice are first, to inform the other party of what the dispute is;
secondly, to inform those who may be responsible for making the appointment of an adjudicator,
so that the correct adjudicator can be selected; and finally, of course, to define the dispute of
which the party is informed, to specify precisely the redress sought, and the party exercising
the statutory right and the party against whom a decision may be made so that the adjudicator
knows the ambit of his jurisdiction.
In that case the notice of adjudication of 3 May 2000 identified the dispute by reference to
two earlier letters, which had therefore themselves to be analysed to see the precise nature of
the dispute referred to the adjudicator. The judge concluded that, in consequence of the
notice, the adjudicator had the jurisdiction to deal with two outstanding invoices, and he
held that the decision was enforceable in respect of those sums. However, he concluded that,
94 [2000] BLR 199.

95 TCC, 26 June 2001, unreported. This case is the subject of a more detailed analysis at paragraph 3.16.
96 [2000] 78 Con LR.
221
because other invoices and general claims were not identified in the notice of 3 May 2000,
the adjudicator did not have the jurisdiction to make a decision about those other invoices
or claims.97
7.52 Conversely, there are many reported cases in which the court has concluded that, on a proper
analysis of the notice of adjudication, the adjudicator had the necessary jurisdiction to reach
all aspects of his decision. So in Jerome Engineering Ltd v Lloyd Morris Electrical Ltd 98 it was
held that an adjudication notice that omitted an express request for relief, and simply made
reference to a failure to make payment in accordance with the DOM/2 standard form of
sub-contract, was sufficient to permit the adjudicator to require the contractor to make an
interim payment to the sub-contractor.99 Likewise, in William Verry (Glazing Systems) Ltd v
Furlong Homes Ltd,100 the TCC judge’s construction of the notice of adjudication provided a
complete answer to the jurisdiction point. In that case, Furlong, the main contractor, sent
Verry, the sub-contractor, a notice of adjudication that, amongst other things, asked the
adjudicator ‘to decide that the extension of time granted by Furlong to 2 February 2004 is
correct’. The judge concluded that this meant that the adjudicator had to decide whether the
existing extension granted by Furlong was correct, which in turn meant that he also had to
consider all Verry’s claims for extension of time, whenever made. In addition, it was found
that, because Furlong had referred to adjudication their existing entitlement to liquidated
damages, it was impossible for the adjudicator to decide such entitlement to liquidated damages
without first deciding Verry’s existing entitlement to an extension of time, again regardless of
their previous claims. Accordingly, for these two separate reasons, as a matter of construction
of the notice to intention to refer to adjudication, the court concluded that the adjudicator
had the jurisdiction to consider de novo Verry’s entitlement to an extension of time. The same
principle was applied to the different facts of Workspace Management Ltd v YJL London
Ltd,101 where the argument was that, because the notice of adjudication contained only the
claiming party’s claim for sums due on an interim valuation, the adjudicator was not entitled,
once he had analysed the valuation and concluded that there was a negative balance, to order
that balance to be paid by the claiming party to the responding party. The TCC judge
rejected the submission that, ‘once the adjudicator had got to nil, he should have stopped’.
The adjudicator had done what was required by the notice: he had carried out a careful
valuation and concluded that the sum due to the claiming party was less than the amount
that had already been paid by the responding party. It was a composite exercise and had to
be completed in full. The decision ordering the balance to be paid by the claiming party was
therefore enforced.
7.53 Two common issues that arise in this context are, first, whether the notice is wide enough to
embrace the claim made and, secondly, whether the notice is wide enough to allow the
97 The same judge was obliged to consider in some detail the notice in the case of David McLean Housing
Ltd v Swansea Housing Association Ltd [2002] BLR 125. The notice identified six ‘matters in dispute’ although
the judge concluded that, in effect, they were all aspects of one dispute and that the notice was valid. The
decision is discussed in greater detail in paragraph 7.80.
98 [2002] CILL 1827.
99
HHJ Havery QC reached a similar conclusion in LPL Electrical Services Ltd v Kershaw Mechanical Services
Ltd (2 February 2001, unreported) where he concluded that, on a proper construction of the notice to refer, the
claimant was seeking payment of all outstanding sums, although the notice only specifically referred to the most
recent interim application for payment.
100 [2005] EWHC 138 (TCC).
101 [2009] EWHC 2017 (TCC); [2009] BLR 497.
222
General Principles
responding party to raise its own cross-claim. The decision in Verry v Furlong, referred to in
the previous paragraph, is an example of this first category. In general terms, the court will
endeavour to avoid construing a notice of adjudication, which is obviously drafted by the
claiming party, in such a way as to limit the defences to the claim that would otherwise be
open to the responding party. Thus, in Pilon Ltd v Breyer Group PLC 102 at paragraph 25 of
his judgment, the TCC judge pointed out that a notice of adjudication would ordinarily be
confined to the claim being advanced and will rarely refer to the points that might be raised
by way of a defence to that claim. But, subject to questions of withholding notices and the
like, a responding party was entitled to defend himself against a claim for money due by
reference to any legitimate available defence, and thus such defences will ordinarily be
encompassed within the notice of adjudication. An adjudicator should therefore think very
carefully before ruling out a defence merely because there was no mention of it in the claiming
party’s notice of adjudication. The judge went on to say:
That is only common sense: it would be absurd if the claiming party could, through some
devious bit of drafting, put beyond the scope of the adjudication the defending party’s
otherwise legitimate defence to the claim.
More difficult issues can arise as to whether or not the dispute being referred to adjudication 7.54
by way of the notice properly included any cross-claim. In VHE Construction Plc v RBSTB
Trust Co Ltd 103 the second adjudicator identified a sum of £254,000 payable by RBSTB in a
written decision dated 9 November 1999. Two days after the decision, RBSTB notified VHE
that they intended to deduct most of that sum by way of liquidated damages, and they
merely paid the small balance between the two figures. VHE sought and obtained summary
judgment for the remainder of the sum due in accordance with the second adjudicator’s
decision. HHJ Hicks QC decided that s111(4) of the 1996 Act required that an effective
notice of withholding payment must precede the referral to adjudication; if it did, the
notice of adjudication must include a reference to the effect of that withholding notice and
the validity of the grounds for withholding payment which it asserts.
In Letchworth Roofing Company v Sterling Building Company 104 the argument was that a party 7.55
with a cross-claim ought to be permitted to raise any cross-claim by way of defence to the
claim being pursued on enforcement, regardless of what was in the notice of adjudication
and regardless of the absence of a proper withholding notice. The TCC judge said that, whilst
there was no doubt that a defendant could raise whatever matters he wanted by way of
defence, that general principle did not permit a defendant to rely on a cross-claim that should
have been the subject of a withholding notice, but was not. A defendant could not avoid the
absence of a valid withholding notice if such a notice was required by the contract and to
hold otherwise would be to obviate the need for withholding notices at all.105 The judge also
made plain that there was nothing in the cases of Cantillon v Urvasco106 and Quartzelec Ltd v
Honeywell Control Systems107 that should or could be taken as softening that vital principle.
102
[2010] EWHC 837 (TCC); (2010) 130 Con LR 90
103
[2000] BLR 187. This decision is discussed in greater detail, in connection with the principles relating to
set-off and withholding notices, in paragraphs 9.21–9.22.
104
[2009] EWHC 1119 (TCC); [2009] CILL 2717.
105
In this context the judge referred to Harwood Construction Ltd v Lantrode Ltd (unreported, 24 November
2000).
106 [2008] EWHC 282 (TCC); [2008] BLR 250.
107 [2008] EWHC 3315 (TCC); [2009] BLR 328.
223
7.56 The importance of ensuring that the notice of adjudication properly describes the relevant
dispute is even more pronounced if the dispute relates to the contents of a final certificate.
Many of the JCT Standard Forms of Building Contract contain detailed provisions relating
to the issue of a final certificate, which, unless challenged within a set period, becomes
conclusive evidence on a variety of potentially significant matters. If a final certificate is
challenged, then the challenger is required to issue a notice of adjudication within a specified
period (not usually longer than 28 days), and it therefore becomes critically important for
the challenger to ensure that every element of his challenge to the final certificate is enshrined
in the notice of adjudication; otherwise, if a point of challenge is omitted from the notice,
the final certificate will become conclusive evidence in respect of that omitted matter. In such
circumstances, there is a potential benefit to be gained by the party who is content with the
final certificate in taking technical points about the notice of adjudication and/or the
conduct of the adjudication to which it gives rise because, if such arguments are successful
and, say, the decision is a nullity, the final certificate will not have been challenged in time.
7.57 The courts are astute to the consequences of such arguments. Thus, in Mr Tracy Bennett v
FMK Construction Ltd 108 the court rejected a number of technical points that would have
ruled the notice, and therefore the adjudicator’s decision, invalid. In particular, the TCC
judge concluded that a first notice of adjudication was sufficient to comply with the final
certificate provisions in the contract, and prevented the final certificate from becoming
conclusive evidence, even though that notice was replaced by a later notice of adjudication
that was served outside the period prescribed by the contract for a challenge to the final
certificate. In similar vein, there was a potential problem with the adjudicator’s jurisdiction
in Cubitt Building & Interiors Ltd v Fleetglade Ltd 109 where the referral notice was allegedly
served more than seven days after the notice of adjudication. If that criticism had been
sustained, and it deprived the adjudicator of jurisdiction, then the period under the contract
for challenging the final certificate would have elapsed, and no subsequent notice would
have been served in order to rectify any default. The court concluded that, because the
adjudicator was only appointed very late on day seven, it was in accordance with the contract
and the 1996 Act if the referral notice was served promptly on the following day, which is
what happened. This meant that the adjudicator did have the necessary jurisdiction and
that the challenge to the final certificate had not been lost. Both cases serve as an eloquent
warning to those who wish to challenge a final certificate that they need to do so promptly
and in clear terms. It can also be worthwhile for a challenger in such circumstances to issue
both a notice of adjudication and a claim form (or arbitration notice) at the same time, so as
to ensure that an error by the adjudicator later during the reference does not create an insur-
mountable procedural difficulty.
7.58 Accordingly, subject to the points noted above, the general rule is that it is the notice of
adjudication that defines the limits of the adjudicator’s jurisdiction, so later documents, and
in particular the more detailed referral notice, cannot extend the adjudicator’s jurisdiction
beyond that which is set out in the notice of adjudication. In KNS Industrial Services Ltd v
Sindall Ltd 110 HHJ Lloyd QC noted in trenchant terms that the further documents which
come into existence following the notice of adjudication, such as the referral, ‘do not cut
108 [2005] EWHC 1268 (TCC); 101 Con LR 92.

109 [2006] EWHC 3413 (TCC); [2006] 110 Con LR 36.
110 [2001] 17 Const LJ 170.
224
General Principles
down, or, indeed, enlarge the dispute (unless they contain an agreement to do so)’. This
conclusion was endorsed by HHJ Seymour QC in Mecright Ltd v T&A Morris Developments
Ltd 111 where the judge went on to say that the basic scheme of adjudication was that which
was referred was a single dispute, and that an adjudicator could only deal with more than one
dispute at a time if there was clear and express consent to this from the parties. Such consent
is not to be implied from conduct or by the construction of documents other than the notice
of adjudication. Indeed, Judge Seymour emphasised the importance of the notice of
adjudication in the summary process. He said:
There is implicit within it [adjudication] a risk of injustice; but Parliament has considered that
risk to be acceptable because an adjudication is of limited temporal effect and only of an
interim nature. While, as I have pointed out, my view and that of other judges is that those
who describe a dispute which they wish to refer to adjudication in vague terms have only
themselves to blame if the scope of what has been referred appears to be wider than what they
may have thought, it seems to me to be wrong in principle to expose those involved in an
expeditious process such as adjudication to the requirement to take care to express themselves
during the process in such a way that it cannot be said that by words or conduct, they have
unintentionally consented or agreed to some process other than that upon which they were
initially engaged. This risk is eliminated if, as it seems to me to be right, any consent or
agreement for the purposes of the Scheme has to be express.
In many ways, the sorts of issues that commonly arise in respect of the dispute that was the 7.59
subject of the notice of adjudication can be exemplified in another case of Judge Seymour’s,
namely Chamberlain Carpentry and Joinery Ltd v Alfred McAlpine Construction Ltd.112 There
was a notice of adjudication that contained a series of elements of Chamberlain’s account
that, on their case, McAlpine had failed to pay. The adjudicator found in their favour and
McAlpine resisted enforcement. The first complaint was that the notice contained more than
one dispute. The second was that the adjudicator’s decision requiring McAlpine to pay sums
arising out of a particular application for payment did not arise from the notice of adjudica-
tion, and there was no correlation between the notice and the valuation exercise that had
been undertaken by the adjudicator. The complaint was, therefore, that the adjudicator had
exceeded his jurisdiction by having regard to points made elsewhere than in the notice of
adjudication. As to the first point, the judge concluded that what Chamberlain referred to
adjudication by their notice of adjudication was a dispute as to how much it should be paid
by McAlpine; that was a single dispute and the fact that, in order to reach a conclusion as to
the sum due, it would be necessary to consider a number of elements that Chamberlain
contended were relevant to the overall calculation of the payment did not mean that there
was in reality a series of disputes as to what was payable under a number of different heads.
As to the second point, however, the judge rejected Chamberlain’s argument that it was
appropriate to consider the adjudicator’s jurisdiction by reference to the referral notice,
which had in fact been sent under cover of the notice of adjudication. Instead, the judge
concluded that, although a valid notice of adjudication may incorporate by reference other
documents and, if it did, it must be construed together with those incorporated documents,
the referral notice was not incorporated into the notice of adjudication because it had been
merely sent with the notice of adjudication and was nowhere referred to within in. Although,
at first sight, that looks to be a rather legalistic approach, it should be noted that, on the facts,
111 22 June 2001, unreported.

112 [2002] EWHC 514 (TCC).
225
the judge concluded that the notice of adjudication had properly described the dispute that
was subsequently determined by the adjudicator in his decision, and he therefore had
the appropriate jurisdiction to arrive at the sum due to Chamberlain. The decision was
therefore enforced.
7.60 A more recent example of the argument that the adjudicator wrongly allowed the dispute to
be broadened by the subsequent documents can be found in the judgement of Ramsey J in
OSC Building Services Ltd v Interior Dimensions Contracts Ltd.113 The argument was that the
dispute set out in the notice of adjudication was limited to the absence of a withholding
notice, but was expanded in the referral notice to include a claim based on the valuation of
the final account. Ramsey J rejected that submission, finding that, on a proper construction
of the notice of adjudication, the dispute being referred to adjudication was the question of
what sums were due to OSC at the time when the notice of adjudication was issued. The
notice of adjudication had to be read in the context and against the background of the prior
communications between the parties, which included a lengthy process of detailed submis-
sions, comments and assessments of the final account claim. In all the circumstances, the
dispute referred to adjudication was not a narrow one as to withholding, but the broader
issue as to the overall value of sums due to OSC.
Had that Dispute Crystallised Between the Parties Prior to the Notice to Refer?
The Development of the Law
7.61 Responding parties often complain that the adjudicator’s decision can concentrate on matters
that, at the time of the issue of the notice of adjudication, the defendant did not even realise
were in dispute. The complaints are either of ‘ambush’, with the notice of adjudication
purporting to identify a dispute of which the responding party was either unaware or had
had only a few days to consider, or ‘creep’, where the responding party thought that the
dispute involved a short, self-contained matter but which, because of the way in which the
referring party put it in the adjudication, involved a much more extensive trawl through
hitherto unchartered territory. In these instances, responding parties complain that the
purported dispute in the notice of adjudication was either no such thing, because the dis-
pute had not crystallised between the parties—indeed, had not even been discussed—at
the time of the issue of the notice of adjudication or, alternatively, that whilst the notice of
adjudication appeared to identify a dispute that the responding party was aware of and was
capable of addressing, the dispute that the adjudicator ended up deciding was very different,
and had never arisen until the process of adjudication itself.
7.62 In principle, the answer to these difficulties is straightforward. The dispute in the notice of
adjudication must have crystallised between the parties prior to the service of that notice,
even though such crystallisation may require no more than the service of a claim by the
claiming party and subsequent inactivity, for a fairly short period, by the responding party.
The adjudicator is obliged to decide that dispute and cannot seek to widen his jurisdiction,
without the parties’ consent, to deal with other matters that are not referred to, either
expressly or by implication, in the notice of adjudication. In practice, in the early days of
adjudication, it was a little unclear as to how the courts might approach the question of
whether a dispute (and, if so, what dispute) had arisen between the parties. In more recent
years, it is submitted that the necessary clarity has been provided by the case-law.
113
[2009] EWHC 248 (TCC); [2009] CILL 2688.
226
General Principles
The starting point for a consideration of what is meant by the word ‘dispute’ is Fastrack 7.63
Contractors Ltd v Morrison Construction Ltd.114 HHJ Thornton QC pointed out that the
1996 Act, and the whole process begun by the notice of adjudication, required there to be a
dispute that had already arisen between the parties to a construction contract. Any selection
or acceptance of appointment by an adjudicator, and/or any subsequent adjudication and
decision, which were not confined to that pre-existing dispute, would be undertaken without
jurisdiction. He went on at paragraph 27 to say:
A ‘dispute’ can only arise once the subject-matter of the claim, issue or other matter has been
brought to the attention of the opposing party and that party has had an opportunity of
considering and admitting, modifying or rejecting the claim or assertion.
In arriving at this conclusion, HHJ Thornton relied on two non-adjudication cases: Halki 7.64
Shipping Corporation v Sopex Oils Ltd 115 and Monmouthshire County Council v Costelloe &
Kemple Ltd.116 In Halki the Court of Appeal confirmed that a ‘dispute’, the existence of
which was the statutory pre-condition of a party being entitled to enforce an arbitration
clause and to have legal proceedings stayed for arbitration under the Arbitration Act 1996,
had a wide meaning and included any claim which the opposing party had been notified of,
and which that party had refused to admit or had not paid, whether or not there was any
answer to that claim in fact or in law. Judge Thornton concluded that the cases showed that a
claim and its submission do not necessarily constitute a dispute and that a dispute only arose
when a claim had been notified and then rejected. However, a rejection can occur when an
opposing party refuses to answer the claim, and a dispute can arise when there has been a bare
rejection of the claim to which there is no discernable answer in fact or in law.
In accordance with the reasoning in Fastrack, HHJ Lloyd QC in Sindall Ltd v Abner Solland & 7.65
Ors117 said that the absence of a reply to a claim or an assertion may give rise to the inference
that there was a dispute, and that this would therefore cover the situation where the
responding party was guilty of prevarication. The judge said, ‘for there to be a dispute for
the purposes of exercising the statutory right to adjudication it must be clear that a point has
emerged from the process of discussion or negotiation has ended and that there is something
which needs to be decided’. His judgment itself is analysed at paragraph 7.88 below. These
two decisions, early on in the life of the 1996 Act, with their emphasis on the need for an
opportunity for the responding party to consider the claim, and a requirement for the process
of discussion or negotiation to have ended before a dispute could be said to have arisen, led
to the suggestion in some quarters that the London TCC judges were taking a more restricted
approach to the meaning of ‘dispute’ in adjudication than was being utilised elsewhere.118
Furthermore, this view was apparently confirmed by two decisions of HHJ Seymour QC 7.66
dealing with the need for the ‘crystallisation’ of the dispute prior to the service of the notice
of adjudication. In Edmund Nuttall Ltd v R G Carter Ltd 119 Judge Seymour concluded that,
for a dispute to have arisen, there must have been an opportunity for each of the protagonists
114 [2000] BLR 168.

115
[1998] 1 WLR 726.
116
[1965] 5 BLR 83.
117
[2001] 3 TCLR 712.
118
See paragraph 3 of the judgment of Forbes J in Beck Peppiatt Ltd v Norwest Holst Construction Ltd [2003]
EWHC 822 (TCC); [2003] BLR 316 in which the judge identified defendant’s counsel’s express submission to
this effect.
119 [2002] BLR 312.
227
to consider the position adopted by the other and to formulate arguments of a reasoned kind.
At paragraph 36 of his judgment, he said:
It may be that it can be said that there is a ‘dispute’ in a case in which a party which has been
afforded an opportunity to evaluate rationally the position of an opposite party has either
chosen not to avail himself of that opportunity or has refused to communicate the results of
his evaluation. However, where a party has had an opportunity to consider the position of the
opposite party and to formulate arguments in relation to that position, what constitutes a
‘dispute’ between the parties is not only a ‘claim’ which has been rejected, if that is what the
dispute is about, but the whole package of arguments advanced and facts relied upon by each
side. No doubt, for the purposes of a reference to adjudication under the 1996 Act or equivalent
contractual provision, a party can refine its arguments and abandon points not thought to be
meritorious without altering fundamentally the nature of the ‘dispute’ between them. However,
what a party cannot do, in my judgment, is abandon wholesale facts previously relied upon or
arguments previously advanced and contend that because the ‘claim’ remains the same as that
made previously, the ‘dispute’ is the same . . . The whole concept underlying adjudication is
that the parties to an adjudication should first themselves have attempted to resolve their
differences by open exchange of views and, if they are unable to, they should submit to an
independent third party for decision the facts and argument which they have previously
rehearsed among themselves. If adjudication does not work in that way there is the risk of
premature and unnecessary adjudications in cases in which, if any one party had had an oppor-
tunity to consider the arguments of the other, accommodation might have been possible.
On the facts, the judge concluded that the dispute that was referred to adjudication was the
existing claim for an extension of time, not the new claim for an extension that was advanced
by reference to an expert’s report that was only provided for the purposes of the adjudication
itself. Similarly, in Hitec Power Protection BV v MCI Worldcom Ltd 120 the same judge
concluded that there was no dispute between the claimant and the defendant in relation to
the matters set out in the notice of adjudication served on behalf of the claimant, because the
issues there identified did not arise between the parties to the adjudication, but between
the claimant and those third parties who had placed a series of separate purchase orders. The
judge said that, by the time the matter was determined by the adjudicator, the claim against
the defendant was put on a completely different contractual basis to that which had been
stated at the time that the notice of adjudication was served and that, in those circumstances,
the adjudicator did not have the necessary jurisdiction to decide the dispute on the basis
of the new, and different, case.

7.67 Nuttall is now regarded as providing an overly-restrictive interpretation of the word ‘dispute’
(as opposed to being a series of cases merely decided on their own specific facts), and a whole
series of subsequent decisions have made it plain that the word ‘dispute’ is not to be given a
restrictive or particular meaning for the purposes of adjudication. Thus, in Beck Peppiatt
Ltd v Norwest Holst Construction Ltd 121 Forbes J rejected the contention that Fastrack
suggested a more restricted approach to the meaning of ‘dispute’ (or that it had been so
interpreted by the TCC judges) for the purposes of adjudication in a way that was incon-
sistent with Halki. He went on expressly to approve what Judge Lloyd said in Sindall v
Solland, commenting that, in his view, Judge Lloyd’s comments were not in conflict with the
approach of the Court of Appeal in Halki. He reiterated that the word ‘dispute’ was an
ordinary English word, which should be given its ordinary English meaning, and that each
120 [2002] EWHC 1953.

121 [2003] BLR 316.
228
General Principles
case had to be determined on its own facts. He expressly rejected the suggestion that the word
‘dispute’ should be given some form of specialised meaning for the purposes of adjudication.
This approach was followed by HHJ Kirkham in Cowlin Construction Ltd v CFW Architects
(A Firm).122 In that case, Cowlin submitted a claim on 27 February 2002. CFW did not
admit that the sum claimed by Cowlin was due and payable and, on 18 May 2002, Cowlin
issued a notice of adjudication. The judge said that, applying the test in Halki, because CFW
had not accepted the claim by 18 May, even though they had not expressly rejected it, there
was a dispute between the parties by that date. She went on to say that, in the same way as
the Court of Appeal in Halki declined to construe the word ‘dispute’ more narrowly in the
context of arbitration, there was similarly no reason to construe the word ‘dispute’ more
narrowly in the context of adjudication.123
There were then a number of TCC decisions in which the point was reiterated that the word 7.68
‘dispute’ should not be given a restricted meaning merely because the adjudication process
was a summary one, some of which dealt expressly with Judge Seymour’s reference to a
‘package of arguments’ in Nuttall.124 Many of the cases noted in the preceding paragraphs
were summarised in the judgment of HHJ Toulmin CMG QC in AWG Construction
Services Ltd v Rockingham Motor Speedway Ltd.125 The judge expressly said that, to the extent
that Nuttall suggested that a dispute could consist only of the issues referred to adjudication
and only those facts and matters set out in the notice of adjudication and/or the referral
notice, he regarded that as too rigid a principle, and contrary to the approach in Halki and
the other cases noted above. He said that, following Halki, a wide interpretation should be
given to the word ‘dispute’ so that the adjudicator’s jurisdiction was preserved wherever
possible. He concluded that, although each case depended on its own facts and the context
in which the referral to adjudication occurred, it was important that a court should approach
the question of what comprised the dispute ‘with robust commonsense, which takes into
account the nature of the dispute and the manner in which it has been presented to the
adjudicator’. He reiterated therefore that, within the limits that he described, the adjudicator
was not confined to considering rigidly only the package of issues, facts and arguments that
had been referred to him.
The pragmatic approach described by Judge Toulmin, and the wide interpretation given to 7.69
the word ‘dispute’ to which he also refers, can be seen in the more recent decisions on this
issue. First, in Amec Civil Engineering Ltd v The Secretary of State for Transport126 Jackson J
considered all of the authorities identified above and summarised them into seven pro-
positions, at paragraph 68 of his judgment, as follows:
1. The word ‘dispute’ that occurs in many arbitration clauses and also in s108 of the Housing
Grants Act should be given its normal meaning. It does not have some special or unusual
meaning conferred upon it by lawyers.
122 [2003] CILL 1961; [2003] BLR 252–254.

123 The same Judge reached the same conclusion in Orange EBS Ltd v ABB Ltd [2003] BLR 323. A final
account claim had been provided on 2 December 2002 and no response had been received by 6 January when
the notice of intention to refer was issued. The judge concluded in accordance with Halki that a dispute had
arisen by 6 January. This case is also referred to at paragraph 5.51.
124
See, by way of example, the two decisions of HHJ Moseley QC in Watkin Jones v LIDL [2002] CILL
1834–1836 and 1847–1849, and Lovell Projects Ltd v Legg & Carver [2003] BLR 452.
125 [2004] EWHC 888 (TCC); [2004] TCLR 6.
126 [2004] EWHC 2339 (TCC).
229
2. Despite the simple meaning of the word ‘dispute’, there has been much litigation over the
years as to whether or not disputes existed in particular situations. This litigation has not
generated any hard-edged legal rules as to what is or is not a dispute. However, the
accumulating judicial decisions have produced helpful guidance.
3. The mere fact that one party (whom I shall call ‘the claimant’) notifies the other party
(whom I shall call ‘the respondent’) of a claim does not automatically and immediately
give rise to a dispute. It is clear, both as a matter of language and from judicial decisions,
that a dispute does not arise unless and until it emerges that the claim is not admitted.
4. The circumstances from which it may emerge that a claim is not admitted are Protean.
For example, there may be an express rejection of the claim. There may be discussions
between the parties from which objectively it is to be inferred that the claim is not
admitted. The respondent may prevaricate, thus giving rise to the inference that he does
not admit the claim. The respondent may simply remain silent for a period of time, thus
giving rise to the same inference.
5. The period of time for which a respondent may remain silent before a dispute is to be
inferred depends heavily upon the facts of the case and the contractual structure. Where
the gist of the claim is well known and it is obviously controversial, a very short period of
silence may suffice to give rise to this inference. Where the claim is notified to some agent
of the respondent who has a legal duty to consider the claim independently and then give
a considered response, a longer period of time may be required before it can be inferred
that mere silence gives rise to a dispute.
6. If the claimant imposes upon the respondent a deadline for responding to the claim, that
deadline does not have the automatic effect of curtailing what would otherwise be a
reasonable time for responding. On the other hand, a stated deadline and the reasons for
its imposition may be relevant factors when the court comes to consider what is a
reasonable time for responding.
7. If the claim as presented by the claimant is so nebulous and ill-defined that the
respondent cannot sensibly respond to it, neither silence by the respondent nor even an
express non-admission is likely to give rise to a dispute for the purposes of arbitration or
adjudication.
Adopting these principles, the judge concluded that a dispute had arisen on the facts of Amec
by the time of the notice of adjudication. This result was upheld in the Court of Appeal,127
which expressly endorsed his seven principles. A similar result occurred in William Verry
(Glazing Systems) Ltd v Furlong Homes Ltd 128 in which the TCC judge observed that the
restrictive approach in Nuttall (if that is what it was) had not been followed in subsequent
cases, and that instead the courts had taken a robust view as to whether a dispute had arisen
in any given case, having regard to its particular facts.
7.70 The only other Court of Appeal decision in this area of adjudication law is Collins (Contractors)
Ltd v Baltic Quay Management (1994) Ltd.129 In his judgment in that case, Clarke LJ (as he
then was) referred expressly to the seven propositions outlined by Jackson J in Amec
(and quoted in full in paragraph 7.69 above). He accepted those propositions as broadly
correct and endorsed the general approach that, while the mere making of a claim did not
127 [2005] EWCA Civ 291; [2005] BLR 227.

128 [2005] EWHC 138 (TCC).
129 [2004] EWCA Civ 1757; [2005] BLR 63.
230
General Principles
amount to a dispute, a dispute would be held to exist once it can reasonably be inferred that
the claim was not admitted. He noted that Jackson J did not endorse the suggestions in some
of the earlier cases, either that a dispute may not arise until negotiation or discussion had
been concluded or that a dispute should not be lightly inferred, and he expressed the opinion
that Jackson J was right not to do so. Indeed, he went on to say that negotiation and discussion
were likely to be more consistent with the existence of a dispute, albeit an as yet unresolved
dispute, than with an absence of a dispute. He concluded that, in such circumstances, the
court was likely to be willing readily to infer that a claim was not admitted and that a dispute
existed so that it could be referred to arbitration or adjudication.
Two other decisions of Jackson J (as he then was) are also relevant to this issue. In Midland 7.71
Expressway Ltd & Anor v Carillion Construction Ltd & Ors 130 he adopted the principles
endorsed by the Court of Appeal in Amec and noted that the contractual definition in that
case of ‘construction dispute’ was very similar to the definition of the word ‘dispute’ given by
the Court of Appeal in Amec. In Multiplex Constructions (UK) Ltd v Mott MacDonald Ltd 131
the same judge rejected what he described as the ‘unreal and artificial’ interpretation of the
dispute between the parties urged upon him by the defendant, Mott MacDonald, favouring
a broad interpretation of the relevant correspondence so as to not unduly circumscribe the
scope of the dispute before the adjudicator. In John Stirling v Westminster Properties Scotland
Limited 132 Lord Drummond Young followed the approach in Amec and concluded on the
facts that a dispute as to an interim certificate existed prior to the notice of adjudication.
He said that a claim had been asserted, no sum had been paid, and the defenders had failed
to advance any reason to explain such non-payment. That, he said, was ‘sufficient for the
inference that the defenders disputed the pursuers’ claim. If that were not so, a party could
adopt the tactic of simply failing to respond to repeated invoices, claim letters and the like,
and thus substantially delay any reference to adjudication.’
The Present Position
In two recent decisions of Akenhead J, a number of the principles in the cases referred to 7.72
above were set out and summarised. The two judgements, when taken together, therefore
amount to a helpful summary of the law as to the crystallisation of a dispute prior to the
commencement of the adjudication. First, in Cantillon Ltd v Urvasco Ltd,133 in the context
of the court’s approach to the question as to whether or not the disputed crystalised prior to
the service of the notice of adjudication, he said this:
55 . . . (a) Courts (and indeed adjudicators and arbitrators) should not adopt an over-legalistic
analysis of what the dispute between the parties is.
(b) One does need to determine in broad terms what the disputed claim or assertion
(being referred to adjudication or arbitration as the case may be) is.
(c) One cannot say that the disputed claim or assertion is necessarily defined or limited
by the evidence or arguments submitted by either party to each other before the
referral to adjudication or arbitration.
(d) The ambit of the reference to arbitration or adjudication may unavoidably be
whitened by the nature of the defence or defences put forward by the defending party
in adjudication or arbitration.
130
[2006] EWHC 1505 (TCC); [2006] BLR 325.
131 [2007] EWHC 20 (TCC); [2007] 110 Con LR 63.
132 [2007] Scot CS CSOH 117.
133 [2008] EWHC 282 (TCC); [2008] BLR 250.
231
As the judge himself pointed out, it followed from that summary that he did not adopt the
much-criticised approach of Judge Seymour in Nuttall v Carter. He said that it was necessary
to look at the essential claim that had been made and the fact that it had been challenged, as
opposed to the precise grounds upon which it had been rejected or not accepted. Neither
party was limited to the arguments, contentions and evidence put forward prior to the
commencement of the adjudication. The adjudicator had to resolve the referred dispute,
namely the claim or assertion made prior to the adjudication that had been challenged or not
accepted, but in so doing he could consider any argument, evidence or other material for or
against the disputed claim or assertion in resolving that dispute.
7.73 In the second case, Ringway Infrastructure Services Ltd v Vauxhall Motors Ltd,134 the same
judge dealt with the court’s approach when deciding if and when crystallisation occurred.
Paragraph 55 of his judgement summarised the authorities as follows:
(1) The existence of a dispute or difference may be inferred from what is said or not said by
the party in receipt of what may be termed a ‘claim’.
(2) There does not have to be an express rejection of a ‘claim’ by the recipient. In so far as the
case of Monmouthshire County Council v Costelloe and Kemple Ltd 135 suggests otherwise,
the more recent cases of Amec and Collins suggest otherwise.
(3) A ‘claim’ for the purpose of giving rise to a dispute or difference may not be a claim for
money or for the payment of money. The variety, extent and scope of disputes are infinite.
It may involve simply an assertion of a right by one party.
(4) One needs to determine whether there is a ‘claim’ and whether or not that claim is disputed
from the surrounding facts, circumstances and evidence pertaining up to the moment that
the dispute, subsequently referred to adjudication (or arbitration) has crystallised.
The cases have identified four ways in which it might be argued that the dispute had not
crystallised by the time of the notice of adjudication: (1) where there was insufficient time
between the original claim and the notice for the claim to have been considered/rejected;
(2) where the original claim had been abandoned prior to the notice of adjudication;
(3) where the correspondence that might otherwise have evidenced crystallisation was marked
‘without prejudice’; (4) where the claim was so nebulous and ill-defined that it could not be
said that any dispute in respect of such a claim had arisen prior to the notice.
7.74 The timing point at (1) is frequently taken: see paragraphs 7.61–7.71 above. The cases set out
there demonstrate that, if a claim has been made, then the recipient of the claim will be
expected to respond to it in a relatively short period. The precise length of any such period
will depend on the surrounding circumstances (and particularly whether the claim has been
presented before or is new) but, since it is unnecessary for the recipient expressly to challenge
the claim in order for a dispute to crystallise, even a relatively short period of silence will be
sufficient for the dispute to crystallise. One case in which the timing point was successfully
taken by a party resisting enforcement was Enterprise Managed Services Ltd v Tony McFadden
Utilities Ltd.136 There, Utilities were pursuing Enterprise as assignees. But Utilities did not
notify Enterprise of the existence of either the assignment, or their claim as assignees, until
the very date on which they purported to give notice of adjudication. The TCC judge noted
that the timing point was usually unsuccessful because of the broad meaning ascribed to the
134 [2007] EWHC 2421 (TCC).

135 [1965] 5 BLR 83.
136 [2009] EWHC 3222 (TCC); [2010] BLR 89.
232
General Principles
word ‘dispute’, but because the notice of the claim as assignees was given at precisely the same
time as the reference was made, it was not possible for a dispute between the parties about
that claim to have crystallised prior to the notice of adjudication. There was no interval
between the two events, let alone a sufficient interval for the court to conclude that the claim
was not accepted. The TCC judge dismissed the suggestion that the dispute had crystallised
because of earlier correspondence between Enterprise and the assignors. He said that, for a
dispute to arise for the purposes of any reference to adjudication, there has to be a dispute
between the two parties who are going to be the parties in that adjudication.
A difficult question can arise in the circumstances postulated at (2), namely where a claim 7.75
was made and then expressly abandoned prior to the notice of adjudication. This point has
already been covered in paragraphs 7.29–7.32 above in connection with settlement of
disputes. In VGC Construction Ltd v Jackson Civil Engineering Ltd 137 Akenhead J noted at
paragraph 49 of his judgement that, as a matter of general principle, a dispute may cease to
be a dispute by reason of a withdrawal of the claim. He also thought that it might be possible
in certain circumstances to apply the principles of estoppel or waiver to a disputed claim that
the claiming party indicated clearly and unequivocally that it was withdrawing. However, he
said that it was necessary to examine critically whether the claiming party was in effect with-
drawing or abandoning the claim, or merely temporarily suspending its pursuit. Equally
difficult questions arise under (3), namely where the correspondence between the parties
before the adjudication, which would otherwise be evidence of a dispute crystallising between
them, was covered by ‘without prejudice’ privilege. In RWE Npower PLC v Alstom Power
Ltd 138 HHJ Havelock-Allan QC addressed this difficulty of paragraphs 48–56 of his
judgement. On a proper interpretation of the correspondence in that case, the judge concluded
that there was nothing privileged about it, because there was nothing to negotiate about until
the claims had been particularised. Furthermore, even if the earlier correspondence had been
privileged, following the notification of a claim in open fashion, and some negotiations on
those claims, an objective assessment of the situation that prevailed in the week before the
notice of adjudication was served led to the conclusion that the parties were in dispute about
the claim. On the facts, any privilege that previously attached to the earlier claims ceased to
attach to them. The judge expressly reached no conclusion on the wider submission that had
been made to him that, just as a court can always look at ‘without prejudice’ communications
in order to determine whether a concluded compromise had been reached, a court could also
examine such material in order to determine whether a dispute had crystallised that was
capable of being referred to adjudication. He commented that those two situations ‘are not
necessarily analogous’.
As to category (4) above, the contention by the unsuccessful party that the claim was 7.76
‘so nebulous and ill-defined’ that it could not be said that a dispute had arisen in respect of it,
has rarely been successful. Two cases are, however, of particular assistance on this point. The
first, Cruden Construction Ltd v Commission for the New Towns139 (which was referred to by
the Court of Appeal in Amec), was an arbitration case. On one day the Commission wrote to
the contractors referring in general terms to a claim and the fact that there were schedules of
defect running to numerous pages which were available for inspection. Four days later,
137 [2008] EWHC 2082 (TCC); [2008] 120 Con LR 178.

138 [2009] EWHC B40 (TCC).
139 [1995] 2 Lloyd’s Law Rep 387.
233
when the contractor’s solicitors wrote to say they were authorised to they received, later that
day, notices of arbitration. HHJ Gilliland QC concluded that no dispute or difference had
existed as at that date because the Commission had not identified which houses were alleged
to be defective or what those defects were nor did they call upon the contractors to put the
defects right or to pay compensation.140 The second is Allied P & L Ltd v Paradigm Housing
Group Ltd,141 where Akenhead J concluded that, although a dispute had crystallised between
the parties as to whether there were breaches of contract by Allied sufficient to justify termin-
ation by Paradigm, it was impossible to extract from the pre-adjudication material any claims
or assertions that gave rise to a dispute in relation to the financial consequences that might
arise from termination. Thus, although the notice of adjudication purported to include
claims for those financial consequences, that did not in itself give the adjudicator the juris-
diction to deal with that aspect of the claim, given the absence of a crystallised dispute.
However, the judge concluded that that was not the end of the matter. Because Paradigm had
made no valid or effective jurisdictional reservation as to the financial consequences of the
termination, and had thus allowed the adjudicator to deal with those issues as well, they
could not now challenge the decision on this jurisdictional ground. The decision was
therefore enforced.
7.77 The cases noted above demonstrate that the argument that a dispute had not crystallised at
the time of the notice of adjudication will sometimes be successful, although for the reasons
previously noted, the argument usually fails,142 partly because the court will adopt a pragmatic
approach to the crystallisation issue, analysing the material that passed between the parties
before the notice ‘with a commercial eye’. One example of that analysis, which led to the
conclusion that the complex dispute before the adjudicator had indeed crystallised prior to
the notice, was Bovis Lend Lease Ltd v The Trustees of the London Clinic.143 On the time point
in that case, Akenhead J rejected the submission that a three-month period had to pass
between the assertion of the claim and the crystallisation of a dispute. Furthermore, the judge
said that even if the provision of the detailed claim letter in that case could be regarded as
something of an ambush, that in itself did not mean that the dispute had not crystallised.
Was the Dispute Referred to Adjudication a Single Dispute?

7.78 The 1996 Act makes it clear that only a single dispute can be referred to an adjudicator at any
one time. The obvious explanation for this is that adjudication is a fast and summary process
and it would become unworkable if an adjudicator had to deal with more than one dispute
at the same time. It also appears that the contractual adjudication provisions drafted by
the various professional bodies are also generally designed to anticipate the reference of a
single dispute at any one time, although some particular standard terms expressly allow
for multiple references at the same time. Single dispute requirements can be problematic
when, under most construction contracts, the potential range of dispute is considerable,
from arguments over proper payment for original work and variations, to debates about
140
Having cited that case in his judgement in VGC v Jackson, Akenhead J said that it was necessary to look at all
the surrounding circumstances, and that even a one-line description of a claim, given the surrounding circumstances,
may not be described as nebulous or ill-defined and may therefore give rise to a subsequent dispute.
141
[2009] EWHC 2890 (TCC); [2010] BLR 59.
142
This is often because, as Akenhead J observed in Cantillon v Urvasco, ‘adjudication is not a game’, and
enforcement issues are not so treated by the courts. The crystallisation argument also failed in PTB Building
Services Ltd v ROK Build Ltd [2008] EWHC 343 (TCC); [2008] 117 Con LR 53.
143 [2009] EWHC 64 (TCC); [2009] 123 Con LR 15.
234
General Principles
responsibility for delays and defects. In addition, many of these issues might crystallise out
of a single claim for an interim payment, or on a final account. The obvious question then
arises: when does a contractor’s claim involve the reference to adjudication of more than one
dispute, thus depriving the adjudicator of jurisdiction? The answer, in the cases thus far,
perhaps surprisingly, is almost never.
Again, the starting point for consideration of this topic is the decision of HHJ Thornton QC 7.79
in Fastrack Contractors Ltd v Morrison Construction Ltd.144 In a much cited passage, Judge
Thornton defined a single dispute as follows:
During the course of a construction contract, many claims, heads of claim, issues, contentions
and causes of action will arise. Many of these will be, collectively and individually, disputed.
When a dispute arises, it may cover one, several or many of one, some or all of these matters.
At any particular moment in time, it will be a question of fact what is in dispute. Thus the
‘dispute’ which may be referred to adjudication is all or part of whatever is in dispute at
the moment that the referring party first intimates an adjudication reference. In other words, the
‘dispute’ is whatever claims, heads of claim, issues, contentions or causes of action that are then
in dispute which the referring party has chosen to crystallise into an adjudication reference.
This passage has been cited with approval in a number of cases including, in particular, David
McLean Housing Ltd v Swansea Housing Association Ltd145 and Michael John Construction v
Golledge.146 There can be no doubt, therefore, that the courts have again taken a broad inter-
pretation of the words ‘dispute’, with the result that if, for example, a contractor’s application
for an interim payment involves claims for variations, extensions of time and loss and
expense, the rejection of that application, or its part-payment, will result in a single dispute,
even if the investigation into the claims for payment will be entirely separate from the investiga-
tion into the claims for an extension of time and consequential loss and expense, which latter
issue also carries with it the inherent assertion that the employer is not entitled to liquidated
damages for the same period of delay.
In David McLean Housing Contractors Ltd v Swansea Housing Association Ltd 147 the contractor 7.80
sought to be paid by reference to interim payment application number 19, provided some
months after practical completion. The claim included claims for payment for measured
work and variations and for direct loss and expense. It was not paid, and there was a notice
of adjudication that identified six separate ‘matters in dispute’. HHJ Lloyd QC concluded
that what was referred to adjudication was a single dispute, namely what payment ought to
have been made as a result of interim payment application number 19. The fact that this
application contained various elements, including measured work, variations and loss and
expense, which were subsequently reflected in the notice of adjudication, did not mean that
there was more than one dispute between the parties. The judge also rejected the contention
that the fact that one element in the notice of arbitration was a claim for an entitlement
144 [2000] BLR 168.

145
[2002] BLR 125.
146
[2006] EWHC 71 (TCC); [2006] TCLR 3. In that case, it was suggested that a contractor’s claim for
money due brought against a number of individuals (because it was unclear who the employer was) involved
two separate disputes: who was the paying party and how much did he owe? The TCC judge rejected this
argument, saying that ‘it would be contrary to the whole purpose of adjudication if such a simple dispute could
then be broken down into its component parts, to enable the Defendants to be able to say that, because the
dispute incorporates more than one issue, there must be more than one dispute’.
147 [2002] BLR 125.
235
to extension of time (rather than a money claim) meant that this, at least, was a separate
dispute; because application number 19 included a claim for loss and expense, the judge said
that that could not properly be ascertained or determined until any right to extension of time
had also been determined. The judge stressed that the interpretation of the notice of
adjudication had to be approached by the court ‘in a sensible manner and to try to give effect
to its intentions, whilst bearing in mind the purposes of adjudication and the presumed
intentions of the parties to be inferred from the contract’.
7.81 Because of the wide interpretation given to the word ‘dispute’ in this context, it is perhaps
unsurprising that there are few reported cases in which it was found that the notice of
adjudication referred more than one dispute to adjudication, and was therefore invalid. In
Grovedeck Ltd v Capital Demolition Ltd,148 HHJ Bowsher QC had already ruled that the
contract was not in writing and therefore did not comply with s107(5) of the 1996 Act, so
the adjudicator did not have the appropriate jurisdiction in any event. His remarks as to the
reference of more than one dispute are therefore strictly obiter. However, Judge Bowsher
concluded that the claimant’s reference to adjudication of claims arising for work carried out
on behalf of the defendant on two separate sites amounted to an attempt to refer more than
one dispute to adjudication, and thus amounted to another ground for refusing to enforce
the adjudicator’s decision.
7.82 In David and Teresa Bothma (In Partnership) T/A DAB Builders v Mayhaven Healthcare
Limited 149 the notice of adjudication stated that ‘disputes have now crystallised between the
parties as follows . . .’ and went on to identify four separate disputes, including the date for
completion, the non-withdrawal of the notice of non-completion, the sum of valuation
number 9, and the ‘scope and validity of architect’s instructions issued to date’. The judge
found that, on the facts, the extension/completion issue was unconnected to the financial
claim, and that, in consequence, two independent disputes were referred to the adjudicator.
He therefore concluded that the adjudicator did not have the jurisdiction to decide those
multiple disputes, and the decision was not enforced. Permission to appeal was refused,150
Waller LJ noting that, although the employer had not taken the specific point about multiple
disputes when the adjudication was first referred to the adjudicator, ‘the employer made it
clear that he reserved his position in relation to jurisdiction in very wide terms’, and that was
sufficient to defeat any question of waiver.
7.83 It is right to note that doubts have been expressed as to the potentially wide application of
Judge Thornton’s words in Fastrack. In Barr Ltd v Law Mining Ltd 151 Lord MacFadyen
agreed that it was not a correct approach to sub-divide and analyse what was in substance one
dispute into its component parts, and to label each part a separate dispute. However, he went
on to say that a realistic view must be taken, and that there was some force in the criticism of
the width of Judge Thornton’s interpretation of the word ‘dispute’ in Fastrack. Indeed he
went as far as to say that, if everything currently in dispute between the parties formed a
single dispute, paragraph 8(1) of the Scheme was fairly restricted in scope or perhaps even
deprived of content altogether. However, the judge went on to note that the adjudicator had
dealt with (and rejected) the ‘several disputes’ argument, having concluded that it was open
148
[2000] BLR 181.
149 16 November 2006, a decision of HHJ Havelock-Allan QC, sitting at the TCC in Bristol.
150 [2007] EWCA Civ 527; [2007] 114 Con LR 131.
151 [2001] Scot CS 152; 80 Con LR 134.
236
General Principles
to him to regard the matters referred to him as comprising one dispute. The judge said that,
despite what he had said about Judge Thornton’s analysis, he was not persuaded that the
adjudicator was wrong to take that view. The adjudicator’s decision was therefore enforced.
It would appear, therefore, that a party refers a single dispute to adjudication if it can be 7.84
demonstrated that his claim, which may be made up of several different elements, can be fairly
described as a single, disputed claim for a sum due (or some other relief, like an extension of
time) under the contract. In those circumstances, it is always important to ensure that the
notice of adjudication is carefully drafted and does not refer to disputes in the plural.152 If a
contractor or a sub-contractor is making a claim pursuant to the payment provisions of the
contract then, provided that such a claim can legitimately include a wide range of different
elements, such a claim is likely to give rise to a single dispute. It is thought that it will be rare
for the court to decide that a claim in relation to one contract and one site gives rise to more
than one dispute, unless the referring party is making two different and unrelated claims
(such as occurred in Bothma), or seeking two different declarations as to its contractual
entitlement that involve entirely different aspects of the contract. Therefore, for example, a
contested claim for a declaration that a sub-contractor is entitled to an extension of time of
15 weeks may well be a separate dispute from the same sub-contractor’s claim, also hotly
denied, that condition X of the sub-contract should be interpreted in such a way as to give
rise to a particular method of valuing variations, or that condition Y meant that he had no
design co-ordination obligation. In practical terms, it is thought likely that a notice to refer
will usually fall foul of the stipulation that it must contain a reference to only one dispute
only where, as in Grovedeck, there is an attempt to refer disputes arising under more than one
contract in a single notice of adjudication, or where, as in Bothma, the notice of adjudication
refers to a number of disputes which, on analysis, are independent of one another.
Difficulties may arise if there is more than one contract between the two parties. In RWE 7.85
Npower PLC v Alstom Power Ltd 153 there was a boiler contract and a feed system contract
between the parties, and it was said by RWE that the claims that were referred to adjudica-
tion arose under both contracts. The judge rejected that submission, concluding that, on a
proper interpretation of the notice of adjudication, the claims were being made under the
boiler contract only. The jurisdiction point therefore failed. In contrast, in Enterprise Managed
Services Ltd v Tony McFadden Utilities Ltd 154 the judge concluded that the adjudicator had
no jurisdiction to consider a claim purportedly made under just one of four contracts between
Enterprise and TML, the insolvent assignors of the claim to Utilities. This was because, as
assignees of an insolvent company, Utilities could only make a claim under rule 4.90 of the
Insolvency Rules 1986 (mutual credits and set-off), which meant that the financial position
under all four contracts had to be considered together. As the same judge noted in Amec
Group Ltd v Thames Water Utilities Ltd,155 if disputes arise under a series of different contracts
between the same two parties, it cannot usually be said that there is one single dispute, and
the adjudicator would not therefore have the jurisdiction to deal with the claims. However,
in Amec, although there were numerous works contracts between Amec and Thames Water,
the overarching contractual position was set out under a framework agreement, and the judge
152
Guidance as to the drafting of the notice of adjudication is dealt with in greater detail in Chapter 18.
153 [2009] EWHC B40 (TCC).
154 [2009] EWHC 3222 (TCC); [2010] BLR 89.
155 [2010] EWHC 419 (TCC).
237
concluded that the dispute that had been referred to adjudication arose under that single
contract. In those circumstances, it was a single dispute and no jurisdictional issue arose.
Insufficient Connection between the Dispute Referred and the

Adjudicator’s Decision
7.86 There are a number of reported cases in which the courts have concluded that the adjudicator
did not have the necessary jurisdiction to arrive at his decision. A number of them can be
categorised as examples of a situation in which there was ultimately insufficient connection
between the dispute that was referred to the adjudicator, and his written decision. Thus, in
AWG Construction Services Ltd v Rockingham Motor Speedway Ltd 156 HHJ Toulmin CMG
QC held that, as a matter of construction, the notice of adjudication served by Rockingham
encompassed a claim that AWG were negligent in designing the race track for reasons that
had been set out in the referral notice and the expert’s report. As the adjudication developed,
Rockingham’s case altered and the issue of inadequate drainage became the central plank of
their criticism of AWG. The judge concluded that it was significant that Rockingham’s own
advisers had failed to include provision for additional drainage in their own remedial scheme.
He found that the case in respect of drainage was essentially new, and emerged only during the
adjudication. It was therefore different to that referred by way of the notice of adjudication.
Therefore the adjudicator’s decision, which relied so heavily on the drainage criticisms, went
beyond the dispute that was referred to him; he answered a question that had not been
referred to him and his decision was not enforced. In Multiplex Constructions Ltd v West India
Quay Developments,157 the same point was argued, but on the facts Ramsey J concluded that
the adjudicator’s decision determined the dispute that had been referred to him.
7.87 Furthermore, it should be noted that this lack of correlation between the dispute referred
and the decision does not only arise where the decision goes beyond that which was
originally referred. In Ballast Plc v The Burrell Company (Construction Management) Ltd 158
Ballast made a claim for sums due. The adjudicator refused to grant the relief sought and
stated that the central request to assess the value of work done was ‘not valid’ because of what
he described as a failure on the part of the parties to abide strictly by the terms of the JCT
contract. Lord Reid said that the adjudicator’s approach was wrong in law and in conse-
quence the adjudicator had failed to exercise his jurisdiction to determine the dispute. His
decision was therefore a nullity.

7.88 The courts’ broad interpretation of the word ‘dispute’ will mean, however, that many
jurisdictional challenges will be doomed to fail. The best example of this is perhaps Sindall
Ltd v Abner Solland & Ors.159 In that case, HHJ Lloyd QC concluded that the notice of
adjudication did not include the reference of a disputed claim for an extension of time
because, at the time of the notice, Sindall were waiting to hear from the contract administrator
and had not treated the administrator’s failure to express any opinion as giving rise to a
dispute. Thus the adjudicator did not have authority to reach a decision on the amount of
the extension of time as such. However, the judge went on to find that the principal dispute
referred to adjudication was whether or not Sindall’s employment had been wrongfully
terminated. That issue turned on whether the contract administrator had been right to say that,
156 [2004] EWHC 888 (TCC); [2004] TCLR 6.

157
[2006] EWHC 1569 (TCC); 111 Con LR 33.
158 [2001] BLR 529.
159 [2001] 3 TCLR 712.
238
General Principles
at the time of termination, the state of progress on site was sufficient to justify the conclusion
that Sindall were not proceeding regularly and diligently with the work. Therefore, in order
to decide the wrongful determination issue, the adjudicator had to have regard to Sindall’s
entitlement to an extension of time at the relevant date. In those circumstances, the judge
concluded that the adjudicator had not arrived at any decision that was beyond his authority
or jurisdiction. In arriving at that conclusion, Judge Lloyd referred to an earlier decision of
his also involving Sindall, namely KNS Industrial Services (Birmingham) Ltd v Sindall Ltd.160
In that case, he referred not only to Judge Thornton’s definition of a dispute in Fastrack, but
he went on to say that:
A party to a dispute who identifies the dispute in simple or general terms has to accept that any
ground that exists which might justify the action complained of is comprehended within the
dispute for which adjudication is sought.
Notwithstanding the wide interpretation of the word ‘dispute’ in the authorities, there are 7.89
still many cases where the courts have concluded that the adjudicator’s decision bears
insufficient relationship to the dispute that was originally referred to him to be enforceable.
Thus in R Durtnell & Sons Ltd v Kaduna Ltd 161 HHJ Seymour QC found that the notice of
adjudication served by Durtnell contained only one limited claim in respect of an extension
of time. The adjudicator, however, did not limit his decision on extensions of time to that one
specific matter, and instead dealt generally with Durtnell’s entitlement. The judge concluded
that he did not have the jurisdiction to do so. He reasoned that there could be no dispute as
to an entitlement to an extension of time in a situation where the claim for that extension had
been referred to the architect, and the time for the architect to make a determination of that
claim, as set out in the contract, had not yet expired. Although the judge accepted that it
was not expressly made a condition precedent in the contract that any dispute referred to
adjudication should first have been referred to the architect, he went on to say that it was not
easy to see how a dispute as to the contractor’s entitlement to an extension of time under the
express terms of the contract could arise until that had happened, and the architect had either
made his determination, or the time permitted for his doing so had expired.162
Often, an adjudicator is at least tempted to exceed his jurisdiction because the dispute that 7.90
has been referred to him is of narrow compass, and he can see an opportunity for resolving a
wider dispute to be of assistance to the parties. Of course, unless the parties expressly consent
to such an exercise, the adjudicator simply has no jurisdiction to proceed in this way. Thus,
in McAlpine PPS Pipelines Systems Joint Venture v Transco Plc 163 the judge concluded, on the
facts set out at paragraphs 3.65–3.66 above, that the notice of adjudication identified the
dispute as being limited to McAlpine’s claim for interest payments. Although that claim had
arisen because, according to McAlpine, payments in respect of various compensation events
had not been certified when they ought to have been, there was no reference to adjudication
of the compensation events themselves, or the information that McAlpine had originally
provided in support of those claims. Transco’s response was simply to dispute the claim on
160
[2000] 75 Con LR 71.
161 [2003] BLR 225.
162 A similar result occurred in Bickerton Construction Ltd v Temple Windows Ltd (TCC, unreported, 26 June
2001) where HHJ Kirkham held that the adjudicator did not have the jurisdiction to decide the final account
figure, because the ongoing consideration of that claim under the contract meant that it had been expressly
excluded from the dispute referred to him.
163
TCC, unreported, 12 May 2004.
239
the basis that it could not succeed. What, therefore, was missing was any reference to
adjudication of the underlying disputes concerning the compensation events themselves,
and the adequacy (or otherwise) of the information originally supplied in support of those
claims. Unhappily, the adjudicator had concluded that he was sure that both parties wanted
him to deal with those other matters, because he believed that the parties wanted him to
conclude the underlying dispute ‘without recourse to further proceedings’. This was a fatal
error: it was certainly not what Transco wanted from the adjudication. As Judge Toulmin
said, if the existing notice of adjudication did not enable the adjudicator to deal with the
dispute in the way in which he wanted, then in the absence of the express agreement of
both sides, he was powerless to alter the terms of the notice or widen the scope of the dispute.
So long as it was just the original dispute that remained before him, he had to decide only
those limited issues which had been referred to him, and he therefore had no basis for
embarking on a consideration of what he regarded as the real dispute. As a result of the
adjudicator’s erroneous view of his own jurisdiction, new issues were introduced in the
course of the adjudication without the agreement of Transco, both by McAlpine and by
the adjudicator himself. The adjudicator therefore exceeded his jurisdiction because the
decision he eventually produced bore no correlation to the narrow dispute that had been
originally referred to him, and his decision was not enforced.
7.91 In contrast to the particular criticism of the decision in McAlpine, the adjudicator in Buxton
Building Contractors Ltd v The Governors of Durand Primary School 164 was also held to have
exceeded his jurisdiction, but this time because he did not deal with the entirety of the dispute
that had been properly referred to him. The contractor made a claim based on a certificate that
had been issued after practical completion, in circumstances where no final certificate could
be issued because the administrator was aware that the school had a cross-claim in respect of
defects. The adjudicator decided that the sum certified was due and that because no withholding
notice had been served by the school, he could not consider the cross-claim for defects. The
judge concluded that the decision demonstrated that the adjudicator had not considered
the nature, content, validity or quantification of the cross-claim and did not investigate the
material provided to him by the school, having made an erroneous assumption that the cross-
claim had been taken into account by the supervising officer when issuing his certificate. HHJ
Thornton QC held that there was a fundamental flaw in the decision, which was that it had
been reached without the adjudicator having considered or decided upon the contents of the
submissions, documents and issues referred to him by the school. He had thus failed to decide
the entirety of the dispute referred to him in accordance with s108(2)(c). It is, however,
important to note that in Carillion Construction Ltd v Devonport Royal Dockyard Ltd 165
Chadwick LJ expressly doubted that the decision in Buxton was consistent with the proposi-
tion that an adjudicator who declined to consider evidence that he thought was irrelevant did
not act outside his jurisdiction. It is therefore a case that must be treated with some caution.
7.92 Four subsequent cases demonstrate the court’s approach to the suggestion that the
adjudicator’s decision does not correlate with the dispute originally referred to him, thereby
resulting in a decision that was outside his jurisdiction. In OSC Building Services Ltd v Interior
Dimension Contracts Ltd 166 the defendant took the point that the adjudicator only had
164
[2004] EWHC 733 (TCC); [2004] BLR 374.
165 [2005] EWCA Civ 1358; [2006] BLR 15.
166
[2009] EWHC 248 (TCC); [2009] CILL 2688.
240
General Principles
jurisdiction to decide the value of the final account and should not therefore have dealt in his
decision with the value of a particular interim application. Whilst Ramsey J accepted that
there can be an important difference between the process of interim applications and final
accounting, he concluded that the adjudicator did have the necessary jurisdiction, partly
because of the proper construction of the notice of adjudication, and partly because, in that
case, the final account claim was the same as the last interim application, which became a
draft final account. And in Balfour Beatty Engineering Services (HY) Ltd v Shepherd Construction
Ltd 167 the defendant argued that the adjudicator was not permitted to deal with all of the
reasons subsequently advanced by the claimant in the adjudication for an extension of time.
Again, as a result of both the notice of adjudication and the way in which the dispute sub-
sequently developed, Akenhead J concluded that the adjudicator was entitled to have regard
to all the various matters advanced before him as giving rise to an extension of time.
A rather different kind of dispute as to the correlation between the dispute referred and the 7.93
final decision arose in Primus Build Ltd v Pompey Centre Ltd and Another.168 In that case both
parties had, in their different ways, asked the adjudicator to pay no regard to the profit figures
in Primus’ accounts when considering whether or not Primus had suffered a loss as a result
of the omission of a major part of the works. However, in order to arrive at a figure that
was part way between the sum claimed, and Pompey’s submission that no sum was due, the
adjudicator had regard to those figures. Pompey argued that the adjudicator therefore
exceeded his jurisdiction. The TCC judge, whilst expressing the view that he had initially
considered this argument to be a little contrived, eventually concluded that it was correct.
The parties had each said that the accounts should be ignored and, as a result, the adjudicator
did not have the jurisdiction to base his calculations on those figures. This decision was
referred to and relied on in the judgment of Christopher Clarke J in Vision Homes Ltd v
Lancsville Construction Ltd.169 There, the judge decided that the adjudicator did not have
jurisdiction because of the technical point that the notice of adjudication was not followed
but preceded by the request to the nominating body. However, for completeness, the judge
dealt with—and rejected—the remaining jurisdictional challenges. In particular, he rejected
the contention that the adjudicator had no power to consider the issue as to whether or not
the contract had been abandoned, basing that part of his decision on a proper interpretation
of the notice of adjudication. And, in contrast to the facts in Primus v Pompey, the judge
found that there was no agreement between the parties that the dispute about the abandon-
ment of the contract was not for decision in the adjudication. Furthermore, as the judge
noted, the adjudicator did not decide that the contract had been abandoned but that,
instead, there had been an omission under a particular clause of the contract which had the
effect of making a number of other provisions inoperable. The judge concluded that, in their
pleadings in the adjudication, both parties had anticipated just such a result.
There is a very fine line between the argument that the adjudicator exceeded his jurisdiction 7.94
because his decision was not responsive to the dispute referred to him, or went beyond the
dispute referred, and the contention that the adjudicator failed to have regard to the rules of
natural justice, because he dealt with and purported to decide an issue that was new or unher-
alded at the time that the adjudication commenced. Accordingly, the analysis set out above
167
[2009] EWHC 2218 (TCC); [2009] 127 Con LR 110.
168 [2009] EWHC 1487 (TCC); [2009] BLR 437.
169
[2009] EWHC 2042 (TCC); [2009] BLR 525.
241
of the cases dealing with the absence of correlation between dispute and decision should be
read together with the various cases where the very similar point was dealt with as a breach of
natural justice. That analysis can be found at Chapter 13 above, particularly at paragraphs
13.26–13.39 below.
7.95 There is a common theme underlying many of those cases where the party challenging the
adjudicator’s jurisdiction is complaining, in one way or another, about novelty: that the matters
raised by the other side in the adjudication are in some way new, either by reference to what
had been said or written prior to the notice of adjudication (crystallisation), or the manner
in which the claim or defence has changed or been amended during the course of the
adjudication itself (decision going outside jurisdiction). These arguments have repeatedly
failed, because the challengor has failed to differentiate between the substance of the dispute,
and the evidence in support, which could properly be new or changed (Bovis Lend Lease
Ltd v The Trustees of the London Clinic 170); or between a new dispute, which cannot be raised,
and a new argument, which can (Barr Ltd v Klin Investment UK Ltd 171 and Vision Homes
Ltd v Lancsville Construction Ltd 172); or between the underlying dispute between the parties
and the issues/arguments relied on in support of either party’s position, which may legiti-
mately alter (Benfield Construction Ltd v Trudson (Hatton) Ltd 173); or between the substantive
defence and the material in support of that defence (Jacques and Another v Ensign174).
7.96 Finally, in order to produce a decision in accordance with his jurisdiction, an adjudicator
must comply with the time limits in the 1996 Act, or, if those time limits are set out in
the contract, the relevant contractual provisions. If he fails to comply with those time
limits, the adjudicator acts outside his jurisdiction and his belated decision is a nullity.
That was the clear effect of the decision in Richie Brothers (PWC) Ltd v David Philip
(Commercials) Ltd.175 There, the Court of Session decided by a majority that a decision
that was not reached within the agreed extended time was a nullity. This important
limitation on an adjudicator’s jurisdiction is discussed in greater detail in paragraphs
2.114–2.132 above.
The Relevance of Earlier Adjudication Decisions

7.97 Once an adjudicator has reached his decision then, until that decision is challenged, either
in arbitration or in court, it is binding on the parties. This can create practical difficulties in
long-running contracts, where there may be a series of disputes that, over time, need to be
referred to the same or different adjudicators. It is clear beyond doubt that a second
adjudicator cannot open up any matters decided by the first adjudicator. If he purports to
do so, the decision of the second adjudicator will be a nullity.
7.98 Of course, the first practical problem that arises for the court is the nature of its investigation
in circumstances where one party is alleging that the second adjudicator trespassed on the
170
[2009] EWHC 64 (TCC); [2009] 123 Con LR 15, paragraph 47.
171
Outer House, Court of Session, 17 July 2009
172
[2009] EWHC 2042 (TCC); [2009] BLR 525, paragraph 67
173
[2008] EWHC 2333 (TCC); [2008] CILL 2633, paragraph 49, in that case a failing on the part of
the adjudicator
174 [2009] EWHC 3383 (TCC).
175 [2005] SLDT 341.
242
General Principles
decision of the first. In Sherwood & Casson Ltd v McKenzie,176 HHJ Thornton QC gave
detailed consideration to the approach the court should adopt when enquiring whether the
two disputes were substantially similar or not. He said that, in conducting that enquiry,
the court would give considerable weight to the decision of the adjudicator and would only
embark on a jurisdictional enquiry in the first place where there were real grounds for con-
cluding that the adjudicator had erred in concluding that there was no substantial overlap.
He commented that it would be a rare adjudication where the conditions were present that
would necessitate such an enquiry. On the facts of that case, he decided that there was no
substantial overlap between the first adjudication (which was concerned with interim appli-
cations and contra charges), and the subsequent adjudication, which was concerned with
Sherwood’s claim for a final account. The judge concluded that, although the variation
claims were similar in factual content in both disputes, they comprised separate disputes,
because the first claim was being treated in the context of an interim valuation without loss
and expense, whilst the latter claim was being treated as part of a final account re-measurement
exercise, together with a claim for loss and expense.
Similarly, in another early case, VHE Construction Plc v RBSTB Trust Co,177 the first adjudicator 7.99
decided that, because no VAT invoice had been issued, the employer was currently under
no obligation to pay the sum claimed of £1 million but that, because the employer had
served no withholding notices, the contractor was entitled to be paid the full amount
applied for within 28 days of the issue of such a VAT invoice. A VAT invoice was then
issued and again there was no withholding notice. However, the second adjudicator con-
cluded that he had power to order repayment of any sum in excess of that which ought
properly to have been applied for by the contractor. He reduced the amount due to the
contractor to about £¼ million. HHJ Hicks QC held that, although the second adjudicator
had no jurisdiction to set aside, revise or vary the first adjudicator’s decision, he had never
been asked to do so, and had been conspicuously careful to avoid any form of words that
might convey the contrary impression. Thus, whilst the obligation under the first adjudicator’s
decision remained, the second decision was also valid and enforceable. As a matter of practical
reality, since the contractor had limited its demands to the net sum, namely the sum that it
would have retained had payment first been made in accordance with the first adjudicator’s
decision, and then repayment made in accordance with the second adjudicator’s decision,
it was the second decision that was enforced. Although the effect of the two decisions was
that the contractor was paid the net sum found due by the second adjudicator, there was,
on the facts, no question of the second adjudicator having modified or altered the decision
of the first.
Generally speaking, the courts have found that subsequent adjudicators’ decisions have not 7.100
trespassed on the province of earlier decisions.178 Thus, in Holt Insulation Ltd v Colt
International Ltd 179 a sub-contractor’s claim was referred to adjudication where it was
rejected. The claim was reformulated and, in a second adjudication, it was decided that the
176
[2000] TCLR 418.
177
[2000] BLR 187.
178
Other relevant cases on this topic, referred to elsewhere in this book, but not in this section, include:
Naylor v Greenacres [2001] Outer Court of Session P514/01; AMEC v Whitefriars [2004] EWCA Civ 1418;
[2005] BLR 1; David McLean v The Albany [2005] TCC 101/05; HG Construction v Ashwell Homes [2007]
EWHC 144 (TCC); [2007] BLR 175 and Castle Inns (Stirling) v Clark Contracts Ltd [2007] CSOH 21.
179 TCC, Liverpool District Registry, HHJ MacKay QC, 23 July 2001 LVOI 5929.
243
sub-contractor was entitled to payment. The contractor argued that where a sub-contractor
had claimed a large sum in adjudication and failed, for whatever reason, it could not reshape
the claim in the light of the first decision, claim a smaller sum, and then seek a second adju-
dication on that second, smaller claim. The TCC judge concluded that, whilst the references
to the adjudicator related to the same matters, they did not relate to the same dispute.
Although they were both concerned with the sub-contractor’s entitlement to claim in respect
of work done, the disputes were crucially different because, on the second occasion, the
claims were put in a way that ensured their success, whilst the earlier claims had failed.
7.101 Similarly, in Mivan Ltd v Lighting Technology Projects Ltd 180 the claim had been successful in
the first adjudication because there were no withholding notices. The responding party paid
the sums found due by the adjudicator, and then subsequently issued its own withholding
notice and notice of adjudication and sought to recover the sums that it said it had overpaid.
The adjudicator made an order in those terms but LTP refused to repay the money, saying
that the adjudicator had no jurisdiction to deal with the second adjudication because it was
effectively a re-run of the first. HHJ Seymour QC concluded that the adjudicator had the
necessary jurisdiction to deal substantively with the second adjudication. He said that the
first adjudication dealt with a narrow dispute as to whether the invoices were payable, whilst
the second adjudication was concerned with the matters raised in the withholding notices
and was therefore ‘a separate and distinct dispute’. Again, in Skanska Construction UK Ltd v
The ERDC Group Ltd,181 the first adjudication had failed because the adjudicator found
there was insufficient information to support the claims. Thereafter there was a second
adjudication relating to the final account, at which time further information relating to the
claims was made available. The court rejected the submission that the second adjudication
trespassed on the first, and concluded that the second adjudicator had the necessary
jurisdiction to decide the dispute that had been referred to him. Again the court referred to
the fact that, by the time of the second adjudication, a different stage in the contract had been
reached; by then, different contractual provisions applied; considerably more information
was available by the date of the issue of the final account than had been available at the time
of the first adjudication; and that ‘different considerations and perspectives may apply’ in
the second adjudication. In consequence of the court’s conclusion that ‘the fundamental
nature and parameters of the dispute’ were different, the challenge to the adjudicator’s
decision was rejected.182

7.102 It is instructive to note that, just as with the cases in which the argument has been advanced
that the adjudicator dealt with more than one dispute and therefore did not have the
appropriate jurisdiction, the submission that the adjudicator was dealing with a matter
previously decided by another adjudicator, although regularly made, has also been largely
unsuccessful. Michael John Construction v Richard Henry Golledge & Ors 183 is a case in point.
There, the claimant contractor carried out work for St Peter’s RFC in Cardiff. Although the
club was named as the employer in the contract, it was an unincorporated association of
individuals, with no separate legal identity or status. The contract was signed by the fourth
defendant, who was then the director of development and subsequently became a trustee of
180
[2001] ADJCS 04/09; TCC, 9 April 2001.
181
[2003] SCLR 296.
182 See also Prentice Island Ltd v Castle Contracting Ltd, 15 December 2003, decision of the Sheriff
Principal.
183 [2006] EWHC 71 (TCC); [2006] TCLR 3.
244
General Principles
the club, although he was not a trustee at the time that the contract was signed. The contractor
made a claim for unpaid monies, which was referred to adjudication. The adjudicator found
that the fourth defendant was liable to the claimant. No sums were paid so the claimant
commenced a second adjudication against the three trustees, as well as the fourth defendant.
The claims consultant acting for the defendants in the second adjudication refused to deal
with the merits of the claims at all, and confined his challenge in the second adjudication
entirely to jurisdictional points. The adjudicator found that the trustees were liable to the
claimant contractor and that, alternatively, the fourth defendant was liable as agent. In the
enforcement proceedings, the defendants took the point that the adjudicator had no jurisdic-
tion to decide the second adjudication because he had decided the same dispute in the first
adjudication. The judge rejected that submission. In respect of the first, second and third
defendants, they had never been a party to any adjudication and thus the question of any
liability on their part could not have been an issue that had ever been adjudicated before.
As to the fourth defendant, he was pursued in the second adjudication because he had
refused to accept liability arising out of the first, and had in fact raised points as to his potential
liability to pay. The issue that arose in the second adjudication, namely whether the fourth
defendant was personally liable because he signed the contract and/or because he was acting
as the agent of the first, second and third defendants, was not a point that had been expressly
decided in the first adjudication and the judge concluded that it was entirely appropriate for
it to be decided in the second adjudication. That jurisdictional challenge therefore failed.
The proper approach was restated by Akenhead J in Balfour Beatty Engineering Services 7.103
(HY) Ltd v Shepherd Construction Ltd.184 At paragraph 41 of his judgement he said that
a sub-contractor who had referred a narrow dispute to adjudication was not barred from
subsequently referring a broader dispute to adjudication, subject to the important caveat
that, once the adjudicator had decided the first dispute, that dispute could not be referred to
adjudication again because it had already been resolved. Thus the second adjudicator had
to be astute to see that he or she decided nothing that overode or undermined the first
adjudicator’s decision. The latter adjudication decision would be wholly or partly unenforceable
if materially it purported to decide something that had already been decided in an earlier
adjudication. On the facts in that case, the claim for an extension of time due to late access
to Block Z had been dismissed in an earlier adjudication. In a subsequent adjudication,
where the adjudicator found an entitlement to an extension of time, the defendant argued
that, because the second adjudicator had not obviously or expressly said that he had
excluded the Block Z access claim from his findings, he must have taken it into account
and had therefore decided something which had not been referred to him and which had
been decided by the first adjudicator. The judge dismissed that submission: on a proper
analysis of the documents, the adjudicator had not taken into account the Block Z access
claim. More controversially, perhaps, the judge went on to find that, even if he had, he was
entitled to do so because it was only in the second adjudication that the extension of time
claim was dealt with on a retrospective basis.
Two subsequent TCC decisions illustrate graphically the dangers of a second adjudicator 7.104
trespassing on ground that had previously been decided by the first adjudicator. In Benfield
Construction Ltd and Trudson (Haddon) Ltd,185 the first adjudicator had decided that practical
184 [2009] EWHC 2218 (TCC); [2009] 127 Con LR 110.

185 [2008] EWHC 2333 (TCC); [2008] CILL 2633.
245
completion had not occurred on the date suggested by the contractor and had not occurred
at the date of the adjudication notice. In the third adjudication, the contractor raised
precisely the same claim as to the date of practical completion which had been dismissed in
the first adjudication, albeit on this occasion he sought to put it by reference to a different
clause in the contract. The third adjudicator, Mr Sliwinski, reached a completely different
ruling on the issue, and the judge had no hesitation in concluding that, as a result, the decision
in the third adjudication was unenforceable. The judge said that the adjudicator had failed
to distinguish between, on the one hand, the underlying dispute between the parties and, on
the other, the issues or arguments that the parties had chosen to deploy in support of their
positions. In that case the underlying dispute was whether practical completion had occurred
on the date suggested by the contractor and, if not, whether liquidated damages were due.
That dispute had been the subject of the first adjudication and could not therefore be the
subject of the third adjudication. In Birmingham City Council v Paddison Construction Ltd 186
HHJ Kirkham reached the same conclusion, although the result might be thought a little
harsh. The first adjudicator had decided Paddison’s loss and expense claim and refused to
award any money because there was insufficient information available. The judge said that,
in consequence, the second adjudicator did not have the power to award Paddison any loss
and expense. Although the subsequent claim for loss and expense was based on a different
expert’s report, the judge said that,
it would amount to a wholly unmeritorious and technical outcome to conclude that there was
a difference between the two disputes. To arrive at that conclusion would permit Paddison to
have a second bite at precisely the same cherry. If this were litigation, such an approach would
amount to a clear abuse of process of the court proceedings.
The judge went on to say that it was a case where Paddison had tried to make good in the
second adjudication the shortcomings in their claim in the first, and that they were not
permitted to do so.
7.105 All of the cases referred to above identify, to some extent or another, the difficulties inherent
in serial adjudication. One of the problems that arose in Vision Homes Ltd v Lancsville
Construction Ltd 187 was that one adjudicator, Mr Allway, had been appointed to decide a
dispute but, during the currency of that adjudication, the responding party had referred
almost the same dispute to another adjudicator, Mr Bingham. The question arose as to
whether Mr Bingham had the necessary jurisdiction. Christopher Clarke J ruled that, at least
on that issue, Mr Bingham did have jurisdiction because ‘unhappily’ there was nothing to
prevent there being two adjudications on the same dispute at once. He noted that whilst the
Scheme made provision for the resignation of an adjudicator where the dispute referred to
him had already been decided, there was no provision for the resignation of an adjudicator
where the dispute that he is to decide has already been referred to adjudication, but no
decision had yet been taken in that first adjudication. Whilst this conclusion looks to be
technically correct, the difficulty is that it might encourage forum-shopping, and a subse-
quent race between two adjudicators to decide the dispute before the other.
7.106 Again, there is extensive overlap between the argument that the adjudicator did not have the
necessary jurisdiction to decide point A (because it had already been decided in an earlier
186 [2008] EWHC 2254 (TCC); [2008] BLR 622.

187
[2009] EWHC 2042 (TCC); [2009] BLR 525.
246
General Principles
adjudication), and the contention that the adjudicator’s failure to decide point A was a
breach of natural justice (because, on a proper analysis, the point had not been decided in
that earlier adjudication). This latter point is dealt with at paragraphs 13.58–13.62 below.
The leading case of Quietfield Ltd v Vascroft Construction Ltd 188 makes clear that the court will
examine closely any material that the adjudicator declined to look at, to see if it really did
concern an issue that, because of the decision in an earlier adjudication, the adjudicator
had no jurisdiction to decide.
Ousting the Jurisdiction of the Adjudicator in Other Ways

It will sometimes be the case that the jurisdiction of the adjudicator will be ousted in other 7.107
ways, usually by the agreement (whether express or implied) of the parties themselves. An
example of this is Sheppard Construction Ltd v Mecright Ltd.189 On 15 March 2000 the parties
had reached a compromise agreement that resulted in a payment of about £75,000 by
Sheppard to Mecright. Then, on 3 July 2000, Mecright purported to make a further claim
for approximately £277,000 and made no mention of the compromise agreement. Mecright’s
claims consultants argued that the settlement agreement had been entered into under duress
and should be set aside. Sheppard issued proceedings in the TCC claiming a declaration that
the adjudicator had no jurisdiction to resolve the dispute referred to him, on the grounds
that the terms of the settlement agreement meant that there was no dispute. In addition they
argued that the ‘duress’ point was not referable to adjudication in any event. HHJ Lloyd QC
found that, where parties had reached an agreement that settled their dispute, there was no
longer any dispute to be referred to adjudication. He held that that was the situation on 3
July, so that Mecright had no right to seek adjudication, and the adjudicator had no
jurisdiction to consider or act upon the notice. He went on to make clear that a dispute
about a settlement agreement of this kind could not be said to be a dispute under the sub-
contract, since the effect of the settlement agreement was that it replaced the original
agreement. The only subsisting obligation was the obligation to pay pursuant to the
settlement agreement. He said that such a settlement agreement was not a construction
contract within the meaning of s108 and that a dispute about an agreement that purports to
settle a dispute or disputes under a construction contract is not a dispute under that contract.190
The judge distinguished the word ‘under’, which, he said, was much more limited than the
wider reach of expressions such as ‘in connection with’ or ‘arising out of ’.191 A similar decision
was reached in Quality Street Properties (Trading) Ltd v Elmwood (Glasgow) Ltd 192 where the
court concluded that the disputes had been settled by the compromise agreement and that
the adjudicator had no jurisdiction. These cases must, however, now be read in the light of
the fuller analysis of compromise agreements in L Brown and McConnell Dowell, discussed
in paragraphs 7.30–7.32 above.
Of course, in cases where the defendant seeks to challenge the jurisdiction of the adjudicator 7.108
on the grounds that the purported disputes have in fact been compromised, the burden is on
188
[2007] BLR 67.
189
[2000] BLR 489. See also paragraph 7.29.
190 A similar view was expressed by His Honour Judge MacKay QC in Lathom Construction Ltd v Cross,
29 October 1999, TCC, Liverpool District Registry, reported at [1999] CILL 1568.
191 See Ashville Investments Ltd v Elmer Contracting Ltd [1988] 3 WLR 867 and paragraph 7.31.
192
[2002] CILL 1922.
247
the defendant to demonstrate, on the balance of probabilities, that the claims have indeed
been compromised. Thus, in any court hearing of the enforcement application, the court
will need to undertake an enquiry into that issue. In JW Hughes Building Contractors Ltd v
GB Metal Work Ltd 193 it was submitted on behalf of JWH that GBM had compromised all
of their claims. Forbes J considered the correspondence, found that it was clear from that
correspondence that there had been no compromise and that therefore this jurisdictional
challenge failed. Although Forbes J went on to find at paragraph 12 of his judgment that,
since the adjudicator had decided this point himself, it was not open to the parties to challenge
it, it is respectfully submitted that that finding appears to be linked to the later finding that
the parties had reached an ad hoc agreement to give the adjudicator the necessary jurisdiction
to make a binding determination on his own jurisdiction. It is thought that, in the ordinary
case, the adjudicator’s investigation of his own jurisdiction in such a situation would not give
rise to a ruling that would be binding on the parties, but would instead require the court, in
accordance with the procedure outlined by HHJ Thornton QC in Fastrack and Sherwood
and Casson, to undertake at least some investigation into whether or not the adjudicator had
rightly concluded that the matter fell within his jurisdiction.
7.109 It should also be noted that, generally, an adjudicator does not have the jurisdiction to
modify the terms of the contract. In David McLean Housing Contractors Ltd v Swansea
Housing Association Ltd 194 HHJ Lloyd QC said in terms that the Scheme for Construction
Contracts, and, as far as he was aware, other standard forms of contract, did not confer on
an adjudicator a right to adapt, vary or otherwise modify the contract. The adjudicator’s
decision had to be limited to the rights and liabilities of the parties pursuant to the contract in
question. The only potential exception to that was concerned with the time for compliance;
since the Scheme (and other standard form contractual provisions) provided that the time
for compliance with an adjudicator’s decision must be set out expressly, this might alter
the time within which a payment might otherwise have to be made under the contract. Thus,
the judge concluded, the Scheme permitted the possible alteration of the time within which
payments were to be made, but it was only to that extent that the strict terms of the contract
might be modified by the adjudicator. In addition, an adjudicator appears to have the power
to open up, revise and review any decision or certificate of a contract administrator but was
not empowered to issue a certificate himself.195
Making a Valid Objection on Jurisdiction

7.110 A point that often arises when the courts have to consider a jurisdictional objection at an
enforcement hearing is the extent, if at all, to which the objection was raised at the time
of the adjudicator’s appointment. If the objection was not taken at that time, then, as we
have seen,196 there is a strong chance that the courts will find that the parties agreed to
give the adjudicator an ad hoc jurisdiction, so that the objection cannot be taken later, or
that the right to take the objection has been waived. What then should a party do who wishes
to make such an objection? The best thing, of course, is to make the sort of detailed objection
193
[2003] EWHC 2421 (TCC).
194 [2002] BLR 125.
195 Vaultrise Ltd v Paul Cook [2004] ADJCS 04/06.
196 See Chapter 6.
248
General Principles
to the adjudicator’s jurisdiction that was made, for example, in The Project Consultancy,197 in
which the responding party made clear how and why the adjudicator had no jurisdiction,
and that their continued participation in the adjudication was subject to this fundamental
objection. But it seems that a general reservation of the responding party’s position as to the
adjudicator’s jurisdiction may be sufficient: on the application for permission to appeal in
Bothma,198 Waller LJ said that the employer’s written reservation as to the adjudicator’s
jurisdiction was so wide that it covered the particular ground that was successful in front of the
judge, even though that particular ground (multiple disputes) was not specifically referred
to in the letter. However, caution is advisable when making a general reservation in relation
to jurisdictional matters: in Ale Heavy Lift v MSD (Darlington) Ltd,199 HHJ Toulmin CMG
QC held that, where the jurisdiction of the adjudicator had not been challenged on a
particular ground, a jurisdictional challenge on that ground had thus been waived.
Summary of Principles Relating to Jurisdiction

The alleged absence of jurisdiction has, thus far, proved to be the most common ground on 7.111
which a defendant relies to seek to avoid the decision of an adjudicator. Such a jurisdictional
challenge must be taken expressly and clearly at the time of the appointment of the
adjudicator. The adjudicator can investigate his own jurisdiction but, unless the parties have
agreed otherwise, his ruling on his jurisdiction will not be binding and can be reviewed by
the court. The appointment of the adjudicator must be valid and therefore in accordance,
either with the 1996 Act, or the relevant contractual provisions. The terms of the construction
contract must be in writing. As to the dispute that the adjudicator decides, he only has
jurisdiction to decide the dispute that is referred for decision by the notice of adjudication.
Furthermore that dispute must have crystallised prior to the service of the notice of intention
to refer, although the court will take a generous view as to whether or not it can be said
that, at that date, a dispute had arisen. The dispute must be a single dispute although,
again, the vast majority of disputes that arise in connection with construction contracts can
be presented as a single dispute, even if they contain a whole series of diverse elements. It is
important that the adjudicator does not trespass beyond the dispute that is referred to him.
Thus, there must be a clear connection between the dispute that is referred to him and
his ultimate decision. Moreover, the adjudicator must not go back over or reconsider any
matters decided in earlier adjudications that have arisen under the same contract between
the same parties. If the answer to a claim is the suggestion that it has already been compro-
mised, then the adjudicator will investigate the substance of that challenge and rule on it.
If he concludes that the claim has been compromised then he may have no jurisdiction,
depending on the terms of the original contract and the terms of any second, settlement
agreement. If the adjudicator concludes that the dispute has not been compromised and/or
that the dispute as to settlement arises under a construction contract, or a contract that
otherwise provides him with jurisdiction, he can decide the underlying dispute, although
(if his jurisdiction continues to be challenged) his decision may then be subject to the review
of the court on the enforcement proceedings.
197 [1999] BLR 377.

198 [2007] EWCA Civ 527; [2007] 114 Con LR 131.
199 [2006] EWHC 2080 (TCC).
249
7.112 In Carillion Construction Ltd v Devonport Royal Dockyard Ltd 200 the Court of Appeal cited
with approval four general and five more specific propositions as to the jurisdiction of
adjudicators that had been identified by Jackson J at first instance, at paragraphs 80 and 81
of his judgment. The four general propositions are set out at paragraph 52 of the judgment
of Chadwick LJ and have been set out verbatim in paragraph 7.04 above. The five more
specific propositions are set out at paragraph 53 of the judgment of Chadwick LJ and have
been set out verbatim at paragraphs 3.72 and 3.93 above. At paragraph 84 of his judgment
in the Court of Appeal, Chadwick LJ stated that the court was in broad agreement with both
those general and more specific propositions, which were indicative of the approach that the
courts should adopt when required to address a jurisdictional challenge to the decision of an
adjudicator appointed under the 1996 Act. He went on to emphasise in clear terms that the
court’s approach to enforcement applications must be that, save in rare cases, the decision
was to be respected and enforced and that complaints of ‘excess of jurisdiction’ were unlikely
to succeed and were likely only to lead to a substantial waste of time and expense.
7.113 The relevant parts of the judgment of Chadwick LJ serve as a clear summary of the courts’
approach to disputes as to jurisdiction. They can be found in numerous subsequent cases.
He said this:
85. The objective which underlies the Act and the statutory scheme requires the courts to
respect and enforce the adjudicator’s decision unless it is plain that the question which he has
decided was not the question referred to him or the manner in which he has gone about his
task is obviously unfair. It should be only in rare circumstances that the courts will interfere
with the decision of an adjudicator. The courts should give no encouragement to the approach
adopted by DML in the present case; which (contrary to DML’s outline submissions, to which
we have referred in paragraph 66 of this judgment) may, indeed, aptly be described as ‘simply
scrabbling around to find some argument, however tenuous, to resist payment’.
86. It is only too easy in a complex case for a party who is dissatisfied with the decision of an
adjudicator to comb through the adjudicator’s reasons and identify points upon which to
present a challenge under the labels ‘excess of jurisdiction’ or ‘breach of natural justice’. It must
be kept in mind that the majority of adjudicators are not chosen for their expertise as lawyers.
Their skills are as likely (if not more likely) to lie in other disciplines. The task of the adjudicator
is not to act as arbitrator or judge. The time constraints within which he is expected to operate
are proof of that. The task of the adjudicator is to find an interim solution which meets the
needs of the case. Parliament may be taken to have recognised that, in the absence of an
interim solution, the contractor (or sub-contractor) or his sub-contractors will be driven into
insolvency through a wrongful withholding of payments properly due. The statutory scheme
provides a means of meeting the legitimate cash-flow requirements of contractors and their
subcontractors. The need to have the ‘right’ answer has been subordinated to the need to have
an answer quickly. The scheme was not enacted in order to provide definitive answers to
complex questions. Indeed, it may be open to doubt whether Parliament contemplated that
disputes involving difficult questions of law would be referred to adjudication under the
statutory scheme; or whether such disputes are suitable for adjudication under the scheme.
We have every sympathy for an adjudicator faced with the need to reach a decision in a
case like the present.
87. In short, in the overwhelming majority of cases, the proper course for the party who is
unsuccessful in an adjudication under the scheme must be to pay the amount that he has been
ordered to pay by the adjudicator. If he does not accept the adjudicator’s decision as correct
(whether on the facts or in law), he can take legal or arbitration proceedings in order to
200 [2005] EWCA Civ 1358; [2006] BLR 15.
250
General Principles
establish the true position. To seek to challenge the adjudicator’s decision on the ground that
he has exceeded his jurisdiction or breached the rules of natural justice (save in the plainest
cases) is likely to lead to a substantial waste of time and expense—as, we suspect, the costs
incurred in the present case will demonstrate only too clearly.
This chapter has dealt with those challenges that might, in the words of Chadwick LJ,
be labelled ‘excess of jurisdiction’. The next chapter deals with the courts’ approach to errors
of law and fact and Part IV (Chapters 11–13) considers the question of the adjudicator’s
obligation to follow the rules of natural justice, the other common area of challenge to the
adjudicator’s decision addressed by Chadwick LJ in Carillion.
251
8
ERRORS OF LAW AND FACT
Introduction 8.01 ‘Slips’ 8.26

Errors of Law/General 8.04 The Alleged Failure to Address
Errors of Law/Jurisdiction 8.15 Particular Issues 8.36
Errors of Fact 8.20 Fraud 8.39
The purpose of the Scheme is to provide a speedy mechanism for settling disputes in
construction contracts on a provisional interim basis and by requiring decisions of
Adjudicators to be enforced pending final determination of disputes by arbitration,
litigation or agreement, whether those decisions are wrong in point of law or fact, if
within the terms of the reference. It is a robust and summary procedure and there may
be casualties although the determinations are provisional and not final.
His Honour Judge David Wilcox in
Absolute Rentals Limited v Glencor Enterprises Ltd 1
Introduction
The alert reader will have noticed by now that the adjudicator is generally entitled to make 8.01
errors of law and fact in reaching his decision, and that such errors will not invalidate that
decision or render it a nullity.2 In those circumstances, it may be thought to be superfluous
to have a chapter, however short, concerned with errors of law and fact. Despite that, the
purpose of this chapter is twofold: first, to demonstrate the sorts of errors that the courts have
said that an adjudicator (with the appropriate jurisdiction) is permitted to make; secondly,
to identify those errors that might—at least potentially—affect the adjudicator’s jurisdiction,
and thus render his decision unenforceable.
The starting point for any discussion of this topic is not a case concerned with adjudication 8.02
at all. In Nikko Hotels (UK) Ltd v MEPC plc 3 a rent review case, the lease contained a formula
for increasing the rent, which necessitated the determination of the average hotel room rate.
The independent expert, whose determination of the issue was provided for by the terms of
the lease, construed that expression as meaning the average of the published prices at which
rooms were said to be available, rather than the average room rate actually achieved. This
1 (2000) CILL 1637.

2 The basis for the discussion below as to errors of law and fact is that set out in footnote 2 to Chapter 7.
3 [1991] 2 EGLR 103.
253
interpretation of the lease naturally meant that the rate was higher than it would otherwise
have been, and the tenants issued an originating summons, alleging that the decision was a
nullity because it was based on a misconstruction of the rent review clause. Knox J dismissed
the summons and held that the expert’s decision was conclusive and could not be reviewed
on the grounds that it was erroneous in law, unless it could be shown that the expert had not
performed the task that had been given to him. The judge said that: ‘If he has answered the
right question in the wrong way, his decision will be binding. If he has answered the wrong
question, his decision will be a nullity.’
8.03 This passage was cited by Dyson J (as he then was) in Bouygues (UK) Ltd v Dahl-Jensen (UK)
Ltd 4 who said that there was a reasonably close analogy between expert valuation cases and
adjudication cases. When Bouygues went to the Court of Appeal,5 Buxton LJ approved this
approach, recording his understanding that this statement was not disputed by Bouygues.
Furthermore, that approach was also expressly endorsed by Sir Murray Stuart-Smith in C &
B Scene Concept Design Ltd v Isobars Ltd 6 who stated in terms that errors of procedure, fact
or law were not sufficient to prevent enforcement of an adjudicator’s decision by summary
judgment. The Court of Appeal made plain in C & B Scene that errors of law could not pre-
vent the enforcement of an adjudicator’s decision ‘unless the Adjudicator has purported to
decide matters that are not referred to him’.
Errors of Law/General
8.04 The issue as to whether an adjudicator’s error of law invalidated his decision lay at the heart
of the first reported adjudication case, Macob Civil Engineering Ltd v Morrison Construction
Ltd.7 The defendant contended that the reference to a ‘decision’ in the 1996 Act meant a
lawful and valid decision, so that, where the validity of a decision was challenged, it was
not binding and enforceable until it had been determined or agreed that the decision was
valid. Dyson J rejected that argument; if it were right, he said, it would substantially
undermine the effectiveness of the 1996 Act. He said that, on that basis, an unsuccessful
party in the adjudication only had to assert some sort of failure on the part of the adjudicator
to be able to argue that there had been no proper ‘decision’, and the enforcement application
would fail. The judge found that the word ‘decision’ was not qualified, so that ‘if his decision
on the issue referred to him is wrong, whether because he erred on the facts or the law, or
because in reaching his decision he made a procedural error which invalidates the decision,
it is still a decision on the issue’. It was this approach which the same Judge reiterated in
Bouygues, and that was approved by the Court of Appeal in that case. It is also the approach
which the Court of Appeal has reiterated in clear terms in Carillion Construction Ltd v
Devonport Royal Dockyard Ltd.8 Chadwick LJ’s clear warning that the courts will be obliged
to enforce the vast majority of the decisions of adjudicators, regardless of so-called errors of
law, is set out in paragraphs 85–87 of his judgment in that case, reproduced at paragraph
7.113 above.
4
[2000] BLR 49.
5
[2000] BLR 522.
6 [2002] BLR 93.
7 [1999] BLR 93.
8 [2005] EWCA Civ 1358; [2006] BLR 15.
254
Errors of Law and Fact
It can, therefore, be said with some confidence that errors of law that do not affect the 8.05
adjudicator’s jurisdiction and do not give rise to some argument as to impartiality or natural
justice, will not prevent the enforcement of an adjudicator’s decision. Following the decisions
in Macob and Bouygues, it has been rare for it even to be argued that an error of law makes
the decision invalid. When the point is canvassed, it is usually by reference to the House of
Lords’ decision in Anisminic v Foreign Compensation Commission.9 In that case the Foreign
Compensation Commission considered and rejected the appellant’s claim to be entitled to
participate in an Egyptian Compensation Fund. When that decision was challenged in
the courts, the Commission contended that the courts had no jurisdiction to entertain
the proceedings. This was rejected by the House of Lords. Lord Wilberforce said that,
whilst the court had a duty to attribute autonomy of decision to the Commission within
the area designated to it, the counterpart of that autonomy was that the courts had to
ensure that the limits of the designated area were observed. Lord Reid said that the courts
were not prevented from inquiring into whether the order of the Commission was a nullity.
In the subsequent House of Lords decision of O’Reilly v Mackman,10 Lord Diplock referred
back to the Anisminic case to say that the House of Lords had recognised that if a tribunal,
whose jurisdiction was limited by statute or subordinate legislation, mistook the law
applicable to the facts as it had found them, then it must have asked itself the wrong question
and therefore had no jurisdiction.
It is thought that, on a close analysis, both of these House of Lords’ decisions, and the other 8.06
non-adjudication cases sometimes relied on to suggest that any error of law made by an
adjudicator renders his decision a nullity,11 simply demonstrate that the courts will only
interfere in the decisions of an autonomous tribunal where that tribunal has acted outside its
jurisdiction. The point made in these cases is that the tribunal may have had the jurisdiction
to enter on its inquiry in the first place but, if it did or failed to do something in the course
of the inquiry that was of such a nature that it took the tribunal outside its jurisdiction, then
the tribunal’s subsequent decision would be a nullity. Therefore, as Lord Reid explained in
Anisminic, there may have been a want of jurisdiction, not at the outset but subsequently,
because, for example, the tribunal made a decision that it had no power to make, or it failed
in the course of the inquiry to comply with the requirements of natural justice, or it mis-
construed the provisions giving it power to act with the result that it failed to deal with the
question remitted to it and decided some question that was not remitted to it. Likewise, he
said, the tribunal may have refused to take into account something that it was required to
take into account, or it may have based its decision on some matter that, under the statutory
provisions setting up the tribunal, it had no right to take into account. All of these were
ways, according to Lord Reid, in which the prima facie jurisdiction of the tribunal might
have been lost as a result of the way in which the tribunal conducted itself.
Lord Reid concluded his examination of the jurisdiction question in Anisminic by saying: 8.07
but if [the tribunal] decides a question remitted to it for decision without committing any of
these errors it is as much entitled to decide that question wrongly as it is to decide it rightly.
9
[1969] 2 AC 147.
10
[1983] 2 AC 287.
11 Other cases which have been cited in support of this proposition include R v Lord President of the Privy
Council ex parte Page [1993] AC 682; Racal Communications Ltd [1981] AC 374; Boddington v B T Police [1999]
AC 143; R v Wicks [1998] AC 92.
255
It is submitted, therefore, that on a careful analysis of Anisimic (and the other public law
cases), the approach approved by the House of Lords and adopted by the courts to errors of
law by an independent or statutory tribunal is very similar to the approach that should be
adopted by the courts to errors of law made by an adjudicator, whether appointed under the
terms of the contract, or under the 1996 Act. Accordingly, it is suggested that, of them-
selves, errors of law cannot invalidate the adjudicator’s decision or deprive the adjudicator
of jurisdiction. The adjudicator is just as entitled to make errors of law as to avoid such errors,
when determining the dispute that has been referred to him. The only way in which his decision
can be impeached is if he never had the jurisdiction to consider the dispute or, if he had the
necessary jurisdiction at the outset as Lord Reid explained, he did something or failed to do
something at some stage during the adjudication itself that took him beyond the proper
determination of the dispute that was referred to him.
8.08 The principal case in which it was argued that, on the basis of Anisminic, and the other
cases noted above, errors of law invalidated the adjudicator’s decision, was London and
Amsterdam Properties v Waterman Partnership.12 The argument was that the judge was not
bound by Bouygues and C & B Scene because they were per incuriam and in conflict with
Anisminic and O’Reilly. HHJ Wilcox considered those decisions in detail and rejected the
submission, finding instead that the adjudication cases, which stressed that an adjudicator
could make errors of law, provided that he was answering the question that had been
referred to him, were entirely consistent with the approach of the House of Lords in
Anisminic and O’Reilly.
8.09 It might be thought that one of the most fundamental matters in any adjudication would be
the issue as to the correct contract terms. However, a potential error by an adjudicator in
ascertaining the correct contract terms will not ordinarily be a matter which goes to his
jurisdiction. In C & B Scene Concept Design Ltd v Isobars Ltd13 the adjudicator acceded to the
contractor’s claim on the basis that the JCT form of contract was incorporated into the agree-
ment between the parties. However, because the parties had not completed the provisions of
Clause 30 of that standard form, the contractual mechanism fell away and the provisions
of the Scheme for Construction Contracts applied instead. Accordingly, the defendant
resisted enforcement on the basis that the adjudicator failed to appreciate that the contractual
provisions had been superseded by the Scheme, and had therefore exceeded his jurisdiction
by addressing himself to the wrong question. At first instance, the recorder considered that
this was an arguable defence, and therefore gave the defendant permission to defend. The Court
of Appeal allowed the appeal, concluding that the dispute that was referred to the adjudicator
concerned the contractor’s entitlement to receive payment pursuant to their applications for
interim payment numbered 4, 5 and 6, and that this valuation dispute had been dealt with
by the adjudicator on the face of his decision. In order to determine that dispute, the adju-
dicator had had to resolve, as a matter of law, whether the JCT clauses applied or not and, if
they did, what the effect was of a failure to serve a timeous withholding notice by the employer.
The Court of Appeal held that the adjudicator had done that too. Even if the adjudicator was
12
[2004] BLR 179 at paragraphs 191–207 of the judgment. Other cases where the point arose, directly or
indirectly, include Allied London & Scottish Properties PLC v Riverbrae Construction Ltd [1999] BLR 246; Ballast
Construction Ltd v Burrell Ltd [2001] BLR 529; Dean & Dyball v Kenneth Grubb Associates [2003] BLR 2465;
Gillies Ramsey Diamond v PJW Enterprises [2003] BLR 48; and Tim Butler Contractors Ltd v Merewood Homes
[2000] TCC 10/00, a decision of HHJ Gilliland QC.
13 [2002] BLR 93.
256
wrong as to the applicable contract conditions, the Court of Appeal concluded that such an
error did not affect his jurisdiction.
The opposite factual situation gave rise to the same result in Allen Wilson Shopfitters v Anthony 8.10
Buckingham.14 There, interim payment applications were dealt with by the contract admini-
strator, who issued interim certificates. When the administrator was sacked, the claimant
contractors were unsure as to how to put their claim arising out of interim valuations 12 and
13, and in their reference to adjudication, they put the claim by reference to the Scheme for
Construction Contracts. The defendant immediately took the point that, by reference to
s106 of the 1996 Act, he was not a residential occupier, so the Scheme could not apply. The
TCC judge rejected that argument. He said that the adjudicator derived his jurisdiction
from the terms of the contract and the notice of adjudication. The adjudicator’s conclusion
that the sums claimed in valuations 12 and 13 were due and payable was a conclusion that
was within his jurisdiction; any inquiry into the precise status of valuations 12 and 13 was
entirely a matter for the adjudicator and, right or wrong, his decision could not be impeached.
The judge referred to and relied on C & B Scene, concluding that, on one analysis, the most
that could be said was that here the adjudicator had done the exact opposite of what the
adjudicator did in C & B Scene, because he applied the Scheme rather than the contract
payment mechanism. However, the point of principle was precisely the same because,
although his choice of payment mechanism may have been incorrect, it could not affect his
jurisdiction and he had answered the question that had been referred to him.
The decisions in C & B Scene and Allen v Buckingham are, perhaps, to be contrasted with the 8.11
decision of HHJ Thornton QC in Joinery Plus Ltd v Laing Ltd.15 In that case, there was no
dispute that the relevant sub-contract conditions were the DOM/2 conditions. In error,
the adjudicator referred throughout his decision to the JCT Works form of sub-contract.
The claimant sub-contractor said that, in consequence, the decision was not a decision
on the dispute referred to the adjudicator. The judge acceded to this submission, holding
that the decision had every appearance of having been decided by reference to the wrong
conditions of contract and without recourse to the correct contractual documentation. Thus
he held that the errors went to the heart of his jurisdiction, which was to decide the referred
dispute. The errors were fundamental and were not capable of being corrected under his
implied power to correct accidental slips. More controversially, the judge sought to distin-
guish C & B Scene as a case where the correct contract provisions were misconstrued by the
adjudicator. On analysis, it is thought that this attempt to distinguish C & B Scene is rather
difficult, since, as the judgment of Sir Murray Stuart-Smith makes plain in C & B Scene, the
only point available to the defendant was that the adjudicator was applying the JCT contract
conditions rather than the Scheme. Accordingly, it is submitted that Joinery Plus is perhaps
best treated as a case on its own specific facts, where the adjudicator reached a decision on the
contract terms that was contrary to the agreed position of both parties. That point certainly
did make it different from the situation in C & B Scene. Furthermore, all of these cases as to
errors in connection with the contract terms must be read in the light of the important
decision of the Court of Appeal in Pegram Shopfitters Ltd v Tally Weijl (UK) Ltd,16 which is
dealt with in detail in paragraphs 8.15–8.17 below.
14 [2005] EWHC 1165 (TCC), [2005] 102 Con LR 154.

15 [2003] BLR 184.
16 [2003] EWCA Civ 1750, [2004] BLR 65.
257
8.12 Another case in which an error of law was said to go, ultimately, to the adjudicator’s
jurisdiction, is Ballast Plc v The Burrell Co (Construction Management) Ltd.17 There it appears
that the adjudicator concluded that he could not carry out the valuation requested
because the parties had departed from the terms of the contract in a number of respects and
the variations and waivers meant that he was unable to reach a decision on any sum due. In the
words of Lord Reid, it appears that the adjudicator considered that ‘it was impossible, as a
matter of construction of his powers, for him to take into consideration, within the framework
of adjudication, even the possibility that the parties might depart from the terms of the JCT
conditions’. Lord Reid considered that that approach was wrong in law and that, given that
there were allegations that variations had been instructed otherwise than in the form
stipulated in the contract, as well as allegations of bad faith, the adjudicator’s error was
material. Lord Reid concluded that as a result of that error, the adjudicator misconstrued
his powers and, in consequence, failed to exercise his jurisdiction to determine the dispute.
He therefore concluded that the decision was a nullity.
8.13 However, it follows from the principles noted above that, in the usual case, a losing party
will have no grounds for resisting enforcement of an adjudicator’s decision if the adjudicator
correctly decided not to consider a particular claim or element of the dispute, even if his
particular reasons for arriving at that correct decision were, on analysis, plainly wrong. In
Northern Developments Cumbria Ltd v J & J Nichol18 the adjudicator had not considered the
repudiation claim because he said that such matters did not arise under the contract. HHJ
Bowsher QC noted that counsel had accepted that the adjudicator’s reasons for rejecting the
repudiatory breach issues were wrong in law. However the judge concluded that the
repudiation issues formed no part of the notice of arbitration and therefore were not within
the adjudicator’s jurisdiction in any event. Accordingly, because the adjudicator was quite
right to exclude such matters from his consideration (because he had no jurisdiction to
consider those issues), his decision could not be impeached, even if his reasons for so doing
were accepted as being wrong.
8.14 Other recent examples of potential errors of law that an adjudicator has been permitted to
make include a decision that, contrary to the parties’ agreement, a particular document was
not a contract document;19 the decision that, despite the existence of a number of contracts,
the later contracts were just variations of the first;20 and the correction of a slip which was, on
analysis, much more substantive than a simple clerical error.21 Each of these cases is referred
to in greater detail below.
Errors of Law/Jurisdiction
8.15 Although the general position, as explained above, is that an adjudicator can make errors of
law that do not affect the validity of his decision, different considerations may apply if those
errors of law touch upon the question of the adjudicator’s jurisdiction. Reference has already
17
[2001] BLR 529.
18
[2000] BLR 158.
19
GPS Marine Contractors Ltd v Ringway Infrastructure Services Ltd [2010] EWHC 283 (TCC), [2010]
BLR 377.
20 Air Design (Kent) Ltd v Deerglen (Jersey) Ltd [2008] EWHC 3047 (TCC), [2009] CILL 2657.
21 O’Donnell Developments Ltd v Build Ability Ltd [2009] EWHC 3388 (TCC), [2009] 128 Con LR 141.
258
been made in paragraph 8.12 above to the decision in Ballast PLC v The Burrell Co
(Construction Management) Ltd in which the court ruled that the particular error made by
the adjudicator rendered his decision a nullity. In Pegram Shopfitters Ltd v Tally Wiejl (UK)
Ltd at first instance 22 the claimant commenced adjudication proceedings and an adjudicator
was appointed pursuant to the Scheme for Construction Contracts. The adjudicator
provided a decision in the claimant’s favour. The defendant refused to pay, contending that,
if there was a contract, it was not the one found by the adjudicator but one that incorporated
the JCT Prime Cost 1998 Conditions. If they were right about that, it meant that the
adjudicator had not been validly appointed, because he had been appointed pursuant to
the different procedure required by the Scheme for Construction Contracts. If they were
wrong about the contract incorporating the JCT conditions, then the defendant said that
there was no contract at all. It was therefore argued (as it had been argued before the adjudi-
cator) that the adjudicator did not have the necessary jurisdiction. HHJ Thornton QC found
that it was clear from the correspondence and the decision that both parties were contending
that there was a written contract in existence and that the defendant was not now permitted to
oppose enforcement of the award on the basis that there was in fact no contract. The judge
decided that, if no clear contract terms were identified and agreed, the parties had not
produced a contract in accordance with s108, and therefore the Scheme applied. The
defendant appealed.
May LJ gave the principal judgment in the Court of Appeal.23 He said that it was an over- 8.16
simplification to say, as the judge had done, that although it was not clear-cut which set
of conditions had been incorporated into the construction contract, there was no dispute
between the parties that there was in any event a construction contract of some kind in exist-
ence. Instead, as May LJ observed, it was the defendants’ crystal clear contention, both
before the adjudicator and before the judge, that if no contract was concluded on the JCT
Prime Cost Conditions, there was no contract at all, with the result that the claimant was
simply entitled to be paid a reasonable sum for the work that he had carried out. May LJ
said that this contention was not a fanciful alternative argument, but was a submission that
had a realistic prospect of success. Moreover, this was a material element of the dispute
because, if the alternative argument were right and there was no contract, there could be no
construction contract in writing from which the adjudicator’s jurisdiction could derive, since
any contract for payment on a quantum meruit basis would not have been a construction
contract in writing within s107 of the 1996 Act. May LJ therefore found that the judge had
been wrong to say that both parties agreed that their relationship was governed by a construc-
tion contract, and had been wrong to preclude the defendant from contending in the alternative
that there was no contract at all. In those circumstances, the Court of Appeal allowed the
appeal and set aside the summary judgment on the adjudicator’s decision. Although, at
paragraph 33 of his judgment, May LJ accepted that the courts should be vigilant to examine
jurisdiction arguments to ensure that they were not insubstantial or advanced just for tactical
reasons, he stressed that there would be cases where legal principle had to prevail over broad
brush policy, and that this was such a case.
Accordingly, the position appears to be that, where the adjudicator is offered two conflicting 8.17
sets of contract conditions, each of which comprised a construction contract in writing with
22 [2003] BLR 296.

23 [2003] EWCA Civ 1750, [2004] BLR 65.
259
either an express or implied series of adjudication provisions, his choice of one set of
conditions over the other will usually be regarded by the courts as part and parcel of his
answer to the question that he had the jurisdiction to answer, and will not therefore invalidate
his decision. If, on the other hand, the adjudicator is given a choice between a contractual
situation that would give him jurisdiction, and a contractual situation that would not, then
the adjudicator’s investigation and ruling on that point is not determinative, and can be reviewed
subsequently by the courts. Moreover if, on that review, the court came to the conclusion
that the argument in support of the contractual position that would deprive the adjudicator
of jurisdiction was not fanciful but instead had a reasonable prospect of success, then the
adjudicator’s decision would not be summarily enforced.24
8.18 It is, however, important to emphasise that the sort of jurisdictional difficulty that arose in
Pegram will not often arise and, in most cases, even if the court suspects that an adjudicator
may have reached the wrong conclusions in law concerning the operation of the contract
provisions, such doubts will not result in a failure to enforce the adjudicator’s decision.
Thus, in Carl Construction (Scotland) Ltd v Sweeney Civil Engineering (Scotland) Ltd,25 Lord
Caplan commented that he did not find the reasons for the adjudicator’s finding (that the
payment provisions in the contract were inadequate) to be clearly set out in the decision
and felt ‘uncomfortable’ with the result, but he concluded that these problems represented
potential mistakes the adjudicator had made in her treatment of the referral, rather than a
venture beyond her jurisdiction. Similarly, in William Verry Ltd v North West London
Communal Mikvar,26 at paragraph 40 onwards of his judgment, HHJ Thornton QC iden-
tified a series of errors made by the adjudicator in dealing with the matters referred.
Somewhat reluctantly, the judge concluded that the decision should be enforced because
it was both valid and enforceable, but he directed that the resulting judgment was not to
be drawn up for six weeks from the date of handing down, so that if there was a subsequent
adjudication between the parties, dealing with some of the matters omitted by the first
adjudicator, one decision could be set against another with only a balancing figure being
paid to the net winner. This was certainly a creative way of seeking to do justice between
the parties in the light of the court’s concerns about the matters that the adjudicator had
apparently ignored but, perhaps because such a court-sponsored stay could be seen to be
contrary to the required swiftness of the adjudication process, it is not a procedure that has
been adopted in other cases.

8.19 A more recent decision that illustrates the courts’ general approach to the adjudicator’s
ability to make errors of law without exceeding his jurisdiction is that of Ramsey J in GPS
Marine Contractors Ltd v Ringway Infrastructure Services Ltd.27 In that case the parties had
apparently agreed that the GPS’ method statement was a contract document. However, in
his decision, the adjudicator concluded that the method statement was a statement of intent
and that, as such, GPS was not obliged to adhere strictly to it. Ringway said that this con-
clusion, which was contrary to the parties’ agreement, meant that the adjudicator had acted
outside his jurisdiction. The judge rejected that submission, noting that under s108 of
the 1996 Act, the adjudicator was entitled to take the initiative in ascertaining the facts and
24
See also Thomas-Frederic’s Construction Ltd v Keith Wilson [2003] EWCA Civ 1494, [2004] BLR 23.
25 [2001] SCLR 95.
26 [2004] EWHC 1300 (TCC), [2004] BLR 308.
27 [2010] EWHC 283 (TCC), [2010] BLR 377.
260
the law. He said he was entitled to reject the common position that the method statement
was a contract document; if he was wrong to do so, it was an error of law which he was
entitled to make. In addition, at paragraph 67 of his judgment, Ramsey J noted that it was
not clear that the agreement between the parties that the method statement was a contract
document (or the adjudicator’s finding to the contrary) made any difference to the ultimate
decision reached by the adjudicator. The jurisdictional challenge therefore failed.
Errors of Fact
Perhaps the most glaring error of fact that an adjudicator can commit is to make a decision 8.20
against a responding party who is not, in fact, a party to the underlying construction contract.
There have been a number of decisions on this factual premise, and the TCC judges have
adopted a relatively robust approach. Thus, in A J Brenton T/A Manton Electrical Components
v Jack Palmer,28 the adjudicator had required the defendant, Mr Palmer, to make a payment
to the claimant. On the enforcement application, the defendant contended that the adjudi-
cator had no jurisdiction to make that award because the correct party to the contract was a
company called Lords of Princetown Ltd. HHJ Havery QC held that this was a matter that
had been raised in the adjudication and the adjudicator had ruled upon it. By reference to
the decisions in Macob and Project Consultancy Group v The Trustees of the Grey Trust29 Judge
Havery concluded that the adjudicator’s decision, including his decision as to who was the
appropriate party to the contract, and therefore the appropriate party to the adjudication,
was a decision that he was empowered to make under the 1996 Act. If, therefore, the adjudi-
cator had made an error in coming to that decision, it was an error of fact that it was within
his jurisdiction to determine. Accordingly Judge Havery concluded that the adjudicator had
the necessary jurisdiction to reach his decision, even if he was wrong about the identity of the
defendant, and the decision had to be enforced. A similar result occurred in Nolan Davis Ltd
v Stephen Catton30 where again the defendant contended that the contract was with one of
his companies, rather than with him personally. HHJ Wilcox said that because the adjudicator
had ruled on this question and that it was a matter that he had the jurisdiction to decide, the
adjudicator’s decision should be enforced.
There is the suggestion that, in his judgment in Nolan Davis, Judge Wilcox assumed that, 8.21
because the question of which party contracted with the claimant was a matter referred to the
adjudicator, the parties had in some way agreed to be bound by his decision on that point.
For the reasons explored in paragraph 7.10 above, that may not be an entirely accurate
statement of the law, and it may have been open to the judge to review the adjudicator’s
determination of that issue. If there had been any doubt about this, the point was confirmed
by Simon Brown LJ (as he then was) in Thomas-Fredric’s Construction Ltd v Keith Wilson.31
There, he concluded that it was tolerably plain that the adjudicator had reached the wrong
conclusion as to the true identity of the contracting parties. However, he made it clear that
the adjudicator’s decision would still be binding if it could be shown that the parties had
agreed to accept his ruling on that point. Since, however, they had not so agreed in
28
TCC, 19 January 2001.
29 [1999] BLR 377.
30 Unreported, 2000 TCC No 590.
31 [2003] EWCA Civ 1494, [2004] BLR 23.
261
Thomas-Frederic’s, and a respectable case had been made out for disputing the adjudicator’s
jurisdiction, the decision in that case was not enforced.
8.22 Accordingly, it is submitted that, if the adjudicator makes an error as to the identity of the
contracting parties, then the subsequent enforcement of that decision may turn on the nature
of the dispute that had originally been referred to him and the strength of the argument to
the effect that he had reached a decision against the wrong party. If the parties had agreed to
be bound by the adjudicator’s decision, or if the adjudicator’s ruling on the jurisdictional
issue was plainly right, then the decision will be enforced: see Brenton, Nolan Davis, and
paragraph 32 of the judgment of Simon Brown LJ in Thomas-Fredric’s. If, however, the
parties did not agree to be bound by the adjudicator’s ruling on the point, and if the defendant
raised a respectable case that the adjudicator was wrong as to the identities of the contracting
parties, then the decision will not be enforced (see in particular paragraphs 20 and 33 of the
judgment of Simon Brown LJ in Thomas-Frederic’s).
8.23 In the reported cases, the errors of fact made by adjudicators have divided broadly into
two categories. First, there are the errors of computation, including circumstances in
which the adjudicator has misunderstood precisely what was being claimed, or where he
has failed to have regard to payments already made. The best-known example of this type
of mistake is Bouygues, discussed above. If it is not accepted as an error by the adjudicator,
there is little or nothing that the paying party can do to avoid liability to pay the sum
found as due by the adjudicator. If, on the other hand, it is accepted by the adjudicator as
an error, as in Geoffrey Osborne Ltd v Atkins Rail Ltd,32 then depending on the procedure
adopted and the existence or otherwise of an arbitration clause, it may be possible for the
error to be the subject of a declaration that would prevent summary judgment from being
entered.
8.24 The second category of error that features in the reported authorities concerns the situation
where the adjudicator allegedly erred in failing to take into account some particular argu-
ment or point. An example of this can be found in Shimizu Europe Ltd v Automajor Ltd.33
In that case, the adjudicator awarded the claiming party £161,996.89 in respect of alleged
variations to smoke ventilation works. It appeared that he did so on the basis that the parties
had accepted that there could be no challenge to that element of the claim. Following
publication of his decision, the defendant complained that it had at no time accepted that
the sum claimed in respect of the variations could not be challenged. In the subsequent
enforcement proceedings, HHJ Seymour QC had to rule on whether or not the adjudicator
had made an error and, if so, whether that affected his jurisdiction. The judge seemed
unimpressed with the suggestion of an error but, in any event, went on to conclude that,
even if the adjudicator had made a mistake, it was in connection with a matter relevant, or
possibly relevant, to the evaluation of what sum, if any, should be paid by the defendant to
the claimant under the contract. It was not a mistake as to what he was being asked to decide.
He therefore asked himself the correct question and he answered that question. If he got the
answer wrong, because he misunderstood the submissions being made to him, then the proper
mechanism for correcting the error would be in the course of the subsequent final account
negotiations or in arbitration proceedings. Such an error (if that is what it was) did not
32 [2009] EWHC 2425 (TCC), [2010] BLR 363.

33 [2002] BLR 113.
262
permit a challenge to the award on jurisdictional grounds, because the adjudicator had the
jurisdiction to make such a mistake.
The decision in Shimizu is also of interest because the judge acecepted the alternative 8.25
argument that the defendant’s request to the adjudicator to correct his decision, and their
part-payment of some of the sum ordered, meant that they could not subsequently dispute
his jurisdiction. That point is explored in more detail in paragraphs 14.22-14.29 below.
‘Slips’
What happens when an adjudicator produces a decision that includes an obvious mistake, 8.26
which he then corrects or expresses the desire to correct? Is an adjudicator permitted to
correct his decision at all? The answer will always depend on the facts, although much may
turn on whether the adjudicator himself acknowledges and accepts that an error has been
made, and the promptness of any purported correction.
The starting point is of course Bouygues (UK) Ltd v Dahl-Jensen (UK) Ltd.34 In that case the 8.27
adjudicator had calculated a sum in favour of Dahl-Jensen of about £200,000. However, he
made a mistake in his calculations by utilising, on one side of the equation, a contract sum
that included retention, and deducted money from it that did not include retention. The
net effect of the decision was to release all the retention to Dahl-Jensen, even though there was
no dispute that Dahl-Jensen were not, at that stage, entitled to that retention. If the
calculation had been correctly carried out, the net result would have been a payment in
favour of Bouygues of about £140,000. Bouygues’ solicitors invited the adjudicator to
amend the decision under the slip rule but this was opposed by Dahl-Jensen’s solicitors,
who claimed that there was no jurisdiction for him to do so. The adjudicator confirmed in
writing that he had not made a clerical slip or error. Both Dyson J and the Court of Appeal
said that, although they considered that the adjudicator had made an error, it was an error
made when he was acting within his jurisdiction. Thus, the decision in Bouygues would
appear to suggest that, once the adjudicator has produced his decision, that is effectively the
end of the story and, if that decision was in accordance with his jurisdiction, it is binding
and enforceable.
Following the decision of Edwards Stuart J in Geoffrey Osborne v Atkins Rail Ltd 35 it has been 8.28
suggested that the decision in Bouygues has been significantly watered down. That is not so.
The reason why the adjudicator’s error came to be corrected by the court, so as to defeat the
enforcement claim in the Osborne case, was purely procedural. Atkins had issued a claim
form under CPR Part 8 seeking a final determination of the issue as to the adjudicator’s error.
Because the error was admitted by everyone, including the adjudicator, and because there
was no arbitration clause, which meant that the court had the jurisdiction to make a final
decision on the point, there was no reason why, in that case, the error could not be corrected.
But, as the TCC judge pointed out in Pilon Ltd v Breyer Group PLC,36 Osborne is a case on its
own particular facts, and he stressed the importance there of the absence of any arbitration
agreement in the underlying contract. If the contract in Osborne had had an arbitration
34 First instance: [2000] BLR 49; Court of Appeal: [2000] BLR 522.
35 [2009] EWHC 2425 (TCC), [2010] BLR 363.
36 [2010] EWHC 837 (TCC), [2010] BLR 452.
263
clause, the court would have had no power to make a final determination of the issue, and
the decision would have been enforced, notwithstanding the error.
8.29 In the earlier case of Bloor Construction (UK) Ltd v Bowmer & Kirkland (London) Ltd,37 the
court also arrived at a decision that was different in effect to that in Bouygues. There, the
adjudicator identified the sum payable by Bowmer to Bloor, but his original decision failed
to deduct the payments on account that had already been made by Bowmer. Within an hour
and a half of the production of his first decision, the adjudicator produced a revised decision
that took into account the payments on account and effectively determined that Bloor was
entitled to no further payment. Bloor’s application to enforce the first (and uncorrected)
decision was rejected. HHJ Toulmin CMG QC held that the error that had been made was
in the category of a slip. He said that, in the absence of any specific agreement to the contrary,
a term can and should be implied into the contract referring the dispute to adjudication, to
the effect that the adjudicator may, on his own initiative or on the application of a party,
correct an error arising from an accidental error or omission. He concluded that parties
acting in good faith would be bound to agree at the start of the adjudication that the
adjudicator could correct an obvious mistake of the sort which he made in this case.38 It is
submitted that, in circumstances where a clear error has been made, which the adjudicator
has corrected within a very short time, without any prejudice to either side, there is room
for the implication of the term suggested. It is therefore difficult to disagree with the practical
common sense that underpins Judge Toulmin’s conclusion.
8.30 Save for one exception, the decision in Bloor has not been further considered in other
cases. The exception is the decision of Dyson J in Edmund Nuttall Ltd v Sevenoaks District
Council,39 which was decided shortly after the judgment in Bloor had been handed down.
Dyson J said that ‘putting the matter at its lowest, it is at least arguable that it [the decision
in Bloor] is right’. Furthermore, it is apparent from other cases that it is a procedure which
the parties in adjudication, and adjudicators themselves, regularly adopt in order to correct
obvious errors. It may be that the point has not been further challenged because everyone
with experience of the UK adjudication industry accepts that, in certain circumstances,
Judge Toulmin’s mechanism, first outlined in Bloor, is a useful way of avoiding even
temporary injustice. As noted in paragraphs 4.10–4.11 above, the slip rule is now
enshrined in the 2009 Act.
8.31 In Cubitt Building & Interiors Ltd v Fleetglade Ltd40 the adjudicator’s decision was completed
on the final day of the extended period and provided to the parties halfway through the
following day. The TCC judge concluded that such a decision was not a nullity, although it
was communicated to the parties at the very last moment. The judge noted that, following
representations from the parties, the adjudicator had corrected that decision by deducting a
figure of £5,000 that had been included twice. Neither party took the point that this sensible
correction of the original decision was outside the adjudicator’s jurisdiction.41
37 [2000] BLR 314.

38 The judge’s reasoning relied on a number of cases as to accidental slips or omissions, including The Montan
[1985] 1 Lloyd’s Rep 189 and R v Cripps ex parte Muldoon [1984] QB 686 and King v Thomas McKenna Ltd
[1991] 1 All ER 653.
39
Unreported 14 April 2000.
40 [2006] EWHC 3413 (TCC); 110 Con LR 36.
41 Despite the fact that a slip rule has developed in practice, it was thought necessary to enshrine it in the
2009 Act, at s140: see paragraphs 4.10-4.11.
264
However, it should be emphasised that the rule in Bloor will be of limited application, and in 8.32
particular can probably apply only in those circumstances where the adjudicator has himself
admitted that there was an obvious error and sought to correct it. In CIB Properties Ltd v Birse
Construction Ltd.42 HHJ Toulmin QC held that, in cases involving a slip or alleged slip, there
were two questions. Firstly, was the adjudicator prepared to acknowledge that he had made a
mistake and correct it? Secondly, was the mistake a genuine slip that failed to give effect to
his first thoughts? It was only if the answer to both those questions was yes that, subject to
the important considerations as to the time within which the correction was made, and
questions of prejudice, the court could give effect to the amendment to rectify the slip if the
justice of the case required it. On the facts of CIB, the judge refused to extend the principle
to circumstances where the adjudicator declined to make any correction, although he had
made a reference to the impending review of his decision by the court. Judge Toulmin
concluded that, even if the adjudicator had invited the court to carry out a review of his
lengthy decision, the court should decline to do so. In any event, the judge concluded that
there had in fact been no slip at all and that the adjudicator’s decision was explicable by the
figures set out in his conclusion. Accordingly, in that case, the ‘slip’ point failed.
The dangers of too wide an application of the slip rule are well-illustrated in the case of ROK 8.33
Building Ltd v Celtic Composting Systems Ltd (No 2).43 In that case the slip rule was expressly
set out in Clause 28 of the CIC model adjudication procedure, 4th edition. The adjudicator
produced a detailed decision setting out numerous figures. On receipt of the decision, Celtic
asked the adjudicator to make a number of corrections. Although their letter set out some
obvious amendments, much of it was concerned with an invitation to the adjudicator to
revisit the computation of a particular certificate. The adjudicator said that this went
beyond the terms of the slip rule and, although he corrected the clerical errors, he declined
to amend the substantive figures. Akenhead J rejected the submission that, in consequence,
the adjudicator had failed properly to exercise his jurisdiction. The judge found that the
payment and certification position was confused and unclear, and that Celtic had failed to
take the opportunity to present their payment case in a simple way. In consequence, the
judge declined to decide whether there had been an error at all but he said that, if there had
been, it did not affect the enforceability of the decision. The judge held that, such was the
confused nature of Celtic’s presentation, he was ‘not at all surprised’ that even such an
experienced adjudicator found the calculations presented ‘less than comprehensible’. The
same judge reached the same conclusion in YCMS Ltd v Grabiner44 despite the fact that, in
that case, the adjudicator had been persuaded to make detailed corrections to his original
decision. The judge ruled that the purported corrections went far beyond the correction of a
simple arithmetical error and amounted instead to a further calculation, ‘the logic of which
must be known only to the adjudicator’. Thus it was the original decision, not the corrected
version, that was enforced.
A recent decision the other way is O’Donnell Developments Ltd v Build Ability Ltd.45 The adju- 8.34
dicator purported to correct his decision, the effect of which was to add a further £150,000 to
the sums due to the claimant. The defendant challenged the validity of the correction.
42
[2004] EWHC 2365 (TCC); [2005] 1 WLR 2252.
43 [2010] EWHC 66 (TCC), [2010] 130 Con LR 74.
44 [2009] EWHC 127 (TCC), [2009] BLR 211.
45 [2009] EWHC 3388 (TCC), [2009] 128 Con LR 141.
265
A threshold question that arose was the extent to which the court could interfere with an
adjudicator’s exercise of his power under the slip rule. Ramsey J concluded that an erroneous
exercise of a power did not fall outside the adjudicator’s jurisdiction. In the particular cir-
cumstances of the slip rule, he set out this helpful summary:
First, if the adjudicator were to exercise a slip rule when there was no express or implied slip
rule, that would clearly be a decision which was outside his jurisdiction. Secondly, if the adju-
dicator is asked by one party to correct a slip and he accepts that an error has been made within
the slip rule then, if the adjudicator makes an error of fact or law in so doing, I consider that such
an error does not take the exercise of the slip rule outside his jurisdiction. Finally, if the adju-
dicator is asked by one party to correct a slip which the other party agrees is a slip within the
slip rule but in operating the slip rule he makes an error of fact or law, then I do not consider
that the court can interfere in that decision.
The judge concluded that, on the facts of that case, the court should not interfere with the
exercise of the adjudicator’s power under the agreed slip rule. The claimant therefore recov-
ered the additional £150,000.
8.35 One final word of warning is appropriate regarding the ‘slip’ rule. As noted in paragraph
8.25 above, a party who seeks to persuade the adjudicator to correct an error under the
so-called ‘slip’ rule must be satisfied that, without the error, the adjudicator had the
jurisdiction to make the decision that he has just communicated to the parties. If he fails
to make this distinction plain, the party seeking the correction runs the risk that by
requesting the change he is accepting the validity of the decision and waiving any right to
challenge the decision on jurisdictional grounds, as was found to have occurred in
Shimizu.46
The Alleged Failure to Address Particular Issues

8.36 The point has already been made that an increasingly common complaint on enforcement
applications is the adjudicator’s failure to deal with a particular issue between the parties.47
In many such cases, there has been a blatant attempt to turn what might otherwise have been
regarded as an error of fact or law on the part of the adjudicator (that would not be a bar to
enforcement) into either a jurisdictional issue or a breach of natural justice, so as to allow the
losing party to avoid payment. An example of a case where the alleged error did not prevent
enforcement was Balfour Beatty Construction Northern Ltd v Modus Corovest (Blackpool)
Ltd.48 Modus complained that the adjudicator had failed to consider a secondary defence
that they had raised, to the effect that, if Balfour Beatty were entitled to be paid extra for the
work in question, payment was not due by way of an interim payment, but through the final
account process which had not yet arisen. The TCC judge ruled that the adjudicator could
be taken to have rejected that defence too, so neither a jurisdictional nor a natural justice
argument arose. Cases where a failure to address issues did lead to the failure of the enforce-
ment proceedings include two decisions of HHJ Steven Davies. In Thermal Energy
Construction Ltd v AE & E Lentjes UK Ltd 49 the adjudicator failed to deal with the defence of
set-off and counterclaim raised by the defendant. This was a critical part of the defence but
46
[2002] BLR 113. See also Allied P&L v Paradigm Ltd [2009] EWHC 2890 (TCC), [2010] BLR 59.
47 For a detailed discussion of this topic, please see paragraphs 13.26–13.39.
48
[2008] EWHC 3029 (TCC), [2009] CILL 2660.
49
[2009] EWHC 408 (TCC).
266
the arbitrator did not even address it in his decision. The judge therefore concluded that the
decision should not be enforced. The same judge reached the same conclusion in Quartzelec
Ltd v Honeywell Control Systems Ltd.50 In that case, although the adjudicator explained that,
because of the wording of the notice of adjudication, he was not able to deal with a particular
defence raised by the defendant, which was called ‘the omissions defence’, the judge ruled
that he had been wrong so do to. More surprisingly, the judge went on to conclude that, even
though this part of the defence was worth just £36,500, whilst the total sum that was the
subject of the decision was about £150,000, this error deprived the adjudicator of any juris-
diction and meant that the entirety of the decision was not enforced.
There is no doubt that many commentators were uneasy about the decision in Quartzelec, 8.37
and observed that it was or might be inconsistent with Bouygues.51 The controversy subse-
quently arose head-on in Amec Group Ltd v Thames Water Utilities Ltd.52 In that case, the
TCC judge said there was no general inconsistency between the two lines of authority. If an
adjudicator wrongly failed to have regard to the responding party’s defence to the claim,
because he erroneously thought that he could not do so, then he was not addressing the
dispute that had been referred to him. On the other hand, if the adjudicator sought to answer
the right question, and engage with the dispute that had arisen between the parties, even if,
in so doing, he made a mistake and forgot something or gave undue significance to some-
thing else, then that decision was still enforceable and no jurisdictional issue or breach of
natural justice could arise. On the facts of Amec, it was suggested that, although the adjudicator
had dealt with a number of Thames Water’s cross-claims, he had failed to deal with one
particular element in sufficient detail, despite the length of his decision. The judge
declined to find that the adjudicator had made an error and said that he was not obliged
in his written decision to go painstakingly through the thousands of smaller items that
made up the particular cross-claim in question. But he went on to find that, even if the
adjudicator had made an error, that was all that it was: an error in calculating the full worth
of the particular item of cross-claim. A failure not to ascribe to that item of cross-claim a
higher value was, at most, an error of calculation that could not affect the enforceability of
the adjudicator’s decision.
In his subsequent decision in Pilon Ltd v Breyer Group PLC 53 the same judge revisited the 8.38
issue. In that case, the adjudicator had wrongly failed to address a critical part of Breyer’s
defence, namely an overpayment defence worth in excess of 70 percent of the sum eventually
awarded to Pilon. The adjudicator had been encouraged to reach this erroneous decision
by Pilon. The judge found that, in those circumstances, the decision should not be
enforced, particularly as there was good evidence that, if the adjudicator had not made
that error, he might have considered other elements of the set-off in a different light, which
could have extinguished the sum due altogether. In reaching these decisions, the judge
distinguished both that case, and the earlier cases such as Ballast and Thermal Energy, from
the decision in Quartzelec, about which he said he was a little uneasy, considering that it
was not in accordance with the general rules set out by Chadwick LJ in Carillion v
Devonport Royal Dockyard.54 In that context, he said that the principle that a decision
50
[2008] EWHC 3315 (TCC), [2009] BLR 328.
51
See the commentary on the case at [2009] BLR 328, in which the editors call the result ‘very surprising’.
52 [2010] EWHC 419 (TCC).
53
[2010] EWHC 837 (TCC), [2010] BLR 452.
54
[2005] EWCA Civ 1358, [2005] BLR 310.
267
must respond to the dispute originally referred was not ‘automatically applicable just
because the adjudicator deliberately (and wrongly) chose not to have regard to a particular
sub-issue, no matter how trivial’.
Fraud
8.39 Until recently, there have been few cases dealing with the impact upon an adjudication of
an allegation of fraud. Such cases as there were demonstrated a certain caution on the part of
the courts when asked to enforce an adjudicator’s decision against a background of alle-
gations of fraud. However, such an approach must now be reviewed in the light of the decision
of the Court of Appeal in Speymill Contracts Ltd v Eric Baskind.55
8.40 The earlier approach was often to refuse summary judgement where there were allegations of
fraud. Thus, in Pro-design Ltd v New Millenium Experience Company Ltd 56 a lighting sub-
contractor sought to enforce an adjudicator’s decision against a main contractor, in circum-
stances where it was alleged that the sub-contractor was a fraudulent vehicle, being a company
owned and operated by an employee of the defendant. Summary judgement was refused,
despite the fact that the fraud issue arose after the conclusion of the adjudication. By con-
trast, in Andrew Wallace Ltd v Artisan Regeneration Ltd 57 the decision was enforced because
the judge concluded that, on the evidence, the defendant had no real prospect of establishing
its allegation of fraud. She said that the court’s enforcement to the decision would not con-
stitute assistance in the perpetration of a fraud.
8.41 In SG South Ltd v Kingshead Cirencester LLP 58 the defendant employer raised allegations of
fraud in the adjudication but failed to establish any factual basis for that stance. In the
enforcement proceedings, Akenhead J formulated the following basic propositions applic-
able when allegations of fraud arose on adjudication enforcement applications:
20 . . .(a) Fraud or deceit can be raised as a defence in adjudications provided that it is a
real defence to whatever the claims are; obviously it is open to parties in adjudi-
cation to argue that the other party’s witnesses are not credible by reason of
fraudulent or dishonest behaviour.
(b) If fraud is to be raised in an effort to avoid enforcement or to support an applica-
tion to stay execution of the enforcement judgement, it must be supported by

clear and unambiguous evidence in argument.
(c) A distinction has to be made between fraudulent behaviour, acts or omissions
which were or could have been raised as a defence in the adjudication, and such
behaviour, acts or omissions which neither were nor could reasonably have been
raised but which emerged afterwards. In the former case, if the behaviour, acts or
omissions are in effect adjudicated upon, the decision without more is enforce-
able. In the latter case, it is possible that it can be raised, but generally not in the
former.
This approach was adopted by Ramsey J in GPS Marine Contractors Ltd v Ringway
Infrastructure Services Ltd 59 and was expressly approved by Jackson LJ in Speymill v Baskind.
55
[2010] EWCA Civ 120, [2010] BLR 257.
56
Liverpool TCC, 26 September 2001
57 [2006] EWHC 15.
58 [2009] EWHC 2645, [2010] BLR 47.
59 [2010] EWHC 283 (TCC), [2010] BLR 377.
268
In that latter case, the judge at first instance had declined to give summary judgement enforcing
an adjudicator’s decision, principally because one of the issues in the adjudication was the
alleged theft (by two employees of Speymill) of files belonging to the employer, Mr Baskind.
Although the adjudicator dealt with that issue, noting that Speymill denied that there had
been any such removal of documents, and dismissed the defence based on the alleged theft,
the judge concluded that the theft/fraud issue gave rise to an arguable defence. That decision
was reversed on appeal. Jackson LJ rejected the contention that the parties had agreed that
the adjudicator would not consider the theft issue, and found that the adjudicator had
addressed the allegation of theft in a measured way, and only to the extent that it was necessary
for him to do so. In addition, the Court of Appeal rejected the suggestion that the decision
should not be enforced because it had somehow been tainted by the alleged fraud of Speymill.
At paragraph 44 of his judgement, Jackson LJ noted that the allegation of theft was raised
directly before the adjudicator and he had taken it into account in the course of his decision.
It was not a case of fraud coming to light after the decision had been provided. Applying the
principles set out in SG South, he therefore held that the allegation of theft did not constitute
a proper basis for refusing to enforce the adjudicator’s decision.
269
9
ABATEMENT AND SET-OFF
The Problem 9.01 The General Rule 9.21

Abatement/Set-Off against a Sum The Exceptions 9.35
Certified/Determined as Due 9.06 Liquidated Damages 9.37
Abatement/Set-Off against Sums Setting Off against Other
Claimed 9.13 Decisions or Arbitral Awards 9.41
Set-Off against the Adjudicator’s Summary 9.43
Decision 9.20
Cashflow is the lifeblood of the village grocer too, though he may not need so
large a transfusion from his customers as the shipbuilder in Mondel v Steel or the
sub-contractor in the instant appeal. It is also the lifeblood of the contractor
whose own cash flow has been reduced by the expense to which he has been put
by the sub-contractor’s breaches of contract. It is not to be supposed that so elementary
and economic proposition as the need for cash flow in business enterprises
escaped the attention of judges throughout the 130 years which had elapsed
between Mondel v Steel and Dawnays’ case in 1971 . . .
Lord Diplock in Gilbert-Ash v Modern Engineering (Bristol) Ltd 1
The Problem
The financial difficulties created for a smaller contractor by the larger or more powerful main 9.01
contractor or employer with whom he contracts have been the subject of much hand-
wringing and not a little legislation since the days of Victorian ‘laissez-faire’ capitalism. The
persistent refusal of the larger company to pay the invoices rendered by the smaller has always
been one of many weapons wielded by the larger organisation to ensure that its own cash flow
was given priority over the interests and rights of others. The phenomenon referred to in the
media in the early 1990s as ‘subbie-bashing’ is, sadly, nothing new: larger and more powerful
main contractors have always done all that they can to make their own contracts as profitable
as possible, and it has often been their sub-contractors and suppliers who have suffered. By
the same token, as Lord Diplock points out in Gilbert-Ash, the main contractor is himself
vulnerable to similar machinations on the part of the employer. Of course, one of the
principal ways in which a main contractor or employer sought to slide out of his contractual
obligations, when faced with a claim for an interim payment, was to seek to rely upon a
set-off or cross-claim alleging defective work or delay. Traditionally, provided that such a
1 [1973] 3 WLR 421 at page 444D.
271
set-off was at least arguable, the sub-contractor was faced with a very real difficulty. If he sued
the main contractor for the money, he might find that he never received work from that main
contractor again. Moreover, even if he did decide to take the main contractor to court, the
court would usually be obliged, in the face of an arguable set-off and cross-claim, to give the
main contractor unconditional leave to defend.
9.02 One of the periodic attempts by the courts to provide assistance to hard-pressed contractors
in these situations can be found in the decision of the Court of Appeal in Dawnays Ltd v F G
Minter Ltd.2 In that case the Court of Appeal allowed the steelworks sub-contractors to recover
the sum due to them pursuant to an interim certificate, holding that, as a matter of construc-
tion of the contract, the main contractor was not permitted to deduct unliquidated damages
by reference to his disputed claims for delay. In a famous passage, Lord Denning MR said:
Every businessman knows the reason why interim certificates are issued and why they have to
be honoured. It is so that the sub-contractor can have the money in hand to get on with his
work and the further work he has to do. Take this very case. The sub-contractor has had to
expend his money on steel work and labour. He is out of pocket. He probably has an overdraft
at the bank. He cannot go on unless he is paid for what he does as he does it. An interim
certificate is to be regarded virtually as cash, like a bill of exchange. It must be honoured.
Payment must not be withheld on account of cross-claims whether good or bad—except so
far as the contract specifically provides. Otherwise any main contractor could always get out
of payment by making all sorts of unfounded cross-claims.
For a while, this decision allowed sub-contractors to recover sums due by way of interim
payment, regardless of possible cross-claims.3
9.03 These halcyon days (at least for those who wanted to be paid promptly without deduction)
were not to last. In Gilbert-Ash (Northern) Ltd v Modern Engineering (Bristol) Ltd 4 the House
of Lords had to consider the same question that had arisen in Dawnays. They concluded that
Dawnays had been wrongly decided. Lord Diplock said he could see no grounds in law to
prevent the main contractor from defending the action by setting up the sub-contractor’s
breach of warranty in doing defective work, even though this involved challenging the
architect’s certificate that that work had been properly executed. He said that there was no
provision in the main contract (which was in a standard form) that excluded the common
law remedy of the employer to set up breaches of warranty by the contractor, in diminution
or extinction of any instalment of the price, notwithstanding that such instalment had
been certified as due from him to the contractor in the certificate issued by the architect.
His views as to the ‘cash flow’ argument, which Lord Denning MR had repeated in the
Court of Appeal in Gilbert-Ash,5 are set out verbatim at the start of this chapter. As a result
of the decision in Gilbert-Ash, for the next 20 years or so, employers and main contrac-
tors would habitually raise set-offs and cross-claims in order to avoid payment of sums
due to contractors and sub-contractors. By the early 1999s, as discussed in Chapter 1
above,6 the problem of non-payment was seen in the Latham Report as the principal problem
2 [1971] 1 WLR 1205; [1971] 2 All ER 1389.

3
See for example GKN Foundations Ltd v Wandsworth London Borough Council [1972] 1 Lloyd’s Rep 528;
and Fredrick Mark Ltd v Schield [1972] 1 Lloyd’s Rep 9.
4
[1973] 3 WLR 421.
5 71 LGR, at 167, when he said, ‘There must be a ‘cash-flow’ in the building trade. It is the very lifeblood of
the enterprise.’
6 See in particular paragraphs 1.11 and 1.12.
272
Abatement and Set-Off
affecting the economic stability of the construction industry. It was implicitly recognised
that it was impossible to prevent an employer or a main contractor from setting up a cross-
claim of some sort because there would always be cases where the employer or main
contractor had a genuine complaint arising out of the contractor’s performance. Accordingly,
in an attempt to ensure that it was only bona fide set-offs and cross-claims that were raised,
the Latham Report concluded that, if an employer or a main contractor was to take advantage
of its rights of set-off, it had to do so in a very short period following the issue of the certificate
or the request for payment. In other words, if there was a bona fide complaint, that complaint
could be, and therefore had to be, registered with the sub-contractor straightaway by way of
a written notice. Implicitly, the Report suggested that a bona fide cross-claim would be the
subject of a prompt notice, whilst a sham would only occur to the employer or the main
contractor much closer to the time when the money had to be paid, and would therefore not
be the subject of a timeous notice.
It was in these circumstances that the withholding notice regime was created. It was the 9.04
withholding notice mechanism that was designed to ensure that an employer or a main
contractor with a genuine set-off could raise it clearly and promptly, so that the sub-contractor
knew that the money otherwise due would not be paid because of a particular cross-
claim. The adjudicator could then be asked to adjudicate on that claim if that is what
either of the parties wanted. The regime endeavoured to ensure that an employer or a
main contractor who thought up a cross-claim at the last possible moment in a final
attempt to avoid payment would simply not be allowed to do so. Sections 110 and 111
of the 1996 Act7 set out a clear series of provisions designed to ensure that any set-off was
notified fully, clearly and promptly.
The suspension or prohibition of the parties’ usual rights and liabilities as to set-off, 9.05
and the particular problems thrown up by the withholding notice mechanism, have been
one of the most common areas of dispute for adjudicators to decide and have given rise to
specific problems as to their jurisdiction. The remainder of this chapter considers the three
most common situations which have arisen in this context. They are:
1. where a defendant seeks to abate and/or set off against a sum which has been certified or
otherwise determined as due and payable under the contract;
2. where a defendant seeks to abate and/or set off against a sum claimed as due and payable
under the contract;
3. where a defendant seeks to abate and/or set off against a sum that has been awarded
pursuant to an adjudicator’s decision.
Abatement/Set-Off against a Sum Certified/Determined as Due

Most standard forms of building and engineering contracts incorporate a complex 9.06
mechanism by which interim payments are made by the employer to the contractor.
These mechanisms usually involve the following:
1. an interim application for payment by the contractor to the employer’s contract
administrator;
7
See paragraphs 2.146–2.174.
273
2. a detailed consideration of that application by the administrator, usually in conjunction

with the employer’s quantity surveyor;
3. the issue of an interim certificate by the administrator, identifying the sum to be paid on
an interim basis and the final date for payment.
9.07 If the contract contains the sort of mechanism referred to above then, following the issue of
the certificate, the employer has a very short time in which to raise any question of abatement
or set-off against the sum certified. This period will usually be provided for in the contract
and can be as little as three days after the issue of the interim certificate. Under the Scheme
for Construction Contracts the withholding notice must be served five days before the final
date for payment.8 If no withholding notice is served by the employer by the specified date
then the contractor is entitled to be paid the sum certified. This general statement of
principle has been questioned following the decision of the House of Lords in Melville
Dundas Ltd v George Wimpey UK Ltd,9 a case discussed in detail in paragraphs 2.169–2.174
above. Whilst this decision allows an employer, under a certain standard form of building
contract, to withhold sums due to the contractor where, even though there has not been a
withholding notice, the contract was determined due to the contractor’s insolvency less than
28 days after the sum fell due, it is hard to agree that such an exception is likely to arise on
a regular basis. Moreover, in Pierce International Design Ltd v Mark Johnston and Another,10
the TCC judge interpreted the proviso to the clause in question (which had not been relevant
on the facts in Melville Dundas) as allowing the contractor to recover, at least where the sums
were due more than 28 days before the determination, there had been no withholding
notices, and the contractor was not insolvent.
9.08 In Re: A Company (No 1299 of 2001)11 the sub-contractor sought £9,702.47 that had
been certified in its favour. There was no notice of intention to withhold payment. The
Deputy High Court Judge concluded that the clear intent of s110 and s111 was to pre-
clude the employer, in the absence of a withholding notice with specified content, from
contending that all or part of the sum demanded by the contractor was not in fact due.
Without a withholding notice, the rule was ‘pay now, litigate later’. The judge went on to
find that any other construction of s110 and s111 would rob them of all practical
significance.
9.09 The same result occurred in Clarke Contracts Ltd v The Burrell Co (Construction Management)
Ltd.12 In that case, Sheriff Taylor concluded that the situation where a sum had been certified
as due, which was the position in the case before him, was different to the situation where the
interim payment was simply the subject of an application by the contractor. He pointed out
that, under the standard form with which he was concerned, the architect would from time
to time issue interim certificates, and that the sum that was referred to the adjudicator had
originally been certified by the architect. He therefore concluded in Clarke that the certified
sum became due and payable in accordance with the contract and, in the absence of a
withholding notice in respect of that certificate, the responding party could not set up any
abatement or set-off. He found that, if the defenders wished to avoid liability to make
8
See paragraph 3.129–3.131.
9
[2007] UKHL 18; [2007] 1 WLR 1136.
10 [2007] EWHC 1691 (TCC); [2007] BLR 381.
11 [2001] CILL 1745.
12 [2002] SLT 103.
274
payment, they were obliged to issue a withholding notice, and the absence of such a notice
meant that they were liable to pay the sum found due by the adjudicator.
In reaching this conclusion, Sheriff Taylor contrasted the position with another Scottish 9.10
case, S L Timber Systems Ltd v Carillion Construction Ltd.13 That was a case in which there
were no certificates, and the interim payment at issue between the parties was simply the
subject of an application by sub-contractor pursuers that had not been scrutinised by any
third party. Sheriff Taylor concluded that this was a vital distinction that meant that, in those
circumstances, no withholding notice was necessary in order to allow the main contractor to
argue how and why elements of the application were not due under the contract. Sheriff
Taylor’s clear distinction was not perhaps appreciated in some of the subsequent reported
cases. However, it lay at the heart of the first Court of Appeal decision on the point in Rupert
Morgan Building Services (LLC) Ltd v Jervis.14
In Rupert Morgan, the builders were in possession of an interim certificate, which the employer 9.11
disputed. There was no withholding notice. The adjudicator found that the certified sum was
due, and his decision was enforced by the court. The defendants appealed, arguing that they
were entitled to withhold payment because they had an arguable defence, to the effect that
the items of work which went to make up the unpaid balance had not been done at all, or
were duplications of items already paid, or were charged as extras when they were within the
original contract, or represented snagging items that had already been paid for. In rejecting
the appeal, Jacob LJ (with whom both Sedley LJ and Schiemann LJ agreed) referred expressly
to the judgment of Sheriff Taylor in Clarke Contracts, which, he said, ‘casts a flood of light on
the problem’. Jacob LJ pointed out that, pursuant to this contract (like so many of the stan-
dard forms) the sum due was determined by the interim certificate. As a result, the contractor
was entitled to the money certified right away. The employer’s contractual duty was to make
immediate payment, and the sum that they had to pay arose because of the certificate. He
pointed out that, in any event, the only risk to the employer was an overpayment followed
by the insolvency of the builder, and that such risk was one which could be avoided if the
certificate was carefully checked and, if any objection arose, the giving of a timeous with-
holding notice by the employer.
Jacob LJ drew a clear distinction between interim payments that had been certified, and were 9.12
therefore due under the contract, and sums that had not been the subject of any third party
scrutiny and that were simply claimed as due by the contractor or sub-contractor in ques-
tion. He said this was a proper distinction to draw, rather than one which, as had been argued
before the Court of Appeal, depended on whether a wide or narrow construction was placed
on s111 of the 1996 Act. He went on to articulate the advantages of the analysis adopted by
Sheriff Taylor, which he expressly endorsed:
14 . . .
(a) It makes irrelevant the problem with the narrow construction—namely that Parliament was
setting up a complex and fuzzy line between sums due on the one hand and counterclaims on
the other—a line somewhere to be drawn between set-off, claims for breach of contract which
do no more than reduce the sum due and claims which go further, abatement and so on.
13 [2002] SLT 997; this case is discussed in greater detail in paragraph 9.17.
14 [2004] 1 WLR 1867.
275
(b) It provides a fair solution, preserving the builder’s cash flow but not preventing the client
who has not issued a withholding notice from raising the disputed items in adjudication
or even legal proceedings.
(c) It requires the client who is going to withhold to be specific in his notice about how much
he is withholding and why, thus limiting the amount of withholding to specific points.
And these must be raised early.
(d) It does not preclude the client who has paid from subsequently showing he has overpaid.
If he has overpaid on an interim certificate the matter can be put right in subsequent certifi-
cates. Otherwise he can raise the matter by way of adjudication or if necessary arbitration
or legal proceedings.
(e) It is directed at the mischief which Section 111(1) was aimed at. This mischief is
mentioned in Keating on Building Contracts. A report called the Latham Report had
identified a problem, namely that ‘main contractors were abusing their position to wrong-
fully withhold payment from sub-contractors who were in no position to make any effec-
tive protest’. Actually the provision has gone further than just dealing with the position
between main and sub-contractors since it covers the position between client and main
contractor too—but the main contractor will need paying himself so he can pay the sub-
contractor. And he may have his own cash flow needs too . . .
Thus, where there is a certificate in favour of a main contractor or a sub-contractor, then
that main contractor or sub-contractor is entitled to the sums certified, unless there is a
withholding notice served within the contractual time limit (and possibly, in cases of deter-
mination and contractor insolvency, as per the decision in Melville Dundas identified in
paragraph 9.07 above). The withholding notice has to raise every point, and in clear detail,
as to why the sum certified is not due. Thus, the notice must include points that would be
classified in law as matters going to abatement, as well as cross-claims for defects, delay and
the like.
Abatement/Set-Off against Sums Claimed

9.13 Is the position different where the sum due has not been certified, but is simply claimed as
due by way of an application for interim payment by the contractor or sub-contractor?
For the reasons noted above, the answer is yes. Although a number of the reported cases are
not always entirely clear on the point, it would appear that, if the employer or main contractor
claims that an interim application is overstated because, for example, it includes items which
have already been paid for, or seeks payment by reference to exaggerated rates and prices, no
withholding notice is necessary. The position may be less clear in circumstances where what
the employer or main contractor disputes is not the application for payment itself, but the
sub-contractor’s entitlement to any payment at all, because of other matters, such as defects
or delay, that are not identified in the original application for payment. In those circum-
stances, the most prudent course is for the employer or the main contractor to issue a
withholding notice setting out that cross-claim. The failure to do so might potentially be a
breach of s111 or the appropriate contract provisions, and mean that no deduction will be
permitted. The authorities dealing with this type of dispute are referred to below.
9.14 From the outset, the position adopted by the TCC judges in London was that, in circum-
stances where the sum being claimed had not been certified, and therefore represented simply
the claiming party’s assessment of what was due, the responding party was not obliged to
serve a withholding notice in order to take issue with the detail of the application. Thus, in
276
Woods Hardwick v Chiltern Conditioning15 HHJ Thornton QC noted that, whilst Chiltern
had not served a withholding notice in respect of their alleged claims arising out of the loss
caused by Woods Hardwick’s purported breaches of contract, the sums claimed by Woods
Hardwick had not been the subject of any sort of third party assessment or certificate, so that
any abatement properly relied on by Chiltern would not require notice under s111. Thus,
notwithstanding the absence of such a notice, Chiltern’s abatement defence could, in
principle, defeat or reduce Woods Hardwick’s claims. A similar view was expressed by HHJ
Lloyd QC in KNS Industrial Services (Birmingham) Ltd v Sindall Ltd.16 The judge concluded
that ‘one cannot withhold what is not due’ and said that, in all the circumstances of that case,
including the adjudication notice, the dispute referred to the adjudicator included any
ground open to Sindall that would justify not paying KNS. Thus the arguments that the sum
claimed was too high did not require a withholding notice.
As previously noted, the distinction between abatement against a certified sum, and abate- 9.15
ment against a sum merely the subject of an interim application, was not always clearly made
in the reported cases. Two examples will suffice:
1. In Whiteways Contractors (Sussex) Ltd v Impresa Castelli Construction United Kingdom
Ltd 17 HHJ Bowsher QC expressed the view that it made no difference whether
deductions were by way of set-off or abatement and that, whichever they might be,
notice of such deductions had to be made by way of withholding notice in accordance
with the Act. Accordingly, to the extent that this case suggests that a party seeking to
reduce an interim application (because, for example, an element of the application was
based on incorrect rates or was not a variation, but part of the contract workscope) has to
serve a withholding notice, it is thought that the principle is overstated in the judgement.
2. Similarly, it may be that the decision of HHJ Gilliland QC in Millers Specialist Joinery
Co Ltd v Nobels Construction Ltd 18 should also be treated with caution. In that case, the
claimant sought £16,005.96 in respect of invoices for joinery work. There was no
certification regime. The defendant opposed the application on the basis that there had
been previous overpayment to the claimant, but there had been no withholding notice.
The adjudicator produced a decision in favour of the claimant. Judge Gilliland upheld
that decision. He said that, whilst ordinarily the claimant would not succeed in obtaining
summary judgment because of the issue of overpayment, the absence of a withholding
notice deprived the defendant of any right to make a cross-claim in respect of the previous
overpayments. The judge pointed out that, if it were correct that the effect of a failure to
serve a withholding notice was that the amount of the invoice was to be regarded as a sum
due under the contract then, in all cases without such a notice, neither an adjudicator nor
the court could properly refuse to order payment in full, even though it might be clear
that the work claimed for had not been carried out. He went on to say that, if the effect
of a failure to serve such a notice deprived the payer of the right to refuse payment on the
ground that the sum sought was not due and payable, it was difficult to see on what basis
the court could refuse to give judgment for the full amount. The judge concluded that the
absence of a withholding notice meant that the recipient had a legal right to be paid on
15
[2001] BLR 23.
16 [2001] 17 Const LJ 170.
17
[2000] 16 Const LJ 453.
18 [2001] CILL 1770.
277
the final date for payment and that the court had to give effect to the failure to serve a
notice under s111.
9.16 It is thought that Judge Gilliland perhaps went too far in the terms of his judgment in Millers.
A claim made on the basis of an invoice, which is disputed by the other side, can be the sub-
ject of a dispute as to what, if anything, might actually be due under that invoice, whether or
not there is a withholding notice. To the extent that Judge Gilliland suggests otherwise, then
it is respectfully suggested that he was wrong to do so, and that he overstated the importance
of the withholding notice in such situations. However, it must be said that, on its own par-
ticular facts, there is nothing objectionable about the result in Millers. That is because the
defendant contractor did not actually oppose the sums claimed, or the basis on which those
sums were calculated. Instead, the defendant was opposing the application on the basis that
it had a separate claim based on previous overpayments. To that extent, it might be said that
this separate claim was a true set-off/cross-claim, and therefore did require a withholding
notice. It is for that reason that it is thought that an employer or main contractor can only be
excused from the obligation to serve a withholding notice where the dispute truly does relate
to the particular sum invoiced or claimed by way of an interim application for payment. Any
other kind of set-off, such as those discussed in both Whiteways and Millers, should, out of
an abundance of caution, be the subject of a withholding notice.
9.17 The clearest analysis of the position where the claim is not based on a certificate but merely
an invoice or an interim application can be found in S L Timber Systems Ltd v Carillion
Construction Ltd.19 In that case, the pursuers were specialist timber suppliers. They made
interim applications for payment, which the defenders refused to pay. The adjudicator
upheld the claims for payment in full, relying in part on the absence of any withholding
notice in support of his conclusion that he did not have to look at the substance of the appli-
cations. Lord MacFadyen concluded that the adjudicator was wrong to adopt this conclu-
sion although he concluded that the adjudicator’s errors of law did not take him out of the
proper scope of his jurisdiction. Lord MacFadyen’s analysis of the particular circumstances
in which the responding party was not obliged to serve a withholding notice has the virtue
of simplicity and clarity. He pointed out that a withholding notice had to be provided against
a sum ‘due under the contract’ and that those words could not be equated with the words
‘sum claimed’. He said that s111 of the 1996 Act was not concerned with every refusal on the
part of one party to pay a sum claimed by the other. It was concerned with the situation
where a sum was due under the contract and the party from whom that sum was due sought
to withhold payment on some separate ground. He went on to say that a dispute about
whether the work, in respect of which the claim was made, had been carried out, or about
whether it was properly measured or valued, or about whether some other event (on which a
contractual liability to make payment depended) had occurred, all went to the question of
whether the sum claimed was due under the contract, and therefore did not involve an
attempt to ‘withhold . . . a sum due under the contract’. Thus he concluded that such dis-
putes did not require a withholding notice. He contrasted that with the position where there
was no dispute that the work had been done and was correctly measured and valued, but
where the party wished to advance some separate ground for withholding the payment; in
those circumstances, a withholding notice was necessary. Paragraph 22 of his judgment
19 [2001] BLR 516.
278
serves as a neat summary of the position where an interim payment has not been certified but
is merely the subject of an application:
In my opinion, the absence of a timeous notice of intention to withhold payment does not
relieve the party making the claim of the ordinary burden of showing that he is entitled under
the contract to receive the payment he claims. It remains incumbent on the claimant to
demonstrate, if the point is disputed, that the sum claimed is contractually due. If he can do
that, he is protected, by the absence of a Section 111 notice, from any attempt on the part of
the other party to withhold all or part of the sum which is due on the basis that some separate
ground justifying that course exists. It is no doubt right, as the adjudicator pointed out, that,
if the section did require a notice of intention to withhold payment as the foundation for a
dispute as to whether the sum claimed was due under the contract, it would be relatively
straight-forward for the party disputing the claim to give such a notice. But that consideration
does not, in my view, justify ignoring the fact that the section is expressed as applying to the
case where an attempt is made to withhold a sum due under the contract, and not as applying
to an attempt to dispute that the sum claimed is due under the contract.
As previously noted, this approach was contrasted in Clarke Contracts v Burrell 20 with the 9.18
situation where the sum due has been certified. There, Sheriff Taylor rightly pointed out
that in S L Timber there had been no calculation of the sum sued for by reference to a
contractual mechanism, which gave rise to an obligation under the contract to make
payment. There had been no more than a claim by the pursuers, which claim had not been
scrutinised by any third party. Furthermore, as Jacob LJ made plain in Rupert Morgan,
there was a clear difference between the two situations. In S L Timber there was no architect
or system of certificates, and the builder simply presented his interim bill for payment.
As Jacob LJ concluded, the bill in itself did not make any sums due. Under that contract,
what would render the invoiced sums due was just the fact of the work having been done;
thus no withholding notice was necessary in respect of works not done, and payment was
not due for work not done.
Accordingly, it can be seen that, in situations where there is no interim certificate, the 9.19
employer or main contractor does not require to have issued a withholding notice in order
to take issue with the detail of the invoice or interim payment application in question. Woods
Hardwick, KNS v Sindall, S L Timber and Rupert Morgan all make that plain. To the extent
that Whiteways and Millers suggest to the contrary, they should be treated with caution.
However, the decisions in Whiteways and Millers are of significance because, in each case,
what the main contractor sought to do was to raise the question of pre-existing overpayments.
Those were not matters which arose directly out of the particular invoice or interim payment
application. Therefore, to the extent that those authorities indicate that a withholding notice
is required before an adjudicator has the jurisdiction to consider the detail of such cross-claims,
they can be regarded as a correct statement of the law.
Set-Off against the Adjudicator’s Decision

There have been numerous decisions dealing with the losing party’s ability to set off, against 9.20
a sum that they are required to pay pursuant to an adjudicator’s decision, a separate claim for
damages or delay. Many of these cases date back to the early days of adjudication enforcement,
20 [2002] SLT 103.
279
when it was sometimes unclear how the adjudicator’s decision fitted in to the existing
contractual framework of interim valuations and interim payments. There were also a
number of cases that tested the extent to which the party’s usual rights of set-off could be said
to have been modified and even abrogated by the 1996 Act. Although it is not possible to
generalise too far, because each case will turn on the precise contractual provisions agreed by
the parties and the precise form of the adjudicator’s decision, it is appropriate to conclude
that, generally, a party who has been ordered by an adjudicator to pay a specific sum forth-
with cannot seek to set off against that sum a claim for damages or for other losses, even if
that claim was not considered in the adjudication itself. Accordingly, the remainder of this
chapter deals first with those cases that illustrate the general rule, before going on to address
the cases in which a set-off was permitted against an adjudicator’s decision, and the particular
difficulties created by the employer’s cross-claim for liquidated damages.
The General Rule

9.21 One of the earliest significant judgments dealing with questions of set-off was Allied London
& Scottish Properties PLC v Riverbrae Construction Ltd.21 In that case, the adjudicator had
found that sums were due from the petitioners to the respondents. The petitioners sought
unsuccessfully to retain those sums against claims on other contracts between the parties.
When that failed, they then sought an order that such sums should be put on deposit, but
not paid over to the respondents, so as to allow the petitioners to pursue their other claims
against the respondents under those other contracts. The adjudicator rejected the submis-
sion, and the petitioners challenged his decision. The Outer House dismissed the petition,
finding that, having found sums due to the respondents, and having dismissed the claim for
retention, the adjudicator could not logically or lawfully have made an order of the type sug-
gested. Lord Kingarth found that such an order would, in effect, sustain the retention claim
that the adjudicator had just rejected, and that, notwithstanding the wide powers given to
adjudicators, such an order would have been unjustified. Another early case was VHE
Construction Plc v RBSTB Trust Co Ltd.22 There, following two adjudications, a net sum was
due to VHE but, following the second adjudication, RBSTB notified the contractor that
they intended to deduct most of that sum by way of liquidated damages for delay. There was
no withholding notice. HHJ Hicks QC concluded that, not only did s111 of the 1996 Act
exclude the right to set-off in the absence of an effective notice of intention to withhold pay-
ment, but that that was one of its principal purposes. He went on to reject the submission
that the general right under the contract to deduct liquidated damages overrode the obliga-
tion to comply with the adjudicator’s decision. Although it was argued that the parties had
to comply with the adjudicator’s decision ‘without prejudice to their other rights under the
contract’, the judge said that ‘without prejudice to’ was the equivalent of ‘subject to’ and
meant ‘but leaving unaffected’. He said that RBSTB’s construction of the contract, to the
effect that they could set-off any other claims against the decision, would destroy the balance
between the need, on the one hand, for swift and unconditional compliance with the adju-
dication decision against, on the other, the preservation of the losing party’s right to contend
for and, if justified, obtain a different final determination by litigation, arbitration or
agreement.
21 [1999] BLR 246.

22 [2000] BLR 187.
280
At paragraph 66 of his judgment in VHE, Judge Hicks also rejected the contention advanced 9.22
by RBSTB that they had a residual right to set-off their liquidated damages claim. He said
that such a construction would make a nonsense of the overall purpose of the 1996 Act,
particularly if payments required to comply with adjudication decisions were more vul-
nerable to attack than those simply falling due under the ordinary contractual machinery.
He said that the parties had to comply with the adjudicator’s decision and that ‘comply’ in
accordance with the contract meant ‘comply, without recourse to defences or cross-claims
not raised in the adjudication’. Thus, on any view, VHE made plain that, in the ordinary
course of events, a losing party could not seek to set off a separate claim against the sum
awarded by the adjudicator.23
There have been a number of subsequent decisions that have been entirely in line with Judge 9.23
Hicks’ conclusions.24 They are analysed in greater detail in paragraphs 9.25–9.34 below.
However, the next decision on this topic has sometimes been taken as limiting the scope of
what Judge Hicks said. That is the Court of Appeal decision in Parsons Plastics (Research and
Development) Ltd v Purac Ltd.25 In that case the sub-contractors, Parsons, sought payment of
approximately £250,000, but the defendant main contractors, Purac, refused to pay and
complained that the sub-contractors had failed to comply with their contractual obligations.
Parsons were subsequently ejected from site. They then took their payment application to
adjudication. There was a dispute about whether or not the sub-contract work was a con-
struction operation. The adjudicator found that it was, and that sums were due to Parsons.
His decision was published on 17 May 2001. Six days later, on 23 May, Purac served an
intention to withhold payment of the sum awarded by the adjudicator by reference to their
own claim for the reasonable costs of completing the sub-contract work. This figure exceeded
the sum awarded by the adjudicator. The judge at first instance refused Parsons’ summary
judgment application in the amount awarded by the adjudicator and granted Purac sum-
mary judgment on their counterclaim. The sub-contractors appealed.
The Court of Appeal dismissed the appeal. Because it was common ground that the 1996 Act 9.24
did not apply, this was properly treated as an ad hoc adjudication. Furthermore, the Court
of Appeal concluded that the wording of the contract meant that the overriding general right
that a party had to set off other sums claimed to be due was not lost or limited, despite the
adjudication provisions. Pill LJ, with whom Mummery and Latham LJJ agreed, said that he
had not found the question an easy one and that when parties provided a specific procedure
by which a claim to withhold payment was to be notified and detailed, it could not readily
be concluded that the effect of a general set-off provision (such as Clause 31 in that case) was
to make the procedure wholly unnecessary. However, he came to the conclusion that the
failure to give a withholding notice was not fatal to the main contractor’s right to set-off. At
paragraph 15 of his judgment, he concluded that, as a matter of the construction of the
relevant provisions of the contract, it was open to the respondents to set off against the
adjudicator’s decision any other claim that they had against the sub-contractors that had
not been determined by the adjudicator. At first sight, this is a rather surprising result.
It is perhaps best classified, as Jackson J described it in Balfour Beatty Construction Ltd
23
See also another early case, Harwood v Lantrode (unreported, 24 November 2000), a decision of HHJ
Seymour QC.
24 See, for example, Multiconcept Developments Ltd v Abacus (CI) Ltd [2002] Adj LR 03/22.
25 [2002] BLR 334.
281
v Serco Ltd 26 as a case where ‘the contract contained a specific term as to set-off which
determined the outcome’.
9.25 A decision more in line with the general principle that to allow the loser to set off against
the sum awarded by the adjudicator was contrary to the whole purpose of the 1996 Act
was that of HHJ Thornton QC in Bovis Lend Lease Ltd v Triangle Development Ltd.27
There, he said that the decision of an adjudicator that money must be paid gave rise to a
second contractual obligation on the part of the paying party to comply with that decision
within the stipulated period. He went on to say that such an obligation usually precluded
the paying party from making withholdings, deductions, set-offs or cross-claims against
the sum that had to be paid.
9.26 It should be noted, however, that some of the statements of principle in that judgment were
doubted by the Court of Appeal in Ferson Contractors Ltd v Levolux AT Ltd,28 which is now
the leading case on this area of the law. In that case, the sub-contractors, Levolux, made a
second interim payment application for about £56,000, but Ferson paid only £4,753. They
relied upon a withholding notice in respect of the balance. Levolux ceased work and
Ferson gave notice to Levolux that it required them to recommence work, failing which
Ferson would terminate the contract on the ground that Levolux had wrongly suspended
performance. Levolux gave notice of intention to refer the dispute to adjudication.
Ferson purported to determine the contract. The matter then went to adjudication. The
adjudicator concluded that Levolux were entitled to the balance of their second interim
payment, and had been so entitled when Levolux stopped work. The principal issue that he
had to decide was whether or not Ferson’s withholding notice complied with the 1996 Act.
He concluded that if the notice did comply with the 1996 Act, the withholding was lawful
and Levolux’s claim failed. If it did not comply, then Ferson were not entitled to withhold
payment and Levolux’s case succeeded. He held that the withholding notice did not comply
with the statutory requirements and was therefore invalid. Thus he found for Levolux. That
decision was enforced by HHJ Wilcox.
9.27 In the Court of Appeal, it was argued that the adjudicator’s decision was limited to whether
or not a certain sum was due and owing, and that the adjudicator had not decided whether
or not there had been a valid determination of the contract. Thus it was said that this point
was available for argument before the judge on the enforcement application, without in
any way resiling from the binding nature of the adjudicator’s decision. This argument was
rejected by the Court of Appeal. They said that the judge was plainly right in concluding
that it was implicit in the adjudicator’s decision that there had been no valid deter-
mination, and that such a conclusion followed inexorably from the adjudicator’s finding
that Ferson had not been entitled to withhold payment. Ferson’s alternative argument
was that the contract provisions overrode the adjudicator’s decision and, in support of this
argument, reliance was placed on Parsons. Mantell LJ distinguished Parsons on the basis
that it was not concerned with s108, and instead related to a set-off and counterclaim
upon which there had been no adjudication. He went on to say that, in any event, the
contract had to be construed so as to give effect to the intention of Parliament rather than
to defeat it, and if that could not be achieved by way of construction, then the offending
26
[2004] EWHC 3336 (TCC).
27
[2003] BLR 31.
28
[2003] EWCA Civ 11; [2003] BLR 118.
282
clause must be struck down. The contract clauses dealing with rights and liabilities on
determination had to be read as not applying to monies due by reason of an adjudicator’s
decision. Longmore LJ referred to the parties’ agreement to comply with the adjudicator’s deci-
sion, and that in any event the adjudicator’s decision had to take precedence over the
contract.
It is suggested that Levolux provides clear guidance as to the position when a party seeks to 9.28
set off against an adjudicator’s decision. In general terms, the courts will view such an argument
as an attempt to frustrate the 1996 Act and, in the ordinary case, will not therefore permit it.
This is particularly so where, as in Levolux, the subject matter of the purported set-off had
implicitly been dealt with in the adjudicator’s decision.
Levolux has been followed in a number of subsequent decisions.29 In M J Gleeson Group Plc 9.29
v Devonshire Green Holding Ltd 30 the TCC judge decided that a payment ordered by an
adjudicator could not be withheld on the basis of a claim that accrued after the commence-
ment of the adjudication. He found that the terms of the contract in question had the same
purpose and effect as that set out by the Court of Appeal in Levolux. He said that the decision
of the adjudicator was binding and had to be complied with by the parties, and the idea that
the decision could be defeated by a withholding notice in respect of events that occurred
after the commencement of the adjudication seemed to him to be entirely inconsistent
with the statutory purpose of providing a quick and effective remedy on an interim basis.
He concluded that an adjudicator’s decision had to be enforced and complied with, without
subtle arguments as to other provisions of the contract.
In David MacLean Contractors Ltd v The Albany Building Ltd 31 the same judge held that a 9.30
defendant could not set off its claim for damages for delay against a specific payment
ordered by the adjudicator. He held that the defendant could not refuse payment based on
a cross-claim in relation to liquidated damages. The judge referred again to Levolux and his
own decision in Gleeson; although he accepted that the contract did not contain an express
prohibition against set-off, he went on to hold that, because the parties had agreed to
comply with the adjudicator’s decision, that meant that they would not exercise any right
of set-off. A set-off would simply delay payment and defeat the purpose of adjudication,
which was designed ‘to assist cash flow’.
In Balfour Beatty Construction Ltd v Serco Ltd 32 Jackson J reviewed, amongst other authorities, 9.31
VHE, Bovis Lend Lease, Parsons Plastics and Fersons v Levolux. It was a case concerned with an
employer’s attempt to withhold payment of sums awarded by the adjudicator by reference to
a cross-claim for liquidated damages. He derived two principles of law from the authorities
that were relevant to the dispute in Balfour Beatty. They were summarised at paragraph 53 of
his judgment as follows:
(a) Where it follows logically from an adjudicator’s decision that the employer is entitled to
recover a specific sum by way of liquidated and ascertained damages, then the employer
may set off that sum against monies payable to the contractor pursuant to the adjudicator’s
decision, provided that the employer has given proper notice (in so far as required).
29
See for example Dumarc Building Services Ltd v Salvador Rico, Epsom County Court, HHJ Hull QC,
unreported, 31 January 2003.
30
HHJ Gilliland QC, sitting at the TCC in Salford, 19 March 2004.
31
HHJ Gilliland QC, sitting at the TCC in Salford, 10 November 2005.
32
[2004] EWHC 3336 (TCC).
283
(b) Where the entitlement to liquidated and ascertained damages has not been determined either
expressly or impliedly by the adjudicator’s decision, then the question whether the employer is
entitled to set-off liquidated and ascertained damages against sums awarded by the adjudicator
will depend upon the terms of the contract and the circumstances of the case.
It is respectfully suggested that there is a third principle to be derived from the authorities,
namely that, if it is to be said that the terms of the contract as to set-off are to override the
effect of the adjudicator’s decision, and deprive the successful party in the adjudication of the
sum otherwise due pursuant to the adjudicator’s decision, then those terms must clearly
provide for such an outcome.
9.32 Subsequent cases have demonstrated that, at least in general terms, a party who asserts a
future claim cannot seek to set off the amount of that claim against a sum awarded by an
adjudicator. In particular:
1. In Interserve Industrial Services Ltd v Cleveland Bridge UK Ltd 33 Jackson J was dealing
with the situation where the losing party wished to set off against the sum awarded
against him the amount that he reasonably expected to recover in a subsequent adjudica-
tion. It was argued that neither the terms of the particular sub-contract in question,
nor the words of s111 of the 1996 Act, could be construed as excluding rights of set-
off which did not exist when the subject of the adjudicator’s decision crystallised.
Jackson J rejected that argument and held that, where the parties to a construction
contract engaged in successive adjudications, each focussed upon the party’s current
rights and remedies, the correct approach was to consider the position at the end of each
adjudication. At that point, absent special circumstances, he concluded that the losing
party had to comply with the adjudicator’s decision and could not withhold payment
on the ground of his anticipated recovery in a future adjudication, based on different
issues.34
2. In Hillview Industrial Developments (UK) Ltd v Botes Building Ltd 35 the adjudicator
ordered Botes to pay Hillview the sum of £292,650. Botes declined to pay this on the
grounds that they were about to issue legal proceedings in respect of their final account
which, they said, did not become due and payable until after the adjudication decision
had been published. It was argued on behalf of Botes that, although in normal circum-
stances Hillview would be entitled to summary judgment, on the facts of the case it was
open to the court to conclude that the case should be disposed of at trial rather than by
way of summary judgment; it was argued that it would be a curious result if Botes was
required to pay the sum in the adjudicator’s award, only for a substantial part of it to have
to be repaid to Botes a short time afterwards. Having considered the decision of Jackson
J in Interserve, HHJ Toulmin CMG QC agreed with the statements of principle set out
above and concluded that, accordingly, Hillview were entitled to judgment immediately,
without any set-off. The fact that Botes had a separate claim that was the subject of a
future application for summary judgment, which may or may not succeed, could not
deprive Hillview of the sums awarded by the adjudicator. Judge Toulmin concluded that
there was no possible justification for not granting summary judgment to Hillview.
33
[2006] EWHC 741 (TCC).
34This approach was followed by HHJ Toulmin QC in Ale Heavy Lift v MSD (Darlington) Ltd [2006]
EWHC 2080 (TCC).
35 [2006] EWHC 1365 (TCC).
284
He said it would be an abuse of the process of the court to allow the case to proceed to
trial in circumstances where Botes conceded that it had no defence. He observed that the
forthcoming application by Botes for summary judgment on their final account was
contested, and so it was impossible to say whether or not Botes would succeed. Summary
judgment was entered to enforce the adjudicator’s decision.
3. In RJ Knapman Ltd v Richards & Ors 36 the adjudicator had awarded a sum of money to
the contractor and also found that the contractor was responsible for the defects in the
windows and the doors. That latter finding had not given rise to a sum to be paid by the
contractor to the employer, and indeed the adjudicator’s decision appeared to suggest
that, pursuant to the terms of the contract, the contractor had to come back and remedy
the defects himself. The TCC judge enforced the contractor’s claim for the money
awarded by the adjudicator. He said that, pursuant to the adjudicator’s decision, there
was no separate financial claim that the employer could set off against the sum found to
be due to the contractor. If the employer was right and the contractor was in breach of its
contractual obligation to comply with the adjudicator’s decision and rectify the defects,
then the contract permitted the employer to take legal proceedings to secure compliance.
They had not done so. In those circumstances, the judge concluded that, because the
contract provided the employer with a remedy that dealt with the very complaint that
the employer now made, it was not appropriate to deprive the contractor of its entitle-
ment as determined by the adjudicator. Merely because there was a possible future claim
accruing to the employer, which had not yet been quantified, did not mean that the court
should decline to enforce the adjudicator’s decision. At paragraph 25 of his judgment,
the judge said:
It is often the case that, if an adjudicator deals with underlying contractual rights, such as the
contractual liability for a particular element of the work, or extensions of time, there will be
no immediate financial consequence of that decision, although such consequences may
become apparent thereafter, once the decision is complied with or not complied with. This
case is no different. The only slight complication here is that there is also a money sum found
to be due by the adjudicator to the claimant. In my judgment, arguments about the possible
failure to comply with one part of the decision do not affect both parties’ obligation to com-
ply with all parts of the decision including, in this instance, the award of the money sum.
Compliance and non-compliance are merely easier to identify if the adjudicator decides on
a sum of money, rather than a declaration as to contractual rights.

Finally, in this group of cases illustrating the general rule, there is Ledwood Mechanical 9.33
Engineering Ltd v Whessoe Oil and Gas Ltd and Another.37 In that case the adjudicator
decided that the defendant’s deduction from Ledwood’s interim application, in respect of
a risk and reward element of the contract sum, was invalid. In consequence of the decision,
the defendant issued a revision to the payment notice in relation to a subsequent application,
purporting to give effect to the adjudicator’s findings. Ramsey J concluded that this was
illegitimate. The effect of the adjudicator’s decision was that the defendant had wrongly
withheld over £1 million in respect of the earlier application. Thus, he said, to permit the
defendant to use an adjustment to the payment notice for a later application would
ignore the wrongful deduction, and permit the defendant to take account of subsequent
events and other rights of set-off that may have accrued in the interim, which it was not
36 [2006] EWHC 2518 (TCC); [2006] 108 Con LR 64.

37 [2007] EWHC 2743 (TCC); [2008] BLR 198.
285
entitled to do. In general, he said, ‘the claiming party is entitled to receive the payment it
should have received at the date of the interim payment without taking into account
subsequent events or other claims for set-off’. In addition, the judge rejected a related sub-
mission advanced by the defendant that it could set off against the sum due an amount
that, they said, arose from an adjustment of the risk/reward element of the payment
arrangements as found by the adjudicator. The judge said that, whilst the natural corollary
of the adjudicator’s decision on principle was that it increased the number of expended
hours in the ‘pain/gain’ calculation, the calculation of that effect was neither undisputed nor
indisputable. This was therefore not a similar situation to a claim for liquidated damages,
which was a particular exception in relation to set-off against an adjudicator’s decision.
Accordingly, he concluded that no valid set-off was open to the defendant on the facts of
that case.38
9.34 Something that a number of these cases have in common is the potential uncertainty about
what it is that the adjudicator has decided. It can sometimes be difficult to say what follows
logically from an adjudicator’s decision because the decision itself is not as clear as it might
be. Sometimes the alleged uncertainty is, on analysis, no such thing. Thus, in Workspace
Management Ltd v YJL London Ltd 39 there was an argument that the adjudicator’s decision
encompassed a valuation but did not actually decide that the balance was due from the
defendant to the claimant. The judge concluded that the decision that the balance was due
was plain or, at the very least, it could be reasonably inferred from the inevitable and logical
consequences of his valuation. The same argument—that the adjudicator was simply doing
a valuation exercise, and was not deciding that an amount was due—featured in JPA Design
and Build Ltd v Sentosa (UK) Ltd,40 with a similar lack of success. But in ROK Building Ltd v
Celtic Composting Systems Ltd 41 the issue was more complicated because, notwithstanding
the fact the the decision ran to over 300 paragraphs, nowhere had the adjudicator indicated
that a particular sum was to be paid by Celtic to ROK. However, on an analysis of the very
lengthy decision, Akenhead J concluded that that too was a reasonable inference.
The Exceptions
9.35 An obvious exception to the general rule is the decision of the Court of Appeal in Parsons
Plastic, where the Court of Appeal concluded that specific contractual terms to set off did
allow the overriding of the adjudicator’s decision.42 Three other cases, the first two of which
were referred to by Jackson J in Balfour Beatty Construction Ltd v Serco, are also relevant.
1. In David McLean Housing Ltd v Swansea Housing Association Ltd43 the adjudicator issued
a corrected decision on 22 March 2001, indicating that a sum should be certified under
the contract in favour of the contractors. The following day the employer’s agent issued
a certificate which reflected that decision. On the same day, the defendant employer
wrote to the claimant contractor stating that liquated and ascertained damages would be
38
There are a number of other authorities which apply these principles to the particular facts of the case. See
in particular Balfour Beatty Construction Northern Ltd v Modus Corovest (Blackpool) Ltd [2008] EWHC 3029
(TCC); [2009] CILL 2660, paragraphs 84–89; and YCMS Ltd v Grabiner [2009] EWHC 127 (TCC); [2009]
BLR 211 paragraphs 51 and 63–64.
39 [2009] EWHC 2017 (TCC); [2009] BLR 497.
40 [2009] EWHC 2312 (TCC); [2009] 50 EG 68, paragraphs 23–25.
41
[2009] EWHC 2664 (TCC); [2009] 130 Con LR 61.
42
43
[2002] BLR 125.
286
deducted from the payment due under that certificate. Subsequently, on 16 May 2001
the defendant wrote a further letter to the contractor stating that the contractor was liable
to pay liquidated and ascertained damages in the sum of £130,359 and that its primary
case was that it was entitled to deduct that sum from such sum as was otherwise due to
the contractor under the contract. On the enforcement application in respect of the sum
indicated in the adjudicator’s decision, HHJ Lloyd QC concluded that the employer
had realistic prospects of successfully demonstrating that the letter of 23 March
complied with Clause 24 of the contract, which was concerned with the payment of
liquidated damages for delay. He therefore declined to enforce the decision. Thus,
McLean was a case where, in all the circumstances, the employer was able to set off against
the sum referred to in the decision. This was partly because of the rather vague notice of
adjudication and the judge’s view that the adjudicator’s decision could effectively be
characterised as guidance as to what should have been certified in response to the specific
interim payment application in question, rather than a finding that a specific sum was
due and owing. In other words, the adjudicator was telling the parties what the certificate
ought to contain and, once his decision was provided, a certificate in that form was
then issued. Thus, given the almost advisory nature of the adjudicator’s decision, the
subsequent certificate that was issued was legitimately the subject of a withholding
notice, pursuant to the express terms of the contract, to deduct liquidated damages. It is
thought that a different sort of dispute, and a more specific adjudicator’s decision, would
have given rise to a situation where the decision could not have been the subject of a fresh
notice (see, for example, VHE ).
2. Indeed, it was in precisely these terms that the decision in McLean was described by
HHJ Seymour QC in Solland International Ltd v Daraydan Holdings Ltd.44 In that
case, the judge decided that, once the adjudicator had reached a conclusion as to
whether the contractor was entitled to any, and if so what, extension of time, the
employer was entitled to liquidated damages for any part of the period of actual delay
for which the contractor had not been found entitled to an extension of time. Subject
to the giving of a notice of intention to withhold payment in respect of liquidated
and ascertained damages against the sum which the adjudicator had determined was
payable to the contractor, there was no reason why a set-off was not appropriate in
respect of that period. Accordingly, as Judge Seymour pointed out, the decision in
McLean was in accordance with the principles outlined by Judge Hicks in VHE and
the earlier cases.
3. In Geris Handelsgesellschaft v Les Constructions Industrielles de la Mediterrannée S.A.,45
HHJ Lloyd QC allowed the defendant to avoid summary enforcement of an adjudi-
cator’s decision, in which various sums had been found due to Geris, pending the
quantification of various sums by way of set-off. Again, rather like the same judge’s decision
in McLean, the set-off was allowed because of the nature and scope of the decision itself.
The adjudicator was unable to resolve all the matters put to him because of jurisdictional
difficulties. Therefore his decision included his conclusions as to those matters he could
resolve, but was not a definitive statement that one party owed the other a specific sum.
Moreover, the judge concluded that the adjudicator had decided that the defendant was
entitled to set off its cross-claims against any sums found due to Geris in other parts of
44
[2002] EWHC 220 (TCC); [2002] 83 Con LR 109.
45
[2005] EWHC 499 (QB).
287
his decision. Thus, the judge’s decision to allow the set-off in that case was in accordance
with the express terms of the adjudicator’s decision.
9.36 Another case that turned on its own particular facts, and the specific contract provisions, was
Connor Engineering Ltd v Les Constructions Industrielles de la Mediterranée.46 The principal
dispute there was concerned with the proper definition of ‘construction operations’. However,
a separate point arose in relation to the dates for payment. The adjudicator said that the sums
should be paid 14 days after the date of his decision. In accordance with the contract, a with-
holding notice could have been served not later than seven days before the expiry of that
14-day period; thus, because of the terms of the decision, a withholding notice could be
served after the production of the decision, thereby avoiding the need for immediate
payment in accordance with that decision. This was again because the adjudicator’s decision
was declaratory, not only as to amount, but also as to when that amount should be paid.
If an adjudicator decides that the sum that he has found to be due should be paid within a
period of 14 days or more after the date of the decision, then, depending on the contractual
provisions as to the timing of withholding notices, this might allow the losing party to issue
a withholding notice, particularly in respect of matters that were not the subject of the adju-
dication, in order to avoid immediate payment. In an appropriate case, an adjudicator is
perhaps better advised to require any payment to be made forthwith, thereby preventing
another dispute about the provision of a fresh withholding notice.
Liquidated Damages
9.37 It will be seen that many of these attempts to set off sums against an adjudicator’s decision
arise out of the employer’s cross-claim for liquidated damages. It has been argued that,
following an adjudicator’s decision, there is an implied term of the standard form of contract
that would permit an employer to deduct liquidated damages from the amount of the award.
The argument has been that such a term is necessary because, without it, the contract would
become unworkable. However, this bold submission was expressly rejected by Dyson J, as
he then was, in Edmund Nuttall Ltd v Sevenoaks District Council.47 Dyson J held that the
contract worked perfectly satisfactorily without such a term. He was extremely wary about
implying a term as to the circumstances in which liquidated and ascertained damages may
be deducted from a sum due to the contractor, when the contract contained detailed express
provisions that dealt precisely with that issue. The judge also pointed out the employer’s
failure to address the claim for liquidated and ascertained damages; the cross-claim should
have been advanced in the adjudication, but was not. He concluded that, since liquidated
damages were not properly deductible under the contract at the time of the adjudicator’s
decision, they would not be properly deductible now. The employer’s attempt to avoid the
summary enforcement of the decision failed.
9.38 As noted above, particular difficulties can arise in circumstances where a contractor has made
a claim for an extension of time that has been unsuccessful, either in whole or in part. In those
circumstances, the employer naturally wishes to rely on the contractor’s failure in order to
make a claim for liquidated damages in respect of the period of delay for which no extension
of time was awarded. Is the employer entitled to set off his claim for liquidated damages
against any sums that the adjudicator may have awarded to the contractor?
46 [2004] BLR 212.

47 TCC, unreported, 14 April 2000.
288
There are three older cases which address this issue. 9.39
1. In The Construction Centre Group Ltd v The Highland Council,48 it was held that the
employer was not entitled to rely on his cross-claim for liquidated damages, notice of
which had been served after the adjudicator had communicated his decision to the
parties, to defeat the enforcement claim. The court followed Levolux, holding that the
adjudicator’s decision was intended to have immediate enforceable effect. At paragraph
16 of the opinion of the court, Lord Hamilton stressed that it was sufficient to defeat the
employer’s reliance on the cross-claim for the court to hold that the claim for liquid-
ated damages could have been, but was not, relied on in the adjudication, and that the
employer’s reliance on the claim for liquidated damages was inconsistent with its con-
tractual obligation to give immediate effect to the adjudicator’s decision.
2. A full analysis of this topic can be found at paragraph 53 of the judgment of Jackson J in
Balfour Beatty Construction Ltd v Serco Ltd.49 The relevant principles are set out in full at
paragraph 10.31 above. In essence, the employer can set off the sum claimed if the entitle-
ment to liquidated damages has been determined, either expressly or impliedly, by the
adjudicator’s decision. If it has not been so determined then it is more difficult, although
ultimately it will depend on the precise words of the set-off provisions in the contract.
3. In William Verry Ltd v Mayor and Burgesses of the London Borough of Camden50 Ramsey J
noted that, following Levolux, the right of set-off from an adjudicator’s decision was
generally excluded. As to the specific question of liquidated damages, at paragraph 29 of
his judgment he said:
The particular issue of whether liquidated damages can be deducted when the adjudicator’s
decision deals with extensions of time but does not deal with the consequential effect on an
undisputed or indisputable claim for liquidated damages raises, I consider, a distinct question
of the manner and extent of compliance with the adjudicator’s decision. It does not, in my
judgment, raise a question as to the ability to set-off sums generally against an adjudicator’s
decision.
In other words, an employer’s ability to set off will probably turn on the contractual
provisions relating to compliance with an adjudicator’s decision and, in certain cases,
the terms of the decision itself.
The ability to set off against an adjudicator’s decision a sum due by way of liquidated dam- 9.40
ages will still be the exception rather than the rule. It has been repeatedly said that a deci-
sion which extends the time for completion, but not for the whole period of delay, will not
automatically entitle the employer to set off liquidated damages for the shortfall. Thus, in
Avoncroft Construction Ltd v Sharba Homes (CN) Ltd 51 HHJ Kirkham rejected the defen-
dant’s submission that it was entitled to set off liquidated damages against the decision
because that was what the adjudicator had decided. The judge found that the adjudicator
had not decided the question of their entitlement to liquidated damages: he had simply
decided the contractor’s entitlement to an extension of time. The employer’s entitlement
to liquidated damages had not even been argued. In the absence of an express provision
in the contract entitling the defendant to deduct or withhold liquidated damages in such
48
[2003] XA123/02 Extra Division, Inner House, Court of Session.
49 [2004] EWHC 3336 (TCC).
50 [2006] EWHC 761 (TCC).
51 [2008] EWHC 933 (TCC); [2008] TCLR 7.
289
circumstances, and by reason of the provision in the contract requiring the parties to
comply with the decision of the adjudicator, the right to set off was not upheld. Similarly,
in SG Hart v Dennis Smith,52 HHJ Toulmin CMG QC found that the defendant employer
was not entitled to set off his claim for liquidated damages against the sum awarded by
the adjudicator to the contractor. The judge found that what followed logically from the
adjudicator’s decision was a declaration that the contract administrator ought to issue a
certificate of non-completion; it could not be derived from that decision that the claimant
was obliged to repay a sum by way of liquidated damages. Indeed, in that case the adjudi-
cator had specifically said in his written decision that he could reach no such conclusion.
The judge went on to note that it would have been necessary to consider the effect of the
contractual provisions, on which the adjudicator made no affirmative finding, in order to
reach the conclusion that the defendant was entitled to liquidated damages. That might
be a matter for a separate application for summary judgement or a further adjudication,
but it was not within the court’s jurisdiction on an application to enforce the current
adjudicator’s award.53
Setting Off against Other Decisions or Arbitral Awards

9.41 The starting point for any consideration of one party’s ability to set off one adjudication
decision against another is the judgement in Interserve Industrial Services Ltd v Cleveland
Bridge UK Ltd.54 Where the the decisions are sequential, the correct approach is to consider
the position at the end of each adjudication. But what happens when there are two enforceable
decisions that might or do impact on each other? That issue was addressed by Akenhead J in
HS Works Ltd v Enterprise Managed Services Ltd.55 He identified the following steps that
needed to be considered before the court would permit a set-off of one decision against
another:
(a) First, it is necessary to determine at the time when the court is considering the issue
whether both decisions are valid; if not or if it cannot be determined whether each is valid,
it is unnecessary to consider the next step.
(b) If both are valid, it is then necessary to consider if, both are capable of being enforced or
given effect to; if one or other is not so capable, the question of set-off does not arise.
(c) If it is clear that both are so capable, the court should enforce or give effect to them both,
provided that separate proceedings have been brought by each party to enforce such deci-
sions. The court has not reason to favour one side or the other if each has a valid and
enforceable decision in its favour.
(d) How each decision is enforced is a matter for the court. It may be wholly inappropriate to
permit a set-off of a second financial decision as such in circumstances where the first
decision was predicated upon a basis that there could be no set-off.
On the facts of that case, the judge found that both the first and the second adjudicators’
decisions were valid and enforceable. Therefore he found that, whilst a sum should have been
52 [2009] EWHC 2223 (TCC); (2009) 159 NLJ 1296.

53
HHJ Havelock-Allan QC reached the same conclusion in RWE Npower PLC v Alstom Power Ltd [2009]
EWHC B40 (TCC). He concluded that the cross-claim for liquidated damages did not logically follow from,
indeed had no connection with, any of the matters decided by the adjudicator, and he found that the terms of
the boiler contract precluded a set-off from being raised: see paragraphs 83 and 88–89 of his judgement.
54 [2006] EWHC 741 (TCC) referred to at paragraph 9.32(1).
55 [2009] EWHC 729 (TCC); [2009] BLR 378.
290
paid by Enterprise pursuant to the first adjudication, and a separate sum paid back by HS as
a result of the second adjudication, the correct approach for the court was to make an order
that reflected the net effect of the decisions, taken together. This also impacted on the orders
for interest and costs. The same result was achieved in JPA Design and Build Ltd v Sentosa
(UK) Ltd.56 JPA had an adjudicator’s decision in their favour in the sum of £300,000, whilst
Sentosa had a separate decision in their favour worth £180,000. Sentosa’s claim to set-off the
£180,000 against the £300,000, together with interest, was allowed, the judge referring
to the equitable jurisdiction that one judgment or order for payment can be set off against
another.57 By reason of JPA’s financial circumstances, a stay of execution was ordered in
respect of the net amount. The judge concluded by doubting whether ‘serial (and nakedly
tactical) adjudications are the best method of achieving a comprehensive and binding
resolution of the disputes between the parties’.
In Workspace Management Ltd v YJL London Ltd 58 the situation was slightly different because 9.42
there was an arbitration award in the claimant’s favour of £85,000. The defendant paid
£28,856.66 in respect of the award, but retained the sum of £56,143.34, on the basis that
there was a subsequent adjudicator’s decision in its favour, which permitted it to set off that
sum. The TCC judge rejected the argument that, because the arbitration award was finally
binding, whilst the adjudicator’s decision was, at most, temporarily binding, the arbitral
award somehow trumped the adjudicator’s decision and prevented set-off. He said that both
decisions were, as at the date of the hearing, binding on the other side and thus neither had
a greater status than the other. The judge concluded that, looking at the case in the round,
it would be artificial to allow the claimant to ring-fence the award simply because it could
not be the subject of potential challenge, in circumstances where the parties were conduct-
ing simultaneous arbitration and adjudication proceedings. Further and in any event, it
was the claimant who had chosen to commence the separate adjudication proceedings, in
which they were ultimately unsuccessful. The judge observed that the claimant could not
now ask the court to ignore the outcome of those proceedings merely because the result was
not to its liking.
Summary
An employer cannot defeat a main contractor’s claim, and a main contractor cannot 9.43
defeat a sub-contractor’s claim, by reference to a late and/or unparticularised set-off and
counterclaim. A proper set-off and counterclaim must be the subject of a withholding notice
and, if there is no such notice, or it is inadequate, the referring party will recover in full in
the adjudication. If the sum claimed has been certified, then the absence of a withholding
notice will be fatal even to claims for abatement, or allegations that, for whatever reason, the
certified sum should not be paid. If, on the other hand, the amount has not been certified,
then a withholding notice is not necessary in order to permit the paying party to scrutinise
the invoice or interim payment application and to challenge aspects of it pursuant to the
contract. A withholding notice will, however, still be necessary to allow the responding party
to raise cross-claims for delay, defects and the like.
56 [2009] EWHC 2312 (TCC); [2009] 50 EG 68.

57 Edwards v Hope [1885] 14 QBD 922 at 926 and Reid v Cupper [1915] 2 KB 147.
58 [2009] EWHC 2017 (TCC); [2009] BLR 497.
291
9.44 Generally it is not possible to set off cross-claims against the sum that is the subject of an
adjudicator’s decision. To do so would deprive the 1996 Act of much of its purpose. It will
only be possible for a losing party to set off a cross-claim against an adjudicator’s decision in
circumstances where the contract terms (relating either to set-off or compliance with the
adjudicator’s decision) clearly permit such a result, or where the adjudicator’s decision does
not have an immediate effect (where, for example, it is declaratory in nature), thereby allow-
ing the provision of a timeous withholding notice after the completion and communication
of the adjudicator’s decision.
292
10
COSTS AND FEES
Costs 10.01 The Adjudicator’s Fees 10.14

The 2009 Act 10.01 Lien 10.24
The Usual Position 10.02
Ad Hoc Jurisdiction to Decide Costs 10.06
Particular Contract Provisions 10.08
A statutorily compliant private agreement in a construction contract for adjudication

could sensibly provide that each party should bear their own legal costs and expenses . . .
It is, however, commonplace that some construction contract adjudications are fiercely
adversarial and expensive. It is commercially unsurprising if some parties, by adopting
a standard form amendment to a standard form, give the adjudicator a jurisdiction to
direct the payment of legal costs.
May LJ in John Roberts Architects Ltd v Parkcare Homes (No 2) Ltd 1
Costs
The 2009 Act
As set out in Chapter 4 above, the 2009 Act introduces potentially major changes to the 10.01
adjudicator’s ability to deal with questions of costs. Those provisions are analysed in para-
graphs 4.12–4.15 above. They are not yet in force. Thus the remaining part of this section
addresses the currently applicable law.

The Usual Position
Although s108 of the 1996 Act sets out the parties’ right to refer disputes to adjudication, and 10.02
contains a number of specific provisions relating to the adjudicator’s role and function, it says
nothing about the adjudicator’s power to make orders as to the payment of either side’s costs at
the conclusion of the adjudication. The Scheme for Construction Contracts contains detailed
provisions relating to the payment of the adjudicator’s fees,2 but again contains no express
power entitling an adjudicator to order one party to pay some or all of the other party’s costs.
In Northern Developments (Cumbria) Ltd v J&J Nichol 3 HHJ Bowsher QC pointed to 10.03
paragraph 25 of the Scheme, which gave the adjudicator power to apportion liability for the
1
[2006] EWCA Civ 64.; [2006] 1 CLC 333
2 This is discussed in greater detail in paragraphs 10.14–10.23.
3 [2000] BLR 158.
293
payment of his fees as between the parties, and went on to note that nowhere in the 1996 Act
or the Scheme was the adjudicator given any similar power to order one party to the adjudication
to pay some or all of the costs of the other. He concluded therefore that, generally, an
adjudicator had no jurisdiction to decide that one party’s costs of the adjudication should be
paid by the other party. Unless and until this point is taken to a higher court, the general
statement of the law in Northern Developments appears to provide a clear answer to this
perennial question.4
10.04 This result can create considerable hardship to the ultimately successful party. Many adjudi-
cations involve a whole raft of complex issues and can require a team of lawyers and experts,
working flat out, to deal with the numerous points that have arisen within the tight timetable
of an adjudication. In litigation or arbitration, the responding party, if it defeats the claims
brought against it, would normally be entitled to a costs order in its favour. However, in
adjudication, where the costs can often be significant, no such order can be made. Take by
way of example the situation where, three years after the event, an employer claims £10
million against the main contractor, for wrongful determination, defects and delay. Assume,
after an intense 42-day adjudication, with the main contractor’s team working round the
clock to prepare a defence on all the detailed points raised, the determination and the defects
claim fail, and the delay claim is successful to only a small degree. If that dispute had been
fought in litigation or arbitration, the main contractor may well have been entitled to most
of its costs on an issue-based approach.5 However, since the dispute had been referred to
adjudication, the main contractor would not be able to recover any of its costs.
10.05 These difficulties explain why there have been a number of ingenious attempts by the success-
ful party in adjudication to recover costs from the other side. Thus, in Total M&E Services
Ltd v ABB Building Technologies Ltd 6 the successful party argued that their costs were recover-
able as damages. The argument was that, if a responding party failed to pay sums due under
the contract, it was foreseeable that the referring party would seek to refer the dispute to
adjudication and properly incur costs in consequence, and thereafter seek to recover those
costs from the responding party. HHJ Wilcox rejected this argument. He said that, since the
1996 Act did not provide for the recovery of costs, a claim that sought to categorise those costs
as damages was misconceived. He also said that, because the Scheme envisaged that each
party might refer a dispute to adjudication, and incur costs that they knew that they could
not recover under the Act, it followed that such costs could not be recoverable as damages
for breach of contract.
Ad Hoc Jurisdiction to Decide Costs

10.06 It is, of course, entirely possible for the parties to agree (either by reference to their contract
terms, or in some other way) to give the adjudicator the express power to determine costs and
award them against one of the parties. This was precisely what happened in Northern
Developments v J&J Nichol.7 In that case, having found that the adjudicator had no general
right to order one party to pay the costs of the other, HHJ Bowsher QC went on to find, that
4
The decision in Northern Developments was expressly approved by Edwards-Stuart J in Yuanda (UK) Ltd v
WW Gear Construction Ltd [2010] EWHC 720 (TCC); [2010] 1 CLC 491, at paragraph 42.
5
See, for example, Summit Property Ltd v Pitmans [2001] EWCA Civ 2020; [2002] CPLR 97 and Fulham
Leisure Holdings Ltd v Nicholson Graham & Jones [2008] EWCA Civ 84; [2008] PNLR 22.
6 [2002] CILL 1857.
7 [2000] BLR 158.
294
Costs and Fees
on the facts of that particular case, the adjudicator had been granted such jurisdiction by
implied agreement of the parties. The judge observed that one party was represented by
experienced solicitors and the other by experienced claims consultants. Each party asked in
writing for their respective costs. Neither submitted to the adjudicator that he had no juris-
diction to award such costs. As a consequence, he concluded8 that the parties had enlarged
the jurisdiction of the adjudicator and given him the power to make an order requiring one
party to pay the costs of the other party.9
It is thought that it is in this context that the decision of HHJ Marshall Evans QC in John 10.07
Cothliff Ltd v Allen Build (North West) Ltd 10 should be seen. On one view of the judgment in
that case, the judge appeared to indicate that an adjudicator had a general power to award
costs. However, it is suggested that, on a proper analysis, Judge Evans was simply concluding
that the adjudicator had such a power at least where, as in that case, costs had been expressly
sought in the application before the adjudicator, and where both sides had been properly
represented. In other words, his reasoning was very similar to that of Judge Bowsher in
Northern Developments.11 Both cases illustrate the dangers of one party expressly seeking
their costs in the adjudication; if they do so, there is at least the risk that this will begin a
process that will ultimately allow the adjudicator to decide, in an appropriate case (say, where
all the claims have failed), to award costs against the referring party or (where all or most of
the claims have been successful) to award costs against the responding party.
Particular Contract Provisions
Some forms of contract (whether in a standard form or bespoke), and some adjudication 10.08
rules, also provide expressly that the adjudicator can make costs orders against one (or both)
of the parties. An early example of such a contract was discussed in Bridgeway Construction Ltd v
Tolent Construction Ltd,12 which required the party serving the notice of adjudication to bear
all the costs and expenses incurred by both parties in relation to the adjudication, including
but not limited to, all the legal costs and the experts’ fees. HHJ MacKay QC upheld the terms
of the contract, observing that contracting parties could contract how they liked and, if the
result was legally unsatisfactory, the disappointed party could not come to court and seek a
declaration that the terms were void. Although the suggestion was that those particular terms
would inhibit a party from pursuing adjudication remedies, and that therefore the clauses
should be declared void as a matter of policy, the judge concluded that the provisions were not
contrary to the 1996 Act and they could not be unfair because they applied to both parties.
The editors of CILL, when reporting Bridgeway, described the case as a good example of the 10.09
situation ‘where through the use of contract drafting a party has drafted compliant adjudication
8 The relevant part of his judgment is set out verbatim at paragraph 3.92.
9
It should be noted that, in John Roberts Architects Ltd v Parkcare Homes (No 2) Ltd [2006] EWCA Civ 64;
[2006] 1 CLC 333, May LJ noted that, although both parties were seeking costs from the other, Roberts were
not relying on a similar submission to the one that found favour in Northern Developments. He said that they
were ‘correct to refrain from doing so’, because that was a decision under the Scheme, which contained no provi-
sion as to costs at all, whilst in Roberts the contract provided expressly that the adjudicator could make orders as
to the costs of the adjudication.
10 [1999] CILL 1530.
11 For another case in which a Judge has expressly followed the reasoning of Judge Bowsher in Northern
Developments, see the judgment of Judge Wilcox in Nolan Davis Ltd v Stephen P Catton (2000) unreported TCC
No 590.
12
[2000] CILL 1662.
295
provisions which would clearly discourage a party from exercising its right to refer disputes
to adjudication’. In the subsequent case of Yuanda (UK) Co Ltd v WW Gear Construction
Ltd 13 Edwards-Stuart J commented that the editors had missed the point and that, if the
effect of the contract drafting was to discourage a party from exercising its right to refer disputes
to adjudication, it raised the question as to whether the provision in question was contrary
to the requirements of the 1996 Act. In Yuanda, the judge carefully considered a clause
similar to that in Bridgeway, and found that it was indeed contrary to the purposes of the Act.
He pointed out that, if the contractor obtained a decision in his favour, the employer would
be able to deduct his legal and professional costs from the sums otherwise due, thereby
depriving the contractor of his remedy, at least up to the amount of the employer’s costs. He
concluded that the clause in that contract would, in practice, limit Yuanda’s freedom to refer
a dispute to adjudication at any time and, in circumstances involving a claim for a relatively
small sum of money, to deprive it of a remedy altogether. He went on to conclude that,
because the contractual provision was not compliant, the adjudication provisions in Part 1
of the Scheme were brought in ‘lock, stock and barrel’.
10.10 Another example of a case in which the particular adjudication rules that had been adopted
gave the adjudicator the power to order costs is the Scottish case of Deko Scotland Ltd v
Edinburgh Royal Joint Venture.14 That was a case under the ORSA Adjudication Rules15 of
1998 which, in Scotland, gave adjudicators the power to make awards of ‘expenses’, which is
the equivalent term for costs. There was no dispute that, pursuant to that contract, the adju-
dicator had the power to order such costs/expenses to be paid; the argument concerned when
such costs fell to be assessed and what they included. Lord Drummond Young held that the
sums had to be taxed before they could be recovered in litigation. Moreover, he said that the
award of expenses in adjudication should normally be confined to judicial expenses (ie legal
costs), and therefore excluded internal costs and the fees paid to claims consultants and
surveyors.
10.11 In John Roberts Architects Ltd v Parkcare Homes (No 2) Ltd 16 Parkcare employed Roberts to
act as architects. Twice, Parkcare exercised its right to refer disputes to adjudication, but each
time they abandoned the reference before the decision had been provided. Roberts brought
proceedings to recover their costs of these abortive adjudications, their position apparently
strengthened by the fact that, pursuant to the particular contract under which they were
engaged, the adjudicator had a specific power to order legal costs and, at the time of the
second abandonment, he had ordered Parkcare to pay Roberts’ costs. However, at first
instance the claim was rejected. HHJ Havery QC said that Parkcare had done no more than
electing to treat the adjudicator as having jurisdiction in accordance with the terms of the
contract, and that there was no term, express or implied, by which the adjudicator had
power to award costs in the event of discontinuance of the adjudication. He said that any
such power was only exercisable as part of a substantive decision. Furthermore, he said, there
was no express or implied term of which a party would be in breach if it invoked the
adjudication procedure in circumstances where there was no dispute properly referable to
adjudication.
13
[2010] EWHC 720 (TCC); [2010] 1 CLC 491.
14 [2003] SLT 727.
15 Now the TeCSA Rules. See paragraphs 5.77–5.86.
16 [2005] EWHC 1637 (TCC); [2005] All ER (D) 341 (Jul).
296
Costs and Fees
This decision was overturned in the Court of Appeal.17 May LJ noted that rule 29 of the CIC 10.12
Model Adjudication Procedure provided that the parties should bear their own costs and
expenses incurred in adjudication, but that, in this case, the rule had been deleted by Clause 9.2
of the RIBA Standard Conditions and replaced with a provision that allowed the adjudicator
to direct the payment of legal costs and expenses of one party by another as part of his decision.
This was a clear power which entitled the adjudicator to award costs. The argument on appeal
was therefore whether that power was limited to circumstances in which the adjudicator
produced a substantive decision on the dispute referred to him following a contested adjudi-
cation. May LJ said that it would be very odd indeed if, by their agreement, the parties had
given the adjudicator power to direct the payment of legal costs (which could be substantial)
only if he went on to make a substantive contested decision. He pointed out that such a con-
clusion would mean that either party, having generated legal costs by referring an unmerito-
rious claim to adjudication, or by responding to a claim with an unmeritorious defence,
could throw their hand in at the eleventh hour without being at risk of paying the legal costs
that their conduct had generated. He therefore concluded that the judge had been persuaded
to adopt the wrong construction of Clause 9.2, and he allowed the appeal.
It should be noted that, irrespective of the subsequent costs position, it was implicitly 10.13
accepted by the Court of Appeal in Roberts that a party to adjudication could, if they so
chose, withdraw/discontinue any claim that they had brought in adjudication proceedings.
This was also the result in Midland Expressway Ltd & Anor v Carillion Construction Ltd & Ors
(No 3).18 There, the claimants argued that the defendants, Carillion, were not entitled to
withdraw a claim they had made in adjudication. Jackson J reached the unsurprising conclu-
sion that it was impossible to read into either the 1996 Act or the Scheme any restriction
prohibiting a party from withdrawing a disputed claim once it had been referred to adjudica-
tion. Any other result would have had the bizarre consequence that the referring party would
have been forced to press on with a bad claim, which would have led to extensive wasted costs
and resources, with no option but to pursue to inevitable defeat. Of course, under a contract
that expressly allows the adjudicator to award legal costs against one of the parties, the party
who discontinues a claim can expect to be faced with the submission that they should pay all
the costs of that discontinued claim. But in the ordinary case, where the adjudicator has no
power to make such costs orders, it does mean that a referring party in adjudication is entitled
to discontinue a claim at the eleventh hour and avoid any of the usual cost consequences of
such conduct.
The Adjudicator’s Fees

In contrast to the position in respect of costs, the Scheme for Construction Contracts contains 10.14
a number of provisions relating to the adjudicator’s fees. If the adjudication is not effective,
paragraph 9(4) of the Scheme makes the parties liable for the adjudicator’s fees and expenses
in circumstances where the adjudicator resigns because the dispute is the same (or substan-
tially the same) as one that has previously been referred to adjudication, or where the dispute
as it emerges during the adjudication varies significantly from the dispute that was originally
referred to him in the notice of adjudication, and he is not competent to decide it. More
17 [2006] EWCA Civ 64; [2006] 1 CLC 333.

18 [2006] EWHC 1505 (TCC); [2006] BLR 325.
297
widely, paragraph 25 of the Scheme expressly entitles the adjudicator to the payment of such
reasonable amount as he may determine by way of fees and expenses reasonably incurred by
him. It also expressly provides that the parties shall be jointly and severally liable for any sum
by way of fees that remained outstanding following the making of any determination on how
the payment shall be apportioned.
10.15 In practice, adjudicators will often order that each side pay half his fees. Usually, the parties
are jointly and severally liable for those fees. Thus the winner can be held liable to the adju-
dicator to pay all his fees, and then recover 50 percent from the loser: see Donal Pugh v Harris
Calnan Construction Ltd.19 However, in a case where the adjudicator has found wholly or
mainly in favour of one party, then it is not uncommon for the adjudicator to order that the
successful party can recover his half of the fees from the unsuccessful party. Such an order is
perfectly legitimate, and is one way in which the adjudicator, without the general power to
make one side pay the other’s costs, can maintain a broadly just and fair balance between the
parties, in order to reflect the ultimate outcome of the adjudication. In addition, an adjudi-
cator’s decision as to liability to pay fees is final and is not subject to challenge in subsequent
arbitration/litigation: see Castle Inns (Stirling) Ltd v Clark Contracts Ltd.20
10.16 The most significant decision on this topic is that of Ramsey J in Linnett v Halliwells LLP.21
The judge carefully analysed the nature of the relationship between the parties and the
adjudicator, and at paragraph 34 of his judgment, noted that the ability of an adjudicator to
obtain fees depended on there being a contractual right to payment under his agreement
with one or both of the parties. There was nothing in s108 of the 1996 Act that gave the
adjudicator a right to payment. Moreover, the contractual right to payment did not arise
under, and was not affected by, the terms of the decision by which the adjudicator decided
which party was to pay his fees and expenses. That decision determined who, as between the
parties, was to bear those sums, but it did not affect any contractual right to payment that the
adjudicator may have, and it did not provide a right to payment if the adjudicator had no
underlying contractual right. In circumstances where there was no jurisdictional challenge,
the judge concluded
(a) Where one party agreed the adjudicator’s terms but the other did not, then the adjudicator
could enforce those terms against the party with whom he has a contract;
(b) If an adjudicator was appointed and neither party made a contract with the adjudicator,
then both parties, by participating in the adjudication and thereby requesting the
adjudicator to act, entered into a contract with the adjudicator, who acted in that capacity
as a result of that request. A contract would be formed by conduct and there would be
implied terms that the parties would be jointly and severally liable to pay his reasonable
fees and expenses.
(c) In principle, the same situation would apply where one party made a contract with the
adjudicator but the other did not. The party who had not made an express contract, but
who participated in the adjudication, thereby requested the adjudicator to act, such that
there was a contract, made by conduct, between that party and the adjudicator. The same
terms as to reasonable remuneration would be implied.
10.17 Although the Scheme deals with the position where an adjudicator resigns because the dispute
has already been decided in an earlier adjudication, it does not deal with the position where
19 [2003] CLDC 30.6.03.

20 [2005] Scot CS CSOH 178.
21 [2009] EWHC 319 (TCC); [2009] BLR 312.
298
Costs and Fees
the adjudicator resigns because he has no jurisdiction generally. However, by analogy with
paragraph 9(4) it is suggested that an adjudicator is entitled to the fees incurred up to his resig-
nation on the grounds of an absence of jurisdiction. The Scheme provides further support
for this approach: in paragraph 11(1) the adjudicator is entitled to his fees if his appointment
is revoked by agreement between the parties. The only exception to that, as stated in paragraph
11(2), is where the appointment is revoked due to the default or misconduct of the adjudicator.
Thus, in Paul Jenson Ltd v Staveley Industries Plc,22 the adjudicator resigned because he did
not have jurisdiction. The district judge rightly said that whether or not the adjudicator was
right or wrong in arriving at this conclusion was irrelevant. On the adjudicator’s claim for
fees, the district judge held that, since there was no suggestion of any fault or misconduct on
his part, the adjudicator was entitled to the fees incurred up to his resignation.
What happens when an adjudicator produces a decision in good faith, but it then becomes 10.18
apparent that he did not, after all, have the necessary jurisdiction to reach that decision?
In Griffin & Anor (t/a K&D Contractors) v Midas Homes Ltd 23 HHJ Lloyd QC ruled that
the adjudicator had the jurisdiction to reach part of his decision, but not jurisdiction as to the
remainder. Judge Lloyd then had to deal with the parties’ respective liabilities for the fees
incurred by the adjudicator in respect of that part of the decision for which he had no juris-
diction. There was apparently no question but that the adjudicator would recover that
element of his fees: the only issue was who should pay them. He concluded that the defen-
dant could not be liable for those fees, because the defendant had not caused the reference to
the adjudicator of matters in respect of which he had no jurisdiction. The judge said that only
the party who had originally sought adjudication could be liable for the fees, expenses and
costs that had been incurred as a consequence of their request for a decision that the adjudicator
had no authority to make. Because the referring party was not entitled under the contract to
refer one part of the claim, and was therefore in breach of contract in so doing, that party was
liable for that element of the adjudicator’s fees. A slightly different result was apparently
reached in the Scottish case of Prentice Island Ltd v Castle Contracting Ltd.24 The adjudicator
required payment by the defendants to the pursuers of the sum of £1,922.70, being one half
of the adjudicator’s total fees and VAT in respect of the adjudication. The judge concluded
that, for entirely separate reasons, the adjudicator had, in good faith, fallen into error and
continued to act in circumstances in which he ought to have resigned. Nevertheless, it was
held that the adjudicator remained in post as a validly appointed adjudicator, and was
therefore entitled to be paid his fees, half by each side. The point was not apparently taken
that the defenders should not be made liable for their half of the adjudicator’s fees, because
it was the pursuers who had commenced the adjudication. In addition, it does not seem that the
argument was run that, in accordance with Griffin, to the extent that fees were incurred in
dealing with a claim in respect of which the adjudicator had no jurisdiction, it could only be
the pursuers who were liable for those costs. Griffin, although a reported case, was not appar-
ently cited to the court in Prentice Island. It is submitted that, for these reasons, the latter is a
decision that needs to be treated with some caution.
In Linnett, already referred to above, Ramsey J also dealt with the contractual position 10.19
between the parties and the adjudicator where there was a jurisdictional challenge. Ramsey J
22 27 September 2001, Wigan County Court, District Judge Donnelly.

23 [2000] 78 Con LR 152.
24 [2003] Judgment of Sheriff Principal R A Dunlop QC, unreported.
299
said that a party who wished to raise a jurisdictional argument had two options. First, it
could make an assertion of lack of jurisdiction and withdraw, taking no further part in the
adjudication proceedings. In those circumstances, in the absence of an agreement with
the adjudicator, there would be no request for the adjudicator to do anything and it would
be very difficult to make that party liable for the fees and expenses of the adjudicator.
Secondly, the party with the jurisdictional challenge could raise the challenge and then con-
tinue to participate in the proceedings. By participating in the proceedings, that party was
not giving the adjudicator jurisdiction to make a binding decision, but was seeking a decision
on jurisdiction that might provide it with a benefit. Therefore, in principle, by participating
and requesting the adjudicator to adjudicate on the dispute, that party will generally be liable
for the reasonable fees and expenses of the adjudicator. The fact that a party makes a jurisdictional
challenge should not in itself affect its liability to pay the adjudicator’s fees if that party
participates in the adjudication proceedings.
10.20 On the facts in Linnett, the judge found that the adjudicator proceeded in compliance with
requests from both sides. On the basis of the principles that he had earlier outlined in his
judgement, the judge therefore concluded that both sides were jointly and severally liable to
pay his fees. The mere fact that Halliwells raised a jurisdictional objection was nothing to the
point. Although the judge concluded that, on the facts, the adjudicator did have the necessary
jurisdiction, he found that, because of their active participation in the adjudication, Halliwells
were liable for his fees, even if the adjudicator had not had jurisdiction.
10.21 Pursuant to s108(4) of the 1996 Act, it is stipulated that the contract must provide that the
adjudicator is not liable for anything done or omitted in the discharge or purported dis-
charge of his functions as adjudicator, unless the act or omission is in bad faith. This provision
finds expression in paragraph 26 of the Scheme for Construction Contracts, which repeats
exactly the words of s108(4). Similar provisions are included in the standard forms of contract.
An interesting question therefore arises as to whether this provision provides an immunity
from a claim by one or both of the parties that the adjudicator’s claimed hours and/or remu-
neration are unreasonable. The better view would appear to be that, if the adjudicator has
determined his fees and expenses, it may well not be possible (at least in the ordinary case)
for the parties, even if they consider that they have a genuine complaint about the extent of
those fees, to seek to open up or review the adjudicator’s fee claim. In Stubbs Rich Architects v
WH Tolley & Son Ltd 25 the adjudicator relied on the immunity to protect himself from the
attack made by one of the parties on the scope and scale of his fees. The court concluded that
the fees could be challenged if, and only if, the adjudicator had acted in bad faith, and it was
not suggested that he had done so. It was also said that there was no statutory regime which
could allow the re-examination of the adjudicator’s fees and that the immunity therefore
applied. In the same case, the judge also criticised the finding in the court below that the fees
were excessive, saying that a court must be very slow indeed to substitute its own view of what
constitutes reasonable hours for that reached by the adjudicator.
10.22 Of course, that is not to say that an adjudicator is entitled to his fees, regardless of conduct.
In Dr Peter Rankilor v Perco Engineering Services Ltd and Another,26 the TCC judge concluded
that the decision was not in breach of natural justice. However, he went on to observe that it
25 8 August 2001, Gloucester County Court, decision of Recorder Lane QC.

26 27 January 2006, a decision of HHJ Gilliland QC, sitting in the TCC in Salford.
300
Costs and Fees
was ‘a surprising submission that if an adjudicator’s decision had been reached in serious
breach of the rules of natural justice and thus would not be enforced by the court, that the
adjudicator should nevertheless be entitled to claim payment for producing what was in fact
a worthless decision without even any temporary binding legal effect’.
A related point as to entitlement to fees might arise if the adjudicator fails to produce his 10.23
decision in the 28 days (or the agreed extended period). In such circumstances, it might be
extremely difficult for the adjudicator to argue that he was entitled to be paid fees when his
failure to produce the decision in time had led to the production of a decision that was in law
a nullity. It may be that in such circumstances, the court would find that there had been a
complete failure of consideration, and the adjudicator was not entitled to any fees at all.
Furthermore, in such circumstances, an immunity couched in standard terms might be of
little assistance to the adjudicator. In Cubitt Building & Interiors Ltd v Fleetglade Ltd 27 the
TCC judge concluded that the decision had been completed and communicated in time.
However, at paragraph 91 of his judgment, he pointed out that, if he had reached the opposite
conclusion, the indemnity in respect of anything done in the discharge of the adjudicator’s
functions would not have protected him, because the adjudicator’s failure to complete the
decision within the agreed period would have represented a complete failure on his part to
discharge those functions at all.
Lien
There can be no doubt that the speed of the adjudication process means that, in a usual case, 10.24
the adjudicator will provide his decision to the parties at a time when he has recovered either
none, or a small amount on account, of his fees. Thereafter, it appears that the parties can be
slow to pay the outstanding fees and this can cause real hardship for adjudicators. There are
a number of reported cases in which adjudicators have been put through all manner of
procedural hoops by parties seeking to avoid payment of their fees. A good example of this
unfortunate process is Faithful & Gould Ltd v Arcal Ltd (In Administrative Receivership) &
Ors.28 There, the first defendant was in administrative receivership and the claim was pursued
against the second and third defendants who were the receivers, and employees or partners
of Deloitte & Touche. The adjudicator had to issue proceedings for his fees, despite the fact
that the defendants had expressly assured him that they would pay his fees before he embarked
on the adjudication. The judge was moved to remark that the defendants had sought to
mount ‘practically every obstacle to this claim that human ingenuity could devise’. They did
so without providing any statement of truth to the court. He rejected all the various points
that were taken in opposition to the claim and expressed his surprise and disappointment
that Deloitte & Touche should have conducted themselves in such a way.29
In order to try and get round these difficulties in the collection of their fees, adjudicators 10.25
have in the past sought to exercise a lien on those fees, saying that they will not release their
decision until their fees have been paid in full. In arbitration, of course, where there is no
27
[2006] EWHC 3413 (TCC); [2006] 110 Con LR 36.
28
Unreported, TCC, Newcastle District Registry, No E190023.
29 Another example of this trend is Cartwright v Fay, 9 February 2005, Bath County Court. That was
another case in which every conceivable point was taken (again unsuccessfully) in opposition to the fees claimed
by the adjudicator.
301
statutory deadline, this is a common occurrence. In adjudication, the courts have indicated
firmly that, because of the emphasis on speed in adjudication above all things, the purported
exercise of a lien will not be permitted.
10.26 The first case in which this point was decided was St Andrews Bay Development Ltd v HBG
Management Ltd.30 In that case the adjudicator failed to produce a decision within the time
limits but, because the delay was only two days, Lord Wheatley regarded the failure as a tech-
nical matter rather than a fundamental error or impropriety eviscerating her entire decision.31
It appears from the report that at least part of the delay in the communication of the decision
arose from the adjudicator’s insistence that her fees be paid. At paragraph 19 of his judgment,
Lord Wheatley said that she had no entitlement to act in this way. He said there was nothing
in the Scheme or the contract that allowed it. Whilst an adjudicator could come to a separate
arrangement with the parties concerning the payment of her fees, it was not permissible for
such an arrangement to frustrate or impede the progress of the statutory arrangement
(adjudication) for resolving the contractual disputes. Any arrangement between the parties
and the adjudicator had to be accommodated within the statutory or contractual time limits.
The payment of the adjudicator’s fees could not be allowed to impede the statutory process or
justify a failure to observe its requirements.
10.27 In Cubitt Building & Interiors Ltd v Fleetglade Ltd 32 the adjudicator’s terms of appointment
stated expressly that a lien might be exercised over the publication of the decision until
receipt of payment by either party. The TCC judge thought that such an open-ended extension
of the statutory period was contrary to the whole principle of adjudication as described in the
1996 Act. He referred to St Andrews Bay and concluded that the adjudicator was not entitled
to exercise a lien in relation to the decision, either as a matter of contract or as a matter of law.
The overriding obligation on the part of the adjudicator was to complete and communicate
the decision within the 28 days or the extended period agreed by both parties. A potential
lien was contrary to that overriding obligation.
10.28 Similar reasoning (albeit on a slightly different point) can be found in the decision of HHJ
Havery QC in Epping Electrical Company Limited v Briggs and Forrester (Plumbing Services)
Limited.33 The judge found that the 28-day period in the 1996 Act was mandatory and that
a contractual provision that suggested otherwise did not comply with the Act. Thus the decision
was a nullity. In addition, it appeared that there was a further delay between completion and
communication of the decision, brought about by the exercise of a purported lien by the
adjudicator, which was subsequently withdrawn. And a similar point arose in Mott MacDonald
Ltd v London & Regional Properties Ltd 34 where, at paragraphs 75–78 of his judgment, HHJ
Thornton QC held that the lien that the adjudicator imposed and implemented was con-
trary to paragraphs 12(a) and 19(3) of the Scheme. On the facts of that case, the judge also
30 [2003] SLT 740.

31 This decision has to be read in the light of the later decisions in Ritchie (PWC) Ltd v Philip [2005]
SLDT341, a decision in which Lord Wheatley gave the dissenting judgment; Hart Investments Ltd v Fidler and
Another [2006] EWHC 2857 (TCC); Cubitt Building & Interiors Ltd v Fleetglade Ltd [2006] EWHC 3413
(TCC); [2006] 110 Con LR 36; Aveat Heating Limited v Jerram Falkus Construction Limited [2007] EWHC
131 (TCC)); [2007] TCLR 3; and AC Yule & Son Ltd v Speedwell Roofing & Cladding Limited [2007] EWHC
1360 (TCC); [2007] BLR 499.
32 [2006] EWHC 3413 (TCC); [2006] 110 Con LR 36.
33 [2007] EWHC 4 (TCC); [2007] BLR 126.
34 [2007] EWHC 1055 (TCC); [2007] 113 Con LR 33.
302
Costs and Fees
found that the adjudicator appeared to lack impartiality, because he had made it a condition
of his appointment that his fees would first have to be paid by the referring party before he
delivered his decision to the parties, and then by appearing to enforce that pre-condition.
The judge said, at paragraph 77 of his judgment, that the adjudicator may not be, or appear to
be, financially beholden to one party, particularly the referring party, or place himself in the
position in which he might appear to be more partial to one side than the other.
For the reasons set out above, it seems safe to assume that an adjudicator has no power to 10.29
exercise a lien over his outstanding fees, if to do so would result in any delay to the completion
or communication of the decision. It is recognised that, in consequence, the payment of their
fees will remain a problem area for adjudicators but, in the light of the critical emphasis on
speed in the 1996 Act, there is little that can obviously be done to alleviate these commercial
difficulties.
303
Part IV
NATURAL JUSTICE
11. General Principles 307

12. Bias 321
13. A Fair Hearing 331
11
GENERAL PRINCIPLES
Introduction 11.01 The Right to a Fair Hearing 11.23

A Brief History 11.04 The Importance of Procedure 11.23
Real Prejudice 11.25
Bias 11.09
The Need for a Hearing 11.27
Automatic Disqualification 11.10
The Right to Know the Opposing Case 11.30
Apparent Bias 11.11
Procedure at an Oral Hearing 11.34
Particular Matters that May Lead to
The Giving of Reasons 11.37
a Finding of Bias 11.14
Considering the Process as a Whole 11.39
Matters that Will Not Lead to a
Finding of Bias 11.20
My Lords, the so-called rules of natural justice are not engraved on tablets of stone. To
use the phrase which better expresses the underlying concept, what the requirements
of fairness demand when any body, domestic, administrative or judicial, has to make
a decision which would affect the rights of individuals depends on the character of the
decision-making body, the kind of decision it has to make and the statutory or other
framework in which it operates. In particular, it is well-established that when a statute
has conferred on any body the power to make decisions affecting individuals, the court
will not only require the procedure prescribed by the statute to be followed, but will
readily imply so much and no more to be introduced by way of additional procedural
safeguards as will ensure the attainment of fairness.
Lord Bridge of Harwich in Lloyd v McMahon1
Introduction
Over the last decade, it has become increasingly common for the losing party in an adjudication 11.01
to endeavour to avoid the consequences of the adjudicator’s decision by claiming that the
decision was reached in breach of the rules of natural justice. Often, the complaints relied on
will have first arisen during the adjudication itself, and the adjudicator may have found
himself struggling to come to terms with a number of unfamiliar procedural rules, which
have their history in administrative law, and can sometimes be extremely difficult to
shoehorn into the constrained timetable of an adjudication. A number of adjudicators have
grumbled that, when they seek further explanation of the breach of natural justice that it is
alleged that they are about to commit, the parties’ representatives take refuge in Latin tags,2
1
[1987] AC 625 at 702.
2
For those who delight in this sort of thing, the two rules of natural justice may be translated thus: nemo
judex in re sua (‘No man a judge in his own cause’); and audi alteram partem (‘Hear the other side’).
307
Natural Justice
or very generalised definitions, such as the description of natural justice as being ‘after
all . . . only fair play in action’.3
11.02 For these reasons, it seemed appropriate for the second edition of this book to expand its
original chapter on fairness into a fuller study of the rules of natural justice generally, and
how they relate to (and are to be applied in) the particular process of construction adjudi-
cation. Thus the present chapter sets out a brief history of the development of the rules of
natural justice in the English common law, and then goes on to identify particular points of
principle arising from allegations of bias and the right to a fair hearing. The following two
chapters deal, respectively, with bias and a fair hearing by reference to construction adjudi-
cation specifically, and endeavour to identify the numerous authorities on those topics.
11.03 However, before embarking on a consideration of the detail, it is important to emphasise the
importance of natural justice, and its common equation with ‘fairness’, in the process of
decision-making. The common law recognises two fundamental rules required by a fair
procedure: that a man may not be a judge in his own cause, and that a man’s defence must
always be fairly heard. If a decision offends against either of those rules, it is outside the
jurisdiction of the decision-making authority.4 In Fairmount Investments Ltd v Secretary of
State for the Environment 5 Lord Russell said that, when construing the statutory powers of a
decision-making body, unless the contrary appeared in the relevant statute, it was to be
implied that the exercise of power in breach of the principles of natural justice had not been
authorised. Similarly, in O’Reilly v Mackman,6 Lord Diplock said that the right of a man to
be given a fair opportunity of hearing what was alleged against him, and then presenting his
own case in his defence, was so fundamental to any civilised legal system that it was to be
presumed that Parliament intended that a failure to observe that rule should render ‘null and
void’ any decision reached in breach of that requirement.
A Brief History
11.04 The rules relating to natural justice have their origins in the courts’ control of the decisions
made by public authorities. They are at the heart of a code of fair procedure that is an essential
part of any system of administrative justice. Furthermore, in administrative law, procedure
is emphatically not a matter of secondary importance: as governmental powers continue to

grow, as one commentator has pointed out, it is only by procedural fairness that they are
rendered tolerable.7
11.05 The requirements that the decision-maker should be unbiased, and that both sides were
entitled to be heard before a decision was reached, formed the cornerstones of numerous
Victorian decisions concerned with the exercise of power by local and ecclesiastical authorities,
universities, societies, clubs and trade union committees. In many ways, the classic example
of the rules in action is Cooper v Wandsworth Board of Works.8 In that case, an Act of Parliament
3 Harman LJ in Ridge v Baldwin [1963] 1 QB 539 at 578.

4
Attorney General v Ryan [1980] AC 718.
5
[1976] 1WLR 1255–1263.
6
[1983] 2 AC 237 at 276.
7 See Wade’s Administrative Law (10th edn), 371.
8 (1863) 14 CB (NS) 180, subsequently approved by the House of Lords in Ridge v Baldwin [1964]
AC 40.
308
General Principles
provided that no-one could put up a building in London without giving proper notice and
that, if they sought to do so, the local board of works could have the building demolished.
A builder began erecting a house in Wandsworth without having given the requisite notice
and, when the building had reached the second floor, the board of works sent in their men
late in the evening to demolish the whole building. The builder was in breach of the Act and
the board of works had done precisely what they were permitted to do under the Act.
However, the court held that the board had no power to act without first asking the builder
what he had to say for himself. Erle CJ pointed out that, whilst it was impossible to see what
harm could arise from the board hearing the builder before they demolished his building, it
was possible to see a great many advantages arising out of the requirement that they hear
from the builder before they inflicted upon him ‘such a heavy loss’.
However, both before and after the Second World War, there was a retreat from this approach, 11.06
largely based on a division between decisions that were said to be ‘purely administrative’ and
those that might be described as ‘judicial or quasi-judicial’. The low point signified by this
approach was reached in Franklin v Minister of Town and Country Planning.9 In that case,
before he considered the inspector’s report into the desirability of designating Stevenage as
the first of the new towns under the New Towns Act 1946, the minister concerned attended
a public meeting in Stevenage and said to protesters that the designation was ‘going to be
done’. Although at first instance and in the Court of Appeal, it was held that the minister had
acted in breach of the rules of natural justice, because he had prejudged the decision he had
to make, the House of Lords reversed both and said that the minister was only obliged to
follow the statutory procedure and had no wider judicial or quasi-judicial duty.
The modern law relating to natural justice can be dated back to the decision of the House 11.07
of Lords Ridge v Baldwin,10 in which their Lordships decisively turned the tide back in
favour of the traditional approach to the rules of natural justice. There, the chief con-
stable of Brighton had been tried and acquitted on a criminal charge of conspiracy to
obstruct the course of justice, although during the trial the judge had commented
adversely on his leadership of his force. Thereafter, without giving any notice, or offering
any hearing to the chief constable, the Brighton Watch Committee unanimously dis-
missed him from office. Although, on his solicitor’s application, there was a hearing
before a later meeting of the Watch Committee, they confirmed their previous decision.
Although he failed both at first instance and in the Court of Appeal, the House of Lords
upheld the chief constable’s claim to a declaration that his dismissal was void because he
had been given no notice of any charge against him and had no opportunity of making
his defence. Lord Reid said:
In modern times, opinions have sometimes been expressed to the effect that natural justice
is so vague as to be practically meaningless. But I would regard these as tainted as the
perennial fallacy that because something cannot be cut and dried or nicely weighed or
measured, therefore it does not exist. The idea of negligence is equally insusceptible of
exact definition . . . and natural justice as it has been interpreted in the courts is much more
definite than that.11
9
[1948] AC 87.
10
[1964] AC 40.
11 As is often the way, legal academics were particularly critical of Lord Reid’s analysis when it was first
reported, although it is now regarded as obviously right. When he retired after 26 years in the House of Lords,
Lord Reid said that it was the decision that had given him the greatest satisfaction.
309
Natural Justice
11.08 Partly because the rules of natural justice are ill-defined, and partly because one man’s
robust application of common sense is another man’s breach of natural justice, the law
reports are littered with cases in which very eminent personages have failed to apply
those rules properly or at all. Thus, in Abraham v Jutsun,12 the Court of Appeal set aside an
order of the Divisional Court (which included the then Lord Chief Justice) requiring a
solicitor to pay costs, because they had made the order without hearing the solicitor’s
defence. Similarly, in R v Archbishop of Canterbury,13 the Archbishop dismissed the curate’s
appeal having considered only his written petition, and denying him an oral hearing. An order
requiring the Archbishop to hold an oral hearing was made by the court. Even Lord
Denning, the great upholder of the rules relating to natural justice, was not immune from
failing to practice what he preached; in Hadmor Productions Ltd v Hamilton,14 Lord Diplock
criticised Lord Denning for violating natural justice in the Court of Appeal when he relied
in a judgment on a speech in a debate in the House of Lords which had not been cited in
argument and which counsel had been given no opportunity to address. Although, in a
later case15 Lord Diplock appeared to take a less critical view of this event, it is respectfully
submitted that deciding a case on a point that was never raised in argument, and was not
even put to counsel for their consideration, is a classic example of a breach of the rule that
every man’s case should be heard. If a case is to be decided by reference to an authority of
which a party has no notice, that party has inevitably been prohibited from properly arguing
its case. This is an example of a failure with a particular application to adjudicators who have
decided something in their own way, or on the basis of their own researches, of which the
parties had no notice until the decision was issued.
Bias
11.09 It is thunderingly obvious that, in any fair system of decision-making, no man can judge
a dispute in which he has a personal interest. This may explain why reported cases in which
the decision-maker has a direct, let alone a pecuniary, interest in the outcome of the
decision are very rare. Instead, the vast majority of the reported cases are concerned, not
with actual bias, but with apparent bias. It is critical that ‘justice should not only be done,
but should manifestly and undoubtedly be seen to be done’.16 In that case, the conviction
by the magistrates of a motorist for dangerous driving was invalidated when it became
apparent that their clerk was, in his capacity as a solicitor, also acting for a third party suing
the same motorist for damage caused in the road accident. Although the magistrates had
not in fact consulted the clerk, and he had scrupulously refrained from saying anything
prejudicial, that was irrelevant. The question was whether he was so related to the case,
through his involvement in the civil litigation, that he was unfit to act as the clerk to the
justices in the criminal case. The answer to that question depended not upon what was
actually done, but what might appear to have been done. Lord Hewitt CJ said that ‘nothing
is to be done which creates even the suspicion that there has been an improper inference in
the course of justice’.
12
[1963] 1WLR 658.
13
[1859] 1 E & E 545.
14 [1983] 1 AC 191.
15 Mahon v Air New Zealand [1984] AC 808 at 838.
16 R v Sussex Justices ex parte McCarthy [1924] 1KB 256.
310
General Principles
Automatic Disqualification
A direct pecuniary interest will disqualify the decision-maker, no matter how small that 11.10
pecuniary interest might be.17 Indeed, the principle of automatic disqualification has been
extended beyond pecuniary or propriety interest; it has been applied where the judge or
decision-maker has a relevant interest in the subject matter of the litigation, even if he has no
financial stake in its outcome. Thus, in R v Bow Street Magistrates ex parte Pinochet,18 Lord
Hoffmann was an unpaid director and chairperson of the company that carried out the
charitable elements of Amnesty International’s activities. Amnesty International was an
intervener in the appeal in the House of Lords case that he decided. It was held that the
company of which Lord Hoffmann was a director was part of an entity or movement working
towards the same goals as Amnesty International, and that this automatically disqualified
him from hearing the case. The case was therefore reheard before a differently constituted
Appeal Committee.
Apparent Bias
If actual bias is rare, and automatic disqualification is equally unusual, what is much more 11.11
common is apparent bias. Over the years, the courts have formulated the test of apparent bias
in a number of similar (but suspiciously different) guises, creating concepts such as ‘real
likelihood’, ‘real danger’, ‘reasonable suspicion’ and ‘real possibility’ of bias. It is well beyond
the scope of this book to chart the history of these different formulations. The modern
approach has its roots in Re Medicaments and Related Classes of Goods (No 2).19 In that case, a
lay member of the Restrictive Practices Court applied for employment with a consultancy
firm, failing to remember that a director of that same firm was the principal expert witness in
a case before the court. By the time of the hearing it was apparent that there was no suitable
employment for the lay member with that firm and that a full explanation, including an
undertaking not to seek employment with the same firm in the future, had been given to the
parties. However, the Court of Appeal concluded that, whilst a judge might accept the lay
member’s explanation and conclude that there was ‘no real danger’ of bias, the fair-minded
observer might have concluded that the lay member’s favourable estimation of the firm, that
led to his application for employment, indicated a partiality to that firm that could not be
undone by the explanation.
The test of the fair-minded observer was adopted by the House of Lords in Lawal v Northern 11.12
Spirit Ltd.20 In that case, a barrister was appointed as a part-time judge in the Employment
Appeal Tribunal. Subsequently, he was briefed to appear in a case before the EAT, which
included lay members with whom he had previously sat in his role as a part-time judge. The
House of Lords confirmed the test of bias as being ‘whether the fair-minded and informed
observer, having considered the facts, would conclude that there was a real possibility that
the tribunal was biased’. Applying this test to the facts of the case, the House of Lords con-
cluded that there was a reasonable possibility that such an observer might consider that the
barrister’s submissions would carry particular weight with those lay members of the EAT
with whom he had sat in the past. The complaint of apparent bias was therefore upheld.
17
Dimes v Grand Junction Canal [1852] 3 HLC 759; R v Meyer [1875] 1QBD 173; R v Barnsley Licensing
Justices [1960] 2 KB 167.
18 [2000] 1 AC 119.
19 [2001] 1 WLR 700 (CA).
20 [2003] UKHL 35; [2004] 1 All ER 187.
311
Natural Justice
11.13 In Lawal, the House of Lords stressed that the fair-minded observer would adopt a balanced
approach and thus:
1. would neither be complacent nor unduly sensitive or suspicious;
2. would be aware of legal traditions of impartiality (for example, a barrister appearing in
front of a senior member of his own chambers sitting as a deputy judge), but might be
critical of such traditions;
3. could be assumed to have access to all the facts that are capable of being known by
members of the public generally, always bearing in mind that it is the appearance to
which these facts give rise that matters, not what was in the mind of the particular judge
or tribunal member who was under scrutiny.
Further, in his speech in Lawal, Lord Bingham stressed that the administration of justice
required higher standards today than had been the case even a decade or two ago. It is respect-
fully submitted that he was undoubtedly right to make this point and that, in consequence,
many of the older cases concerned with allegations of apparent bias should be treated with
extreme caution. Even a cursory glance at the textbooks reveal a number of authorities that
would, in all probability, be decided differently today.21 This also helps to explain why
natural justice issues have arisen so frequently in adjudication cases.
Particular Matters that May Lead to a Finding of Bias

11.14 In administrative law, there are a number of particular ways in which the decision-maker
may reveal an apparent bias. One of the most common is predetermination, that is to say,
where the decision-maker fails to apply his mind properly to the decision that he has to make
because he has—or has given the impression that he has—already made up his mind. Such
predetermination amounts to ‘the surrender by the decision-making body of its judgment’.22
In another well-known example of predetermination,23 the police authority erred when
retiring a chief inspector compulsorily on the grounds of mental health, because they referred
him to a doctor who had previously reported adversely on his condition. The Court of
Appeal held that the doctor had a duty to act fairly and in accordance the rules of natural
justice and that he could not do so because he had already committed himself to an opinion
in advance of the new enquiry.
11.15 However, even where possible predetermination exists, the court will still apply the test of the
fair-minded observer. Thus, in National Assembly for Wales v Condron,24 despite the fact
that the chairman of the planning committee had told a protestor against open cast mining
that he was ‘going to go with the Inspector’s Report’, which report was in favour of mining, the
Court of Appeal concluded that the fair-minded observer would not apprehend bias and
thus the decision was upheld. Some commentators have questioned whether, in order
to determine whether the decision-maker has closed his mind and thus moved from
21 It should also be noted that Article 6(1) of the European Convention on Human Rights entitles those
affected to an impartial tribunal. The Court of Human Rights’ jurisprudence tests the concept of impartiality
both subjectively—was there in fact bias?—and objectively—were there guarantees that excluded any legiti-
mate doubt as to the impartiality of the tribunal? There is a clear and direct link between the objective bias in
that jurisdiction and the common law principle that justice must be seen to be done.
22
See the judgment of Sedley J in R v Secretary of State for the Environment ex parte Kirkstall Valley Campaign
Limited [1996] 3 All ER 304 at 325.
23 R v Kent Police Authority ex parte Godden [1971] 2 QB 662.
24 [2006] EWCA Civ 1573; [2007] BLGR 87 (Richards LJ).
312
General Principles
predisposition to predetermination, it is unnecessarily complicated to apply the test of the

fair-minded observer.25
Apparent bias may also arise when the decision-maker is required to adjudicate on a matter 11.16
on which he has, in a different capacity, already expressed an opinion, such as where the
judge had previously been a minister who had, in that capacity, expressed a clear view in
Parliament as to the legal effect of the statutory provision with which the case was concerned.
As Lord Bingham noted,26 the fair-minded informed observer would conclude that there
was a real possibility that the judge ‘would subconsciously strive to avoid reaching a conclusion
which would undermine the very clear assurances he had given to Parliament’.
The problems that can arise when a decision-maker may have inadvertently expressed a view 11.17
in another capacity are particularly common in cases involving magistrates, who may also be
members of local authorities or other administrative bodies. It is important that the work of
those who give their services in this way is not unduly hampered, but it is also important to
uphold the principle of fair and unbiased decisions. In these cases, apparent bias can often be
a question of degree. A justice who proposed a prosecution, or voted for it, as a member of
a local authority, is obviously disqualified from hearing that prosecution.27 Similarly, the
Court of Appeal set aside the decision of a local education authority not to prohibit the
dismissal of a teacher by the school’s governors, in circumstances where three members of
the relevant sub-committee of the local authority were also governors of the school.28
Any indication that the decision-maker has prejudged (or might prejudge) the outcome 11.18
will normally render any subsequent decision void. Thus it was objectionable for a magistrate
to prepare a statement for the sentence half way through the trial29 and for a judge to take
over the prosecution in the absence of a prosecuting lawyer.30 Similarly, a decision by a
justice who refused a liquor licence, and who subsequently said that, because he was a
member of a strict temperance society, he would have been a traitor if he had voted in
favour of the licence, was set aside because his views indicated bias from the outset.31
Although it has been said that preconceived opinions do not constitute bias, because it
does not follow that the evidence will be disregarded in favour of the preconception,32 it is
respectively submitted that this is one area where, as Lord Bingham noted, the position
today is rather different to that recorded in a number of the older cases. It is thought that
the expression of a preconceived opinion on the issues must always give rise to at least the
risk of an allegation of apparent bias.
Other situations where prejudice and apparent bias have been identified include personal 11.19
friendships or hostility,33 or where there was a clear commercial relationship between the
decision-maker and one of the parties in the case.34 However, the courts will endeavour
always to distinguish such cases from simple acquaintanceship or general business contacts.
25 Please see p 391 of Wade’s Administrative Law (10th edn).

26 Davidson v Scottish Ministers [2004] UKHL 34; 2005 1 SC (HL) paragraph 17.
27 R v Gaisford [1892] 1 QB 381 and R v Henley [1892] 1 QB 504.
28 Hannam v Bradford Corporation [1970] 1WLR 937.
29
R v Romsey Justices ex parte Gale [1992] COD 323.
30
R v Wood Green Crown Court ex parte Taylor (1995) The Times, 25 May.
31
R v Halifax Justice ex parte Robinson [1912] 76 JP 233.
32 R v London County Council re Empire Theatre [1894] 71 LT 638,
33 R v Handley [1921] 61 DLR 656.
34 R v Rand [1866] LR 1 QB 230.
313
Natural Justice
In one case, which might also be decided differently today, a builder was not disqualified
from sitting on a planning committee dealing with an application by one of his com-
mercial rivals.35
Matters that Will Not Lead to a Finding of Bias

11.20 In Locabail (UK) Limited v Bayfields Properties Limited,36 the Court of Appeal held that a
deputy High Court judge was not disqualified from hearing a case simply because the
solicitor’s firm of which he was a partner was, without his knowledge or involvement,
concerned in related litigation. The case is important because the Court of Appeal identi-
fied a number of matters that would not ordinarily found an objection against a judicial
decision-maker on the ground of bias. The court said that objections could not be based
on religion, ethnic or national origin, gender, age, class, means or sexual orientation of the
judge. In addition, objections could not ordinarily be based on the judge’s educational,
social, employment or service background, nor his political associations, professional
associations, membership of social or charitable bodies or the fact that the judge had, in the
past, received instructions from a party or the party’s legal representatives. More controver-
sially perhaps, given the authorities noted in paragraphs 11-14–11.18 above, it was also
held that, in an ordinary case, neither the judge’s prior decisions nor any views that he
might have expressed in textbooks or articles would be relevant to issues of apparent bias.
However, as noted in the next paragraph, the application of this general rule must depend
on the particular facts.
11.21 In administrative law cases involving allegations of apparent bias, it is usually quite easy to
see the line in the sand and to work out what will cross it and what will not. Thus, in R v
Bristol Betting and Gaming Licensing Committee ex parte O’Callaghan,37 a judge who was a
director of a property company that rented out a property to one of the parties was not
disqualified from dealing with the case. The evidence was that the judge was wholly unaware
of the link and the Court of Appeal said that the circumstances showed that there was no
real danger of bias: the interest was so minimal that no reasonable and fair-minded person
sitting in court would have considered there was a real (as opposed to a fanciful) danger of
a fair trial not being possible. On the other side of the line, in AWG Group Limited v
Morrison,38 a judge who had known a witness for 30 years was disqualified from hearing the
trial. It was said that in such circumstances, recusal was not merely a discretionary case
management decision. And where a judge had expressed himself in particularly strong terms
in articles on legal issues that subsequently arose before him, then the general rule will not
apply, because there was a real danger that the fair-minded observer could not exclude the
possibility of unconscious bias.39
11.22 The courts have often been eager to draw the distinction between genuine and fanciful
allegations of bias. However, it is respectfully submitted that this can be a dangerous course,
because what might have appeared a fanciful allegation of bias to a Victorian judge might
very well cause a fair-minded observer in the twenty-first century to identify a clear case of
apparent bias. One of the cases commonly taken to exemplify the rule that fanciful allegations
35
R v Holderness BC ex parte James Roberts Limited [1992] 5 Admin LR 470.
36
[2000] 2 WLR 870 (CA).
37 This case was heard with the Locabail case referred to above.
38 [2006] EWCA Civ 6; [2006] 1 WLR 1163.
39 Timmins v Gormely, also heard with the Locabail case.
314
General Principles
will be dismissed is R v Deal Justices,40 where a justice of the peace was not disqualified from
hearing a prosecution instituted by the RSPCA, merely because he subscribed to that society.
In the present day, whilst mere subscription to such an organisation may be acceptable, it is
submitted that, say, any active involvement in the society’s campaigns would probably
preclude the justice from hearing such a case. Similarly, in a more recent case also held to
exemplify this rule,41 a judge was not disqualified in a case where one party’s solicitors were
acting for him personally in relation to his will. Again, some have suggested that, despite
what Lord Woolf said in his judgment in that case about the ‘legal traditions and culture of
this jurisdiction’ being known to the fair-minded observer, depending on the nature and
extent of the relationship between the judge and the solicitors, a case of apparent bias might
have been made out on those or similar facts.
The Right to a Fair Hearing

The Importance of Procedure
It is fashionable to criticise the rule that every man is entitled to have his defence heard as a 11.23
lawyer’s trick, an invitation to rely on procedural and technical restrictions that end up
obstructing, rather than enhancing, justice. Some administrators regard the rule, and the
complexities to which it has given rise, as an obstacle to efficient administration. Some adju-
dicators may well have the same view. But, at least in the administrative sphere, this rule (and
its offshoots) is regarded as the surest way of keeping bureaucratic control in check, and
promoting fair administration. The mere fact that the rules of natural justice are procedural
does not mean that their importance should be underestimated: ‘the history of liberty has
largely been the history of the observance of procedural safeguards’.42
On the other hand, it is important to note that the rules of natural justice, and in particular 11.24
the right to a fair hearing, are only procedural. They are not substantive. Thus, when in Chief
Constable of North Wales Police v Evans,43 Lord Denning suggested that the rules of natural
justice meant that, not only should there be a fair hearing, but the decision produced there-
after must itself be fair and reasonable, his view was rejected by the House of Lords. Thus, in
administrative law, on an application for judicial review, the court is unconcerned with
whether the decision can be regarded as objectively fair and reasonable; provided that there
was a fair and unbiased consideration of both parties’ cases, and there was no error of law, the
decision will be upheld, even if it was not necessarily a decision which the court would, on
its own, have reached. Accordingly, when Lord Denning said that ‘the rules of natural
justice—or of fairness—are not cut and dried; they vary infinitely’,44 it must be remembered
that the rules to which he was referring relate to procedure, and nothing else.
Real Prejudice
In another echo of the law as it has subsequently developed in relation to construction 11.25
adjudication, it should also be noted that, if a party wishes to claim that he has not had a fair
40
[1881] 45 LT 439.
41
Taylor v Lawrence [2002] EWCA Civ 90, [2003] QB 528,
42 Frankfurter J in McNabb v United States 318 US 332 (1943).
43 [1982] 1 WLR 1155.
44 R v Home Secretary ex Parte Santillo [1981] QB 778.
315
Natural Justice
hearing for some particular reason, he must be able to demonstrate that he has suffered real
prejudice as a result. Just as the TCC has made plain in adjudication cases that, in order to
avoid enforcement of the decision, any breach of natural justice must also be shown to be
material,45 so too in administrative law cases have the courts been at pains to stress that some
material consequences of the breach are necessary to justify interference. There is no such
thing as a merely technical infringement of natural justice.46
11.26 That said, a study of the leading authorities on this topic demonstrates that, although judges
often appear to acknowledge that a procedural objection has been raised by a party with a
hopeless defence, they have still been rather reluctant to conclude that, if there had been a
fair hearing, it would have made no difference to the result. Indeed they have regularly
stressed that the procedure and the merits should be kept strictly apart. In some earlier cases,
it was even suggested that it was immaterial whether the same decision would be arrived at
in the absence of the breach of natural justice.47 As a result of this ambivalence, in administrative
law there can be a difference of approach, depending on the nature of the decision under
review. Thus, a breach of natural justice by a tribunal in a case that was in any event hopeless
might be disregarded whilst, in the case of a discretionary administrative decision, a breach
of natural justice might, without more, render the decision invalid.48
The Need for a Hearing

11.27 The general rule is that a party who would be adversely affected by an administrative decision
is entitled to have his case heard. That will usually mean an oral hearing.49 In the leading case
of R (West) v Parole Board,50 the House of Lords held that ‘an oral hearing is most obviously
necessary to achieve a just decision in a case where facts are at issue’. They went on to say that
there would be other situations where an oral hearing would also contribute to a just
decision.
11.28 It is to be noted, however, that even in the field of administrative law, an oral hearing is not
mandatory. Thus, if urgent action is needed on the grounds of public health and safety, and
it is simply not possible for a hearing to be arranged, the absence of such a hearing will not
be fatal.51 Furthermore, even in cases where urgency is not a feature, some decisions will
require no hearing before they are made. Thus a decision to prosecute or bring legal
proceedings, which will obviously have potentially adverse consequences for the other party,
does not entitle him to be consulted or shown any evidence in advance of the decision.52
11.29 In many cases, it will be sufficient for the decision-maker to give an opportunity to the
person affected to make written representations to be taken into account before the decision
is made. That is because, in most cases, the demands of fairness would be met by the presentation
45 For a fuller discussion of this topic, see paragraphs 13.10–13.12.

46 George v Secretary of State for the Environment (1979) 77 LGR 689.
47 See, for example, General Medical Council v Spackman [1943] AC 627 at 644 (Lord Wright).
48 For a fuller discussion of this topic, see Wade’s Administrative Law (10th edn), at 424.
49 R v Immigration Tribunal ex parte Mehmet [1977] 1 WLR 795, a case in which the tribunal’s decision to
make a deportation order was quashed because they had failed to give the applicant an oral hearing.
50
[2005] UKHL1, [2005] 1 WLR 350.
51
See, for example, R v Birmingham City Council ex parte Ferrero Limited [1991] 3 Admin LR 613 in which
a local authority prevented the sale of toys without holding a hearing because they considered them to be dan-
gerous. They described the ban as ‘an emergency holding operation’.
52 Wiseman v Bornenam [1971] AC 297 at 308.
316
General Principles
of written material as opposed to requiring an oral hearing. Thus in Lloyd v McMahon,53 the
House of Lords held that a district auditor, who was dealing with 49 Liverpool councillors
who had failed to make a valid rate and were surcharged, had acted reasonably in giving them
full particulars of his complaints and inviting their written representations. Representations
were then made in writing and the councillors did not ask for an oral hearing. The House of
Lords concluded that the auditor had adopted a procedure that was both suitable and fair in
all the circumstances. Similarly, a licensing authority may deal with the application, and any
objections, in writing, provided that the applicant has an opportunity to reply to any
objections made.54 Similarly, a person appealing against a deportation order is not entitled
to an interview.55
The Right to Know the Opposing Case

Of course, the entitlement to an oral hearing is little use unless the party in question knows 11.30
the detail of the case that it has to meet at that hearing. It has long been a central tenet of
administrative law that a decision-maker must always give ‘a fair opportunity to those who
are parties in the controversy for correcting or contradicting anything prejudicial to their
view’.56 In Kanda v Government of Malaya,57 Lord Denning made plain that, if the right to
be heard was to be a real right that was worth anything, it must carry with it a right for the
interested party to know (preferably in advance of the hearing) the case that was made against
him. Lord Denning said that that party must know what evidence had been given, and what
statements had been made affecting him, and then he was to have a fair opportunity to cor-
rect or contradict them.
Thus, in R v Deputy Industrial Injuries Commissioner ex parte Jones,58 a case that has much in 11.31
common with adjudication enforcement, the decision of the commissioner was quashed
because he obtained a report from an independent medical expert after the hearing, but
before he produced his decision. Although he was entitled to obtain such a report, the breach
of natural justice was the failure to notify the parties of this step, and the failure to seek their
comments on the report that was then obtained. The commissioner had therefore taken
further evidence, of which the parties were unaware, and had relied on that evidence in clear
breach of the rules of natural justice. A similar sort of default occurred in R v Criminal
Injuries Compensation Board ex parte Ince59 where the Board reached a decision in reliance on
an earlier decision in another case, but in circumstances where they had failed to identify that
earlier decision to the parties, and had not notified them of even the possibility that they were
going to follow the other decision.
Disclosure to the person affected of the case against him inevitably gives rise to issues of 11.32
timing. The disclosure of relevant material must be made in reasonable time, so that the
affected person can prepare his response to the material with which he is provided.60 At an
inquiry, the person who might be affected by any adverse findings is entitled to be given fair
53 [1987] AC 625.
54 R v Huntington DC ex parte Cowan [1984] 1 WLR 501.
55
R v Home Secretary ex parte Malhi [1991] 1 QB 194.
56
Taken from the speech of Lord Loreburn in Board of Education v Rice [1911] AC 179.
57
[1962] AC 322.
58 [1962] 2 QB 677.
59 [1973] 1 WLR 1334.
60 R v Thames Magistrates Court ex parte Polemis [1974] 1 WLR 1371.
317
Natural Justice
warning in advance of the inquiry so that he can seek to meet such findings at the hearing
itself.61 Of course, what needs to be notified in advance will always depend on the facts of the
particular case. Where there is no factual issue, and the matters are not prejudicial to the
party charged, advance notice is unnecessary.62
11.33 A specialist tribunal may use its own knowledge and experience in dealing with the issues before
it, but it is still obliged to disclose to all parties any reports and/or evidence that it may have
obtained or received.63 Thus, in R v Westminster Assessment Committee,64 the committee’s decision
was quashed because it failed to disclose a report by an expert valuer on which it had relied in
fixing a rating assessment at a figure that was even higher than that contended for at the hearing
by the rating authority. The Court of Appeal confirmed that it was relevant to ask whether the
report was obtained before or after the assessment objected to, and whether the report was of a
general or particular nature. Since the report had been relied on by the committee, but had
not been seen or commented on by the person affected, the decision had to be quashed.
Procedure at an Oral Hearing

11.34 In administrative law, where there is an oral hearing it has been said that certain minimum
requirements should always be met.65 The tribunal must:
1. consider all relevant evidence that any party wishes to rely on;
2. inform every party of the evidence to be taken into account (whether derived from another
party or independently), giving sight to all parties of any evidence independently
obtained;
3. permit the questioning of witnesses;
4. allow the parties to comment on the evidence when it has been concluded and make
submissions on the entirety of the case.
The failure to follow this process, and in particular the failure to allow cross-examination66 has
led to the quashing of decisions in a number of different types of administrative decisions.67
11.35 The strict rules of evidence do not apply to such hearings.68 Thus material which might
otherwise offend against the rules as to hearsay and the like will be taken into account, but
always subject to the overriding obligation to ensure that the hearing is genuinely fair. Thus,
a decision to allow in hearsay evidence may make it even more important to ensure that such
evidence is tested by cross-examination, and if such cross-examination is not possible, then

the tribunal may conclude that the only practical course is to exclude the evidence altogether.69
It is always important for any decision following a hearing to be based on at least some
evidence of probative value.70
61
Mahon v Air New Zealand Limited [1984] AC 808.
62 Davis v Carew-Pole [1956] 1WLR 833.
63 R v National Insurance Commissioner ex parte Viscusi [1974] 1 WLR 646.
64 [1941] 1 KB 53.
65 These requirements are derived from the judgment of Diplock LJ, as he then was, in R v Deputy Industrial
Injuries Commissioner ex parte Moore [1965] 1QB 456 at 490.

66
R v Newmarket Assessment Committee ex parte Allen Newport Limited [1945] 2 All ER 371 at 373.
67
See, by way of example, R v Hull Prison Visitors ex parte St Germain (No 2) [1979] 1 WLR 1401; Re
Cheeung and Minister of Employment in Immigration [1981] 122 DLR (3d) 41.
68 Mahon v Air New Zealand Limited [1984] AC 808.
69 R v Hull Prison Visitors above.
70 Mahon v Air New Zealand Limited, above.
318
General Principles
In administrative law, there are a number of authorities that have stressed that, in order for 11.36
hearings to be fair, speed and convenience are not necessarily of the essence. The right to a
fair hearing is more important than the right to have a speedy decision.71 Thus, if the
decision-maker wrongfully refuses a reasonable request for an adjournment, such a refusal
may amount to a denial of a fair hearing, particularly if the refusal means that the affected
party either cannot appear at all, or can only appear at an obvious disadvantage (because,
for example, he has not had a proper opportunity to deal with the material provided by the
other side).72
The Giving of Reasons

It is trite law that any judge or tribunal must give reasons for the decision that is provided73 11.37
and, although there is no general rule that reasons need to be given in connection with
administrative decisions,74 in practice reasons are almost always given for any decision,
whether administrative or otherwise. The judicial review system cannot properly operate
without reasons being provided for the decision under review. Furthermore, a general sense
of justice and fair play is offended by a decision that does not explain how and why it has been
reached.
The stated reasons for a particular decision do not need to be lengthy. They do, however, need 11.38
to be coherent and adequate. They need to set out the decision-maker’s conclusions on the
important issues that were raised, including any significant issues of fact or any matters of
law.75 However, it is important to note that the stated reasons do not need to deal with every
matter in issue, only the principal disputes that have arisen. Courts generally endeavour not
to impose too rigorous an obligation on the part of the decision-maker to give reasons,76 and
are reluctant to quash sound decisions where the only error is a technical failure in the stated
reasons.77 In Adami v Ethical Standards Officer,78 the Court of Appeal stated that to quash a
decision because of a failure to give adequate reasons was ‘a disproportionate and inappro-
priate response’.
Considering the Process as a Whole

Procedural fairness must be concerned with the procedure as a whole. Although, inevitably, 11.39
the focus will be on the final decision or order under review, and the hearing or deliberations
that gave rise to it, that does not mean that the earlier steps in the procedure are not immune
from the same requirements of fairness. Preliminary steps, which do not themselves have
legal consequences, may lead to decisions that do. Thus a consideration of the fairness of a
procedure needs to be considered by reference to the process as a whole, so as to determine
71
R v Portsmouth City Council ex parte Gregory and Moss [1991] 2 Admin LR 681. This is, of course, the
complete opposite of the rules relating to construction adjudication, where the need to have the right answer
has been subordinated to the need to have the answer quickly, and the timetable cannot be extended save by
agreement.
72 See, by way of example, Priddle v Fisher and Sons [1968] 1 WLR 1478; and Lucy v Royal Borough of
Kensington and Chelsea [1997] COD 191.

73 See, for example, Checkpoint Ltd v Strathclyde Pension Fund [2003] EWCA Civ 84; [2003] L & TR 22.
74
R v Home Secretary ex parte Doody [1994] 1 AC 531.
75
South Bucks District Council v Porter (No 2) [2004] UKHL 33, [2004] 1WLR 1953.
76
R v Higher Education Funding Council ex parte Institute of Dental Surgery [1994] 1 WLR 242 at 263
(Sedley J).
77 R vHome Secretary ex parte Jahromi [1996] 8 Admin LR 197.
78 [2005] EWCA Civ 1754; [2006] BLGR 397.
319
Natural Justice
whether each separate step is fair to the affected person. Thus, in Wiseman v Borneman,79 the
House of Lords considered both the preliminary and the final stages of a case brought by
the tax authorities before the tribunal to determine whether a particular scheme amounted
to tax avoidance. The preliminary stage required the tax authorities to demonstrate a prime
facie case to the tribunal. The tribunal refused to allow the taxpayer to be represented at that
preliminary hearing or to see the evidence submitted by the authorities. The House of Lords
concluded that, since the taxpayer would have a full opportunity to state his case on all of
that material in the subsequent proceedings, there was no breach of natural justice. But Lord
Wilberforce expressed his hesitation in concurring with this conclusion, and said that the
tribunal had to disclose the official evidence for the taxpayer’s use at the second hearing, and
that there was a residual duty of fairness on the part of the tribunal to ensure that prejudicial
evidence was not introduced unfairly.
11.40 The courts are generally anxious to ensure that the rules of natural justice are observed, even
in the making of preliminary investigations and reports, and particularly where those investi-
gations and reports may lead to significant consequences to the affected person.80 Thus,
where a company was under statutory investigation, the inspectors were obliged to give the
company directors a proper opportunity to meet any criticisms made, even though, at that
stage, the inspectors were only producing a first report.81 Similarly, a police officer who was
the subject of a preliminary inquiry, and was threatened with compulsory retirement, was
entitled to have the report of that inquiry disclosed to his own doctor.82 But, as always, the
courts will endeavour to be realistic and will not quash a decision if there was no prejudice at
the preliminary stage. Thus, in Herring v Templeman,83 an academic board recommending
the expulsion of a student was not obliged to give that student a hearing, because it was
simply making a recommendation to the governing body, and there was a proper opportunity
for the student to make representations to the governing body when they came to consider
those recommendations, and before making their final decision.
11.41 With that general overview in mind, it is now appropriate to consider the application of the
rules of natural justice, and the principles that underpin them, to construction adjudication.
It will quickly become apparent that, whilst many of the general principles that I have out-
lined above are of direct relevance to adjudication, there are one or two, particularly relating
to timing and speed, that are emphatically not.
79
[1971] AC 279.
80
R v Agricultural Dwelling House Advisory Committee ex parte Brough [1897] 1 EGLR 106.
81 Re Pergamon Press Limited [1971] Ch 388.
82 R v Kent Police Authority ex parte Gooden [1971] 2 QB 662.
83 [1973] 3 All ER 569.
320
12
BIAS
Actual Bias 12.01 Circumstances of Appointment 12.11

Apparent Bias: The Test 12.03 Unilateral Contact with the
Amec Capital Projects Ltd v Parties 12.16
Whitefriars City Estates Ltd 12.05 Without Prejudice Communications 12.20
The Appointment of the Same The Proper Conduct of Hearings 12.22
Adjudicator 12.09
Bias is an attitude of mind which prevents the judge from making an objective
determination of the issues that he has to resolve. A judge may be biased because
he has reason to prefer one outcome of the case to another. He may be biased
because he has reason to favour one party rather than another. He may be biased
not in favour of one outcome of the dispute but because of a prejudice in favour
of or against a particular witness which prevents an impartial assessment of the
evidence of that witness. Bias can come in many forms. It may consist of irra-
tional prejudice or it may arise from particular circumstances which, for logical
reasons, predispose a judge towards a particular view of the evidence or issues
before him.
Lord Phillips of Worth Matravers in Re Medicaments and
Related Classes of Goods (No 2)1
Actual Bias
There is no reported case in which a direct allegation of actual bias has been made against a 12.01
construction adjudicator.2 It is submitted that the general principles set out in paragraphs
11.09 and 11.10 above would be applicable to any such allegation. Thus an adjudicator
would be found to be biased if he had a direct pecuniary or proprietary interest, no matter
how small, in the outcome of the adjudication. An adjudicator should never accept appoint-
ment in a case where he has a direct or indirect financial stake in either the parties or their
1
[2001] 1 WLR 781, paragraph 37.
2
Although in the case of Fileturn Ltd v Royal Garden Hotel Ltd [2010] EWHC 1736 (TCC); [2010] BLR
512 dealt with in paragraph 12.15, the defendant came close to making that suggestion, raising a number of
points on the inaccuracies in the adjudicator’s answers to various questions that he had been asked, which
went to his relationship with the claims consultants representing the claimant in the adjudication.
321
Natural Justice
representatives.3 Neither should the adjudicator accept appointment in an adjudication

in which a close member of his family, or a long-standing personal friend or business
colleague, has a direct involvement. More widely, it is also submitted that, if one of the
parties to the adjudication has a particular purpose or agenda (because it is, say, a charity or
a pressure group) the adjudicator should decline appointment if he has direct personal links
with or is actively supportive of those aims. Different considerations may apply if the link is
with one party’s legal or other representatives: see paragraph 12.15 below.
12.02 It has been argued (albeit unsuccessfully) that an adjudicator must have been biased simply
because of the result of the adjudication. In Camillin Denny Architects Limited v Adelaide
Jones and Company Limited 4 one of the arguments advanced by the unsuccessful employer/
defendant was that the adjudicator must actually have been biased because no unbiased
adjudicator could have reached the particular decision on costs which he promulgated.
The argument, such as it was, was to the effect that, because the successful contractor/
claimant had recovered just under 60 percent of the sum that it had originally sought in the
adjudication, the adjudicator must have been biased in that party’s favour when he awarded
them 90 pecent of their costs. Akenhead J described that argument as ‘wholly miscon-
ceived’ and pointed out that the adjudicator had carefully considered the competing costs
arguments across three pages of his decision, and that any suggestion of bias could be
rejected out of hand. It is perhaps diffcult to conceive of circumstances where the mere
result of a construction adjudication was so outlandish that, without more, an allegation
of bias would be likely to succeed.
Apparent Bias: The Test

12.03 There is a fuller discussion of the relevant test for bias in paragraphs 11.11 and 11.12 above. In
short, the test for bias was set out by Lord Phillips of Worth Matravers in In Re Medicaments.5
After considering a number of recent decisions on the point, including the House of Lords
in R v Gough 6 and Locabail v Bayfield 7 Lord Phillips said:
The court must first ascertain all the circumstances which have a bearing on the sugges-
tion that the judge was biased. It must then ask whether those circumstances would lead
a fair-minded and informed observer to conclude that there was a real possibility, or a real
danger, the two being the same, that the tribunal was biased.8
He went on to say that the material circumstances would include any explanation given
by the judge/tribunal under review as to his knowledge or appreciation of those circum-
stances. Where that explanation was accepted by the complainant, it could be treated as
accurate. Where it was not accepted, it became one further matter to be considered from the
3 In Mott MacDonald Ltd v London & Regional Properties Ltd [2007] EWHC 1055 (TCC); [2007] 113 Con
LR 33, the judge concluded that there was at least the appearance of bias on the part of the adjudicator because
he refused to provide the decision until his fees had been paid by the referring party, giving the impression that
he was therefore financially beholden to that party.
4
[2009] EWHC 2110 (TCC); [2009] BLR 606.
5
[2001] 1 WLR 700 at 726, 727.
6
[1993] AC 646.
7 [2000] QB 451.
8 Paragraph 85. See also Director General of Fair Trading v Proprietary Association of Great Britain [2000] All
ER (D) 2425.
322
Bias
viewpoint of the fair-minded observer. The court did not have to decide whether the
explanation should be accepted or rejected. Rather it had to decide whether or not the
fair-minded observer would consider that there was a real danger of bias, notwithstanding
the explanation that had been advanced.9
The first adjudication case to consider questions of apparent bias was actually decided 12.04
before In Re Medicaments. In Glencot Development v Ben Barrett 10 HHJ Lloyd QC applied
the test in R v Gough, holding that the views of the person against whom the allegation of bias
had been made were either irrelevant and/or not determinative of the issue; what mattered
was whether the circumstances would lead a fair-minded and informed observer to conclude
that there was a real possibility, or a real danger, that the tribunal was biased. In that case, the
adjudicator was also asked to mediate between the parties in respect of a specific point as to
the applicability of a discount. However, when it became apparent that other elements of the
claim were also not agreed, the adjudicator again purported to act as a mediator to try and
resolve those elements too, and arranged separate meetings with those acting for each side.
He subsequently produced a decision in the adjudication, the validity of which was
challenged. The judge concluded that the adjudicator’s participation in these separate dis-
cussions would lead a fair-minded observer to conclude that there was a real possibility of
bias on his part. The adjudicator went to and fro between the parties, speaking to them
privately, and there was nothing to indicate what he had said, heard or learnt. He was under
no strict obligation to report such matters to the parties as the meetings continued, and since
everything was without prejudice anyway, there could be no inquiry into what had happened.
As the judge pointed out, a private discussion with one party could have conveyed material
or impressions that subsequently influenced the adjudicator’s decision, and the other party
would have had no opportunity to deal with such matters at all; in fact, that other party
would not even know what they were. The decision was therefore not enforced.
Amec Capital Projects Ltd v Whitefriars City Estates Ltd

The leading case on apparent bias in construction adjudication is the decision of the Court 12.05
of Appeal in Amec v Whitefriars.11 In that case, the contract named a particular adjudicator
and said that, if he was not available, he should nominate a replacement. The contractor gave
notice of adjudication in respect of its claim for over £500,000 but the adjudicator that was
appointed, a Mr Biscoe, was neither the named adjudicator, nor his nominee, and had
instead been appointed by the RIBA, pursuant to the Scheme for Construction Contracts.
Mr Biscoe awarded the contractor the entirety of its claim. However, on enforcement, HHJ
Lloyd QC decided that the Scheme was not applicable and that the adjudicator should have
been the person named in the contract, or his nominee. Thus he ruled that Mr Biscoe had no
jurisdiction and his decision was a nullity. Thereafter, the same claim was the subject of a
second notice of adjudication. In the intervening period, the adjudicator named in the con-
tract had died. In those circumstances, the contractor maintained that the contractural
machinery was now void and that, in the changed circumstances, the Scheme did now apply.
The contractor wrote to the RIBA suggesting that Mr Biscoe be nominated again, and he was.
9 This approach was subsequently approved by the House of Lords in Porter v Magill [2002] AC 357.
10
[2001] BLR 207.
11
[2004] EWCA Civ 1418; [2005] BLR 1.
323
Natural Justice
Following the service of formal documents by both sides, the adjudicator issued a second
decision that was in the same terms as his first. The employer argued that this decision should
be declared to be invalid on the grounds of apparent bias.
12.06 The first issue was whether or not Mr Biscoe had the necessary jurisdiction, which itself
turned on whether, as a result of the death of the named adjudicator, the contractual scheme
for nominating the adjudicator was void such that the Scheme applied instead. HHJ
Toulmin CMG QC concluded that the death of the named adjudicator had rendered the
contractural mechanism void, so that the Scheme applied, which meant in turn that
Mr Biscoe had the necessary jurisdiction. At paragraphs 10–13 of his judgment in the
Court of Appeal, Dyson LJ (as he then was) concluded that the judge had reached the correct
conclusion on that issue. That left the second point: whether, because the adjudicator had
already decided the issue once, in a decision which, through no fault of his own, was found
to be unenforcable, a fair-minded and informed observer, having considered all the circum-
stances that had a bearing on the suggestion that the decision-maker was biased, would
conclude that there was a real possibility that he was biased?
12.07 Having set out the various authorities dealing with the test of apparent bias, Dyson LJ then
considered their applicability in situations where the decision of a tribunal was allowed
on appeal and a re-hearing was ordered. He said that the question that fell to be decided in
all such cases was whether the fair-minded and informed observer would consider that the
tribunal could be relied on to approach the issue on the second occasion with an open mind,
or whether he or she would conclude that there was a real (as opposed to fanciful) possibility
that the tribunal would regard its task with a closed mind, predisposed to reaching the
same decision as before, regardless of the evidence or arguments that might be adduced.
As he pointed out, the reason for sending a case back for a re-hearing will often be because
there was fresh evidence or a new point, or the appeal court had held that the tribunal
made some mistake which, it was to be expected, would not be repeated at the re-hearing.
He noted that the dispute as to bias in Amec v Whitefriars was unusual, because no court
had ever found that Mr Biscoe had made any mistake in arriving at his first decision and
there was no fresh material in the second adjudication. Dyson LJ said that the mere fact that
the tribunal had previously decided the issue was not of itself sufficient to justify a conclusion
of apparent bias, and that something more would always be required. He went on to say that,
if an adjudicator was asked to redetermine an issue, and the evidence and arguments were
merely a repeat of what had been provided first time round, it would be unrealistic, indeed
absurd, to expect the adjudicator to ignore his earlier decision and not to be inclined to come
to the same conclusion as before.
12.08 At the conclusion of this part of his judgment, Dyson LJ stressed that the vice that the law
had to guard against was that an adjudicator may approach the re-hearing with a closed
mind. But, if an adjudicator had considered an issue carefully before reaching a decision on
the first occasion, it could not sensibly be said that he had a closed mind if, the evidence and
arguments being the same second time around, he did not give as careful a consideration
on the second occasion as on the first. He would be expected to give such reconsideration
of the matter as was reasonably necessary for him to be satisfied that his first decision was
correct. On the facts in Amec v Whitefriars, although the employer ultimately accepted that
the mere fact of Mr Biscoe’s re-appointment was not sufficient to found a case of apparent
bias, the Court of Appeal rejected as immaterial the additional, unremarkable elements
324
Bias
of the background on which the employer had sought to rely in order to demonstrate
apparent bias.
The Appointment of the Same Adjudicator

There are particular problems when the same adjudicator acts in a number of different adju- 12.09
dications involving different disputes but the same parties and the same underlying contract.
In R G Carter Ltd v Edmund Nuttall Ltd (No 2)12 an adjudicator, in his fourth decision arising
out of the same contract, concluded that a substantial sum of money was due to be paid by
Carter to Nuttall. There were disputed enforcement proceedings which led to HHJ Seymour
QC’s conclusion that the adjudicator did not have jurisdiction, so that the fourth decision
was unenforceable.13 On the same day that Judge Seymour concluded that the decision in
Nuttall’s favour was not to be enforced, Carter gave notice of a fifth adjudication between the
parties and sought the appointment of a different adjudicator from the adjudicator whose
decision had just been held to have been made without jurisdiction. However, despite this,
the same adjudicator was appointed for the fifth adjudication. Carter made an application to
set aside the appointment on the basis that the adjudicator was biased as a result of the previous
adjudication. The application was refused. HHJ Bowsher QC rejected the suggestion that
the adjudicator’s mind had been poisoned by deciding the earlier dispute in excess of his
jurisdiction. He said that he did not see that the fair-minded and informed observer could or
would think that the adjudicator was biased or had acted unfairly in proceeding with the
fourth, nor with the fifth, adjudication. He rejected the criticisms of the adjudicator, holding
that they were unjustified.
A similar result occurred in Michael John Construction Ltd v Richard Henry Golledge and 12.10
others,14 dealt with in detail at paragraph 7.102 above. Given that the defendants in that
case never made any submissions at all about valuation in the second adjudication, but
limited themselves entirely to ill-founded criticisms relating to jurisdiction and fairness,
it was unsurprising that the adjudicator reached the same decision on the figures as he had
reached in the first adjudication. The TCC judge rejected the allegation of bias and enforced
the decision. One of the points made by the judge in Michael John Construction was that it
was wrong to say that the mere fact that an adjudicator had already decided earlier issues
was enough to justify a conclusion of apparent bias in a subsequent adjudication. In

expressing that view, he was of course following the decision of the Court of Appeal in
Amec v Whitefriars.15
Circumstances of Appointment
In a number of the reported cases, allegations of apparent bias, inevitably made by the unsuc- 12.11
cessful party in the adjudication, have arisen out of the efforts made at the outset by the
claiming party to appoint a particular person as the adjudicator. Indeed, the decision in
12
[2002] BLR 359.
13
See the first Carter v Nuttall decision at [2002] BLR 312, referred to at paragraph 7.66.
14
[2006] EWHC 71 (TCC); [2006] TCLR 3.
15
[2004] EWCA Civ 1418; [2005] BLR 1.
325
Natural Justice
Amec v Whitefriars is relevant to this issue as well. In that case, HHJ Toulmin CMG QC
referred to a note of a telephone conversation between the claiming party’s solicitor and the
adjudicator, which occurred at the time of his appointment in the second adjudication,
following the court’s ruling that he did not have jurisdiction to decide the first. The solicitor
had explained to the adjudicator that the reason his clients were referring the matter back to
him was because of his familiarity with the facts, which would save time and costs. The judge
said that a fair-minded and informed observer might well have concluded that there was a
real possibility of bias arising out of this part of the telephone conversation. The Court of
Appeal came to a different view. Dyson LJ noted that, if the adjudicator had not been told
that this was the reason why the matter was coming back to him, he would have been likely to
infer it anyway. Dyson LJ observed that he could not see how the position was affected by the
solicitor’s comment that the reason why the dispute was being referred to the adjudicator was
that he was familiar with the facts, and he did not accept that this remark amounted to an
invitation to the adjudicator to reach the same decision as on the previous occasion, still less
that it was to be inferred that there was a real possibility that the adjudicator had reached the
same decision by reason of that remark.
12.12 In Makers UK Limited v London Borough of Camden16 a similar point arose. The contractor/
referring party’s solicitor was keen to appoint an adjudicator who was qualified as an archi-
tect and as a lawyer, because of the issues of repudiatory breach and the failure to proceed
regularly and diligently with the works, both of which arose in the dispute. The contract
provided that the President of the RIBA would nominate the adjudicator, so the solicitor
undertook an internet search for an RIBA panel member with legal qualifications. A Mr Harris
was duly identified. Accordingly, before the adjudicator was appointed, the contractor’s
solicitor spoke to Mr Harris, who confirmed that he was available to act if asked in the forth-
coming adjudication. The solicitor then wrote to the RIBA to request the nomination of an
adjudicator, suggesting Mr Harris be appointed if he was available. No mention was made
of the earlier contact. When the responding party learnt about the call, they complained, and
argued that the adjudicator had not been validly appointed. Following the contractor’s
success in the adjudication, the employer sought to resist the enforcement of Mr Harris’
decision on the ground of bias. Their primary argument was that there was an implied term
in the contract that ‘neither party may seek to influence unilaterally the nominator’s deter-
mination regarding the identity of an adjudicator, by making unilateral representations to

the nominator concerning whom he should nominate or otherwise’. The employer maintained
there was a breach of that term such that Mr Harris’ appointment was null and void.
12.13 For the reasons set out in paragraph 29 of his judgment in that case, Akenhead J rejected the
suggestion that such a term fell to be implied into the construction contract. Amongst other
things, he stressed that there was nothing in the contractural provisions relating to appoint-
ment that prevented the parties making representations to the RIBA as to the attributes or
even the name of the person to be appointed. The judge held that the system of nomination
could work satisfactorily, even if representations were made by the parties seeking nomin-
ation. The RIBA could, of course, either take or leave such representations and, since it was
not necessarily wrong or unhelpful for a party to make such representations, there was no
basis for the implied term. Moreover, the implied term was aimed at preventing unilateral
representations by the party seeking a nomination, but there was no obvious support for the
16 [2008] EWHC 1836 (TCC); [2008] BLR 470.
326
Bias
proposition that such representations were to be avoided, and no evidence that in the commercial
world such unilateral representations would be regarded as unusual or unpopular.17
The other way in which the defendants in Makers v Camden sought to resist enforcement 12.14
was by alleging apparent bias as a result of the way in which the solicitor and the adjudicator
had dealt with the original approach. It was said that the solicitor had made a deliberate
decision not to agree an adjudicator with the employer, and did not subsequently reveal to
the RIBA that he had spoken to Mr Harris in advance of his appointment. Mr Harris had
similarly failed to disclose that same conversation. Akenhead J rejected the suggestion of
apparent bias in such cirrcumstances. He applied the ‘fair-minded and informed observer’
test and concluded that, since there was no obligation on the contractor to liaise with the
employer before applying to the RIBA for the nomination of an adjudicator, and that there
was nothing reprehensible in the solicitor not mentioning to the RIBA, or the employer,
that he had had contact with Mr Harris for those limited purposes. The contractor had no
obligation to make that plain. There was therefore nothing to suggest apparent bias and that
second argument was also dismissed.18
A number of the issues surrounding an allegation of apparent bias on the part of an adjudica- 12.15
tor came together in the judgment of Edwars-Stuart J in Fileturn Ltd v Royal Garden Hotel
Ltd.19 In that case, Fileturn were represented in the adjudication by a Mr Silver of Alway
Associates, a firm of claims consultants of which the adjudicator, Mr Sliwinski, had previously
been a director. The evidence was that Mr Sliwinski was an adjudicator much favoured by
Mr Silver, who had requested his appointment in at least a dozen adjudications since he
ceased to be a director of Alway. The judge applied the test for apparent bias set out above, and
had regard to what the adjudicator had said in answer to questions put to him (answers which,
as the judge said, were ‘not a model of clarity’), as well as the background facts. He concluded
that, since Mr Sliwinski did not know of these requests (because only one resulted in his
appointment); since Alway were only involved in between 5 percent and 10 percent of the
adjudications that Mr Sliwinski decided; and since there was no evidence of significant contact
between the two men after Mr Sliwinski had ceased to be a director of Alway, the fair-minded
and informed observer would reject the suggestion of apparent bias. The judge said that there
was no inherent objection to the fact that the legal representatives of one or more of the parties
are well-known to a judge,20 and applied the same principle to the adjudicator.
Unilateral Contact with the Parties

The difficulties in both Amec v Whitefriars and Makers v Camden arose out of pre- 12.16
appointment contact between the solicitor for the referring party and the adjudicator.
Although in neither case was the allegation of apparent bias made out, it is thought that, in
17 At paragraph 37(3) of his judgment, Akenhead J said that nominating institutions might sensibly
consider their rules as to nominations and as to whether they do or do not welcome or accept suggestions from
one or more parties as to the attributes or even identities of the person to be nominated by the institutions. If
such suggestions were permitted, the nominating institutions might consider whether notice of the suggestions
must be given to the other party.
18
This was the first skirmish in an increasingly bitter battle between these parties: see also Camden v Makers
[2009] EWHC 605 (TCC); [2009] 124 Con LR 32.
19 [2010] EWHC 1736 (TCC); [2010] BLR 512.
20 Taylor v Lawrence [2002] EWCA Civ 90; [2003] QB 528.
327
Natural Justice
order to avoid any such suggestion, an adjudicator should take care not to engage in
separate dealings with the parties at any stage of the adjudication. Over the course of many
years, arbitrators have developed procedural systems so as to ensure that they only speak
to the representatives of one party in the presence of the representatives of the other party,
and that any correspondence that they receive from one party is immediately copied to the
other. An adjudicator must adopt the same procedures. Importantly, an adjudicator must
not endeavour to confuse his role as adjudicator with the very different role of a mediator.
The two forms of dispute resolution are, bluntly, incompatible. Mediators can, and often
will, have closed meetings with one side before going on to have a similar meeting with the
other. Such a procedure has no place in adjudication, which is designed to replicate, in
miniature and at very high speed, many features of an arbitration or a court case.
12.17 In the early days of construction adjudication, a number of adjudicators endeavoured to
conduct adjudications in clear breach of these relatively simple guidelines. Thus, in Glencot
Development & Design Co Ltd v Ben Barratt & Son (Contractors) Ltd 21 the adjudicator endea-
voured to act as both an adjudicator and a mediator, and purported to hold discussions with
the parties separately. HHJ Lloyd QC concluded that, in going to and fro between the
parties, and having separate discussions with them, the adjudicator had failed to act in
accordance with the rules of natural justice. Similarly, in Woods Hardwick Ltd v Chiltern
Air-Conditioning Ltd 22 the adjudicator, on his own initiative, consulted representatives of
Woods Hardwick, and with Chiltern’s sub-contractors, without informing Chiltern either
that he had obtained information from those sources, or telling them the content of that
information. HHJ Thornton QC considered that the failure to make available to both
parties the information obtained by him from Woods Hardwick and the sub-contractors
meant that he had not acted impartially and he declined to enforce the decision. The adjudi-
cator compounded the difficulties by providing a witness statement that sought to argue
Woods Hardwick’s case in favour of enforcement, and purported to elaborate on his reasons
for making adverse findings against Chiltern.
12.18 However, it will not always be the case that separate discussions will result in a finding
that the adjudicator has acted in breach of natural justice. It may depend on the terms of the
particular contract in question. In Dean & Dyball Construction Ltd v Kenneth Grubb Associates
Ltd 23 the adjudication had been conducted in accordance with the CIC Model Adjudication
Procedure, which expressly permitted separate interviews with the parties and their respective
experts. HHJ Seymour QC concluded that natural justice did not necessarily require that
the evidence from witnesses of one party had to be taken in the presence of the opposite
party or its representatives, provided that the tribunal taking evidence indicated to the
opposite party what that evidence was, and gave that other party an opportunity to deal
with the evidence, particularly in respect of matters to which the tribunal was minded to
attribute importance. Although the judge said that he had grave difficulty in seeing that
adopting such a course could ever be appropriate without the tribunal indicating to the
absent party what had been said, and providing an opportunity for a response, he considered
that the procedure adopted by the adjudicator in Dean & Dyball, in which all the relevant
information obtained by this process had been provided to the other side, and they had
21 [2001] BLR 207.

22 [2001] BLR 23.
23 [2003] EWHC 2465 (TCC); [2003] 100 Con LR 92.
328
Bias
been given an opportunity to deal with it, was entirely fair. The judge concluded that no
dispassionate observer, aware of the particular circumstances of the case, would consider that
there was a risk of actual unfairness or bias on the part of the adjudicator.
In Amec v Whitefriars, Dyson LJ observed that ‘conversations between one party and the 12.19
tribunal in the absence of the other party should be avoided’. In Makers v Camden, Akenhead J
echoed that, saying that it was better for all concerned if parties limit their unilateral contacts
before, during and after an adjudication, and that the same was true for adjudicators having
unilateral contact with individual parties. He correctly observed that such contact ‘can be
misconstrued by the losing party, even if entirely innocent’.
Without Prejudice Communications

In Specialist Ceiling Services Northern Ltd v ZVI Construction (UK) Ltd 24 the complaint 12.20
was that the arbitrator was or might have been biased in favour of the claiming party
because he had been told that the responding party had made a without prejudice offer. He
was also told about one aspect of that offer, although he was not told what the offer was, or
how it was made up. HHJ Grenfell applied the In Re Medicaments test, and held that the
fair-minded observer would not have concluded that there was any possibility that the adjudi-
cator was biased, noting that ‘he was unfazed by the knowledge that there had been “without
prejudice” negotiations’ and that his approach to the final account claim was inconsistent
with his having been influenced by his knowledge of the offer. In Volker Stevin v Holystone
Construction25 the TCC judge came to the same conclusion on similar facts, although in that
case there had already been a finding of liability against the responding party, so the judge
observed that the adjudicator would have been amazed to be told that the responding party
had not made any offer. Again, there was nothing to support an allegation of bias.
It is thought that, if the adjudicator was told of the amount of a without prejudice offer, 12.21
it might be very difficult for him to continue with the adjudication, because there would be
an inevitable question-mark about whether the result of the adjudication, however inad-
vertently, was shaped by the amount of the offer. But it is not possible to lay down a hard and
fast rule to that effect; it may, for example, matter just how it was that the adjudicator became
aware of the offer in the first place. In Volker Stevin, the judge noted that the referring party
told the adjudicator that an offer had been made at a without prejudice meeting only after
the responding party had deliberately made repeated references to other matters that
had been discussed on that same privileged occasion. The court will be astute not to permit
the deliberate sabotage of an adjudication by the use of without prejudice material.
The Proper Conduct of Hearings

Oral hearings in adjudication proceedings are rare, but not unknown, and they will inevi- 12.22
tably become more common once the changes introduced by the 2009 Act come into force.
It is important to note that such hearings must be conducted without any apparent bias,
particularly if evidence is being taken at the hearing. It is not unknown for adjudicators who
24 [2004] BLR 403.

25 [2010] EWHC 2344 (TCC).
329
Natural Justice
also practice as arbitrators to turn adjudication hearings into mini-arbitrations, and to

interrupt and comment upon the evidence or explanations as they are being given. Depending
on the precise nature of those interruptions, this may not be regarded as an appropriate way
to conduct a hearing, and could give rise to allegations of apparent—if not actual—bias. In
Michel v R 26 the Privy Council allowed the defendant’s appeal because of the constant
interruptions by the judge at first instance, his repeated snide and sarcastic remarks, and his
obvious hostility to the defendant’s case. On the other hand, applications to remove an
arbitratotor for bias, although sanctioned by s24 of the Arbitration Act 1996, are rarely
successful: see, for example, the decision in Goel v Amega Ltd,27 and the cases referred to in
that judgment.
26 [2010] 1 Cr App R 24.

27 [2010] EWHC 2454 (TCC).
330
13
A FAIR HEARING
Introduction 13.01 Failure to Consult 13.41

The Application of the Rules of Natural Taking Advice from Others 13.48
Justice to Construction Adjudication 13.05 Indication of Preliminary View 13.51
The Materiality of the Alleged Breach 13.10 Procedural Difficulties 13.54
Ambush 13.54
Size/Nature of Claim 13.13
Effect of Earlier Adjudications 13.58
Addressing the Issues 13.26
Addressing a Matter Outside the Scope of Miscellaneous 13.63
the Original Dispute 13.27 Human Rights 13.66
Failing to Address a Matter in Issue 13.29 Unfair Terms in Consumer Contracts
Failure to Consider a Further/Final Regulations 13.71
Submission or a Rejoinder 13.36
Communications with and Indications
to the Parties 13.40
Unilateral Communications 13.40
It is now well established that the purpose of adjudication is not to be thwarted by an

overly sensitive concern for procedural niceties . . . Adjudication under the 1996 Act
is necessarily crude in its resolution of disputes . . . It is now clear that the construction
industry regards adjudication not simply as a staging post towards the final resolution
of the dispute in arbitration or litigation but as having in itself considerable weight and
impact that in practice goes beyond the legal requirement that the decision has for the
time being to be observed. Lack of impartiality or fairness in adjudication must be con-
sidered in that light. . . . It has become all the more necessary that, within the rough
nature of the process, decisions are still made in a basically fair manner so that the
system itself continues to enjoy the confidence it now has apparently earned. . . .
However the time limits, the nature of the process and the ultimately non-binding
nature of the decision, all mean that the standard required in practice is not that which
is expected of an arbitrator.
His Honour Judge Humphrey Lloyd QC in Balfour Beatty Construction Ltd v
The Mayor & Burgesses of the London Borough of Lambeth1
Introduction
Having dealt with bias in the preceeding chapter, the references below to ‘natural justice’ 13.01
should be taken to be synonymous with the requirement that, within the constraints of
1 [2002] EWHC 597 (TCC); [2002] BLR 288.
331
Natural Justice
construction adjudication, the parties are entitled to a fair hearing. In his judgment in
Carillion Construction Ltd v Devonport Royal Dockyard Ltd 2 Chadwick LJ said that it was
only too easy in a complex case for a party who was dissatisfied with the adjudicator’s decision
to comb through his reasons and identify points upon which to present a challenge under the
labels ‘excessive jurisdiction’ or ‘breach of natural justice’. He went on to say that to seek to
challenge the adjudicator’s decision on either of these grounds was likely, save in the plainest
cases, to lead to a substantial waste of time and expense. The specific warning in relation to
allegations of unfairness echoed that of Dyson LJ in AMEC v Whitefriars,3 who said that it
will only be in the rarest cases that a court will refuse to enforce an adjudicator’s decision
because there was a real risk that the adjudicator was either biased or failed to act
impartially.
13.02 The mere fact that the decision itself might be unfair is not a ground for resisting enforce-
ment. That is a fundamental principle of adjudication enforcement. The best example of this
is still Bouygues (UK) Ltd v Dahl-Jensen (UK) Ltd,4 where the adjudicator’s error was not in
respect of a small sum; the retention fund was in the region of £350,000, with the result that
the adjudicator erroneously awarded a sum to Dahl-Jensen when, had he made the proper
deduction for retention, a similar sum would in fact have been due to Bouygues. Despite all
of that, the Court of Appeal ruled that, because the adjudicator had the jurisdiction to reach
that decision, the unfair result would not prevent enforcement of the decision. In other
words, any attempt on an enforcement application to extend the concept of fairness from
procedural to substantive matters, such as Lord Denning’s unsuccessful effort noted at para-
graph 11.24 above, will be unsuccessful.
13.03 Two fundamental points must be noted at the outset. First, time is of the essence in adjudication:
because the adjudicator must produce his decision within the specified time, he or she has to
put the parties under pressure to ensure that they provide the necessary information just as
promptly. Whatever feelings of unfairness this may cause, it is an integral feature of adjudication
and will not, at least in the ordinary case, amount to a breach of natural justice. As the TCC
judge put it in Edenbooth Ltd v Cre8 Developments Ltd,5
adjudication does not work if the parties take too long to provide information to the adjudicator.
The corollary of that is that parties often feel under pressure to do things more quickly than
they would like. However, as I have said, that is simply an inevitable consequence of the
adjudication process.
Secondly, a party alleging a breach of natural justice must also be able to demonstrate that
the breach relied on was material: that it had or would have had a significant effect on the
outcome of the adjudication. This important qualification is explored in more detail in para-
graphs 13.10–13.12 below.
13.04 It must always be acknowledged that the nature of the adjudication process carries with it a
risk of unfairness, both in respect of the way in which the adjudication is conducted, and in
the result. There are two particular reasons for this. The first, of course, is the speed with which
an adjudication has to be completed. In such circumstances, with the need to have the ‘right’
2
[2005] EWCA Civ 1358; [2006] BLR 15. The relevant comments are cited at paragraph 7.113.
3 [2004] EWCA Civ 1418; [2005] BLR 1.
4 [2000] BLR 49; Court of Appeal: [2000] BLR 522.
5 [2008] EWHC 570 (TCC); [2008] CILL 2592, paragraph 17.
332
A Fair Hearing
answer subordinated to the need to have an answer quickly,6 there will always be a greater risk
that both the process and its end product will or might be unfair, certainly compared to an
arbitration or a court hearing. Secondly, under the Scheme and many of the standard
forms of contract, the adjudicator is entitled to ‘take the initiative in ascertaining the facts
and the law necessary to determine the dispute’.7 Most adjudicators are not lawyers. Thus
there is the risk that the adjudicator, in taking the initiative as he is entitled to do, may adopt a
procedure that is or might be unfair. Provided that it can be shown that, within the limitations
of the adjudication process, the adjudicator acted generally in accordance with the usual rules
relating to bias and natural justice, his decision is likely to be enforced. The potential limitations
on the adjudicator’s role as an inquisitor rather than a referee are identified below.
The Application of the Rules of Natural Justice to

Construction Adjudication
Many of the standard form contracts, and the Scheme for Construction Contracts, expressly 13.05
require the adjudicator to act impartially. The authorities make clear that this is broadly the
same as acting without bias (see Chapter 12 above) and in accordance with the rules of natural
justice. Thus the expressions ‘impartial’ and ‘in accordance with natural justice’ have been
used synonymously in the reported cases.
There was originally some doubt as to whether the rules of natural justice applied to adjudi- 13.06
cations. It will be recalled that, in Macob Civil Engineering Ltd v Morrison Construction Ltd 8
Dyson J said that a decision could not be impeached, even if the adjudicator ‘in reaching his
decision . . . made a procedural error which invalidates the decision’ provided that he had the
jurisdiction to do so. The fact that a procedural error would not invalidate the decision was
echoed by Sir Murray Stuart-Smith in C & B Scene 9 when he said at paragraph 26 that ‘errors
of procedure . . . are not sufficient to prevent enforcement of an adjudicator’s decision by
summary judgment’. In consequence of these comments, it was argued in some quarters that
the adjudicator could act in breach of natural justice with impunity, and his decision would
still be enforced.
This argument was expressly rejected by HHJ Bowsher QC in Discain Project Services Ltd v 13.07
Opecprime Development Ltd.10 Having said, at paragraph 31 of his judgment, that he was not
sure what was meant by the word ‘procedural’ in Dyson J’s judgment, he went on to say that
he certainly rejected any submission that Dyson J was holding that the rules of natural justice
did not apply to adjudication.11 He also rejected the submission that a breach of natural
justice was to be regarded as a ‘procedural error’:
One can test that proposition by thinking the unthinkable, going to an extreme and asking
what would be the approach if it were shown that an adjudicator refused to read the written
6
See paragraph 86 of the judgment of Chadwick LJ in Carillion Construction v Devonport Royal Dockyard
Ltd [2005] EWCA Civ 1358; [2006] BLR 15. This contrasts with the usual approach, set out in paragraph
11.36.
7 See Part 1, paragraph 13 of the Scheme for Construction Contracts.
8 [1999] BLR 93.
9 [2002] BLR 93.
10
[2001] BLR 287.
11
See Chapter 2.
333
Natural Justice
submissions of one party because they were typed with single rather than double spacing. It
would never happen. But if it did, his decision would not be enforced. So there must be some
breaches of natural justice that would persuade the court not to enforce the decision of an
adjudicator. How is that line to be drawn?12
The judge referred to the decision of HHJ Lloyd QC in Glencot Development and Design Co
Ltd v Ben Barratt & Sons (Contractors) Ltd 13 where the judge had said that it was accepted
that the adjudicator ‘has to conduct the proceedings in accordance with the rules of natural
justice or as fairly as the limitations imposed by Parliament permit’. Judge Bowsher expressly
agreed with that statement.
13.08 Judge Bowsher’s judgment in Discain, referred to above, was actually his second judgment
on the issues created in that adjudication, reached after a full trial. The trial arose because of
the judge’s earlier decision to refuse summary judgment, in the course of which he also
considered the applicability of the rules of natural justice within the limited timescale of the
average adjudication. In the judgment in which he gave the defendant permission to defend,
he said:14
. . . I do understand that adjudicators have great difficulties in operating this statutory scheme, and
I am not in any way detracting from the decision in Macob. It would be quite wrong for parties
to search around for breaches of the rules of natural justice. It is a question of fact and degree
in each case . . . The Scheme [for Construction Contracts] makes regard for the rules of natural
justice more rather than less important. Because there is no appeal on fact or law from the
adjudicator’s decision, it is all the more important that the manner in which he reaches his
decision should be beyond reproach. At the same time, one has to recognise that the adjudicator
is working under pressure of time and circumstance which make it extremely difficult to comply
with the rules of natural justice in the manner of a court or an arbitrator. Repugnant as it may
be to one’s approach to judicial decision making, I think that the system created by the [1996]
Act can only be made to work in practice if some breaches of the rules of natural justice which
have no demonstrable consequence are disregarded.
Although this formulation has been the subject of minor refinement in subsequent cases, it
is submitted that it still remains the most practical guide, for parties and adjudicators alike,
as to the requirement to act in accordance with natural justice to the extent that, within the
constraints of adjudication, such conduct is possible. It was cited with approval by HHJ
LLoyd QC in Balfour Beatty Construction Ltd v The Mayor and Burgesses of the London Borough
of Lambeth15 where he stressed that the purpose of adjudication is not to be thwarted ‘by an
overly sensitive concern for procedural niceties’. He also said that, where the complaint was
that some important material was not drawn to the attention of the parties by the adjudicator
prior to the eventual decision, that material had to be either decisive or of considerable
potential importance to the outcome and not peripheral or irrelevant. He reiterated, how-
ever, that, within the rough nature of the process, decisions still had to be made in a basically
fair manner so that the whole process of adjudication continued to enjoy the confidence
12 Judge Bowsher also quoted with approval an article by Mr Ian Duncan Wallace QC in the Construction
Law Journal (2000) 16 Const LJ 102 in which the author said that it was a ‘startling proposition’ that an adju-
dicator’s decision, if arrived at in serious breach of a principle of natural justice, ‘must as a matter of law never-
theless be enforced in circumstances where payment under an invalid decision could easily turn out to be
irretrievable and precipitate to the insolvency of the party affected . . .’
13 [2001] BLR 207.
14 [2000] BLR 402.
15 [2002] EWHC 597 (TCC); [2002] BLR 288.
334
A Fair Hearing
which it had now earned.16 The facts of this case are analysed in greater detail in paragraph
13.42 below.
In RSL (Southwest) Ltd v Stansell Ltd 17 it was argued that the adjudicator’s decision was not 13.09
binding because it had been reached in breach of the rules of natural justice. Stansell’s com-
plaint was that the adjudicator had failed to give the parties an opportunity to comment
upon the report, which the adjudicator himself had commissioned, and which dealt with the
delay and loss and expense claims that lay at the heart of the adjudication. RSL argued that
there can have been no breach of the rules of natural justice because the report was not made
available to them either. HHJ Seymour QC said this:
The introduction of systems of adjudication has undoubtedly brought many benefits to the
construction industry in this country, but at a price. The price, which Parliament, and to a
large extent the industry, has considered justified, is that the procedure adopted in the interests
of speed is inevitably somewhat rough and ready and carries with it the risk of significant
injustice. That risk can be minimised by adjudicators maintaining a firm grasp upon the prin-
ciples of natural justice and applying them without fear or favour. The risk is increased if
attempts are made to explore the boundaries of the proper scope and function of adjudication
with a view to commercial advantage . . . The duty to act impartially is, in its essence, a duty to
observe the rules of natural justice. It is not simply a duty not to show bias.
The judge concluded that the adjudicator should not have had any regard to the final report
that he had commissioned without giving both parties the chance to consider the contents
of that report and to comment upon it. If an extension of time was necessary to allow such a
process, then the adjudicator should have explained that to the parties and sought their
consent to such an extension. This case is analysed further in paragraph 13.43 below.
The Materiality of the Alleged Breach

The point made by Judge Lloyd in Balfour Beatty, to the effect that it must be demonstrated 13.10
that the alleged breach of the rules of natural justice was significant and/or causative of
potential prejudice, has been emphasised in a number of later cases. The first was Carillion
Construction Ltd v Devonport Royal Dockyard Ltd.18 At first instance, Jackson J had concluded
that an adjudicator’s decision to decline to consider evidence which, on his analysis of the
facts and/or the law, was irrelevant, was not a breach of the rules of natural justice and had
not been shown to be significant. That conclusion was expressly approved by the Court of
Appeal.19 Furthermore in Kier Regional Ltd (t/a Wallis) v City & General (Holborn) Ltd 20 the
same judge reached the same conclusion despite the fact that he saw ‘considerable force’ in
the contention that the adjudicator ought to have taken into account two experts’ reports
which he had declined to read, on the basis that they had not been available to the contract
administrator when he had produced the relevant evaluation. However, Jackson J went on to
16 Other cases where the courts have summarised the general applicability of the rules of natural justice to
the adjudication process include AWG Construction Services Ltd v Rockingham Motor Speedway Ltd [2004]
EWHC 888 (TCC); [2004] TCLR 6; and Palmac v Park Lane Estates [2005] EWHC 919 (TCC); [2005] BLR
301.
17
[2003] EWHC 1390 (TCC).
18 [2005] EWHC 778 (TCC); [2005] BLR 310.
19 See paragraph 84 of the judgment of Chadwick LJ.
20 [2006] EWHC 848 (TCC); [2006] BLR 315.
335
Natural Justice
say that it was unnecessary for him to decide that point, because the error allegedly made by
the adjudicator was not one that could invalidate his decision. He found that, on the basis of
the adjudicator’s decision as a whole, he had considered each of the arguments advanced by
City & General in its written response. At worst, it was an error of law that caused him to
disregard two pieces of relevant evidence but, in the light of the decision of the Court of
Appeal in Carillion,21 that error would not render the adjudicator’s decision invalid.
13.11 In Cantillon Ltd v Urvasco Ltd 22 Akenhead J said that, for it to make any difference on
enforcement, a breach of the rules of natural justice must be more than peripheral; it must
be a material breach. He said that, in cases where the adjudicator failed to bring to the
attention of the parties a point or issue which they ought to have been given the opportunity
to comment upon, a breach would be material if it was one that was either decisive or of
considerable potential importance to the outcome of the resolution of the dispute, and was
not peripheral or irrelevant. Whether the issue was decisive or of considerable importance
(or, conversely, was peripheral or irrelevant), involved a question of degree that had to be
assessed by the judge.
13.12 Accordingly, it is safe to conclude that, whilst an argument that the adjudicator has failed to
comply with the rules of natural justice will be considered with a certain amount of scepticism
by the court,23 where elementary and basic principles of natural justice have not been
observed, with a resulting serious effect upon the decision in question, the court will be
prepared to refuse to enforce summarily that decision. Due allowance will be given to
the adjudicator’s obligation to take the initiative to find the relevant facts and the law, and
the constraints of the tight timetable in which he is operating. Furthermore, any such prima
facie failure to comply with the rules of natural justice must be both obvious and important.
It is therefore instructive now to go on to consider some specific instances in which the courts
have considered an alleged failure to comply with the rules of natural justice.
Size/Nature of Claim
13.13 One feature of adjudication and enforcement disputes, which in a number of the reported
cases sits like the proverbial elephant in the room, obvious to all and mentioned by no-one,
concerns the use of the adjudication process to obtain decisions in complex factual and legal
disputes and multi-million pound final account claims. The (usually unexpressed) concerns
to which this situation can give rise are obvious: adjudication was intended for simple,
straightforward, singular disputes that could be properly dealt with and decided within 28 days.
The adjudication process was not designed for the consideration of complicated, multi-
million pound claims that rely on scores of lever arch files, which have taken the claiming
party months to prepare, and which the responding party is then obliged to deal with in a
matter of days, in order to allow the adjudicator sufficient time to consider both the claim
and the response, and then provide his (lengthy) decision in writing. It might be said with
21
[2005] EWCA Civ 1358; [2006] BLR 15.
22
[2008] EWHC 282 (TCC); [2008] BLR 250.
23
A typical example of this approach can be found in the decision of HHJ Wilcox in South West Contractors
Limited v Birakos Enterprises Limited [2006] EWHC 2794 (TCC) where the judge reiterated that it was ‘not
permissible for this court to minutely examine the reasons for an award to see if an adjudicator might have made
a mistake’.
336
A Fair Hearing
some force that such a situation was not what the framers of the 1996 Act had in mind when
creating the adjudication process, and that the use of the adjudication process to resolve
such claims is demonstrably wrong and unfair.24 The complaint is, therefore, that the mere
reference of such a claim to adjudication is unfair, and any decision resulting from such an
adjudication must also be unfair, and therefore unenforceable.
In London & Amsterdam Properties v Waterman Partnership Ltd 25 HHJ Wilcox said, at para- 13.14
graph 146 of his judgment, that there may be some disputes, particularly arising at the end
of a project, which are too complex to permit a fair adjudication process within the time
limits of the scheme. On the facts of that case, he refused to enforce the adjudicator’s decision,
but that refusal was apparently based, not on the grounds of complexity, but instead on the
specific ground that material had been served late upon the responding party which they had
not had an opportunity to address. There was therefore a triable issue as to whether the adju-
dicator had acted impartially. Similarly, in AWG Construction Services Ltd v Rockingham
Motor Speedway Ltd 26 HHJ Toulmin CMG QC, at paragraph 123 of his judgment, raised
the possibility that there may be disputes that are so complex, and the advantages so weighted
against a defendant, that there was a conflict between the adjudicator’s duty to provide a
decision and his duty to act impartially. Again, however, the judge refused to enforce the
adjudicator’s decision, not on this ground, but on the alternative basis that the adjudicator’s
decision dealt with and relied on matters that were not properly the subject of the notice of
adjudication, and that there had been a serious procedural failure, in that AWG did not have
a sufficient opportunity to consider the new issues and new material belatedly introduced by
the referring party.
However, in CIB Properties Ltd v Birse Construction Ltd,27 HHJ Toulmin said in terms that his 13.15
earlier view in AWG about size/complexity had been ‘erroneous’. In that case, the first
adjudicator decided in August 2002 that CIB had been entitled to terminate Birse’s contract.
Almost a year later, in July 2003, CIB demanded consequential payment in a sum in excess
of £16.6 million. The claim was referred to adjudication in November 2003, and consisted
of about 50 lever arch files. During the adjudication, both Birse and CIB provided extensive
further disclosure of documents so that, in the end, there were somewhere in the region of 150
lever arch files relevant to the adjudication. The adjudicator’s time for reaching a decision was
extended on a number of occasions and the decision itself was not provided until 24 February
2004, when CIB were awarded £2,164,892 out of a claim for approximately £16 million.
One of the grounds for the challenge to the adjudicator’s decision was that the size and com-
plexity of the dispute made it impossible for it to be resolved fairly by adjudication.
Judge Toulmin said that the test was not whether the dispute was too complicated to refer to 13.16
adjudication, but whether the adjudicator was able to reach a fair decision within the time
limits allowed by the parties. He said that the adjudicator had asked himself the right questions,
namely that he could only reach a decision if he had sufficiently appreciated the nature of any
24 It is noteworthy that, at the end of his lengthy judgment in Carillion explaining how and why the
adjudicator’s decision should be enforced, Chadwick LJ doubted whether ‘Parliament contemplated that
disputes involving difficult questions of law would be referred to adjudication under the statutory scheme; or
whether such disputes are suitable for adjudication under the scheme’.
25 [2004] BLR 179.
26 [2004] EWHC 888 (TCC); [2004] TCLR 6.
27 [2004] EWHC 2365 (TCC); [2005] 1 WLR 2252.
337
Natural Justice
issue referred to him (including the submissions of each party) before giving a decision on
that issue, and that he was satisfied that he could do ‘broad justice’ between the parties. On
the facts, the judge concluded that the adjudicator was able to reach such a decision, not-
withstanding the size and complexity of the claim and the supporting documentation.
He found that the adjudicator was, at all stages, careful to consider how he could conduct
the adjudication fairly and he succeeded in doing so, discharging fully his duty not only to
act fairly but to reach a fair determination on the evidence. At all times the adjudicator had
given the parties a fair opportunity to deploy their cases before him. For these reasons, the
judge said at paragraph 199 of his judgment, the size and nature of a claim would only be
relevant if it meant that the adjudicator could not discharge his duty to reach a decision
impartially and fairly within the time limit and, on the facts of CIB v Birse, the adjudicator
had been able to discharge that duty. It should also be noted that this was a case where the
responding party had agreed to various extensions of time to the statutory period in which
the decision had to be completed. As Judge Toulmin makes plain, a responding party is not
bound to agree to extend time beyond the time limits laid down in the 1996 Act, even if such
a refusal renders the adjudicator’s task impossible, as would apparently have been the posi-
tion in CIB v Birse.
13.17 Subsequently, the courts have followed the approach in CIB v Birse. Thus, in The Dorchester
Hotel Ltd v Vivid Interiors Ltd 28 the TCC judge refused the responding party’s application
under CPR Part 8 for a declaration that the size and complexity of the final account claim,
and the limited time that the responding party had to address it, meant that there was ‘a serious
risk of a breach of natural justice in the conduct of the adjudication’. There was no doubt that
the claim was large and was accompanied by 37 lever arch files. It was also served very shortly
before Christmas 2008. However, having set out the authorities, the judge concluded that
the declaration should not be granted. There were four reasons for that. First, the adjudicator
had said in clear terms that he could fairly determine the adjudication within the agreed
timetable and that, in circumstances where the adjudicator had expressed such a view, it
should not ordinarily be for the court, in any but the most obvious case, to reach a different
conclusion. Secondly, the judge observed that, although the timetable was tight, it could not
be said, at the outset, that it was incapable of giving rise to a fair result. Thirdly, the judge
could not say on the facts whether the new material that was served with the adjudication
notice was of any real significance. Finally he noted that if, during the course of the adjudica-
tion, it became apparent that it was impossible for the matter to be properly dealt with within
the timetable, the responding party would be able to rely on such matters to resist enforce-
ment of any decision made against them.
13.18 In HS Works Ltd v Enterprise Managed Services Ltd 29 Akenhead J stressed that, in considering
submissions made on enforcement about the size or complexity of the claim, the most
important factor was whether, and if so upon what basis, the adjudicator had felt able to
reach his decision in the time permitted. He said that the court should look at the opportuni-
ties available to the responding party to address the claim being made before the adjudication
started. He also made the point that it was inevitable, given the restricted timetable, that
there would be an element of ‘rough justice’ in construction adjudication and that one
should not nessarrilly equate an adjudicator’s approach over 28 days with that of a judge or
28 [2009] EWHC 70 (TCC); [2009] Bus LR 1026.

29 [2009] EWHC 729 (TCC); [2009] BLR 378.
338
A Fair Hearing
arbitatror who may have available a period of up to 18 months to undertake the same task.
In that case, he concluded that the adjudicator ‘did a thorough and conscientious job’ in
addressing the numerous items in dispute, and had been entitled to use spot checks to verify
the overall credibility of parts of the evidence. It was not necessary (indeed, in a 28-day
adjudication, it was not possible) to assess individually the individual final account items and
the contra charges.
In Amec Group Limited v Thames Water Utilities Ltd 30 the TCC judge summarised the law 13.19
on this subject in these terms:31
1. The mere fact that an adjudication is concerned with a large or complex dispute does not
of itself make it unsuitable for adjudication: see CIB v Birse.
2. What matters is whether, notwithstanding the size or complexity of the dispute, the
adjudicator had: (a) sufficiently appreciated the nature of any issue referred to him before
giving a decision on that issue, including the submissions of each party; and (b) was satis-
fied he could do broad justice between the parties: see CIB v Birse.
3. If the adjudicator felt able to reach a decision within the time limit then a court, when
considering whether or not that conclusion was outside the rules of natural justice, would
consider the basis on which the adjudicator reached that conclusion (HS Works). In
practical terms, that consideration is likely to amount to no more than a scrutiny of the
particular allegations as to why the defendant claims that the adjudicator acted in breach
of natural justice.
4. If the allegation is, as here, that the adjudicator failed to have sufficient regard to the
material provided by one party, the court will consider that by reference to the nature of
the material; the timing of the provision of that material; and the opportunities available
to the parties, both before and during the adjudication, to address the subject matter
of that material.
On the facts of that case the judge concluded that the responding party had had sufficient
opportunity to deal with the claim, largely because the issues in the adjudication arose out of
the responding party’s own withholding notice. As the judge said, the responding party
should have known from the outset precisely how they could justify every item in that with-
holding notice and could not now complain that they had insufficient time to deal with the
detailed claim, to which the withholding notice had been their initial response. Accordingly,
the challenge on natural justice grounds failed.
It is not uncommon for contractors and sub-contractors to identify the entirety of their final 13.20
account claim as the single dispute that they want the adjudicator to decide. It is sometimes
thought that a claiming party has a distinct advantage in adopting the adjudication procedure
to pursue such a final account claim or (which is just as common) a claim based upon his last
interim application for payment. Whilst the claiming party might have spent weeks and
months preparing his final account claim, or the last interim application, an adjudication
reference following hard on the heels of the submission of the claim itself allows the responding
party very little time to deal with the detail. Again, the authorities demonstrate that, provided
that the claim can be dealt with fairly by the adjudicator, the adoption of such a procedure
will not, of itself, be regarded as unfair or lead to an unenforceable decision. It is part of what
30 [2010] EWHC 419 (TCC).

31 Paragraph 60 of the judgment in Amec.
339
Natural Justice
was called in Camden v Makers Ltd 32 ‘the commercial advantage and lever’ that accompanies
the right to adjudicate.
13.21 Of course, the adjudication process can involve significant risks to the referring party as well.
For example, in William Verry (Glazing Systems) Ltd v Furlong Homes Ltd 33 Furlong, the main
contractor, had its own reasons for thinking that it was to its advantage to refer to adjudica-
tion the entirety of its sub-contractor (Verry’s) final account claim. This had the effect of
requiring the adjudicator, during the statutory 28 days, to reach decisions about disputed
variations, extensions of time, loss and expense, and liquidated damages—in other words,
all the potential disputes which can arise under a building contract. The TCC judge described
that as a ‘kitchen sink’ final account adjudication. The result rebounded on Furlong, because
the adjudicator’s decision was not in its favour and instead found sums and an extension
of time due to Verry that Furlong had opposed. As the judge said, ‘a referring party should
think very carefully before using the adjudication process to try and obtain some sort of
perceived tactical advantage in final account negotiations and, in so doing, squeezing a wide-
ranging final account dispute into a procedure for which it is fundamentally unsuited’.
Another, related point that arose in Verry stemmed from the adjudicator’s comment in his
decision that there had been so much material provided to him that, in the timescale required
by adjudication, even with the extensions of time that had been granted to him, it had not
been possible for him to make a full analysis of that evidence, of the kind that would have
been appropriate in litigation or arbitration. The judge accepted the proposition that, if an
adjudicator runs out of time and cannot produce a fair decision within the statutory time
limit, he should say so, and not go on to reach an unfair decision. However the judge also
concluded that, on the facts in Verry, the adjudicator had patently not reached an unfair
result, and his comment about the absence of a full analysis was merely demonstrative of
the difference between the speedy adjudication process and the more considered (and
slower) business of arbitration or litigation. It was held that the adjudicator had produced
a detailed and painstaking decision that properly reflected all the material with which he
had been provided.
13.22 It is not uncommon for a party to maximise the restricted timetable in an adjudication by
commencing the process at a time when it knows that the responding party may be under
particular pressure. A common example is the issue of a notice of adjudication just before
Christmas. This can create particular difficulties if the claim is large and complex. At para-
graph 51 of his judgment in Bovis Lend Lease Ltd v The Trustees of the London Clinic,34
Akenhead J took the hypothetical example of a reference on 24 December. He said that,
although that could give rise to an assertion that there had been an ambush, given the
Christmas break common in the construction industry, it had to be noted that, for better or
for worse, Parliament did not give the adjudicator the power to extend the 28 days by reason
of such difficulties. That said, he went on to say that there was a sensible school of thought
that suggested that, in such circumstances, an adjudicator could in effect decline to accept
the appointment on the grounds that justice could not be done. It was in fact common in
such circumstances for an adjudicator to accept the appointment on condition that an extension
of time was granted.
32 [2009] EWHC 605 (TCC); [2009] 124 Con LR 32.

33 [2005] EWHC 138 (TCC).
34 [2009] EWHC 64 (TCC); [2009] 123 Con LR 15.
340
A Fair Hearing
In The Dorchester Hotel Ltd v Vivid Interiors Ltd 35 the TCC judge was dealing with a real 13.23
example of a claim, involving 37 lever arch files, which was commenced on 19 December
2008. The judge said that it appeared that this decision had been made in order to obtain the
greatest possible advantage from the summary adjudication prodecure and that such
conduct was not uncommon. Although he said that it was a matter of regret that the adjudi-
cation process was now regularly exploited in this way, the 1996 Act and the standard forms
of building contract made plain that the claims could be made ‘at any time’, so it was not
necessarily impermissible to start an adjudication at such a time: again, the point is dealt with
if the adjudicator asks himself the questions identified in CIB v Birse.
It has been pointed out in a number of the reported cases that no adjudicator’s decision has 13.24
failed at the enforcement hurdle because of the underlying size or complexity of the claim. It
is suggested that this is principally because, following CIB v Birse, adjudicators have risen to
the challenge of taking the adjudication by the scruff of the neck, working out whether they
can deal with it within the set time (as extended with the consent of the parties), and then
fixing a clear timetable to which the parties have then been oblidged to comply. However,
there is one recent case where this did not happen. In Enterprise Managed Services Ltd v Tony
McFadden Utilities Ltd 36 the adjudicator’s decision was not enforced for a variety of jurisdic-
tional reasons, so the argument as to the size and complexity of the claim did not arise
directly for decision. However, between paragraphs 91 and 99 of his judgment, the TCC
judge commented adversely on the adjudicator’s failure to adopt the approach outlined in
CIB v Birse. That was a case where the claim was for a final account said to be worth £7 million
and where there were numerous disputes. The supporting material for the claim alone filled
40 lever arch files. There were also cross-claims with similarly large volumes of material.
Instead of getting to grips with the issues as to size and complexity, and the necessary timetable
required to deal fairly with the dispute, the adjudicator appeared to abdicate all responsibility
for the process, and instead operated a series of piecemeal extensions of time. The judge said
that this put the responding party in an extremely difficult position and that ‘piecemeal
extensions in large and paper-heavy Final Account disputes are not what the 1996 Act was
designed for. The enthusiasm on the part of some adjudicators to permit “creep” in these
cases should be curbed.’ The judge expressed the view that, on the material before him,
the claim did not appear to be suitable for adjudication, and that the adjudicator ought to
have made that plain at the outset. He compounded his failure by refusing to address the
jurisdictional points that were subsequently decided in favour of the responding party on
the enforcement application.
Accordingly, although this is a complaint that has arisen from time to time, there is no 13.25
reported case in which the court has concluded that the claim advanced in the adjudication
was so complicated and/or so large that, for that reason alone, it was inherently unsuitable
for the adjudication process from the outset. Validity and enforcement would appear always
to boil down to whether or not the adjudicator had been able to deal fairly with the dispute
referred to him. Enterprise v McFadden is an example of a situation where the adjudicator
wrongly abdicated this vital consideration, but where it was held that, for other reasons, the
adjudicator did not have the necessary jurisdiction in any event.
35 [2009] EWHC 70 (TCC); [2009] Bus LR 1026.

36 [2009] EWHC 3222 (TCC); [2010] BLR 89.
341
Natural Justice
Addressing the Issues

13.26 The reported cases demonstrate three different situations in which the essential criticism
is that the adjudicator has wrongly dealt with a matter that he should not have done, or failed
to deal with a matter that he should have done. Sometimes these arguments are put on a
jurisdictional basis, to the effect that the adjudicator dealt with something that was outside
his jurisdiction, or failed to deal with something that was within his jurisdiction and there-
fore wrongly restricted that jurisdiction. However, as the following analysis makes plain, it is
thought that these criticisms fit more comfortably under the general rubric of natural justice
and, in particular, the alleged denial to one party or the other of a fair hearing. The cases
are dealt with under three headings below: where the adjudicator addresses an issue outside
the scope of the original dispute; where the adjudicator fails to address an issue that is within
the referred dispute; and where the adjudicator fails to have regard to a final or further
submission or rejoinder.
Addressing a Matter Outside the Scope of the Original Dispute
13.27 An unsuccessful responding party will often complain that the adjudicator wrongly took into
account new material, or a new point, advanced by the referring party that was not raised at
the outset and to which it never had a proper opportunity to respond. The cases show that
this contention has not generally found favour with the courts. In PT Building Services Ltd v
ROK Build Ltd 37 one of the complaints put forward by the responding party, ROK, was that
the notice of adjudication included additional material to supprt PT’s variation claims that
was new and so extensive that ROK had been unable to provide a line-by-line response
during the adjudication. It was said that this rendered the process unfair and a breach of natural
justice. Ramsey J did not accept that submission; although he accepted that ROK had to
respond to new material, he considered that the process adopted by the adjudicator, including
the provision of a written response by ROK and a meeting attended by both parties, gave
them a fair opportunity to present their case in the context of the adjudication.
13.28 An unsuccessful responding party will often complain that the claiming party has made a
new claim, or put an old claim in an entirely new way, in its reply document. Again,
complaints of this type have regularly been rejected by the courts. Thus in VGC Contruction
Ltd v Jackson Civil Engineering Limited 38 the complaint was that, although VGC were making
a claim for £300,000 for delay and disruption, they did not put forward a detailed basis for
that claim until their reply, when they introduced a calculation based on the Hudson formula.
Although Akenhead J found that this was undoubtably a new way of putting the claim,
because no such calculation had been produced before, the reply had been provided in
response to the assertion by Jackson, the responding party, that there was no calculation or
support for the claimed figure of £300,000. In the absence of any suggestion that there was
insufficient time fror the responding party to address the claim based on the Hudson formula,
and given that the responding party had actually addressed various quantum arguments
which anticipated VGC’s claim that overhead and profit was recoverable, there could be no
suggestion of unfairness or breach of natural justice. Similiarly, in Amec Group Limited v
37 [2008] EWHC 3434 (TCC).

38 [2008] EWHC 2082 (TCC); [2008] 120 Con LR 178.
342
A Fair Hearing
Thames Water Utilities Ltd 39 the TCC judge was unimpressed with the submission that the
detail of the claiming party’s case as to the correct hourly rate for remedying defective work
was set out in the reply rather than in the original claim. But these cases must be contrasted
with the situation where the adjudicator decides something that neither party asked him to
decide (R. Durtnell & Son ltd v Kaduna Ltd 40) or decides something that both parties agreed
that he should igmore (Primus Build Ltd v Pompey Centre and Another 41). In those instances,
the decisions were not enforced, not because of a breach of natural justice, but because the
adjudicator wrongly exceeded his jurisdiction.
Failing to Address a Matter in Issue

It has become increasingly common for the losing party to complain that the adjudiactor 13.29
failed to address the issue that was referred to him and that his decision was therefore outside
his jurisdiction or unfair. However, care needs to be taken to differentiate between the dispute
referred to the adjudicator that it is said he wholly failed to answer, and his alleged failure to
answer one of numerous sub-issues raised by one or other party. In the former case, it will
follow that he has not addressed the dispute referred to him and/or that he has failed to hear
one party’s case, such that the decision will not be enforced. But where he may have failed to
deal with one of numerous sub-issues in a lengthy and complex adjudication, the courts will
be much slower to refuse enforcement.
Cases where it was found that the adjudicator wrongly restricted the scope of the adjudication, 13.30
and therefore failed to have regard to the responding party’s legitimate defence (and thus
breached the rules of natural justice), include Broadwell v k3D 42 and Thermal Energy
Construction ltd v AE and E Lentjes UK.43 In Broadwell, HHJ Raynor QC refused to enforce
the adjudicator’s decision because he had wholly failed to address the responding party’s counter-
claim. Since the set-off of that cross-claim formed the basis of the responding party’s legitimate
defence, he held that the adjudication had not been conducted in accordance with the rules
of natural justice and the decision was not enforced. Similarly, in Thermal Energy, HHJ
Stephen Davies found that the adjudicator’s failure to deal anywhere in his decision with the
set-off and counterclaim raised by the responding party again meant that there was a failure to
comply with the rules of natural justice and the responding party had been significantly preju-
diced as a result. By contrast, in Balfour Beatty Construction Northern Ltd v Modus Corovest
(Blackpool) Ltd 44 the TCC judge rejected the referring party’s submission that the adjudicator
had failed to consider a secondary defence to the effect that, if there had been a variation, it
was not to be paid for until the end of the contract. The judge concluded that the adjudicator
had addressed the point sufficiently so as to mean that there was no breach of natural justice.
The high watermark of this line of authority is the decision of HHJ Stephen Davies in Quartzelec 13.31
Ltd v Honeywell Controls Systems Ltd.45 In that case the adjudicator had misunderstood the legal
position and, as a result, had decided that he could not address what was referred to as the
responding party’s ‘omissions defence’. The judge refused to enforce the adjudicator’s decision,
39 [2010] EWHC 419 (TCC).

40
[2003] EWHC 517 (TCC); [2003] BLR 225.
41
[2009] EWHC 1487 (TCC); [2009] BLR 437.
42
[2006] ADJCS04/21.
43 [2009] EWHC 408 (TCC).
44 [2008] EWHC 3029 (TCC); [2009] CILL 2660.
45 [2008] EWHC 3315 (TCC); [2009] BLR 328.
343
Natural Justice
even though the omissions defence was worth only about 25 percent of the sum awarded by
the adjudicator to the claiming party. It appears that one factor of particular significance in that
case was that the adjudicator’s mistake had been induced by the referring party, who encouraged
him, on spurious grounds, to ignore that element of the responding party’s defence. Commentators
have, however, reacted with surprise to a result that denied a claim worth £135,000 simply
because one aspect of the defence, worth £36,500, was wrongly not taken into account.46 In
Pilon Ltd v Breyer Group PLC 47 the TCC judge expressed his unease about the decision in
Quartzelec, pointing out that, even if there had been a breach of natural justice, it was difficult
to say, in accordance with the usual test, that it was properly material. He concluded that
Quartzelec should therefore be treated as something of a special case.
13.32 Two decisions of Akenhead J are much more in line with the standard approach. In HS Works
Ltd v Enterprise Managed Services Ltd,48 the complaint relating to the first adjudication was
that, although the adjudicator had upheld HS’s case that there were no effective withholding
notices from Enterprise, Enterprise argued that the adjudicator ought in any event to have
gone on to consider the merits of each of their contra charges and that his failure to do so was
a breach of natural justice. The judge rejected that contention saying that, as a matter of
logic, because the primary case about the invalidity of the withholding notices was upheld,
there was no need for the adjudicator to consider the alternative case on the detail. He said
that it was not incumbent upon an adjudicator to include in his or her decision a commentary,
let alone findings, upon every issue that arose in the reference, save to the extent that it was
necessary to provide reasons and explanations for what he or she decided. In relation to the
argument that, if the adjudicator had dealt with the merits of the contra charges, he might
have reached a different view on the issue as to the need for withholding notices, the judge
was dismissive, saying that it was fanciful to speculate that the adjudicator, having formed a
view that in principle the primary case should succeed, would then have played some form
of mental gymnastics so, having considered the merits of the contra charges, he could then
reach an opposite conclusion on the same issue.
13.33 In similar vein, in Jacques and Another v Ensign Contrators Ltd 49 the adjudicator had concluded
that the employer owed the contractor just under £100,000. He made plain that his reasoned
decision was limited to essentials but that he had carefully considered all the relevant material.
The suggestion was that there had been a breach of natural justice because the adjudiactor
had failed expressly to consider specific submissions on particular topics put forward by the
contractor. Akenhead J rejected that submission saying that, although the adjudicator had to
consider defences properly put forward by the responding party, it was within his jurisdiction
to decide what evidence was admissible and helpful and what was not, and therefore what
matters he dealt with in detail in the decision, and what he did not. If he, within jurisdiction,
decided that certain evidence was inadmissible, such a conclusion would rarely (if ever) amount
to a breach of the rules of natural justice. He said that it was important to distinguish between
the adjudicator’s failure to consider and address substantive (ie factual or legal) defences, and an
actual or apparent failure or omission to address all aspects of the evidence that went to support
that defence. The former might give rise to a breach of natural justice; the latter would not.
46
The comments of the editors of the Building Law Reports are at [2009] BLR 329–330.
47 [2010] EWHC 837 (TCC); [2010] BLR 452.
48 [2009] EWHC 729 (TCC); [2009] BLR 378.
49 [2009] EWHC 3383 (TCC).
344
A Fair Hearing
It is submitted that Akenhead J was right to distinguish between a failure to consider and 13.34
address a substantive defence and a failure to address some particular aspect of the evidence
or element of the submission. Put another way, this will be the difference between the adju-
dicator’s deliberate decision to ignore a critical element of the responding party’s defence,
and an inadvertent failure to have regard to some particular submission or evidence that
made up that defence. In Amec Group Ltd v Thames Water Utilities Ltd 50 TWUL argued that the
adjudicator failed to deal with the vast majority of their streetworks cross-claim. He dealt
with the ‘big ticket’ items on the face of his decision but did not make express reference to,
or obvious allowance for, the numerous smaller items. The TCC judge rejected the suggestion
that there was a breach of natural justice. At paragraphs 87 and 88 of his judgment, he
pointed out the difference between an adjudicator making an inadvertent mistake, which led
to a failure to address some particular issue (which would not be a breach and was permissible
in accordance with Bouygues)51 and, on the other hand, a deliberate decision by an adjudicator
not to have regard to a significant element of, say, the set-off and counterclaim, which might,
if it was material, amount to a breach of natural justice and prevevnt enforcement.
A number of the authorites referred to above were summarised by the TCC judge in Pilon 13.35
Ltd v Breyer Group PLC.52 In that case, encouraged by Pilon, the adjudicator, who had to
decide what was due on batches 26–62, decided that he could not have regard to Breyer’s
defence of set-off based on an alleged overpayment on batches 1–25. The judge found that
the adjudicator had been wrong to reach that conclusion, because any consideration of what
(if anything) was due to Pilon in respect of batches 26–62 necessarily involved a consideration
of any overpayment on earlier batches. The overpayment defence alone was worth in excess
of 70 percent of the total sum claimed and the judge found that the decision not to consider
the overpayment might also have had an effect on his consideration of other aspects of the
claim. He therefore found a material breach of natural justice. In relation to the applicable
principles the judge summarised the correct approach as follows:
22.1 The adjudicator must attempt to answer the question referred to him. The question may
consist of a number of separate sub-issues. If the adjudicator has endeavoured generally to
address those issues in order to answer the question, then, whether right or wrong, his decision
is enforceable: see Carillion v Devonport.
22.2. If the adjudicator fails to address the question referred to him because he has taken an
erroneously restrictive view of his jurisdiction (and has, for example, failed even to consider
the defence to the claim or some fundamental element of it), then that may make his decision
unenforceable, either on grounds of jurisdiction or natural justice: see Ballast, Broadwell, and
Thermal Energy.
22.3 However, for that result to obtain, the adjudicator’s failure must be deliberate. If there
has simply been an inadvertent failure to consider one of a number of issues embraced by the
single dispute that the adjudicator has to decide, then such a failure will not ordinarily render
the decision unenforceable: see Bouygues and Amec v TWUL.
22.4 It goes without saying that any such failure must also be material: see Cantillon v Urvasco
and CJP Builders Ltd v William Verry Ltd In other words, an error must be shown to have had
a potentially significant effect on the overall result of the adjudication: see Kier Regional v City
and General (Holborn) Ltd.
50 [2010] EWHC 419 (TCC).

51 [2000] BLR 522.
52 [2010] EWHC 837 (TCC); [2010] BLR 452.
345
Natural Justice
22.5 A factor which may be relevant to the court’s consideration of this topic in any given case
is whether or not the claiming party has brought about the adjudicator’s error by a misguided
attempt to take a tactical advantage. This was plainly a factor which, in my view rightly, Judge
Davies took into account in Quartzelec when finding against the claiming party.
Failure to Consider a Further/Final Submission or a Rejoinder

13.36 The final failure in this context arises out of the service of pleadings or written submissions in
the adjudication process. It has become commonplace for referring parties to claim an entitle-
ment to serve a reply, and equally common for the responding party then to seek to have the
last word by serving a rejoinder. It is submitted that, whilst a reply can often be useful as a
means of identifying and focusing on the key issues, it cannot be regarded as automatic in
every case. Even more importantly, even if there is a reply, a responding party is certainly not
permitted as of right to put in a rejoinder and, even if such a rejoinder is served, it is inevitable
that the adjudicator will only have a short amount of time to consider it before producing his
decision. Complaints by responding parties that the adjudicator failed to have proper regard
to their rejoinder, or did not let them provide a rejoinder at all, have usually failed to give rise
to an arguable case on natural justice. But, again echoing the potential difference between an
inadvertent failure to consider some particular sub-issue and a deliberate erroneous exclusion
of a critical matter, a breach of natural justice has been found where the adjudicator wrongly
believed that he did not have jurisdiction to look at any part of a late formal submission.
13.37 The three cases dealing with rejoinders, or the lack of them, within the timetable of an
adjudication each resulted in the rejection of the submission that there had been a breach of
natural justice. In Balfour Beatty Construction Northern Limited v Modus Corovest (Blackpool)
Ltd 53 there was a complaint by Modus that the adjudicator wrongly considered Balfour
Beatty’s reply without seeking a rejoinder from Modus. The TCC judge rejected that submission
as untenable. The adjudicator had provided a timetable that allowed for a reply and made no
reference to a rejoinder. Modus did not query or challenge that timetable at any time during
the adjudication, and neither did they ask the adjudicator for permission to serve any such
rejoinder. On that basis alone, the judge concluded that the point was not open to them.
Moreover, he went on to find that, because Modus subsequently failed to identify any signifi-
cant new points raised by Balfour Beatty for the first time in the reply that they had not had
an opportunity to answer, they had also failed to demonstrate how the alleged breach of
natural justice could possibly be material. In GPS Marine Contractors Ltd v Ringway
Infrastructure Services Ltd,54 Ringway argued that there was a breach of natural justice because,
although they had put in a rejoinder despite the adjudicator’s refusal to allow one, the adju-
dicator did not subsequently take it into account. Ramsey J rejected that submission, noting
that the reply was confined to matters raised in the response, and therefore did not contain
anything new. He said that, in the context of a rapid summary procedure leading to a tem-
porarily binding decision, the adjudicator was entitled to limit the number of rounds of
submissions. As the adjudicator in that case had observed, parties to adjudication often feel
the need to keep making further comments on what the other party has said, but the timescale
in adjudication simply does not permit this. The judge held that Ringway’s desire to serve a
rejoinder two days before the date that the decision was due was something that the process
53 [2008] EWHC 3029 (TCC); [2009] CILL 2660.

54 [2010] EWHC 283 (TCC); [2010] BLR 377.
346
A Fair Hearing
did not and could not allow. The adjudicator’s timetable was a fair one and he was entitled to
refuse Ringway permission to serve a rejoinder.
The final case setting out what might be termed the orthadox view is Amec Group Limited v 13.38
Thames Water Utilities.55 In that case, TWUL alleged that there had been a breach of natural
justice because the adjudicator had not taken into account matters noted in their further
response document, provided just over two days before the timetable expired. The judge
concluded that the adjudicator could not ignore that further response altogether because,
although he had refused permission for a formal further response, he had invited final sub-
missions. The judge said that, in an adjudication on a tight timetable, the adjudicator was
not oblidged to consider in detail a second round submission or pleading, served very late in
the adjudication process. His overriding obligation was to complete the decision in the
stipulated time period. If that meant that he could not read or digest in detail a document
provided just over two days before that decision had to be finalised and provided to the parties,
then that was simply one of the consequences of the adjudication process. In adjudication, a
requirement to consider every round of the parties’ submissions in detail, which might be
required of a judge or an arbitrator pursuant to the rules of natural justice, would always
be tempered by the adjudicator’s overriding obligation to comply with the time limit. As
the judge put it, ‘TWUL were not entitled to a further bite of the cherry, and even if they
chose to avail themselves of such an opportunity, the adjudicator was not obliged to wade
through their further submissions in microscopic detail.’
As noted above, very different considerations may apply if the adjudicator deliberately but erro- 13.39
neously failed to have regard to a pleading at all which, although provided late, was still served
some time before the adjudicator had to produce his decision. In CJP Builders Ltd v William Verry
Ltd 56 the contract required the response to the referral to be served seven days thereafter. The
substantial part of the response was in fact served five to six hours late. The adjudicator decided
that the particular contract under which the dispute arose meant that he had no discretion to
permit any extension of time and told the parties that he could have no regard to the contents of
the response. Verry contended there had been a breach of natural justice. Akenhead J said that,
on a proper construction, the clause of the contract did not prevent the adjudicator from grant-
ing appropriate extensions of time to either party for the service of documents, responses and
evidence. Thus the adjudicator had made a wholly honest but ultimately wrong decision to
exclude from his consideration Verry’s substantive defence to the claims made. The effect was
devastating, because it meant that, essentially, he had to treat the claim as uncontested. Accordingly,
Akenhead J concluded that the adjudicator had failed to apply the rule of natural justice that
entitled each party to be heard and to have his evidence and arguments considererd by the tribunal.
He had no doubt that the breach was material, and thus the decision was not enforced.
Communications with and Indications to the Parties

Unilateral Communications
The importance of avoiding any unilateral contact between the adjudicator and one of the 13.40
parties has already been stressed: see paragraphs 12.16–12.19 above.
55 [2010] EWHC 419 (TCC).

56 [2008] EWHC 2025 (TCC); [2008] BLR 545.
347
Natural Justice
Failure to Consult
13.41 A more significant problem may arise out of the adjudicator’s failure to consult with the parties,
either about a communication he has received from one party, or about a view or approach
he has formed independently of both sides. Thus in Discain Project Services Ltd v Opecprime
Development Ltd (No 1) 57 one of the claimant’s personnel contacted the adjudicator and had
a conversation in which some of the substantive issues in the adjudication were discussed.
That conversation was neither recorded by the adjudicator, nor was its substance communi-
cated to the defendant. There was a later conversation, also between the adjudicator and the
claimant’s employee. HHJ Bowsher QC considered that there was a very serious risk, if not
of bias, then at least of a failure on the part of the adjudicator to follow the rules of natural
justice, namely a failure to consult with one party on important submissions that had been
made by the other party. He said that he found such a situation ‘distasteful’ and could not
bring himself to enforce an adjudication decision that had been arrived at in that way. When
the matter was fully tried out 58 the judge concluded on the evidence that he should decline
to enforce the decision because it had been reached after a substantial and relevant breach of
natural justice.
13.42 A number of the reported cases concern an adjudicator who has failed to share with the parties
his approach to the particular dispute he has to resolve. Thus, in Balfour Beatty Construction
Ltd v The Mayor & Burgesses of the London Borough of Lambeth 59 the adjudicator was con-
cerned with a dispute as to extensions of time. The dispute was complicated, and involved
various debates about the proper approach to the critical path. The adjudicator sought help
from a programming expert, who adopted a particular methodology when analysing the
delay, which was then included by the adjudicator in his decision. It was a methodology that
had not been agreed, or even commented on, by either party; in fact, neither party was aware
of the particular approach taken by the adjudicator until they saw his decision. In particular,
the adjudicator failed to invite the parties’ comments on whether his as-built programme was
a suitable basis from which to derive a retrospective critical path analysis. In the circum-
stances, the HHJ LLoyd QC held that the decision was invalid and that the adjudicator had
not acted impartially. He said that an observer would conclude that, by making good the
deficiencies in the contractor’s case, and by overcoming the absence of a sustainable as-built
programme (and the complete lack of any analysis by the contractor as to which of the rele-
vant events were critical and non-critical) with his own analysis on which he had not even
asked the parties to comment, the adjudicator moved into the danger zone of being partial,
or at least liable to the accusation of ‘apparent bias’. The judge said that the burden of proof
remained on the contractor who was claiming the extension of time, so that the defendant
employer was entitled to have the dispute decided on the contractor’s own terms, namely on
the material that it had provided, and not on a basis devised by the adjudicator that had not
been made known to the parties. That perceived lack of impartiality or apparent bias could
have been cured by disclosure to the parties of what the adjudicator was doing, and what he
considered to be the right approach to the critical path. He should have told both parties
what he had in mind so as to give them an opportunity of either endorsing his approach or
57 [2000] BLR 402.

58 Discain Project Services Ltd v Opecprime Development Ltd [2001] BLR 287.
59 [2002] EWHC 597 (TCC); [2002] BLR 288.
348
A Fair Hearing
deflecting him from his chosen course.60 His failure to do so was fatal to the validity of his
decision.
Similarly, in RSL (Southwest) Ltd v Stansell Ltd 61 the adjudicator had relied on the report of 13.43
a separate independent expert which he had commissioned. HHJ Seymour QC concluded
that the adjudicator should not have had any regard to the final report without giving both
parties the chance to consider the contents of that report and to comment upon it. His failure
to do so was a breach of natural justice. It was also a relevant breach because, so the judge
concluded, the evidence demonstrated that the adjudicator took into account the report in
reaching his decision in relation to extensions of time for completion of the sub-contract
works. Also in similar vein, the TCC judge in Pring & St Hill Ltd v C J Hafner (T/A Southern
Erectors) 62 found that the adjudicator carried forward from an earlier adjudication (between
different parties) not merely what he had seen or been told, but also the judgments that he
had formed and the opinions that he had reached, all of which led him to reach a particular
conclusion in that other adjudication. The judge concluded that the adjudicator should have
made available to the defendant his thought processes as to why some of his earlier conclusions
in the previous adjudication were relevant, and that his failure to do so was a breach of the
principles of natural justice.63 In addition, it should also be noted that the adjudicator’s direc-
tions in respect of the final submissions were a complete muddle, with each party sending
their final submissions to the adjudicator but not providing them to one another. The judge
described such a procedure as ‘very unwise’ although he added that it was ‘one of the hazards
of adjudication and one which was self-inflicted’. That point alone, therefore, would not
have amounted to a breach of the rules of natural justice.
It will be a matter of fact as to whether the adjudicator adopted his own methodology in 13.44
determining the dispute between the parties, and the extent, if at all, to which he was obliged
to share that approach with the parties. This will often require a very detailed analysis of the
issues by the court. Thus, in Multiplex Constructions (UK) Limited v West India Quay
Development Company (Eastern) Limited,64 it was said that the adjudicator’s decision on the
contractor’s extension of time claim decided a case not put to him, and adopted an approach
that the parties were not given an opportunity to address. Ramsey J considered in detail the
issues in the adjudication, and the adjudicator’s determination of those issues, and con-
cluded that, unlike the adjudicator in Balfour Beatty, he had not adopted his own methodology,
but had instead carefully assessed the contractor’s own programming analysis, and made due
allowance for his concerns about their claim and the basis for it. There had been no breach of
the rules of natural justice.
One of the many disputes in Cantillon Limited v Urvasco Limited 65 was that the adjudicator 13.45
had acted unfairly because, although Cantillon had claimed specific preliminary costs for a
particular 13-week period of delay, the adjudicator had awarded them costs for a different
60 This is one of a number of cases where it might be said that the adjudicator was trying too hard to be help-
ful. A good example of this trend is McAlpine PPS Pipelines Systems Joint Venture v Transco Plc (TCC, unre-
ported, 12 May 2004) referred to at paragraphs 3.65–3.66.
61
[2003] EWHC 1390 (TCC).
62
[2002] EWHC 1775 (TCC); (2004) 20 Const LJ 402.
63
As the judge put it, ‘it is always going to be difficult for a party in the position of SE to challenge an award
made off stage in another adjudication . . .’.
64 [2006] EWHC 1569 (TCC); [2006] 111 Con LR 33.
65 [2008] EWHC 282 (TCC); [2008] BLR 250.
349
Natural Justice
and later 13-week period, without giving Urvasco the opuurtunity to deal with that claim.
Akenhead J concluded that the adjudicator had the juridisdiction to find that a later period
of delay than that claimed had in fact occurred. The claim was not, and should not have been
considered to be, limited to a loss and expense claim for 13 specific calendar weeks. Urvasco
could not say that they had not had the opportunity to address the financial ramifications of
there being a finding that reflected their own assertion that any prolongation occurred during
the later, not the earlier, period. The judge found that they had deliberately decided not to
take up that opportunity. He also found that the adjudicator had not, deliberately or otherwise,
misled the parties as to what he was or was not going to do. Indeed, the adjudicator had
hinted broadly that he might be finding that any delay could relate to the later period, rather
than the earlier period that had originally been claimed. Akenhead J also rejected the submis-
sion that the adjudicator was making Cantillon’s case for them and found instead that he was
properly assessing what was due to Cantillon, and investigating the facts as the evidence was
presented. Urvasco’s failure to respond to this emerging possibility did not convert what had
happened into a breach of natural justice.
13.46 The result in Cantillon v Urvasco can be catorgorised as one where the adjudicator was dealing
with complex factual issues and arrived at a result that was or should have been envisaged, at
least as a possibility, by both sides. The opposite was the case in Primus Build Ltd v Pompey
Centre Ltd and Another.66 In that case the contractor, Primus, claimed in adjudication the loss
of profit which they allegedly suffered when the office building element of a larger project
was omitted from their scope of work. Primus claimed over £100,000, whilst Pompey argued
that, on the evidence, no loss had been identified at all. Neither party’s position relied on or
took any point about Pompey’s accounts: indeed, although those accounts had been intro-
duced by Primus as part of their reply, the parties were agreed that the profit figures in those
accounts should be ignored for the purposes of calculating the loss of profit, if any, arising
out of the omission. The adjudicator, without consulting the parties, and without giving
them any notice of what he intended to do, produced a decision that awarded Primus about
half of their claim, on the basis of a calculation based on certain figures in the accounts.
13.47 Pompey’s contention was that the adjudicator’s unheralded decision to use figures from doc-
uments, which both sides had told him to ignore, amounted to a breach of natural justice.
The TCC judge agreed. He said that the reason why the adjudicator had to do his own
calculations was because he had rejected Primus’s own calculations, and therefore agreed
with Pompey that the claim as submitted was unarguable. As to the issue as to whether the
adjudicator should have consulted with the parties, the judge said that, where an adjudicator
considered that the referring party’s claims as pleaded could not be sustained, yet he himself
identified a possible alternative way in which a claim of some sort could be advanced, the
adjudicator would normally be obliged to raise that point with the parties in advance of his
decision. The judge went on to find that this principle must apply a fortiori in circumstances
where the adjudicator had been told by both sides to ignore the documents from which the
alternative approach was to be derived. Common sense demanded that, before reaching any
conclusion, the adjudicator must ask the parties for their submissions on that alternative
approach. The judge had no difficulty in concluding that, since the entire decision was
founded on the adjudicator’s calculation, the breach of natural justice was significant and
material. The decision was therefore not enforced.
66 [2009] EWHC 1487 (TCC); [2009] BLR 437.
350
A Fair Hearing
Taking Advice from Others

Another related theme, which arose (for example) in RSL, concerns the not uncommon 13.48
practice adopted by some adjudicators of seeking third party assistance in order to arrive at a
decision on the dispute. The first reported instance of this was the case noted in paragraph
13.42 above, Balfour Beatty Construction Ltd v The Mayor and Burgesses of the London Borough
of Lambeth.67 There the adjudicator employed somebody else to carry out a critical path
analysis. His failure to invite the parties’ comments on his new methodology led to his deci-
sion being unenforceable. In paragraph 41 of his judgment, the judge also dealt with the use
of third party assistance. HHJ Lloyd QC concluded that the adjudicator had sought and
obtained assistance from others in a manner which was not authorised by the original agree-
ment or the JCT rules. However, although this was therefore a breach of the rules, the judge
could not draw the conclusion that this breach had any material effect on the decision itself,
or that there was any material prejudice to the employer, or substantial injustice as a result.
Thus, if the natural justice point had been limited to the unauthorised use of third party
assistance (as opposed to the failure to consult the parties) the judge would have enforced the
There are a number of other cases on this topic, often concerned with disputed claims for 13.49
extensions of time. In Try Construction Ltd v Eton Town House Group Ltd 68 the adjudicator
obtained assistance from a programming expert. The parties agreed to such assistance being
provided and also agreed that the programming expert could contact the parties’ respective
programming experts independently. Eton’s defence to the subsequent enforcement application
of the adjudicator’s decision was based on the particular methodology adopted by the
programming expert. HHJ Wilcox said that there had been no breach of natural justice
during the adjudication, because the parties had agreed to the appointment of the expert,
and took a full part in the process that gave rise to the decision. Importantly, he found that
both parties had had the opportunity to respond to all issues arising out of the methodology
used in the expert’s analysis, and that therefore there had been no breach of the principles of
natural justice. Judge Wilcox distinguished the situation in Balfour Beatty on the basis that,
in that case, no analysis at all had been put forward by the contractor, and the adjudicator,
without agreement or notice, used an entirely independent analysis and devised his own
critical path. Furthermore, unlike the situation in Try, the responding party in Balfour Beatty
had not had the opportunity to deal with the relevant points. Indeed, in Try, both parties had
had a proper opportunity to deal with the analyst’s exercise; it was a wholly transparent pro-
cess and was therefore entirely legitimate. As noted in paragraph 13.43 above, RSL was, on
the facts, more akin to the situation in Balfour Beatty than the events which occurred in Try.
In BAL (1996) Ltd v Taylor Woodrow Construction Ltd 69 the adjudicator obtained his own 13.50
legal advice without telling the parties when he was going to meet with his legal advisers,
what material he would provide to them, or even if the advice he received would be in writing.
His decision was in the referring party’s favour but did not disclose the advice that he had
received. HHJ Wilcox concluded that, on these facts, there had been a breach of natural
justice. Furthermore, he rejected the argument that, in some way, the responding party had
acquiesced in the proposed procedure, saying that the significance of the procedure might
67 [2002] EWHC 597 (TCC); [2002] BLR 288.

68 [2003] CILL 1982.
69 [2004] All ER (D) 218 (Feb).
351
Natural Justice
not have been immediately apparent and the rapid time limits in adjudication left little time
to consider the full implications of that which the adjudicator had suggested. The judge said
that acquiescence had to be clear, informed and unambiguous and there was no suggestion
of that in the case under review. The decision was therefore not enforced.70
Indication of Preliminary View

13.51 The authorities make clear that the adjudicator is not generally obliged to indicate to the
parties that he has formed a particular preliminary view, in order to seek their express comments
upon it, unless (as explored above) his view is based on a new approach, which neither party
could have anticipated.71 Whether the failure to share his preliminary views will amount to
a serious breach of the rules of natural justice on the part of the adjudicator will always
depend on the facts. If, for example, the referring party contends that the delay was due to
reason A, and the responding party claims that it was due to reason B, then, if the adjudicator
forms a strong preliminary view that the referring party is right and the delay was caused by
reason A, he will not need to make that view known to the other side; the responding party
is already aware, and has prepared a case to meet, the allegation that the delay was due to
reason A. If, on the other hand, the adjudicator has considered all the material and reached
the conclusion that, in truth, the cause of the delay was reason C, it is thought that he would
be obliged to make that plain to the parties, in order to get them to deal with it. Thus, in
Shimizu Europe Ltd v LBJ Fabrications Ltd 72 the parties had agreed that their contractual
relationship was based on a letter of intent. The terms of the contract were not, therefore, in
issue. However, the adjudicator decided that LBJ’s entitlement to payment was not capped
by reference to the letter of intent but could be ascertained in a different way. HHJ Kirkham
decided that the adjudicator did not have jurisdiction to reach such a conclusion, because it
went outside the parameters agreed by the parties. However, in the alternative, the judge said
that at the very least, prior to his decision, the adjudicator should have made clear to the par-
ties that, although they had agreed that they had contracted on the basis of the letter of
intent, he was proposing to decide whether or not that was so, and he should have given them
the opportunity to make submissions on the question of contract formation. By not doing
so, the adjudicator acted in breach of the rules of natural justice, with the consequence that
the court would be slow to give summary judgment to enforce his decision.
13.52 Two further examples should be noted of situations where the court concluded that the
adjudicator should have indicated to the parties, in advance of his decision, the basis of his
conclusions, and where his failure to do so amounted to a breach of natural justice.
1. In Ardmore Construction Ltd v Taylor Woodrow Ltd 73 the part of the claim in the adjudication
concerned with overtime was based solely on the construction of a particular letter. The
eventual decision on the point, however, was based upon the adjudicator’s summation
70 For an example of a situation where the adjudicator obtained legal advice from counsel, and there was no
breach of natural justice, see Michael John Construction v Golledge and Others [2006] EWHC 71 (TCC); [2006]
TCLR 3.
71
In Carillion, Chadwick LJ, citing Jackson J at first instance, reiterated that it is often not practicable for
an adjudicator to put his provisional views to the parties and it would only be in an exceptional case, like Balfour
Beatty, that a failure to share provisional conclusions with the parties will amount to a breach of natural
justice.
72 [2003] BLR 381.
73 (2006) CILL 2309.
352
A Fair Hearing
of discussions that had taken place at a meeting that the adjudicator had convened, and
that the court described as ‘more of an open-ended discussion than a controlled, struc-
tured meeting’. Notwithstanding that, the adjudicator had used those discussions to
make findings of acquiescence and verbal instructions wholly independent of the letter.
The defendant had been given no opportunity to investigate such matters or to place
relevant evidence before the adjudicator. The Outer House of the Court of Session,
although indicating that it was mindful of the dangers of picking over decisions and
adjudicators’ procedures too critically, held that this was a clear breach of natural justice,
with the result that that part of the decision dealing with the overtime claim was reduced.
The alternative approach should have been put to the defendant in advance of the
decision.
2. The same criticism was upheld in Humes Building Contracts Limited v Charlotte Homes
(Surrey) Ltd,74 where the adjudicator based his decision on a view of the law which had
not been argued by or put to either party. The TCC judge found that whether the inter-
ests of fairness required an adjudicator to put a matter to the parties for comment that
had not previously been raised would depend on the circumstances, and no hard-and-
fast rule could be laid down. In that case, he concluded that the adjudicator’s failure to
put to the parties his view that the absence of a withholding notice meant the defendant
could not rely on a set-off based upon extensive evidence of defective work carried out by
the claimant was a breach of natural justice. It meant that the adjudicator had excluded
a substantial part of the defence without consideration of its merits, for reasons that were
wrong in law. The decision was not summarily enforced.
A topic inextricably linked to the adjudicator’s duty, in certain circumstances, to share and 13.53
invite comments upon his preliminary views is the question of his or her own expertise and
the role that it might play in the decision-making process. In many technical cases, the adju-
dicator will have been chosen for his or her particular knowledge and experience in that
specialist field. If the adjudicator then brings that knowledge and experience to bear on the
evidence that is presented, then it has been held that, unsurprisingly perhaps, such a process
cannot on its own be a legitimate ground for complaint. In Dr Rankilor v Perco Engineering
Service Ltd and Another,75 the dispute concerned ground conditions. The contractor said that
they were unexpected; the employer disagreed, contending that the tender indicated that the
ground would be clay, and that was what was encountered on site. The adjudicator, who was
an expert, concluded that the particular conditions were unexpected. He reached that view
by relying, at least in part, on his own geological expertise and applying it to the evidence.
HHJ Gilliland QC held that it was for the adjudicator to share all his preliminary views with
the parties, particularly in circumstances where they were based entirely upon the technical
data that had been provided in the course of the adjudication. His conclusions were not at odds
with the evidence, and his decisions were summarily enforced. In addition, as the judge
pointed out, it was inevitable that the adjudicator’s decision would be influenced/guided by
his personal knowledge, experience and understanding, such that this could never be, of
itself, a legitimate ground for complaint.
74
4 January 2007, a decision of HHJ Gilliland QC sitting at the TCC in Salford. For a case in which the
adjudicator informed the parties in advance of what he proposed to do, and then did it, so that no unfairness
could result, see Balfour Beatty Engineering Services (HY) Ltd v Shepherd Construction Ltd [2009] EWHC 2218
(TCC); [2009] 127 Con LR 110, para 72, discussed at paragraph 13.65(2).
75 [2006] Adj LR 01/27.
353
Natural Justice
Procedural Difficulties
Ambush
13.54 Another theme related to those discussed above is the question of ambush, and in particular
the provision, late in the 28-day period, of further information (often by the referring
party) that the adjudicator may take into account without giving the responding party an
opportunity to deal properly with that information. This has been dealt with, in the context
of large and complex claims, at paragraphs 13.13–13.25 above, and in the context of late
submissions, at paragraphs 13.36–13.39 above. It is submitted that the position now is that
an ambush argument is, without more, unlikely to succed, and the older cases suggesting
otherwise should be treated with caution. The best-known is London and Amsterdam
Properties Ltd v Waterman Partnership Ltd,76 where substantial information and evidence
was provided to Waterman for the first time during the latter stages of the adjudication.
This material, which related to important aspects of the quantum of the claim, was served
late, with the result that Waterman did not have an opportunity to address it. Despite the
fact that Waterman had not been given that opportunity, the information was used as the
basis for important elements of the adjudicator’s decision. It was found that the responding
party had therefore demonstrated a substantial, live and triable issue as to the impartiality
of the adjudicator.
13.55 There are a number of other cases on this same point. In McAlpine PPS Pipeline Systems Joint
Venture v Transco plc,77 the facts of which are set out at paragraphs 3.65–3.66 above, HHJ
Toulmin CMG QC found that Transco had a realistic prospect of arguing at trial that it was
not afforded a fair opportunity to respond to the evidence about the compensation events,
which had been served at a late stage of the adjudication process. He therefore concluded
that the adjudicator had acted unfairly and that, since that unfairness created a real prospect
of prejudice, he would not enforce the adjudicator’s decision. Similarly, although HHJ
Seymour QC’s decision in Edmund Nuttall Ltd v R G Carter Ltd 78 was principally concerned
with whether or not the dispute that the adjudicator decided was the dispute that had crys-
tallised between the parties at the time of the notice of adjudication, the judge also dealt
with the underlying fairness of the situation in which the responding party found itself
facing, for the first time in the adjudication, a claim that the judge considered was radically
different to that which had been debated between the parties prior to the adjudication.
13.56 Notwithstanding these particular decisions, the general approach in the TCC is that, even
in larger claims, there are certain features of adjudication that, however unsatisfactory they
might be, are inherent in the process. These include the likelihood that not all of the mater-
ial served by the referring party in the adjudication will have been seen before; that the
volume of material served with the referral notice might be very extensive and may very
well not be capable of being responded to item-by-item, either during the 7 or 14 days in
which the response is required or even during the entire adjudication; and that any time-
table for the responding party’s response, let alone any reply and any rejoinder, will be very
limited.
76 [2004] BLR 179.

77 TCC, unreported, 12 May 2004.
78 [2002] BLR 312.
354
A Fair Hearing
Thus, in Bovis Lend Lease Ltd v The Trustees of the London Clinic 79 Akenhead J rejected the 13.57
defendant’s contention that the nature and volume of the new material and the timetable
imposed amounted to an ambush and therefore a breach of the rules of natural justice. At
paragraph 68 of his judgment, he observed that not once during the course of the adjudica-
tion had the defendant or its professional advisors complained or even made the assertion that
it had had insufficient time to address the referring party’s case. He also noted that the respond-
ing party had been able to give consideration to the detailed claim, such that its response had
led to the adjudicator reducing the claim by over 40 percent. In short, he concluded that suf-
ficient time had been requested and taken by the responding party to address the issues in the
adjudication in sufficient detail, and that there had been no ambush of any sort.
Effect of Earlier Adjudications

It is often difficult for an adjudicator, appointed in a subsequent adjudication, to work out 13.58
what, if any, limits or restraints have been placed upon him as a result of earlier decisions.
A review of the authorities suggests that adjudicators can be caught between two inflexible
rules: on the one hand, they must not reach a decision that qualifies or alters, even implicitly,
any earlier adjudication decisions but, at the same time, they cannot always assume that the
mere fact that a point has or may have arisen in an earlier adjudication means that they
cannot consider it afresh. If they do purport to decide something which has already been
decided in a previous adjudication, they may well be taken to have acted unfairly in so
doing.
The difficulties are well illustrated in the case of Quietfield Ltd v Vascroft Construction Ltd,80 13.59
the facts of which are set out in detail in paragraphs 14.39–14.41 below. In short, in a second
adjudication, an employer claimed liquidated damages for a period of delay for which an
application by the contractor for an extension of time on particular grounds had been refused
by the first adjudicator. The contractor defended himself by reference to an entitlement to an
extension of time that relied on material (‘Appendix C’) that had not been referred to in the
first adjudication. Jackson J referred to a number of authorities, including the decision in
William Verry (Glazing Systems) Ltd v Furlong Homes Ltd 81 in which the TCC judge had held
that where a claim was made in adjudication, the responding party could employ all available
defences to that claim. Jackson J decided that Vascroft’s alleged entitlement to an extension
of time, as set out in Appendix C, was substantially different from the claims for an extension
of time which were advanced, considered and rejected in the first adjudication. He con-
cluded that Appendix C ought to have been considered in the third adjudication and that, as
a result, the decision in that adjudication could not be enforced because the adjudicator
failed to abide by the rules of natural justice.
Quietfield appealed, but their appeal was dismissed.82 May LJ said that it was as clear as may 13.60
be that the dispute referred to the first adjudication was Vascroft’s disputed claim for extension
of time on the grounds advanced in their two earlier letters. Since Vascroft’s Appendix C in
79
[2009] EWHC 64 (TCC); 123 Con LR 15.
80
At first instance, this case is reported at [2006] EWHC 174 (TCC); 109 Con LR 29. In the Court of
Appeal, this case is reported at [2007] BLR 67.
81 [2005] EWHC 138 (TCC); see paragraph 13.21.
82 [2007] BLR 67.
355
Natural Justice
the third adjudication identified a number of causes of delay that did not feature in the two
letters and were substantially different from the claims for extension of time that were advanced,
considered and rejected in the first adjudication, the adjudicator was wrong in the third adju-
dication not to consider Appendix C. Dyson LJ delivered a concurring judgment.83
13.61 The decision in Quietfield was considered by Ramsey J in HG Construction Ltd v Ashwell
Homes (East Anglia) Ltd,84 the facts of which are set out in paragraphs 14.42–14.43 below.
In that case, the second adjudicator acted outside his jurisdiction and/or unfairly, because
the dispute about the liquidated damages provisions that he purported to decide was sub-
stantially the same as the dispute that had already been decided by the first adjudicator. And
in Benfield Construction Ltd v Trudson (Hatton) Ltd,85 the second adjudicator decided that
practical completion had been reached on the date alleged by the contractor, despite the fact
that the first adjudicator had decided that it had not. The decision of the second adjudicator
was therefore unfair and unenforceable.
13.62 In Jacques and Another v Ensign Contractors Ltd 86 there were a number of adjudications. In
adjudication 4, decided by Mr Sucliffe, he directed that the contractor should pay the
employer some £28,000, but rejected the bulk of the employer’s claim for defects. That decision
was never enforced and the parties subsequently reached a written agreement that it was null
and void. In adjudication 5, Mr Paul Jensen was appointed as the adjudicator. Questions of
defects again arose and the contractor relied on various passages in Mr Sucliffe’s decision that
suggested that the defects claim was considerably overstated. The employer objected to the
reference to the fourth adjudication decision, because it had been agreed that it was null and
void, and the adjudicator said that he would have no regard to it. His decision was in favour
of the employer. The contractor said that there had been a breach of natural justice by the
adjudicator in failing to have regard to the earlier decision. Akenhead J rejected that submis-
sion: the earlier decision was was not binding on Mr Jensen, so that decision could not inherently
be a defence to the claim in adjudication 5. Moreover, he found that, even if Mr Jensen had
decided that he could have regard to the substantive decision in adjudication 4, that would
have been a decision within his jurisdiction, provided that he did not go on to abdicate his
own responsibility to decide the dispute referred to him. The adjudicator’s function was to
consider the evidence and argument placed before him and his view that the earlier adjudica-
tor’s decision was irrelevant and inadmissible was a respectable one and was not a breach of
natural justice.
Miscellaneous
13.63 There are a number of other decisions that are useful pointers to the limits of a natural justice
argument arising out of an adjudicator’s decision. At one end of the spectrum is J W Hughes
Building Contractors Ltd v G B Metalwork Ltd 87 where Forbes J rejected the submission that
the failure on the part of JWH’s solicitors to provide their own clients with documents served
83
The decision in Quietfield is also important on the extent to which a subsequent adjudicator is bound by
the findings of an earlier adjudicator. This is a point dealt with at paragraphs 7.97–7.106.
84
[2007] EWHC 144 (TCC); [2007] BLR 175.
85 [2008] EWHC 2333 (TCC); [2008] CILL 2633.
86 [2009] EWHC 3383 (TCC).
87 [2003] EWHC 2421 (TCC).
356
A Fair Hearing
during the course of the adjudication somehow resulted from unfairness on the part of the
adjudicator. He found that there was nothing in the adjudicator’s decision that gave any
indication that the adjudicator was aware of any embarrassment being experienced by JWH
in dealing with the matter due to the failure of JWH’s own solicitors to provide them with a
copy of the original referral documentation. The judge pointed to the strict timetable that
applied in adjudications and observed that the adjudicator had to deal with the case as
best he could within the constraints of that timetable. Although the adjudicator was aware
that JWH had some problems with regard to missing paperwork, he satisfied himself that
GBM had done what they were required to do by way of service of documentation on JWH’s
solicitors. JWH had been invited to raise the matter further some six days in advance of the
adjudication meeting, but they did not do so. In those circumstances, there was simply nothing
more that the adjudicator could have done.
At the other end of the spectrum is the decision of HHJ Seymour QC in A & S Enterprises Ltd 13.64
v Kema Holdings Ltd.88 In that case the adjudicator suggested a meeting. Because of the short
notice, a Mr Overend of Kema was unable to attend that meeting, although the suggestion
had been made that he join the meeting by way of conference call. In fact the meeting went
ahead with another representative of Kema attending by telephone. The adjudicator’s decision,
which was in favour of A & S, criticised Mr Overend for ‘choosing not to make himself avail-
able by telephone’ and therefore playing no part in the meeting. The adjudicator described his
failure to take part in the meeting as ‘very unhelpful’ and he said that he had viewed Kema’s
submissions and arguments that they had put forward ‘in this light’. Judge Seymour had no
difficulty in concluding that the adjudicator’s conduct revealed both a real possibility of bias
and a breach of natural justice. He found that the adjudicator did not make clear to the parties
at any stage before his decision that Mr Overend’s attendance was necessary or that his
non-attendance would prejudice the defendant. If the adjudicator felt that it was important
that Mr Overend attend the meeting, then he had to make that clear to Kema, in order to give
them an opportunity to deal with it. His failure to do so meant that his decision did not
comply with the requirements of natural justice and was therefore unenforceable.89
Three recent cases illustrate the wide-ranging nature of the matters which have been alleged 13.65
(but not found) to constitute a breach of natural justice by the adjudicator:
1. In Gipping Construction Ltd v Eaves Ltd 90 the claimant contractor was seeking to enforce
an adjudicator’s decision against the defendant developer. The dispute in the adjudication
had concerned whether the bungalows in question were complete and free of defects and,
if so, what sums were due to the claimant. In the enforcement proceedings, the defendant
claimed that there had been a breach of natural justice because the adjudicator had not
undertaken an on-site inspection and so therefore had no first-hand knowledge of the
defects that were at the centre of the dispute. Akenhead J rejected that argument, saying
88 [2004] CILL 2165.

89 In Vaultrise v Paul Cook [2004] ADJCS 04/06 the adjudicator ruled that a meeting previously arranged
for 12 February would go ahead on that date because otherwise he did not have sufficient time to produce the
decision. The defendant was represented at the hearing although his solicitor was not available. The defendant
subsequently alleged that this procedure was unfair. The court concluded that, because the defendant was
represented and had plenty of opportunity to arrange alternative representation, the adjudicator could not be
criticised for going ahead with the meeting and not adjourning it to a later date when the first-choice solicitor
was available. Again, the reason for this was the adjudicator’s statutory deadline.
90 [2008] EWHC 3134 (TCC).
357
Natural Justice
that there was no obligation on the adjudicator to have a site inspection, which would
always be a matter for his or her discretion in all the circumstances. He went on to say that
the adjudicator had sufficient material before him to conclude that the defects were mat-
ters of design, and therefore not the claimant’s responsibility in any event. Akenhead J
said that a court should not criticise an adjudicator for deciding not to have a site visit in
circumstances where it had not been, and could not be, established that it was essential
that such a visit take place.
2. One of the issues that arose in Balfour Beatty Engineering Services (HY) Ltd v Shepherd
Construction Ltd 91 concerned the adjudicator’s decision to draw an adverse inference
against Shepherd as a result of their failure to produce documents that the adjudicator
considered to be relevant. Akenhead J concluded that there had been no breach of natural
justice. He said that adjudicators were not bound by the usual rules of evidence and so
could draw such inferences if they believed them to be warranted. He went on to say that,
in such a situation, it may well be appropriate for an adjudicator to give advance notice
of at least the possibility that he might draw such an inference, and obsevered that this
was precisely what the adjudicator had done in that case. Accordingly, the adjudicator
had acted fairly.
3. In Rok Building Ltd v Celtic Composting Systems Limited (No 2) 92 the defendant, Celtic,
argued that the adjudicator’s decision contained an obvious error and that, pursuant to
the express terms of the procedure which the parties had adopted (which allowed the
correction of accidental errors and omissions), his failure to apply the slip rule correctly
amounted to a breach of natural justice. However, the difficulties with Celtic’s argument
were encapsulated in the fact that, at the relevant time, they had not themselves identified
some simple slip or error, but had instead put before the adjudicator a complex calcula-
tion which, to the extent that it was comprehensible, seemed to go to the heart of the
decision. In such circumstances, Akenhead J had little difficulty in concluding that, on
the facts, the adjudicator was best placed to determine whether there really had been an
accidental error or ommisson and that, on the evidence before him, there was no
evidence of any such error. The alleged breach of natural justice was therefore not made
out. As a matter of logic, it would seem to follow that, if an adjudicator was expressely
entitled and obliged to correct accidental errors, and refused to correct an error that was
both obvious and significant, he might be in breach of the general rule to act fairly.
Human Rights
13.66 When the 1996 Act came into force, there was a lingering uneasiness as to whether the swift
and summary nature of the adjudication process was entirely compatible with the European
Convention on Human Rights. Article 6 of the Convention provides that:
In the determination of his civil rights and obligations . . . everyone is entitled to a fair and
public hearing within a reasonable time by an independent and impartial tribunal established
by law. Judgment shall be announced publicly . . .
In some ways, a comparison between the adjudication process and this entitlement demon-
strates two completely opposite imperatives in operation. If Article 6 does not apply to
91 [2009] EWHC 2218 (TCC); [2009] 127 Con LR 110.

92 [2010] EWHC 66 (TCC); [2010] 130 Con LR 74.
358
A Fair Hearing
adjudications, because the adjudicator’s decision is only of temporary effect, then it might be
argued that Article 6 does not apply to any orders of the court, such as interim custody orders,
that are not intended to have a permanent effect. If that were right, Article 6 would be significantly
reduced in scope. If, on the other hand, Article 6 applied to adjudication, there would be
numerous challenges to the adjudicator’s decision on the basis that, very often for reasons
inherent in the adjudication process itself, there had not been ‘a fair trial’. In Elanay Contracts
Ltd v The Vestry 93 the defendant claimed that the adjudicator’s decision was unenforceable
because it had not been provided with a fair hearing. In particular it was said that the principal
person involved in the relevant events on behalf of the defendant spent most of the 28 days
in hospital, visiting his dying mother, which difficulties were compounded by the late delivery
of documents produced by the claimant. HHJ Havery QC noted that the procedure had to
be completed within the required period, and whilst that may well be inherently unfair, it was
the time limit pursuant to which the adjudicator had to comply. As to Article 6, Judge
Havery pointed out that the proceedings before an adjudicator were not in public. More
significantly, he concluded that Article 6 did not apply to an adjudicator’s decision or to
proceedings before an adjudicator because, although the adjudicator was concerned with a
decision or determination of civil rights, the decision was not in any sense a final determination.
Thus, he said, the fact that the procedure before the adjudicator is very much a rough and
ready procedure cannot, of itself, be regarded as a reason for not ordering summary judgment.
He also made the point that, if Article 6 did apply to adjudications, then ‘it is manifest that
a coach and horses is driven through the whole of the 1996 Act’.
A much fuller consideration of the correlation between Article 6 of the Convention on the 13.67
one hand, and the adjudication process on the other, was provided by HHJ Bowsher QC in
Austin Hall Building Ltd v Buckland Securities Ltd 94 Austin Hall, with an adjudicator’s deci-
sion in their favour, took steps to enforce that decision. Buckland resisted the application,
complaining that, as the responding party, they had had no proper and equal opportunity to
respond the claims made in the adjudication, that the time allowed for the adjudication had
been insufficient, and that there was no public hearing and pronouncement of the decision.
Therefore, they contended that the adjudication had been conducted in breach of Article 6
of the Convention. Judge Bowsher rejected all of those points. He concluded that adjudication
proceedings were not legal proceedings and did not result in a judgment that, in itself, could
be enforced. A decision of an adjudicator was not itself enforceable; the successful party had
to issue a separate application in court in order to enforce the decision. Moreover, the judge
said, an adjudicator under the 1996 Act was not a public authority and was not bound by the
Human Rights Act.
Perhaps more importantly, the judge concluded that, even if the adjudicator was a public 13.68
authority under the Human Rights Act, all the requirements of Article 6 of the Convention
were satisfied, if the adjudication process was looked at in the round. At paragraph 45 of his
judgment, he said:
If one considers the whole of that process, including the court proceedings necessary to enforce
the decision then there is necessarily a public hearing before the decision is enforced (if enforce-
ment be necessary) and all the other requirements of Article 6 are satisfied. To illustrate the
principle behind that decision one need look no further than consider the long standing
93 [2001] BLR 33.

94 [2001] BLR 274.
359
Natural Justice
process of the court granting an interim injunction without notice, or ex parte as it used to be
said. An injunction granted without notice to the defendant, if viewed on its own, is made in
breach of the rules of natural justice and in breach of Article 6 of the Convention. To test
whether there is a breach of Article 6 or of the rules of natural justice, one must look at the
process as a whole, including the urgency of the situation, the safeguards ordered by the court
including a cross-undertaking in damages, and, more importantly, an order limiting the length
of the injunction in time until an early public hearing on notice to the defendant. One has to
balance against those safeguards the consideration that the rights of the citizen, such as the
rights of a newspaper’s rights of freedom of expression, may be seriously limited and the short
period of the limitation of those rights may be very important . . .
The judge went on to find, on the facts of that case, that the adjudicator’s conduct was not
unlawful and there was no breach of the Convention. Part of the reasoning behind that
conclusion was, of course, the short period in which the adjudication was required by statute
to be carried out and completed. The time limits that the adjudicator had set for the proper
disposition of the adjudication were tight, but they were necessary in order for him to
comply with the 28-day time limit for his decision, and that was imposed upon him by the
1996 Act.
13.69 A further factor in Judge Bowsher’s decision was his re-statement of the principle that he had
set out in Discain (and Judge Lloyd had repeated in Glencot), to the effect that the rules of natural
justice applied to adjudications. Thus, said Judge Bowsher, in practice adjudications were
governed by the rules of natural justice, which were not very different from Article 6 of the
Convention, except for the requirement of a public hearing and the public pronouncement of
the decision. The time limits that were the subject of Buckland’s attack were also generally
subject to the rules of natural justice, but as the judge pointed out, there could be no question
of an Act of Parliament being attacked in the courts as being itself in breach of the rules of nat-
ural justice. Since the adjudicator was constrained by the 1996 Act to impose the time limits
that he did, he could not be criticised for breaching the rules of natural justice in so doing.
13.70 It would appear that, certainly for the moment, Judge Bowsher’s judgment in Austin Hall has
dealt comprehensively with the suggestion that adjudication itself is contrary to the Human
Rights Act. Indeed, the only subsequent decision in which the point has arisen was R G Carter
Ltd v Edmund Nuttall Ltd (No 2) 95 in which Judge Bowsher referred to his own decision in
Austin Hall and reiterated his view that he did not believe that the Human Rights Act 1998
applied to adjudication but that, even if it did, there was no breach of the Act. He concluded
that he did not believe that the Human Rights Act made any difference in that case. It is,
perhaps, a source of some surprise that, given the sheer volume of litigation in the last decade
concerning the European Convention on Human Rights and the Human Rights Act, the
compatability of the 1996 Act with those statutory requirements has not been tested in a
higher court.
Unfair Terms in Consumer Contracts Regulations

13.71 As their names suggest, the Unfair Terms in Consumer Contracts Regulations (‘UTCCR’)
are designed to provide a measure of protection to consumers in their dealings with larger
commercial organisations. Regulation 5(i) provides that:
95 [2002] BLR 359.
360
A Fair Hearing
A contractual term which has not been individually negotiated should be regarded as unfair if,
contrary to the requirement of good faith, it causes a significant imbalance in the party’s rights
and obligations arising under the contract to the detriment of the consumer.
Regulation 5(ii) goes on to say:
A term shall always be regarded as not having been individually negotiated where it has been
drafted in advance and the consumer has, therefore, not been able to influence the substance
of the terms.
There have been a number of cases in which an employer, who has found himself on the receiv- 13.72
ing end of an adjudicator’s decision in favour of the contractor, has sought to rely on the
UTCCR in order to resist enforcement and strike down the adjudication provisions. Before
turning to the adjudication cases, it should be noted that the test of ‘significant imbalance’,
which is a vital ingredient of any attack based on the Regulations, was the subject of consid-
eration by the House of Lords in Director General of Fair Trading v First National Bank plc.96
Lord Bingham of Cornhill said that:
The requirement of significant imbalance is met if a term is so weighted in favour of the supplier
as to tilt the parties’ rights and obligations under the contract significantly in his favour. This
may be by the granting to the supplier of a beneficial option or discretional power, or by the
imposing on the consumer of a disadvantageous burden or risk or duty . . . This involves look-
ing at the contract as a whole. But the imbalance must be to the detriment of the consumer.
The first case in which the UTCCR were considered in the context of adjudication was 13.73
Picardi v Cuniberti & Cuniberti.97 In that case the architect claimed that he had been engaged
by the defendants pursuant to the RIBA Conditions of Engagement, which included an
adjudication clause. The subsequent fee dispute was referred to adjudication and the adjudi-
cator awarded the sum of about £50,000 in favour of the claimant architect. The TCC judge
refused to enforce the decision on the basis that, on the evidence before him, the contract
between the parties did not include the RIBA Conditions, and therefore did not include any
express adjudication provisions. Since the work involved the employer’s own residence, the
1996 Act did not apply (by operation of s106), so the Scheme for Construction Contracts
could not be implied into the contract either. That, of course, was sufficient to deal with the
case. However, the judge went on to consider the operation of the UTCCR. He concluded
that, because the work in question involved a private dwelling house that was excluded from
the 1996 Act, a contractual provision that, despite this exclusion, adjudication was to be the
initial method of dispute resolution, was clearly an unusual provision that had to be brought
to the specific attention of the lay party if it was later to be validly invoked. He concluded
that a procedure that the consumer was required to follow, and that would cause irrecoverable
expenditure in either prosecuting or defending a claim brought pursuant to it, was some-
thing that may hinder the consumer’s right to take legal action. The fact that, in this particular
case, the consumer, as a residential occupier, was excluded from the 1996 Act, reinforced that
view. The judge also referred to the fact that the RIBA Guidance required their members
individually to negotiate adjudication clauses with their employer. Although he thought that
they were right to recommend the giving of such guidance, the architect in the instant case
had not done so. Accordingly the judge concluded that if, contrary to his view, the adjudication
96 [2002] 1 AC 481.
97 [2003] BLR 487.
361
Natural Justice
provisions had been incorporated into the contract with the defendants, they would have
been excluded by reason of the UTCCR.
13.74 The decision in Picardi was considered almost immediately by HHJ Moseley QC in Lovell
Projects Ltd v Legg & Carver.98 The facts were superficially similar, in that the defendants were
the employers and the claimant, who was successful in the adjudication, was the contractor.
The contract incorporated the JCT Minor Works Form, and therefore included a set of
express adjudication provisions. The defendants sought to resist the enforcement by reference
to the UTCCR. Judge Moseley rejected the argument that the adjudication provisions
were unfair. He said that, to be unfair, the terms must cause a significant imbalance in the
parties’ rights and obligations under the contract, to the detriment of the consumer.
Furthermore, that significant imbalance had to be caused by the adjudication provisions
contrary to the requirement of good faith. He concluded that neither requirement was satisfied
in the instant case. This was because the adjudication terms in the JCT Form applied equally
both to contractors and employers, and that there had been no breach of the requirement of
openness, because the adjudication terms were fully, clearly and legibly set out in the contract
and contained no concealed pitfalls or traps. As for the requirement of fair dealing, the con-
tractor did not, either deliberately or unconsciously, take advantage of the consumer’s necessity,
indigence, lack of experience, unfamiliarity with the subject matter of the contract, weak
bargaining position or any other factor listed in the Schedule to the Regulations. The judge
also pointed to a factor, which will commonly be present and which will often be decisive of
this point, namely that the contract form containing the adjudication provisions had been
required by the architect acting on behalf of the employer himself. It was very difficult to
argue that the employer was prejudiced by contract terms proffered by his own agent.
13.75 This important point was one of the reasons which led Judge Moseley to distinguish the
factual situation in Lovell from that in Picardi. He pointed out that the adjudication provi-
sions in Picardi had not been the subject of clear advice from the employer’s architect; indeed,
his dispute was with the architect who should have provided that advice. Judge Moseley said
that, whilst he entirely accepted the correctness of that decision, it had no application to a
case where the form of contract was insisted on by the employers, who had available both
advice from solicitors and from the architect, who was their nominated contract administra-
tor. It is respectfully submitted that Judge Moseley was right, on the facts of Lovell, not to
follow Judge Toilmin’s obiter remarks in Picardi. Furthermore, the facts of Lovell are more
likely to recur in the future than those in Picardi, which is perhaps best regarded as a case on
its own particular facts.
13.76 Judge Moseley’s approach has been followed in a number of subsequent cases. In Westminster
Building Co Ltd v Beckingham 99 the employer engaged the claimant contractor to carry out
works to his house. The principal contract document was a specification, which contained a
provision that the contract would be the JCT IFC form, a standard form of building contract
that included a set of express adjudication provisions. The contractor signed the form that
had been sent to him by the defendant’s surveyors and, although the defendant never signed
it, he did not inform his surveyors that he had any objection to its form or content. HHJ
Thornton QC concluded that those contractual provisions applied. As to the attack based on
98 [2003] BLR 452.

99 [2004] BLR 163.
362
A Fair Hearing
UTCCR, the judge rejected it. He said that, although the contract terms were not individually
negotiated, they were couched in plain and intelligible language. Moreover, those terms had
been decided upon by the surveyors who were Mr Beckingham’s agents, and thus Mr Beckingham
had available to him competent and objective advice as to the existence and effect of the
adjudication clause before he proffered and entered into the contract. Westminster did
no more than accept the contract terms offered, and had no reasonable need to draw to
Mr Beckingham’s attention the potential pitfalls to be found in the adjudication clause and
its operation during the course of the work. The clause did not therefore contravene the
requirement of good faith. Furthermore, the judge agreed with Judge Moseley that the adju-
dication provisions did not constitute a significant imbalance as to Mr Beckingham’s rights,
and did not significantly exclude or hinder the consumer’s right to take legal action or other
legal remedy, or restrict the evidence available to him.
In Bryen & Langley Ltd v Martin Rodney Boston,100 HHJ Seymour QC reached a similar view. In 13.77
that case, the judge pointed out that one of the important features in Picardi was that the form
of contract that contained the provisions that the judge considered to be unfair was put forward
by the architect claimant, who was then seeking to rely on them if he established the contract
for which he contended. That was not the case in either Lovell or Westminster. Judge Seymour
concluded that, on the facts in Bryen & Langley, the UTCCR were of no application. He stressed
the importance of the professional advice that would have been given to the employer as to the
proposed form of contract, saying that, in English law, it was not normally the function of a
party negotiating a contract to protect the other party in the negotiations from the conse-
quences of his own folly, or from the negligence of third parties, such as the professional advisers
to the other party. Thus, the judge reasoned, it would be an unusual case in which it would not
be a complete answer, to any suggestion that a building contractor had acted in bad faith in letting
a consumer choose to use a particular standard form of building contract, to point out that the
consumer had made his own decision, with or without the advice of a third party.
For other reasons, Judge Seymour did not enforce the adjudicator’s decision on jurisdiction 13.78
grounds. When the case went to the Court of Appeal, that other part of his judgment was
overturned.101 However, on the points arising under the UTCCR, the Court of Appeal
agreed with Judge Seymour’s analysis. Rimer J, who gave the principal judgment in the
Court of Appeal, said that it was necessary to consider not merely the commercial effects of
the term on the relative rights of the parties but, in particular, whether the term had been
imposed on the consumer in circumstances which justified a conclusion that the supplier
had fallen short of the requirements of fair dealing. Thus, he said, Mr Boston faced exactly
the same difficulties as did the consumers in the Lovell and Beckingham cases: the relevant
provisions were not imposed upon him by the supplier; instead it was Mr Boston, the con-
sumer, acting through his agent, who imposed those conditions on the supplier. Even on the
assumption that Mr Boston played no part in the preparation of the invitation to tender and
did not receive advice as to the adjudication provisions, he had had the opportunity to influence
the terms on which the contractors were being invited to tender. Rimer J concluded that,
since it was Mr Boston (by his agent) who had imposed the terms, the suggestion that there
was any lack of good faith or fair dealing by the contractor, with regard to the ultimate incor-
poration of those terms into the contract, was ‘repugnant to common sense’.
100 [2004] EWHC 2450 (TCC); [2005] BLR 28.

101 [2005] EWCA Civ 973; [2005] BLR 508.
363
Natural Justice
13.79 The more recent cases on this point have followed this approach.102 In Steve Domsalla
(t/a Domsalla Building Services) v Kenneth Dyason,103 HHJ Thornton QC held that the adju-
dication provisions themselves did not substantially alter the balance of the parties’ rights
and obligations and so were not caught by the Regulations. However, because Mr Dyason
was the employer in name only, the contract having been negotiated and administered by his
insurers or their agent, the judge concluded that the withholding notice provisions were
unfair and not binding. He said that Mr Dyason was unable to avoid the effect of an adverse
adjudication decision relating to unpaid certificates, even where there were good cross-claims
for defects and delay, because (through no fault of his) no withholding notices had been
served. The adjudicator’s decision, which had given effect to the withholding notice provi-
sions, and had therefore ignored the detail of Mr Dyason’s cross-claim, was not summarily
enforced. Permission to appeal against this judgment was granted, but the matter was
resolved by agreement and the appeal was never heard.
13.80 It is therefore submitted that, unless it can be demonstrated as a matter of fact that the adju-
dication provisions were imposed by the contractor on the employer, the UTCCR argument
will be difficult to get off the ground. Moreover, from a wider perspective, it might be difficult
to argue that, even then, the incorporation of the adjudication provisions was somehow to
the detriment of the consumer. It is thought that possibly only in cases where the consumer
would otherwise fall outside the sphere of adjudication altogether (because, for example, the
works were concerned with a private dwelling house, as in Picardi) will such an argument
even be available. Thus, for the vast majority of cases, it would appear that a party who has
been unsuccessful in adjudication will be unable to avoid the consequences of that failure by
reference to the UTCCR. It is perhaps noteworthy that, in the last three years, no such
attempt has been identified in any of the reported cases.
102 See, for example, Cartwright v Fay (unreported, 9 February 2005, Bath County Court) and Allen Wilson
Shopfitters v Mr Anthony Buckingham [2005] EWHC 1165 (TCC); 102 Con LR 154.
103 [2007] EWHC 1174 (TCC); [2007] BLR 348.
364
Part V
ENFORCEMENT
14. The Status and Effect of an Adjudicator’s Decision 367

15. Principles of Enforcement 389
16. Adjudication Business in the TCC 405
17. Stay of Execution 425
14
THE STATUS AND EFFECT OF AN
ADJUDICATOR’S DECISION
Introduction 14.01 Temporary Finality/Generally 14.30

A Valid Decision 14.04 Temporary Finality/Subsequent
Compliance with Time Limits 14.06 Adjudications 14.36
Errors and Slips 14.09 Status in Later Court or Arbitration
The Decision Itself 14.15 Proceedings 14.45
Compliance with the Decision 14.16 Winding Up/Bankruptcy 14.52
Status of Decision 14.19 Protective Measures in Scotland 14.57
Approbation and Reprobation 14.22
Mr Raynsford: [We are] aiming for a solution that was perfectly expressed in
representations to the Minister and Opposition by Professor John Uff QC. In a happy
phrase, he expressed concern that the objective should be to ensure ‘decisions of tem-
porary finality only’. That is an elegant way of expressing what we all want to achieve.
Mr Robert B Jones: I should like to hear the Professor trying to defend that in the courts.
Mr Raynsford: As a QC, he no doubt has many opportunities to defend such
construction. His phrase captures the essence of what we want from adjudication.
Hansard, 18.6.96, columns 331–332, Standing Committee F
Introduction
The sponsors of the original Bill were attracted by the proposition that adjudication in the 14.01
construction industry would not only be compulsory, but also binding; in other words, they
envisaged a situation where the decision of an adjudicator could not be challenged. However,
this was met with a chorus of disapproval from almost all directions, the main objection
being that, if an adjudicator had to decide a dispute within a very short time, mistakes were
entirely foreseeable, and it would be grossly unfair if the party who suffered from such a
mistake had no opportunity at all to rectify the error. The good sense of this position was
quickly acknowledged, but it immediately created another problem: if the decision was not
to be binding, what was the purpose of adjudication at all?
Eventually, it was proposed that, although it was essential that the adjudicator’s decision 14.02
should be binding on the parties, the parties would have the opportunity to reopen the
dispute, if they chose to do so, either in arbitration or in litigation. Although it was said in
the House of Lords that it was hard to see how a decision could be both binding and
367
Enforcement
temporary,1 in practice, this concept has given rise to few difficulties. The adjudicator’s
decision becomes binding on the parties, because that is what the 1996 Act provides or, in a
contractual adjudication, what is expressly provided for by the terms of the contract.
Thereafter, although the parties can agree to accept the adjudicator’s decision as finally
determining the dispute, if they do not do so, then the decision remains binding until the
dispute is finally determined by legal proceedings or arbitration.2
14.03 In most cases, therefore, the position is very straightforward. Assuming that the adjudicator’s
decision is valid (because he had the necessary jurisdiction to reach that decision and, in so
doing, there was no breach of the rules of natural justice) then the parties are bound to
comply with that decision. If the losing party does not comply with it, the winning party is
entitled to issue enforcement proceedings to ensure compliance. The parties can then
agree that the adjudicator’s decision has finally determined the particular dispute in
question. Even if they have not reached such an agreement, that will be the effect of the
adjudicator’s decision unless and until the loser reopens the dispute in subsequent arbitration
or litigation. At that point, the dispute becomes reopened in its entirety, and the adjudicator’s
decision has no evidential or legal status. A number of these points are developed in the
paragraphs below.
A Valid Decision
14.04 For the reasons set out in Chapter 8 above, the adjudicator’s decision will usually be enforced
by the courts, even if the reasoning that justified that decision was erroneous in law or fact.3
However, as HHJ Lloyd QC made plain in Alstom Signalling Ltd v Jarvis Facilities Ltd 4 the
enforcement policy only applies to decisions which are valid, namely decisions that the
adjudicator was authorised to reach, in circumstances where that decision was not vitiated by
some material failure to comply with basic concepts of fairness. Thus, as the judge pointed
out, it is misleading to speak of a right of enforcement of an adjudicator’s decision; such a
right is always qualified or contingent on the validity of the decision itself.
14.05 In addition to questions of jurisdiction and natural justice, there are two procedural hurdles
which need to be cleared by the adjudicator if the decision is not to be regarded as an
unenforceable nullity. These are concerned with the adjudicator’s obligation to comply with
the statutory time limits (as extended by agreement) and his ability, if any, to make corrections
to errors in the decision communicated to the parties.
Compliance with Time Limits

14.06 The time limits for the provision of the referral notice, and the adjudicator’s obligation to
complete the decision within 28 days (or any extended period), has been dealt with in detail
at paragraphs 2.114–2.132 and, in relation to the particular requirements of the Scheme, at
paragraphs 3.76–3.82 above. On a careful review of the cases cited there, there is no
1
In the debate on 23 July 1996, Lord Howie of Troon said: ‘I know that I am only a Scot and we look
at things somewhat differently, but it is hard to see how it can be both binding and temporary . . .’
(Hansard, 23.7.96, page 1342).
2 Section 108(3).
3 The basis for the discussion below as to enforcement is that set out in footnote 2 to Chapter 7.
4 [2004] EWHC 1285 (TCC), paragraphs 19 and 20.
368
The Status and Effect of an Adjudicator’s Decision
authority whatever for the proposition that an adjudicator is entitled to take longer than the
28 days (or any extended period agreed by the parties) in order to complete his decision.5
Indeed the authorities reiterate that both the 1996 Act, and the standard forms of contract,
only confer authority on the adjudicator to make a decision within the 28-day period, or
such other period as may be agreed: see, for example, paragraph 26 of the judgment of
HHJ LLoyd QC in Barnes & Elliott Ltd v Taylor Woodrow Holdings Ltd.6
A number of the most recent cases on the point reiterate that the decision must be completed 14.07
within the relevant period and that the adjudicator was not entitled unilaterally to award
himself some sort of extension of time for completion of the decision. In Ritchie Bros (PWC)
Ltd v David Philip (Commercials) Ltd 7 the decision was provided over a week late. The Court
of Session held, by a majority, that the decision was not within the adjudicator’s jurisdiction
because it was a decision that had been reached out of time. The court rejected the suggestion
that the adjudicator was entitled to reach his decision at any time during an indefinite
period after the expiry of the 28 days so long as none of the parties had served a fresh notice
of adjudication. Lord Nimmo Smith pointed out that if, as was plainly the case, certainty was
a principal objective of adjudication, it was not achieved by leaving the parties in doubt as to
where they stood after the expiry of the 28-day period.
This approach and these comments were expressly approved in Cubitt Building and Interiors 14.08
Ltd v Fleetglade Ltd.8 There the TCC judge referred to his earlier decision of Hart Investments
Ltd v Fidler & Another 9 in which he had expressly said that he considered the decision in
Ritchie was right. He went on to say that, in his view, adjudicators did not have the
jurisdiction to grant themselves extensions of time without the express consent of both
parties and that, if their time management was so poor that they failed to provide a decision
in the relevant period and had not sought an extension, their decision may well be a nullity,
as in Ritchie. HHJ Havery QC also came to the same conclusion in both Aveat Heating Ltd v
Jerram Falkus and Epping Electrical Co Ltd v Briggs & Forrester (Plumbing Services) Ltd.10
Errors and Slips

As discussed at length in paragraphs 8.26–8.35 above, the fact that an adjudicator makes an 14.09
error or slip will not ordinarily invalidate his decision and will not give the losing party any
ground for objecting to the enforcement of the subsequent decision. Thus, in the best-
known example of this approach, the Court of Appeal held that an adjudicator’s decision
was enforceable, even though he had muddled together gross and net sums, with the result
that he released to the contractor all the retention monies, even though it was not suggested
that such retentions were due under the contract.11 It should be noted that, in that case, the
5
The only decision which suggests to the contrary, Simons Construction Ltd v Aardvaark Developments Ltd
[2004] 1 BLR 117, has been expressly doubted and not followed in Ritchie Bros (PWC) Ltd v David Philip
(Commercials) Ltd [2005] 1 BLR 384 and Cubitt Building and Interiors Ltd v Fleetglade Ltd [2006] EWHC 3413
(TCC); [2006] 110 Con LR 36. The suggestion that what matters is not the language of the 1996 Act, but the
consequences of the non-compliance, was rejected for a variety of reasons by the TCC Judge in AC Yule & Son
Ltd v Speedwell Roofing & Cladding Limited [2007] EWHC 1360 (TCC); [2007] BLR 499.
6
[2004] BLR 111.
7
[2005] BLR 384.
8
[2006] EWHC 3413 (TCC); [2006] 110 Con LR 36.
9 [2006] EWHC 2857 (TCC); [2007] BLR 30.
10 There is a full discussion of these, and the other cases on this topic at paragraphs 2.114–2.132.
11 See Bouygues (UK) Ltd v Dahl-Jensen (UK) Ltd [2000] BLR 49 (Dyson J); [2000] BLR 522 (Court of Appeal).
369
Enforcement
adjudicator wrote to the parties, once the alleged error had been pointed out, and maintained
that his calculations correctly reflected his intentions and did not contain a clerical mistake,
or an error arising from an accidental slip or omission. He therefore concluded that he
would not make any amendment to his decision.
14.10 For these reasons, the general position is that an error or a slip by an adjudicator does not
invalidate his decision. However, what is the effect of an error or a slip that the adjudicator
acknowledges and endeavours promptly to rectify? Is he entitled to rectify such an error,
and does either the original error or the purported rectification invalidate the decision?
14.11 Depending on the nature of the error, and the speed with which it is rectified, it is thought
that, in some circumstances, an adjudicator does have the power to rectify an error without
invalidating the decision. The best-known example of this is Bloor Construction (UK) Ltd v
Bowmer & Kirkland (London) Ltd 12 where the adjudicator sent out a decision at 3.32 p.m.
on 11 February 2000 to the effect that Bowmer should pay to Bloor about £122,000.
On receipt of that decision, Bowmer pointed out to the adjudicator that he had failed to
deduct the payments on account previously made by Bowmer. The adjudicator agreed that
he had made an error and, at 5.53 p.m. on the same day, he sent out a corrected decision
which, after making due allowance for the previous payments on account, concluded that
Bloor were entitled to no further payment. HHJ Toulmin CMG QC concluded that, in the
absence of any specific agreement to the contrary, a term should be implied into the contract
that an adjudicator might correct a mistake arising from an accidental error or omission and
that, although there had to be a time limit within which such corrections could be made, the
issue of a corrected decision within three hours of the erroneous decision was within any
acceptable time limit. Accordingly, Bloor were not permitted to enforce the adjudicator’s
first and uncorrected decision and the corrected decision was held to be a valid statement of
the position as between the parties.
14.12 Perhaps surprisingly, in view of the sheer volume of cases concerned with adjudication
enforcement, there are few subsequent decisions in which the implied term identified by
Judge Toulmin in Bloor has been further considered. In Edmund Nuttall Ltd v Sevenoaks
District Council,13 which was decided shortly after Bloor, the adjudicator had immediately
accepted that an error had been made, and took steps to correct it. In considering whether or
not there was any residual power to make the correction, Dyson J said that, ‘putting the
matter at its lowest, it is at least arguable that it [the decision in Bloor] is right’. He also stressed
that the adjudicator’s prompt correction of the error was a feature of the present case, which
was not present in Bouygues. In the more recent case of ROK Building Ltd v Celtic Composting
Systems Ltd,14 a case where there was a contractual power to correct errors, Akenhead J
rejected the criticism of the adjudicator that he had failed to use the power, in circumstances
where the proposed changes went far beyond clerical errors and arithmetical mistakes.
14.13 It is thought therefore that, in straightforward circumstances, an adjudicator ought to have
the power to correct clear and obvious errors. Indeed, many of the standard forms of contract
expressly provide the adjudicator with such a power, and it is also now part of the 2009 Act.15
12
[2000] BLR 314.
13 Unreported, 14 April 2000, a decision of Dyson J.
14 [2009] EWHC 2664 (TCC); [2009] 130 Con LR 61.
15 See the discussion at paragraphs 4.10–4.11.
370
But it is also thought that this power could only be exercised in rare cases, and that often
there will be a risk that the purported correction will be invalid or, even worse, might operate
to invalidate both the original and the amended decisions. First, it is thought that the original
error would have to be accepted as an error by the adjudicator. It should be clear and obvious.
Secondly, it should be corrected immediately, as happened in Bloor. If the error is pointed out
to the adjudicator, and two or three days go by without any rectification, then it will be
appropriate for the parties to assume that any power to change the terms of the decision will
have lapsed. Sufficient certainty in the adjudication process cannot be provided if an
adjudicator is entitled to amend his decision days after it has been sent out and the alleged
error pointed out to him.16
Accordingly, it is most unlikely that any sort of slip rule could operate in circumstances 14.14
where the adjudicator did not expressly accept that an error had occurred. Thus in CIB
Properties Ltd v Birse Construction Ltd 17 there was no acceptance by the adjudicator that he
had made any error, and his written indication that the whole matter would be reviewed by
the courts was not to be taken as an admission that there was any error in the first place. And
in Joinery Plus Ltd v Laing Ltd 18 HHJ Thornton QC held that an adjudicator who had sent
out a decision based on an incorrect set of sub-contract terms was not entitled to write to the
parties purporting to correct that decision by stating that the error was of no material relevance
to the substance of his decision. In that case, the judge ruled that the original decision,
because it was based on the incorrect contract terms, was a nullity.
The Decision Itself

It should also be noted that, in extreme cases, the court may decline to enforce the decision 14.15
summarily because of a significant deficiency in the decision itself. Thus, in Paul Broadwell
(t/a Broadwell Construction) v k3D Property Partnership Ltd,19 there had been a number of
sub-issues referred to the adjudicator. The decision dealt only with some of these matters,
stating simply that ‘all other matters had been considered’. HHJ Raynor, sitting at
the TCC in Salford, concluded that the adjudicator had failed to deal expressly with all the
matters referred to him, including in particular all aspects of the defence, and that the
catch-all phrase in the decision was inadequate. The application for summary judgment
was refused.
Compliance with the Decision

Section 108(3) of the 1996 Act provides that the decision of the adjudicator is binding 14.16
until the dispute is finally determined by legal proceedings or by arbitration. The parties
are therefore obliged to comply with the decision. Paragraph 23(2) of the Scheme for
16 There is evidence to suggest that parties to an adjudication operate a commercial and commonsense
approach to errors and slips. For example, in Cubitt Building and Interiors Ltd v Fleetglade Ltd [2006] EWHC
3413 (TCC); [2006] 110 Con LR 36 there was a major dispute about whether or not the decision had been
completed within the agreed extended period. However this argument was all about the events leading up to the
last day of that period and the events in the 12 hours after the expiry of that period. Quite separately, there was
an agreed error in the decision, which was pointed out to the adjudicator and caused him to make a subsequent
modification to the decision. Neither party took any point on that correction procedure.
17 [2005] 1 WLR 2252.
18 [2003] BLR 184.
19 [2006] Adj CS 04/21.
371
Enforcement
Construction Contracts provides that the parties ‘shall comply’ with the decision of the
adjudicator ‘until the dispute is finally determined by legal proceedings, by arbitration . . . or
by agreement between the parties’. Most of the standard forms of construction and
engineering contracts expressly provide that the parties are bound to comply with the
14.17 The general requirement for compliance was spelt out in clear terms by Dyson J in Macob
Civil Engineering Ltd v Morrison Construction Ltd.20 He said that the intention of the 1996
Act was to introduce a speedy mechanism for settling disputes in construction contracts on
a provisional interim basis and required the decisions of adjudicators to be enforced pending
final determination. Absent questions of jurisdiction, natural justice or some sort of pro-
cedural question, the parties must comply with the adjudicator’s decision. Since most
adjudications are about claims for money due, this means that the losing party must pay to
the successful party the sum identified by the adjudicator in his decision.
14.18 The presumption that an adjudicator’s decision must be complied with forthwith has
given rise to procedural issues: what is the best way of enforcing the decision of an adjudicator?
One of the earliest cases on this point was Outwing Construction Ltd v H Randell & Son
Ltd.21 There the adjudicator’s decision was dated 12 February 1999 and required the
defendant to pay a sum to the claimant. The claimant issued an invoice in that sum on
15 February 1999. No money was forthcoming and on 8 March 1999, the claimant issued
a writ. On 10 March 99 the claimant issued and served a summons returnable on 12 March
1999 seeking that the defendant’s time for acknowledgment of service be abridged to two
days, and that the time for the defendant to serve evidence in opposition to the claim for
summary judgment be abridged to seven days. On the morning of the return day, the
defendant paid the claimant the sum claimed plus interest and costs. However the defendant
refused to pay the costs of the application, on the ground that payment of the full amount
stayed the action and that, since the claimant had indicated that, if payment was made
within 14 days the costs would be limited, the claimant was not justified in its conduct and
had acted with undue haste. HHJ Lloyd QC rejected this argument, holding that it
was justified to abridge time because an action to enforce an adjudicator’s decision was
not comparable to the process of recovering an apparently undisputed debt. The 1996 Act
required that adjudicators’ decisions, if not complied with, were to be enforced without
delay. He also concluded that there was no reason why a party, who had not voluntarily
complied with a decision, should be allowed the best part of a month before the decision
was converted into an order of the court. Outwing was the start of the special enforcement
procedure created by the TCC for the enforcement of adjudicators’ decisions, which is
explained in greater detail in Chapter 16 below.
Status of Decision
14.19 There has been a good deal of careful consideration as to the nature of a claimant’s cause of
action when endeavouring to enforce an adjudicator’s decision. In VHE Construction plc v
RBSTB Trust Co Ltd 22 HHJ Hicks QC concluded that enforcement proceedings were
20 [1999] BLR 93.

21
[1999] BLR 156.
22
[2000] BLR 187.
372
proceedings to enforce a contractual obligation, namely the obligation to comply with the
adjudicator’s decision. The adjudicator’s decision did not have the status of a judgment and
there was no provision in the 1996 Act that corresponded to s66 of the Arbitration Act 1996,
under which, by leave of the court, judgment may be entered in terms of an arbitral award or
the award may be enforced in the same manner as a judgment. Similarly, in David McLean
Housing Contractors Ltd v Swansea Housing Association Ltd 23 HHJ Lloyd QC said that a
decision was not an arbitral award and could not be equated to one. He said that an action
to enforce an adjudicator’s decision was an action to enforce the right or liability that had
been upheld by that decision.
In Bovis Lend Lease Ltd v Triangle Development Ltd 24 HHJ Thornton QC also considered the 14.20
nature of enforcement proceedings. Although certain aspects of the judgment in that case,
concerned with arguments relating to set-off, were doubted by the Court of Appeal in Levolux
AT Ltd v Ferson Contractors Ltd 25 it is thought that the judge’s summary of the nature of
enforcement proceedings is not only uncontroversial but positively helpful. The judge said
that, ordinarily, a decision of an adjudicator will give rise to a contractual entitlement to
immediate payment without deduction, set-off, withholding, reliance on a cross-claim,
abatement, or stay of execution. That was because the sum in question was due by virtue of
the statutory and contractually-backed provisions requiring compliance and the giving of
full effect to the decision of an adjudicator, in addition to it being due by virtue of the underly-
ing contractual provisions. It was for that reason that the courts had repeatedly held that no
deduction or withholding would ordinarily be allowed from the sum found due by reference
to an adjudicator’s decision.
The nature and date of accrual of the cause of action, where a losing party in an adjudication 14.21
subsequently commences court proceedings for the return of monies paid in consequence
of that adjudication, is the subject of a detailed analysis by HHJ Stephen Davies in Jim
Ennis Construction Ltd v Premier Asphalt Ltd.26 In that case, in 2002, Ennis had made a
deduction from Premier’s final account. Premier sought to challenge that deduction
almost six years later, in late 2008. The adjudicator upheld Premier’s claim and required
the outstanding sum to be paid by Ennis. Ennis paid the money and, almost immediately,
endeavoured to start proceedings to seek its return, on the basis that the adjudicator had
been wrong to reach the conclusion that he did. Premier said that the claim was one for
damages for breach of contract and was statute-barred. The judge rejected that conten-
tion, holding that the obligation to comply with an adjudicator’s decision gave rise to a
new cause of action in favour of the successful party, to compel the losing party to comply
with that decision. He found that the concomitant of that was an implied term that an
unsuccessful party was entitled to bring court proceedings to have the dispute finally
determined and that, if it was successful in overturning the decision reached by the
adjudicator, it was entitled to be repaid those sums that had been paid out in accordance
with the decision. This may mean, however, that what might be called the ‘normal’ limit-
ation period of six years could effectively be doubled to almost 12 years in certain
circumstances.
23
[2002] BLR 125.
24 [2003] CILL 1939.
25
[2003] 86 Con LR 98.
26
[2009] EWHC 1906 (TCC); [2009] 125 Con LR 141.
373
Enforcement
Approbation and Reprobation

14.22 The doctrine of election prevents a party from ‘approbating and reprobating’, or ‘blowing
hot and cold’ in relation to the validity of an adjudicator’s decision. The law on election is set
out in Codrington v Codrington,27 Banque des Marchands v Kindersley 28 and Lissenden v CAV
Bosch Ltd.29 The point was emphasised in one of the earlier adjudication cases, Macob v
Morrison.30 There Dyson J (as he then was) said that,
what the defendant could not do was to assert that the decision was a decision for the purposes
of being the subject of a reference to arbitration but was not a decision for the purposes of being
binding and enforceable pending any revision by the arbitrator . . . once the defendant elected
to treat the decision as one being capable of being referred to arbitration, he was bound also to
treat it as a decision which was binding and enforceable unless revised by the arbitrator.
14.23 Two early decisions of HHJ Seymour QC are regularly relied on in support of the proposi-
tion that a party who accepted and/or relied upon the decision of an adjudicator following
its communication to the parties cannot, at some later stage, as a result of some change in
circumstances, seek to argue that the adjudicator did not have the necessary jurisdiction to
reach that decision or that, in some way, it was entitled to reject the validity of the decision
which it had earlier accepted. Thus, in Shimizu Europe Ltd v Automajor Ltd,31 discussed at
paragraphs 8.24–8.25 above, the claiming party contended that, even if the adjudicator had
exceeded his jurisdiction in basing his decision on his misunderstanding of the agreed value
of the variations, any right that there would otherwise have been on the part of the defendant
to raise an objection on this ground had been waived when the defendant made a part
payment of the sum awarded by the adjudicator and/or when the defendant invited him to
correct the decision as a result of the alleged mistake. Judge Seymour said that a party cannot
simultaneously approbate and reprobate a decision of the adjudicator. He decided that, by
inviting the adjudicator to correct the decision under the slip rule, the defendant’s solicitor
was accepting that the decision was valid (ie it was one that the adjudicator had the jurisdiction
to make). Since the point that they raised as to his alleged error went to the adjudicator’s
jurisdiction, it followed that, if they were right, the decision, or at least the relevant part of it,
was a nullity and there was nothing that needed to be corrected. The judge therefore expressly
accepted the alternative submission that the invitation to the adjudicator to correct the
decision under the slip rule was only consistent with the defendant’s recognition of it as a
valid decision. He reached the same conclusion in respect of the part payment. Thus, it is
important for any disgruntled party, who seeks to get the adjudicator to correct his decision,
to make sure that, if he does so, he does not waive his right to complain that the adjudicator
did not have the necessary jurisdiction to make the decision in the first place.
14.24 In R Durtnell & Sons Ltd v Kaduna Ltd,32 discussed at paragraph 7.89 above, the same judge
found that the defendant had not waived his right to raise a jurisdictional objection.
He concluded that the matters that the adjudicator purported to decide without the necessary
27
[1875] LR7HL 854 at 866.
28
[1951] 1 Ch112.
29
[1940] AC 413 per Lord Atkin.
30 [1999] BLR 93 at 99.
31 [2002] BLR 113.
32 [2003] BLR 225.
374
jurisdiction were not such that the defendant either did appreciate, or should have appreciated,
prior to the publication of the adjudicator’s decision, that they would be included in that
decision. Thus the question of waiver of such rights did not arise and the defendant had not
lost the right to challenge the adjudicator’s jurisdiction. Judge Seymour also dealt with the
question of benefit. He said that what constituted a benefit was not necessarily confined to
the obtaining of a net cash sum or an entitlement to a payment. He said that, for the purposes
of this doctrine, a benefit accrued to one party if his liability to another party in respect of
any particular matter was crystallised on an interim basis in a particular amount, even though
that was an amount which he was called upon to pay. Thus a party who contended that his
obligation towards another party was limited to payment of a particular sum by reason of the
decision of an adjudicator has both claimed and derived a benefit from that decision.
In the subsequent case of Amec Group Ltd v Thames Water Utilities,33 in a passage of his 14.25
judgement that was obiter (the judge having already concluded that the adjudicator had the
necessary jurisdiction for other reasons), the width of Judge Seymour’s definition of ‘benefit’
in Durtnell was questioned. The judge said that, taking that definition to its logical conclusion,
a benefit so defined could mean that a party that has lost an adjudication, and has dutifully
allowed for every aspect of the decision against him when preparing his next withholding
notice, would still be deriving a benefit from the decision. The judge commented that that
would appear, on the face of it, to be a surprising conclusion and noted that no authority had
been identified by Judge Seymour in support of his wide definition.34
An adjudicator’s decision is to be treated as a whole, and the parties cannot seek to approbate 14.26
those parts of it which they like, and reprobate those parts of it which they do not. In Redworth
Construction Ltd v Brookdale Healthcare Ltd 35 the claimant contractor advanced a particular
case in the adjudication as to the make-up of the contract between the parties, in support
of its case that the adjudicator had the necessary jurisdiction. The adjudicator acceded to
those submissions. The defendant maintained its jurisdictional challenge. In the subsequent
enforcement proceedings, the contractor sought to put its case on the contract in a very
different way. HHJ Havery QC refused to allow the contractor to go beyond the matters that
it had relied on in the adjudication in order to support the adjudicator’s conclusion that he
had the necessary jurisdiction. He did this in reliance upon the decision in Banque des
Marchands de Moscou v Kindersley 36 and the principle of election: Redworth had elected to
put their case in a particular way, and they could not now resile from it. He reasoned that
Redworth had made their election in order to obtain a benefit, namely the decision of an
adjudicator in their favour, both as to his jurisdiction and substantively. They had in conse-
quence obtained both those benefits, regardless of whether the same benefits could have been
obtained by other arguments. It was therefore unjust to allow Redworth to resile from their
election, by arguing a different case on contract formation, to endeavour to hang on to the money
decision in their favour. They could not approbate and reprobate the adjudicator’s decision.37
33 [2010] EWHC 419 (TCC).

34 The question of benefit was also considered by Ramsey J in PT Building Services Ltd v ROK Build Ltd
[2008] EWHC 3434 (TCC) discussed in paragraph 14.29.
35
[2006] EWHC 1994 (TCC); [2006] BLR 366.
36
[1951] 1 Ch 112.
37 This approach was followed in RWE Npower PLC v Alstom Power Ltd [2009] EWHC B40 (TCC), paragraphs
37–40, where the judge rejected the argument that the solicitors’ letter in question gave rise to a common
assumption from which they could not depart, and also found that, in any event, there had been no benefit.
375
Enforcement
14.27 In the recent case of Nickleby FM Ltd v Somerfield Stores Ltd 38 the defendant complained that
the claimant was seeking to assert a new basis for the adjudicator’s jurisdiction that had not
been advanced before the adjudicator and was materially different to the way that the case
was put at the time. On analysis, this new argument did not matter because Akenhead J
concluded that the adjudicator plainly had jurisdiction. However, during the course of his
judgment, the judge expressly disagreed with the approach of Judge Havery in Redworth.
This was, he said, because Banque des Marchands was concerned with two sets of court
proceedings, and was thus readily comprehensible in that context. The judge contrasted that
with the position of an adjudicator who reaches what is expressed and accepted as a non-
binding decision on jurisdiction, following his own enquiry. Whether the Redworth decision
was rightly decided required an examination of whether a materially different case on jurisdic-
tion was being mounted in the court proceedings compared with that raised before the
adjudicator. The judge went on to say that it must also be relevant to consider whether, at
least in a clear case, an adjudicator with the correct and full information before him would
have reached the same conclusion that he did, and whether the adjudicator did in fact have
jurisdiction. If he or she did have jurisdiction to decide the dispute referred to adjudication,
and if he or she with the full information available would have inevitably concluded that
there was such jurisdiction, the judge could see no reason why the adjudicator’s decision
should not be enforced. Any issue as to election would be irrelevant.
14.28 In Knapman Ltd v Richards & Ors 39 the argument was advanced that a claimant who was
seeking to be paid in accordance with the adjudicator’s decision was seeking to approbate and
reprobate because the adjudicator had also found that the claimant’s supply of the windows
and doors had been unsatisfactory and incomplete. However, the TCC judge concluded
that, on the facts, that was not a case where the approbation/reprobation principle was
relevant or applicable. Although the adjudicator had decided that the claimant was liable in
respect of the doors and windows, this had not crystallised into a financial decision, and the
terms on which the contractor would return to site to carry out this work were still
under negotiation. It could not be said, therefore, that the contractor had reprobated
the adjudicator’s decision, and he was entitled to the sum decided by the adjudicator.
14.29 Three recent cases in the TCC in London confirm that, in certain circumstances, the
doctrine of approbation and reprobation will be relevant so as to prevent one party from
endeavouring to rely on the decision for some purposes and to challenge it for others.
1. In PT Building Services Ltd v ROK Build Ltd 40 PTB obtained a decision in their favour,
which ROK did not pay. However, PTB was worried about ROK’s continuing stance that
there had been no crystallised dispute at the start of the first adjudication, so they com-
menced a second adjudication in relation to the original claim. ROK challenged that
second notice, saying that the matter had already been decided in the first adjudication,
and the second adjudicator resigned in consequence. In the subsequent enforcement
proceedings, ROK challenged the decision in the first adjudication on the grounds of
jurisdiction, despite having positively relied on it so as to persuade the second adjudicator
to resign. Ramsey J concluded that ROK had to elect whether to contend that the first
decision was unenforceable, so that it would not preclude PTB from commencing
38
[2010] EWHC 1976 (TCC); [2010] 131 Con LR 203.
39 [2006] EWHC 2518 (TCC); 108 Con LR 64.
40
[2008] EWHC 3434 (TCC) paragraphs 26–28.
376
the second adjudication, or to accept that it was enforceable, thus precluding a second
adjudication. If it chose the first alternative, then it could repeat certain challenges to
the jurisdiction of the adjudicator at the second adjudication, but it could not assert that
the first adjudication decision prevented the adjudicator from continuing with the
second adjudication. ROK chose the second alternative, asserting that there was a valid
adjudication decision arising from the first adjudication, which precluded the second
adjudicator from proceeding. By doing so, the judge concluded that it had elected to treat
the first decision as a valid decision, and ROK could not now seek to challenge the validity
of that decision in the enforcement proceedings.
2. In Linnett v Halliwells LLP,41 another decision of Ramsey J, the underlying facts were
very similar, although that was ultimately a claim by the adjudicator for unpaid fees from
Halliwells, the responding party in the adjudication. Halliwells had defended a claim made
by the contractors ISG in the second adjudication, on the basis that the adjudicator’s
decision in the first adjudication was binding. The judge concluded that, if he had found
that the adjudicator in the first adjudication did not otherwise have jurisdiction, he
would have held that Halliwells could not approbate and reprobate that first decision,
because they had relied on it for the purposes of defending themselves in the second
adjudication and, having obtained the benefit of the first decision in the second
adjudication, they could not now assert that the adjudicator had no jurisdiction to make
that first decision.
3. In Pilon Ltd v Breyer Group PLC42 Pilon were seeking, unsuccessfully as it turned out,
to enforce an adjudicator’s decision. Their principal difficulty was that the adjudica-
tor had wrongly excluded from his consideration the main element of Breyer’s
defence of set-off. Accordingly, Pilon wished to run an alternative argument that,
even if the adjudicator had considered that element of the defence, it would have
made no material difference to the result. However, in order to argue that, they needed
to say that the adjudicator’s finding on the other part of the claim, to the effect that
the absence of withholding notices did not mean that he should not consider Breyer’s
detailed valuation defence, was wrong. The TCC judge pointed out that, although it
was inherent in Pilon’s application for summary judgment that the adjudicator was
right, on this particular point they wanted to argue that he was wrong and that the
court should substitute its own view for that of the adjudicator. The judge said that
such an approach would amount to ‘the clearest possible case of approbation and
reprobation’.
Temporary Finality/Generally
Despite the concerns expressed during the passage of the Bill through Parliament, the 14.30
construction industry has had little difficulty with the concept of ‘temporary finality’. A valid
decision will be binding on the parties and will be enforceable in the courts in the usual way.
The decision will effectively provide the answer to the dispute between the parties, unless and
until one or other of the parties seeks to reopen the dispute in litigation or arbitration, or if
the parties reach an agreement as to the binding nature of the decision.
41
[2009] EWHC 319 (TCC); [2009] 1 CLC 157 paragraphs 116–117.
42
[2010] EWHC 837 (TCC); [2010] BLR 452 paragraphs 35–36.
377
Enforcement
14.31 A number of the authorities have stressed the ‘provisional interim basis’43 of the adjudicator’s
decision. Thus, in Bouygues (UK) Ltd v Dahl-Jensen (UK) Ltd 44 Buxton LJ referred to the
purpose of the adjudication procedure as enabling ‘a quick and interim, but enforceable,
award to be made in advance of the final resolution of what are likely to be complex and
expensive disputes’. In the same case, Chadwick LJ stressed that the adjudicator’s decision was
‘not finally determinative’ and was a method ‘of providing a summary procedure for the
enforcement of payment provisionally due under a construction contract’.45 The point has
already been made that, even though the adjudicator’s decision is not finally determinative,
it will regulate the parties’ rights and obligations for the short term and, given the volatility
of the construction industry, may, at least by default, prove to be determinative after all: the
successful contractor may simply not be in existence when the time comes for the final
determination of the dispute.
14.32 It is also a little misleading to stress the temporary nature of the adjudicator’s decision as if,
in some way, its determinative nature will somehow wear off over time. The point has already
been made that, once an adjudicator has decided a particular dispute in a particular way, that
decision will be binding for all time, unless and until one of the parties seeks to challenge it
in subsequent arbitration or litigation. In other words, it is up to one party, almost always the
loser in the adjudication, to raise the matter afresh in order for it to be considered again.
If there is no challenge, the decision will become binding by default.
14.33 Of course, the usual consequences for a losing party in an adjudication is that, because the
decision is temporarily binding, he has to pay the sum ordered by the adjudicator, however
much he feels that the decision was wrong. But there is one limited circumstance in which
the losing party may be able to avoid that consequence. That is where the point at issue in the
adjudication is a clear and straightforward one that does not require oral evidence, and
where, following the adjudicator’s decision, the losing party immediately issues proceedings
under CPR Part 8 for a declaration that the underlying position is as it contended in the
adjudication. In Jarvis Facilities Ltd v Alstom Signalling Ltd 46 HHJ Lloyd QC said that there
was no reason in principle why a challenge to a subsequent decision could not encompass or
lead to the court’s final determination in respect of an earlier decision, by way of the Part 8
procedure. The judge noted that, in reality, the losing party is rarely in a position to act as
Alstom did in that case because of the very confined nature of the point in issue. But he said:
If, however, before an application to enforce an adjudicator’s decision is heard, the point
decided by it is finally determined adversely to the party who is relying on the decision, then
that application and the action will fail.
In Walter Lilly & Co Ltd v DMW Developments Ltd 47 the TCC judge endorsed this approach,
adding the express qualification that it was for the applicant under CPR Part 8 to demon-
strate that the question to be decided falls within the relatively tight confines of that procedure.
43 The words used by Dyson J in Macob Civil Engineering Ltd v Morrison Construction Ltd [1999] BLR 93.
44 [2000] BLR 522.
45 In Carillion Construction v Devonport Royal Dockyard Ltd [2005] EWCA Civ 1358; [2006] BLR 15, the
same judge said ‘The task of the adjudicator is to find an interim solution which meets the needs of the case . . .
The statutory scheme provides a means of meeting the legitimate cash-flow requirements of contractors and
their subcontractors. The need to have the “right” answer has been subordinated to the need to have an answer
quickly. The scheme was not enacted in order to provide definitive answers to complex questions.’
46 [2004] EWHC 1285 (TCC) paragraphs 19–20.
47 [2008] EWHC 3139 (TCC), [2009] TCLR 3.
378
There was a suggestion that Judge Lloyd’s approach in Jarvis was contrary to the principles 14.34
laid down by the Court of Appeal in Bouygues. That submission was rejected by Edwards-
Stuart J in Geoffrey Osborne Ltd v Atkins Rail Ltd.48 In that case, the adjudicator had made an
error in failing to allow for monies already paid. This mistake was agreed by all parties, and
the adjudicator, and worth almost £1 million. Edwards-Stuart J distinguished Bouygues on
the basis that, in that case, the contractor had not sought to obtain the court’s ruling on a
point of law or fact decided by the adjudicator and that, in Bouygues, the court could not have
undertaken that final determination anyway, because there was an arbitration clause. On the
facts in Osborne, Atkins were seeking to obtain a ruling on a point of law and the court was
entitled to make a final determination on the mistake point because it was a straightforward
matter and there was no arbitration clause. Accordingly, the judge found that the adjudicator
was not entitled to make the order for payment because of the error, and that Atkins were
entitled to a declaration to the effect that the adjudicator was wrong to order such payment.
There can be no doubt that, as a matter of practice, this decision will make it harder for a 14.35
party who has achieved some form of unjustified windfall in an adjudication from enjoying
even the temporary fruits of that victory. It provides at least some palliative to those who are
uneasy about the court enforcing decisions that were accepted on all sides to be wrong.
However, it is important not to overstate the significance of the decision in Osborne. First, it
will only be appropriate where Part 8 proceedings are issued promptly by the losing side.
Secondly, it will only be appropriate where the point at issue is capable of being resolved in
Part 8 proceedings. That is likely to be a very limited category of dispute, possibly limited to
obvious errors (accepted as such by the adjudicator), and pure issues of construction of con-
tractual terms and other defined points of law, which have a plain and obvious consequence.49
Thirdly, it will only be appropriate at all if the court has the power under the contract to
determine finally the particular point at issue. Since most standard form of building and
construction contracts include arbitration clauses, it is thought that, in the majority of cases,
the Osborne approach will simply not be available.
Temporary Finality/Subsequent Adjudications

Particular difficulties can arise on major construction contracts where there may be a series 14.36
of adjudications between the same parties. Although the decision in adjudication 1 is binding
in the subsequent adjudications, what happens if there are changes to the factual position
along the way? For example, it is clear that a decision in adjudication 1 to the effect that, as a
matter of construction of the contract, the contractor was responsible for the integration of
the mechanical and electrical design with the rest of the building, will make it impossible for
the contractor, in a subsequent adjudication, to claim additional monies or an extension
of time on the basis that he was not contractually responsible for such integration, and carried
out this task pursuant to a variation instruction. On the other hand, if the contractor loses
an adjudication claim for an extension of time based on delaying factors 1–10, he would not
be able to make a subsequent claim for an extension of time based on those same factors,
but he could properly make a claim (and, if the claim was not admitted, start a second
48 [2009] EWHC 2425 (TCC); [2010] BLR 363.

49 It was not suitable for complex disputes of fact, as explained by Ramsey J in Forest Heath District Council
v ISG Jackson Ltd [2010] EWHC 322 (TCC).
379
Enforcement
adjudication) for the same period of delay based on factors 11–20. Furthermore, even if the
contractor did not raise factors 11–20 by way of a separate claim, he could defend himself
against a claim for liquidated damages for that same period by reference to factors 11–20, or
indeed any other factors that had not featured in his original extension of time claim.
However, the cases on which this overview has been taken demonstrate that it is not always
easy to identify what can and cannot be raised in subsequent adjudications.
14.37 In Emcor Drake & Skull Ltd v Costaine Construction Ltd 50 there had been two adjudications.
In the first, Emcor claimed an extension of time based on ‘the November claim’, which was
unsuccessful. In the second adjudication Emcor pursued a claim for an extension of time
covering the same period as the claim in the first adjudication, but based on different facts
and matters, set out in what was called ‘the February claim’. The February claim was successful.
The adjudicator’s decision was enforced, HHJ Havery QC noting that the effect of the first
adjudication was not that Emcor were not entitled to any extension of time, but simply that
they had not discharged the burden of showing that they were entitled to an extension of
time based on the material set out in the November claim. The February claim was based on
wider matters and, because the second adjudicator was not invited to trespass on the first
adjudicator’s decision, and did not do so, the second decision was enforced.
14.38 In David MacLean Contractors Ltd v The Albany Building Ltd 51 there were two adjudications
before the same adjudicator. In the first, the adjudicator decided that certain withholding
notices were valid, which entitled the defendant employer to deduct liquidated damages
from payments otherwise due to the contractor. In the second adjudication he held that the
employer’s non-completion certificates were invalid and that, in consequence, £1.3 million
liquidated damages had been wrongly withheld and had to be paid back to the contractor.
The TCC judge concluded that the disputes in the two adjudications were different, because
in the first the subject matter was the validity of the withholding notices and, in the second,
it was the validity of the non-completion certificates. Although the adjudicator came to a
decision in the first that was against the contractor, and a decision in the second that was
against the employer, that was simply the result of the facts of the individual disputes, and
the adjudicator did not, in his second decision, trespass upon or modify the temporary
finality of the first decision.
14.39 Both these cases were considered by Jackson J in Quietfield Ltd v Vascroft Contractors Ltd.52
In the first adjudication between the parties, Vascroft made a claim for an extension of time
based on the facts and matters set out in two specific letters dated September 2004 and April
2005. The claim failed on the facts. In the third adjudication, the employer, Quietfield,
sought liquidated damages for the delay and objected when, as part of Vascroft’s defence,
they sought to rely on an extensive substantiation of the original claim for an extension
of time. This extensive substantiation was called Appendix C. Although it contained material
that had not been raised in adjudication 1, the adjudicator in adjudication 3 ruled that
Appendix C was inadmissible and held that Quietfield were entitled to liquidated damages.
Jackson J concluded that the adjudicator had been wrong to exclude Appendix C, finding
that, in accordance with William Verry (Glazing Systems) Ltd v Furlong Homes Ltd,53 Vascroft
50
[2004] EWHC 2439 (TCC); 97 Con LR 142.
51 HHJ Gilliland QC, sitting as a TCC Judge at Salford District Registry, 10 November 2005.
52 [2006] EWHC 174 (TCC); [2006] 109 Con LR 29.
53 [2005] EWHC 138 (TCC).
380
were entitled to advance any available defence to the claim against them for liquidated
damages, irrespective of whether that defence had been notified when the relevant dispute
arose. As the judge said, Appendix C was ‘a far cry’ from the two letters that were relied on in
the first adjudication and it was ‘perhaps regrettable’ that Vascroft had not relied on Appendix
C before. The judge said that he was quite satisfied that Vascroft’s alleged entitlement to an
extension of time as set out in Appendix C was substantially different from the claims for an
extension of time that they had advanced in adjudication 1, and that had been considered
and rejected in that adjudication. Therefore, he ruled that it did not threaten the temporary
finality of the decision in adjudication 1 for the adjudicator to consider Appendix C on its
merits in adjudication 3.
At paragraph 42 of his judgment in Quietfield, Jackson J identified four principles that were 14.40
applicable where there were successive adjudications. He defined them as follows:
(i) Where the contract permits the contractor to make successive applications for exten-
sion of time on different grounds, either party, if dissatisfied with the decisions made,
can refer those matters to successive adjudications. In each case the difference between
the contentions of the aggrieved party and the decision of the architect or contract
administrator will constitute the ‘dispute’ within the meaning of section 108 of the
1996 Act.
(ii) If the contractor makes successive applications for extension of time on the same
grounds, the architect or contract administrator will, no doubt, reiterate his original
decision. The aggrieved party cannot refer this matter to successive adjudications. He
is debarred from doing so by paragraphs 9 and 23 of the Scheme and section 108(3)
of the 1996 Act.
(iii) Subject to paragraph (iv) below, where the contractor is resisting a claim for liquid-
ated and ascertained damages in respect of delay, pursued in adjudication proceedings,
the contractor may rely by way of defence upon his entitlement to an extension
of time.
(iv) However the contractor cannot rely by way of defence in adjudication proceedings upon
an alleged entitlement to extension of time which has been considered and rejected in a
previous adjudication.
Quietfield appealed to the Court of Appeal, but their appeal was dismissed.54 May LJ agreed 14.41
with Jackson J that adjudication 1 was solely concerned with the grounds advanced in the
two letters, and that the material in Appendix C, which identified a number of causes of
delay that did not feature in the two letters and was substantially different from them, should
have been considered by the adjudicator in adjudication 3. In his concurring judgment,
Dyson LJ expanded upon the first two of the principles outlined by Jackson at first instance.
He said that the first principle might appear to suggest that every dispute arising from the
rejection of an application for an extension of time may be referred to adjudication. Dyson
LJ did not consider that that was necessarily the case: the question of whether a contractor
may make successive applications for extensions of time depended on the true construction
of Clause 25 of the relevant standard form of contract and any term necessary to be implied.
The question whether disputes arising from the rejection of successive applications for an
extension of time may be referred to adjudication depended on the effect of s108(3) of the
1996 Act and paragraph 9(2) of the Scheme. Dyson LJ went on to say that, whilst on site, if
an architect rejected an application for an extension of time, pointing out a deficiency in the
54 [2007] BLR 67.
381
Enforcement
application, which the contractor subsequently made good, it would be absurd if the
architect could not grant the application if he now thought that it was justified. By contrast,
in adjudication, where referrals can be expensive, the statutory scheme protects respondents
from successive referrals to adjudication of what is substantially the same dispute. He went
on to say that, whether dispute A is substantially the same as dispute B would always be a
question of fact and degree and that, where the only difference between disputes arising
from the rejection of two successive applications for an extension of time was that the later
application made good the shortcomings of the earlier application, an adjudicator would
usually have little difficulty in deciding that the two disputes were substantially the same.
On the facts of Quietfield, however, Dyson LJ concluded that the disputes were different and
that the judge had reached the right conclusion.
14.42 HG Construction Ltd v Ashwell Homes (East Anglia) Ltd 55 was another case about serial
adjudications. The first decision concluded that, despite the contractor’s arguments that the
work scope for each section of the contract was uncertain, the liquidated damages provisions
in the contract were valid and enforceable. The contractor then sought a further adjudication,
on the basis that liquidated damages had been wrongfully deducted because the employer
had taken partial possession. The employer refused to take part in that adjudication, and the
second adjudicator found in favour of the contractor. Ramsey J decided, after a careful
analysis of the nature, scope and extent of the disputes in both adjudications, that the dispute
referred in the second adjudication was the same or substantially the same as the dispute
previously referred to (and decided by) the first adjudicator. He said that it followed that
the second adjudicator’s conclusion, in paragraph 96 of his decision, that there was no basis
on which the liquidated and ascertained damages could operate, was based on the determin-
ation of the same or substantially the same dispute that had been raised and decided in the
first adjudication. It was therefore not binding on the parties; it was the first decision, and
not the subsequent decision, that had the temporary finality of a valid adjudication decision.
The application for summary judgment based on the enforcement of the subsequent decision
was dismissed.
14.43 Although Ramsey J’s conclusions were based on his detailed analysis of the issues in the two
adjudications, he referred in some detail to the Court of Appeal’s judgments in Quietfield.
He distinguished the situation in HG on the facts, saying that it was not a case where there
was a changing factual position, where later claims for extensions of time were based on a
different set of facts. He also observed that the standard contractual provisions as to
adjudication, in that case encapsulated in Clause 39A.7.1, were aimed ‘at providing a limit
to serial adjudications’.
14.44 The two most recent cases in the TCC on this topic are Birmingham City Council v Paddison
Construction Ltd 56 and Benfield Construction Ltd v Trudson (Hatton) Ltd.57 In the latter case
the adjudicator in the third adjudication produced a decision that was completely contrary
to the decision in the first adjudication, although it was dealing with the same issue. For a
variety of reasons, the TCC judge concluded that the adjudicator in the third adjudication
did not have the necessary jurisdiction to deal with the dispute, because it had already
been decided in the first adjudication. In reaching that conclusion he pointed out the
55 [2007] EWHC 144 (TCC); [2007] BLR 175.

56 [2008] EWHC 2254 (TCC); [2008] BLR 622, paragraphs 15–29.
57 [2008] EWHC 2333 (TCC); [2008] CILL 2633.
382
similarities between that case and HG Construction. He summarised the relevant principles
as follows:
‘34 . . . (a) The parties are bound by the decision of an adjudicator on a dispute or difference
until it is finally determined by court or arbitration proceedings or by an agree-
ment made subsequently by the parties.
(b) The parties cannot seek a further decision by an adjudicator on a dispute or differ-
ence if that dispute or difference has already been the subject of a decision by an
adjudicator.
(c) The extent to which a decision or a dispute is binding will depend on an analysis of
the terms, scope and extent of the dispute or difference referred to adjudication
and the terms, scope and extent of the decision made by the adjudicator. In order
to do this the approach has to be to ask whether the dispute or difference is the
same or substantially the same as the relevant dispute or difference and whether
the adjudicator has decided a dispute or difference which is the same or funda-
mentally the same as the relevant dispute or difference.
(d) The approach must involve not only the same but also substantially the same
dispute or difference. This is because disputes or differences encompass a wide
range of factual and legal issues. If there had to be complete identity of factual
and legal issues then the ability to readjudicate what was in substance the same
dispute or difference would deprive [this principle] of its intended purpose.
(e) Whether one dispute is substantially the same as another dispute is a question of
fact and degree.
Status in Later Court or Arbitration Proceedings

If the aggrieved party is unhappy with the adjudicator’s decision, he can commence his 14.45
own proceedings in court, or in arbitration, in order to reverse the decision and, if rele-
vant, to recover the sums paid pursuant to the decision that is now challenged. Neither the
1996 Act, nor the Scheme for Construction Contracts qualifies the right of the aggrieved
party to issue that challenge so, on larger projects, it is not uncommon for the proceedings
seeking to challenge the decision to be issued shortly after the publication of the decision
to the parties. In an appropriate case, where the adjudicator’s decision has been concerned
with a declaration as to the parties’ contractual rights and obligations, the issue of a separ-
ate set of proceedings challenging the decision can lead to a binding judgment of the court
on the point previously considered by the adjudicator. This process can be seen in a
number of the decisions concerned with the design and construction of the new Wembley
Stadium.58
By contrast with the 1996 Act, some of the standard forms do place restrictions, usually 14.46
temporal, upon the aggrieved party’s right to challenge the decision. Commonly, these provisions
prevent a party from challenging the adjudicator’s decision until after practical completion.
Whilst this has the advantage of preventing the parties from diverting time and resources
to the continuation of a dispute already decided by the adjudicator, it can allow bad feeling
to rankle and fester during an ongoing project, with the aggrieved party looking for any
58
See, by way of example, Multiplex Constructions (UK) Ltd v Cleveland Bridge [2006] EWCA Civ
1834; Multiplex Constructions (UK) Ltd v Mott Macdonald Ltd [2007] EWHC 20 (TCC); [2007] 110 Con
LR 63; and Multiplex Constructions (UK) Ltd v Honeywell Control Systems [2007] EWHC 236 (TCC);
[2007] BLR 167.
383
Enforcement
way of getting back at the successful party as the project unfolds on site. It can also have the
disadvantage of ensuring that an adjudicator’s decision as to the parties’ contractual rights
and entitlements will continue to bind them until the end of the contract works, no matter
how wrong the adjudicator might have gone when arriving at his decision.
14.47 A potentially difficult question concerns the status of the adjudicator’s decision in any
subsequent litigation or arbitration. Let us take, by way of an example, a claim advanced by
a contractor in adjudication that he was entitled to a 20-week extension of time, and assume
that this claim was advanced to the satisfaction of the adjudicator, who decided that 20 weeks
was a reasonable entitlement, even though there was an absence of detail that, in arbitration
or litigation, might have proved fatal to the whole claim. The employer then says that he
wishes to challenge the adjudicator’s decision, and there is subsequent litigation between
the parties. Is the contractor entitled to rely in his pleaded defence upon the adjudicator’s
decision in support of his claim for an extension of time of 20 weeks, contending that it
was for the employer to demonstrate that the adjudicator was wrong in reaching this
decision?
14.48 It seems that the unequivocal answer to this question is no. Once the decision has been
formally challenged by the issue of subsequent litigation or arbitration, the contractor in
the example noted above is not entitled to rely on the existing decision as having any
status whatsoever, let alone one that changes or displaces the ordinary burden of proof. In
City Inn Ltd v Shepherd Construction Ltd,59 Lord MacFadyen stated that it was no part of
the function of an adjudicator’s decision to reverse the onus of proof in any arbitration or
litigation to which the parties might resort to obtain a final determination of the dispute
between them. He said that the burden of proof lay where the law placed it and it was
unaffected by the terms of the adjudicator’s decision. Thus, in the example previously
noted, it would be for the contractor properly to plead and prove his entitlement to the
20-week extension of time.
14.49 The decision in City Inn was followed in another Scottish case, Citex Professional Services
Ltd v Kenmore Developments Ltd.60 There, the judge agreed with the reasoning of Lord
MacFadyen in City Inn. However, in that case, the dispute was principally concerned with
the correct interpretation of the contract, and the judge observed that, as a matter of
practicality, he could not conceive that questions as to the burden of proof would play any
significant part in the court’s determination of the issue in any event. That is rather different
to the situation in City Inn, and in the example postulated above, where the potential
difficulties that can arise out of the onus of proof in delay cases are such that a contractor
might welcome the opportunity of reversing the normal burden of proof.
14.50 A rather unusual case on this topic, again from Scotland, is Stiell Ltd v Riema Control Systems
Ltd.61 There an adjudicator awarded the claiming party less than half the sum sought and that
sum was duly paid by the defenders. The pursuers were unhappy with the adjudicator’s
decision. Sums in the hands of a third party were arrested under a warrant for arrestment62
and the defenders, having paid the sum ordered by the adjudicator, moved that the arrestment
59
[2002] Scots Law Times 781.
60 [2004] Scot CS 20 (28.1.04).
61 [2001] 3 TCLR 9.
384
should be recalled. However, this was refused by the court on the ground that the action by
the pursuer for the remaining part of the sum allegedly due (namely that part not ordered by
the adjudicator) was one that involved no conditional contingency, because the sums claimed
were outstanding, and thus the debt existed. The court held that the fact that the issue in the
action may, in certain circumstances, have to be determined first by an adjudicator did not
mean that there was any change in the issue to be determined in the proceedings, and the
determination by the adjudicator did not make claims, which were pure, become contingent.
It is respectfully suggested that this case turns on the particular operation of Scots law, and
that in England and Wales a different result would have occurred: because the adjudicator
had found that the claimant was not entitled to part of the sum claimed, the claimant
would not have been able to conduct itself on the basis that that part of the sum was indeed
due. If the claimant purported to do so, the defendant would have been entitled to a
declaration to that effect, or to obtain summary judgment on its defence.63
There is only one reported instance of an otherwise valid adjudicator’s decision ending up 14.51
having no real status or ultimate effect, but that was explained by the unusual facts of the
case. In Kier Regional Ltd v City & General (Holborn) Ltd (No 2) 64 Kier had originally obtained
an adjudication decision in their favour which, subsequent to the judgement of the court,65
was enforced by way of a final charging order. Meanwhile, the parties prepared for a major
arbitration that dealt with all of the issues that were the subject of the original decision, and
a number of others. During that time, Kier believed that the charging order was sufficient
security for the amount of the judgement but, just a few weeks before the arbitration, they
came to realise that it was not, and they sought third party debt orders against companies
related to the defendant. The judge concluded that there were no third party debts and that
it was therefore inappropriate to make third party debt orders. But he went on to find that,
if it had been a question of discretion, he would not have made the orders anyway for a
variety of reasons, including the imminence of the arbitration itself and the fact that, at that
arbitration, the whole basis of the adjudicator’s decision was to be reviewed. It was also noted
that, on the delay elements of the original decision, neither party in the arbitration was now
contending that the adjudicator’s analysis was correct. Because the arbitration was due to
commence very soon, and because of the lengthy period of inactivity between the original
judgement and the application for the third party debt order, the judge considered it
appropriate to restrain Kier from taking any further enforcement proceedings until after the
arbitration had been concluded.
Winding Up/Bankruptcy
As set out in more detail in Chapter 16 below, the TCC has evolved its own procedure 14.52
applicable to the enforcement of the decisions of adjudicators. In those circumstances, it will
rarely be necessary for the successful party to seek to enforce the adjudicator’s decision by any
other means. Specifically, it will be very rare for the successful party to choose to issue
63
There is no question that Stiell is an unusual case. It is difficult not to agree with the commentary in the
TCLR which suggests that the case might be seen as authority for the curious proposition that an adjudicator’s
decision is binding when it is in favour of the claimant, but not otherwise.
64 [2008] EWHC 2454 (TCC); [2009] BLR 90.
65 [2006] EWHC 848 (TCC), reported at [2006] BLR 315.
385
Enforcement
winding-up or bankruptcy proceedings 66 as a means of enforcement. However, there will

occasionally be situations in which winding up or bankruptcy proceedings are appropriate
and there have been a number of authorities that have considered the status of the adjudicator’s
decision in such circumstances.
14.53 In George Parke v The Fenton Gretton Partnership,67 FGP obtained an adjudicator’s decision
in their favour in respect of their outstanding fees, but Mr Parke failed to pay and FGP issued
a statutory demand seeking payment of the sum awarded. HHJ Boggis QC, sitting as a judge
of the Chancery Division, held that the adjudicator’s decision created a debt that could form
the basis of a statutory demand and fell to be treated in the same way as a judgment or order
in accordance with paragraph 12.3 of the Insolvency Proceedings Practice Directions.
However, he said that, as a matter of principle, a debtor’s counterclaim or set-off might be
sufficient for the court to set aside the statutory demand and that, on the facts of that
case, the statutory demand would indeed be set aside. The judge concluded that, because
Mr Parke had brought TCC proceedings in which he argued that, not only did he not
owe the adjudicated figure, but once the final account was properly drawn, it was he who
was owed money, there was a valid cross-claim that went to the sum demanded and that
there was therefore a genuine triable issue. He therefore found that the statutory demand
should be set aside. This decision perhaps illustrates the perils of proceeding by way of a
statutory demand rather than by way of straightforward enforcement proceedings. On the
general principles set out in Chapter 9 above, the alleged set-off would not normally have
prevented the court, in enforcement proceedings, from requiring Mr Parke to pay FGP
the sum identified by the adjudicator. However, in the bankruptcy proceedings, where
different principles applied, a different result occurred.
14.54 In Re a Company (No 1299 of 2001) 68 the sub-contractor claimed the sum of £9,702.47 that
had been certified by the main contractor’s surveyor. The sum was not paid because the
main contractor alleged that it was entitled to a set-off, even though there had been no
withholding notice in accordance with s111 of the 1996 Act. The Deputy High Court Judge
concluded that there was an undisputed debt due to the sub-contractor, because the main
contractor’s surveyor had certified that sums were due and there was no withholding notice.
He also concluded that the existence of a significant cross-claim on the part of the main
contractor, alleging defects in the work carried out by the sub-contractor, did not entitle the
main contractor to an injunction to restrain the sub-contractor from presenting a winding-up

petition. He said that the main contractor could have established its claims by commencing
a cross-adjudication as soon as it became aware of the alleged problems with the work.
It might be said that the decision in this case is more in line with the authorities cited
above, in relation to the enforcement of an adjudicator’s decision, than the decision in Parke.
The judge based his reasoning on the principle that the absence of a withholding notice
meant that there was no ground on which it could be disputed that the £9,702.47 was due
and payable. In those circumstances the sub-contractor was to be regarded as a creditor of
the main contractor with locus standi to present a winding-up petition. As to a consideration
of the cross-claim in its own right, the judge concluded that the main contractor had failed
66
In Harlow & Milner v Linda Teasdale (No 1) [2006] EWHC 54, the TCC judge refused to allow the
successful party to recover the costs of the (ultimately futile) bankruptcy proceedings.
67 [2001] CILL 1713.
68 [2001] CILL 1745.
386
to take any step to litigate a cross-claim for defective work. The judge concluded that there
was at least a significant possibility that a future court, hearing the winding-up petition,
might form the view that the main contractor had had a reasonable opportunity to litigate
the cross-claim and could therefore, in the exercise of its discretion, properly decide to make a
winding-up order. As a result of that conclusion, the judge could not say that the proposed
petition would have no reasonable prospect of success, and therefore considered that he
should allow the sub-contractor to present such a petition if it wanted to. He refused the
injunction sought by the main contractor.
In Guardi Shoes Ltd v Datum Contracts 69 the contractor, Datum, referred its claim for 14.55
payment to adjudication. Although the employer, Guardi, alleged that there were defects
in Datum’s work, there was again no withholding notice under s111, and the adjudicator
therefore decided that Guardi had to pay Datum £108,000. Guardi refused to pay. Datum
issued enforcement proceedings and obtained summary judgment. A part of the out-
standing sum was paid but, with £78,000 odd still owing, Datum served a statutory demand
on Guardi. A winding-up petition was presented. Guardi then obtained an injunction
without notice restraining advertisement of the petition, and the matter came before Ferris
J on Guardi’s application for a continuation of that injunction. He concluded that the
injunction should not be continued. He said that Guardi had had an opportunity to serve a
s111 notice but had failed to do so, and that in those circumstances it could not be said that
the presentation of the petition was an abuse of process. Nor could it be said that the petition
was bound to be dismissed if it were to proceed. He said that the circumstances surrounding
the supposed inability on the part of Guardi to litigate in relation to the defects were of
crucial importance. Because Datum were entitled to be paid under the contract, unless a
witholding notice was served, the failure to provide such a notice was fatal to Guardi’s
application. Guardi were not permitted to come to court to say that, although they had not
operated the contractual machinery under which their obligation on their part to pay Datum
would have been suspended, Datum should be put into the same position as if Guardi had
operated that contractual machinery. Since Guardi had only itself to blame for this position,
the injunction would not be continued.
Clearly the approach of Ferris J in Guardi, like the decision in In Re A Company, was much 14.56
more in line with the approach of the TCC judges and the Court of Appeal in the vast
majority of adjudication enforcement proceedings. They are obviously to be contrasted with
the decision in George Parke v The Fenton Gretton Partnership, which might be seen now as a
case very much on its own facts.
Protective Measures in Scotland

Under Scots law, a pursuer can take protective measures by seeking to freeze, in the hands of 14.57
third parties, monies otherwise owing to the defender: this is known as an arrestment.70
In Rentokil Allsa Environmental Ltd v Eastend Civil Engineering Ltd,71 the defenders obtained
an adjudication decision in their favour. The pursuers belatedly paid up, but simultaneously
69 [2002] CILL 1934.

70 See also paragraph 14.50 and the case of Stiell there cited.
71 (1999) CILL 1506.
387
Enforcement
lodged an arrestment in the defenders’ solicitors’ hands in a larger sum, said to be due by way
of damages. This claim had already been considered in the adjudication. The Sheriff Principal
recalled the arrestments, concluding that they were not being used to protect the legitimate
interests and rights of the pursuers ‘but mainly to embarrass the defenders, defeat the
adjudicator’s awards and strain the financial credit of the defenders. The use of the arrestments
demonstrates an abuse of process which ought to be addressed.’ In this way, the purpose of
the 1996 Act was preserved and enforced. The decision is perhaps to be contrasted with the
result in Stiell, discussed at paragraph 14.50 above.
388
15
PRINCIPLES OF ENFORCEMENT
Introduction 15.01 Does the Decision Fail to Address the

General Approach 15.02 Dispute Properly? 15.19
If Written Reasons are Required, are
Jurisdiction/The Contract 15.06 They Sufficient? 15.20
Was There a Construction Contract? 15.06 Was the Decision Reached/Issued Within
Was the Construction Contract in the Statutory/Extended Period? 15.21
Writing? 15.09
Was There a Written Agreement to Natural Justice 15.22
Adjudicate? 15.10 Was the Adjudcator Actually or Apparently
Biased? 15.22
Jurisdiction/The Appointment 15.11 Did the Size/Nature of the Claim
Was the Adjudicator Appointed in Make It Inherently Unsuitable for
Accordance with the Agreed Adjudication? 15.23
Procedure? 15.11 Did the Adjudicator Fail to Address a
Jurisdiction/The Dispute 15.13 Key Issue? 15.24
Had the Dispute Crystallised at the Time Did the Adjudicator Fail to Consult the
of the Notice of Adjudication? 15.13 Parties Prior to the Decision? 15.26
Was More Than One Dispute Referred to Does the Decision Cut Across the
the Adjudicator? 15.14 Decision in an Earlier Adjudication? 15.27
Did the Parties Try to Extend the Scope Was the Breach of Natural Justice Material? 15.28
of the Dispute Beyond that Set Out The Severability of the Decision 15.29
in the Notice of Adjudicaiton? 15.15
In What Circumstances is a Withholding Can the Paying Party Set Off a Separate
Notice Necessary? 15.16 Claim Against the Sum Awarded by
the Adjudicator? 15.33
Jurisdiction/The Decision 15.18
Does the Decision Answer the Dispute Summary Judgment 15.35
Referred in the Notice of Adjudication? 15.18 Summary 15.37
It is only too easy in a complex case for a party who is dissatisfied with the decision of
an adjudicator to comb through the adjudicator’s reasons and identify points upon
which to present a challenge under the labels ‘excess of jurisdiction’ or ‘breach of
natural justice’ . . . To seek to challenge the adjudicator’s decision on the ground that
he has exceeded his jurisdiction or breached the rules of natural justice (save in the
plainest cases) is likely to lead to a substantial waste of time and expense . . .
Chadwick LJ in Carillion Construction Ltd v Devonport
Royal Dockyard Ltd 1
1 [2005] EWCA Civ 1358; [2006] BLR 15.
389
Enforcement
Introduction
15.01 As will already have been noted, a large proportion of the authorities analysed in the
preceding chapters arose out of applications to the TCC by the successful party to enforce
the decision of the adjudicator. The general principles applied by the courts in such enforcement
applications can therefore be discerned from those authorities. In order to avoid undue
repetition, the purpose of this chapter is to concentrate on the most commonly argued
points that arise in enforcement applications and to summarise the courts’ approach to such
questions. It is intended to be a checklist of the main points that are made in detail elsewhere
in the text. There are now very few issues arising on enforcement applications that have not
been the subject of at least one clear exposition by the Court of Appeal or a statement of
principle by a TCC judge.
General Approach
15.02 The general approach of the courts to enforcement applications can be seen in the two early
judgments of Dyson J (as he then was) in Macob Civil Engineering Ltd v Morrison Construction
Ltd 2 and Bouygues (UK) Ltd v Dahl-Jensen (UK) Ltd.3 In the latter case, despite the clear
error made by the adjudicator, the judge concluded that, in accordance with the adjudi-
cation provisions in the contract, the decision had to be enforced. This decision was upheld
by the Court of Appeal, with both Buxton and Chadwick LJJ reiterating the point that,
because the adjudicator answered the right question, the fact that he answered it in the
wrong way did not affect his jurisdiction and did not prevent the summary enforcement of
the decision.4
15.03 In Bouygues, Chadwick LJ said that the purpose of the 1996 Act, and the contractual
adjudication provisions that followed, was to provide a speedy method by which disputes
under construction contracts could be resolved on a provisional basis. He said that the
adjudicator’s decision, although not finally determinative, might give rise to an immedi-
ate payment obligation that could be enforced by the courts. He said it could be looked
upon ‘as a method of providing a summary procedure for the enforcement of payment
provisionally due under a construction contract’. He said at paragraph 29 of his judgment

that adjudicators’ decisions ought to be enforced by way of summary judgment.
15.04 Precisely the same approach was adopted by the Court of Appeal in the subsequent case of
C & B Scene Concept Design Ltd v Isobars Ltd.5 Sir Murray Stuart-Smith said that, unless the
adjudicator had acted outside his jurisdiction, summary judgment should be entered to
enforce his decision. This was because the whole purpose of the 1996 Act was to provide
a swift and effective means of dispute resolution that was binding during the currency of
the contract, until final determination by litigation or arbitration. He said that any dispute could
be quickly resolved by the adjudicator and enforced through the courts; if the adjudicator
was wrong, the matter could be corrected in subsequent litigation or arbitration. Thus, even
2
[1999] BLR 93.
3 [2000] BLR 49.
4 [2000] BLR 522.
5 [2002] BLR 93.
390
Principles of Enforcement
if the adjudicator had made errors of law as to the relevant contractual provisions, his decision
was binding and enforceable until the matter was corrected at the final determination by the
judge or the arbitrator. Essentially, the only errors that may be capable of defeating an
enforcement application are obvious or agreed errors that can be finally determined by the
court in parallel Part 8 proceedings.6
Accordingly, the most important question of all in any adjudication, and in any enforcement 15.05
application, is whether the adjudicator acted within his jurisdiction. Thereafter, it is neces-
sary to check whether the decision was reached by a fair means in all the circumstances.
There are a number of issues that perennially arise when considering the adjudicator’s
jurisdiction and the rules of natural justice, which can conveniently be framed as questions.
The proper approach to these questions is outlined below.
Jurisdiction/The Contract
Was There a Construction Contract?
There are two decisions of the Court of Appeal that demonstrate that, if there is a real 15.06
dispute between the parties about whether or not they had agreed a construction contract,
such a dispute will mean that, at least arguably, the adjudicator did not have the necessary
jurisdiction, and thereby prevent the enforcement of his decision. They are:
1. Thomas-Fredric’s (Construction) Ltd v Keith Wilson.7 In that case, there was a clear dispute
as to whether the defendant/appellant, Mr Wilson, was ever a party to the relevant contract
at all. Although Simon Brown LJ (as he then was) readily recognised the concern that
what he called the ‘salutary’ new statutory power introduced by the 1996 Act to promote
early payment in construction contracts might be emasculated by jurisdictional challenges,
he concluded that, in that case, the adjudicator’s ruling was, on any view, not plainly right
and indeed was, if anything, plainly wrong. In those circumstances, he concluded that
the application for summary judgment against Mr Wilson, based on the adjudicator’s
decision to that effect, should have been dismissed.
2. Pegram Shopfitters Ltd v Tally Weijl (UK) Ltd.8 In that case, although the facts were
rather different, the Court of Appeal took the same approach. There was a dispute as to
the contract terms, with the defendant contending that, if the contract was not made
in the JCT Standard Form of Prime Cost Contract (1998 Edition), there was no agree-
ment between the parties at all. The claimant alleged that there was a contract, but not
in the JCT Form, and that it constituted a construction contract and therefore incor-
porated the implied adjudication provisions set out in the Scheme. The adjudicator
had been appointed, and produced his decision, in accordance with the Scheme. In
consequence of the defendant’s alternative case that there was no contract at all, which
was at least arguable, May LJ said that both the adjudicator, and the TCC judge at first
instance, had been wrong to proceed on the assumption that both parties were agreed
that their relationship was governed by a construction contract. The defendant, he
said, had made it crystal clear that, if no contract was concluded on the JCT terms,
6 Geoffrey Osborne Ltd v Atkins Rail Ltd [2009] EWHC 2425 (TCC); [2010] BLR 363.
7
[2003] EWCA Civ 1494; [2004] BLR 23.
8
[2003] EWCA Civ 1750; [2004] 1 WLR 2082.
391
Enforcement
there was no construction contract at all, and therefore it was arguable that the
adjudicator (who had not been appointed under the JCT provisions) did not have
the necessary jurisdiction to decide the dispute that had arisen. Like Simon Brown LJ
in Thomas-Fredric’s, May LJ accepted that the court had to be vigilant to examine
jurisdictional arguments of this kind ‘critically’. However, he concluded that, on the
evidence, Pegram was a case where legal principle had to prevail over broad brush
policy. One or other of the defendants’ contentions as to the nature and existence of the
contract might well prove to be correct and, in those circumstances, they had a
legitimate jurisdictional challenge to an adjudicator appointed under the provisions of
the Scheme for Construction Contracts. Again, therefore, the appeal was allowed, and
the summary judgment application was refused.
15.07 There are as yet no decisions of the Court of Appeal that deal with the meaning of ‘construc-
tion operations’ and the sorts of disputes that have arisen under s105 of the 1996 Act.
Accordingly, the relevant authorities are those referred to in paragraphs 2.24–2.41 above, in
particular the decisions of Ramsey J in North Midland Construction PLC v AE & E Lentjes UK
Ltd 9 and Cleveland Bridge (UK) Ltd v Whessoe-Volker Stevin Joint Venture.10 In the former
case, the judge concluded that the exceptions in s105(2) should be construed narrowly, by
reference to the individual construction operations, rather than more broadly, considering
all operations necessary to achieve the aims and purposes of the owner or the principal con-
tractors. This is likely to lead to a reduction in the number of disputes that fall outside the
scope of the 1996 Act. However, where an adjudicator deals in one decision with claims aris-
ing out of construction operations, on the one hand, and operations that are excluded by
s105(2) on the other, then Cleveland Bridge is authority for the proposition that, in the usual
case, it will be impossible and/or inappropriate for the court to pick through the decision to
work out which parts might be enforceable and which parts are not. The result will be that
the entire decision will not be enforced.
15.08 It will be open to the responding party in the adjudication to defend itself on the basis
that the claim under the construction contract has been settled and that, in consequence,
no dispute is capable of being referred to adjudication. Although that will be a matter for
the adjudicator to decide, since it goes to his jurisdiction, he cannot make a binding
decision on the point and, if the issue as to whether or not the original claim was settled
requires oral evidence, it will not be possible for that issue to be resolved at the enforcement
hearing and summary judgement will be refused: see, for example, Lee v Chartered Properties
(Building) Ltd.11 As to the debate about whether a construction contract with the necessary
adjudication and payment provisions is enforceable under the Unfair Terms in Consumer
Contracts Regulations, the relevant authorities are those set out at paragraphs 13.71–13.80
above. The Court of Appeal in Bryen & Langley Ltd v Rodney Martin Boston12 upheld the
general approach adopted by the TCC, to the effect that, in most cases, where the contract
has been proffered by or on behalf of the employer, it will be extremely difficult for him to
argue at a later date that the provisions relating to adjudication or payment/withholding
were in some way unfair.
9
[2009] EWHC 1371 (TCC); [2009] BLR 574.
10 [2010] EWHC 1076 (TCC); [2010] BLR 415.
11 [2010] EWHC 1540 (TCC); [2010] BLR 500.
12 [2005] EWCA Civ 973; [2005] BLR 508.
392
Was the Construction Contract in Writing?

In order for the provisions of the 1996 Act and the Scheme for Construction Contracts to 15.09
be implied, there has to be a construction contract in writing between the parties. In RJT
Consulting Engineers Ltd v DM Engineering (Northern Ireland) Ltd 13 the Court of Appeal
stressed the importance of the contract being in writing. In the words of Ward LJ, ‘writing
is important because it provides certainty. Certainty is all the more important when
adjudication is envisaged to have to take place under a demanding timetable.’ On the facts
of that case, he concluded that the adjudicator did not derive sufficient jurisdiction merely
because there was evidence in writing of the existence of the agreement, its substance, the
parties to it, the nature of the work and the price. Ward and Robert Walker LJJ concluded
that what has to be evidenced in writing ‘is, literally, the agreement, which means all of it,
not part of it. A record of the agreement also suggests a complete agreement, not a partial
one.’ For the reasons explained in detail at paragraphs 2.51–2.92 above, it is thought that
the reference by Auld LJ to the need for a written record of ‘the material terms of the agree-
ment’ evidenced a different approach to that of the majority, and that, at least for the present,
the only safe basis on which to proceed with an adjudication is to ensure all the terms of the
contract are in writing. When the 2009 Act finally comes into force, all of these issues will
become redundant, because there will no longer be a requirement that the construction
contract must be in writing.14
Was There a Written Agreement to Adjudicate?

If there was a written agreement to adjudicate then, subject to other points that may be raised, 15.10
the adjudicator will have the necessary jurisdiction, and it will not matter if, for example, not
all of the terms of the contract are in writing or the contract deals with an otherwise excluded
construction operation or work for a residential occupier: see Treasure & Son v Dawes.15 If,
however, there is a written adjudication agreement but, for whatever reason, it does not
comply with the provisions of the 1996 Act or the Scheme, then the general rule will be that
the adjudication provisions are replaced lock, stock and barrel by the Scheme: see the analysis
of Edwards-Stuart J in Yuanda (UK) Co Ltd v WW Gear Construction Ltd.16
Jurisdiction/The Appointment
Was the Adjudicator Appointed in Accordance with the Agreed Procedure?

The adjudicator derives his jurisdiction from the express terms of the contract (if any) or 15.11
the implied terms of the Scheme. Thus, it is important to ensure that the adjudicator is validly
appointed in accordance with whatever the applicable contract terms may be. A deficiency
in the appointment of the adjudicator strikes at the heart of his jurisdiction and, no matter
how technical the objection, and even if no prejudice has resulted from the error, the decision
will not be enforced: see IDE Contracting Ltd v RG Carter Cambridge Ltd 17 and Vision Homes
Ltd v Lancsville Construction Ltd.18 Thus, for example, the making of a request to the nominating
13
[2002] BLR 217.
14
15
[2007] EWHC 2420 (TCC); [2008] BLR 24.
16 [2010] EWHC 720 (TCC); [2010] 1 CLC 491 at paragraphs 55–62.
17 [2004] EWHC 36 (TCC); [2004] BLR 172.
18 [2009] EWHC 2042 (TCC); [2009] BLR 525.
393
Enforcement
body under the Scheme must follow the giving of the notice of adjudication and, if the
request comes first, the appointment will be invalid.
15.12 Not every procedural error will result in the court concluding that the adjudicator did
not have the necessary jurisdiction. Thus, the failure to serve the referral notice within
seven days of the notice of adjudication, as required by the Scheme, may deprive the
adjudicator or jurisdiction altogether (see Hart v Fidler 19) because that timetable was one of
the fundamental provisions in the process of adjudication. On the other hand, the failure
to serve a copy of the contract, as required by the Scheme, until the day after the provision
of the referral notice, is not a failure sufficient to deprive the adjudicator of jurisdiction:
see PT Building Services Ltd v ROK Build Ltd.20 The court’s general approach, as set out
in that latter case, is not to allow every breach of the terms of the Scheme, no matter how
trivial, to be seized upon to impeach the process of adjudication.
Jurisdiction/The Dispute
Had the Dispute Crystallised at the Time of the Notice of Adjudication?
15.13 Although there is no Court of Appeal authority on this topic, it is thought that the cases
summarised at paragraphs 7.61–7.77 above provide clear guidance on this issue. The two
decisions of Akenhead J in Cantillon Ltd v Urvasco Ltd 21 and Ringway Infrastructure Services
Ltd v Vauxhall Motors Ltd 22 stress that the court will not adopt an over-legalistic analysis of
what the dispute is, and will determine in broad terms whether a claim or assertion has been
made and whether or not that claim has been rejected. No express rejection is required.
Neither is a lengthy period required between the making of the assertion or claim and the
deemed non-acceptance of it. Furthermore, even if a particular element of the dispute could
fairly be said not to have crystallised at the time of the notice of adjudication, if it is dealt with
in the adjudication itself without a reservation of position, then the parties will be deemed
to have given the adjudicator the necessary ad hoc jurisdiction to decide that point too: see
Allied P & L Ltd v Paradigm Housing Group Ltd.23
Was More Than One Dispute Referred to the Adjudicator?

15.14 Some contracts permit the reference of more than one dispute to the adjudicator, but
most standard forms do not, and the Scheme for Construction Contracts does not permit
the reference to adjudication of more than one dispute at a time. Although it is often argued
under such contracts that the adjudicator did not have the necessary jurisdiction because
more than one dispute was referred to him under the notice of adjudication, this argument
has very rarely succeeded.24 The reason for this is because the courts have adopted a wide
definition of the word ‘dispute’, with the result that, properly framed, a notice of adjudication
will usually be capable of referring one single dispute to the adjudicator, even if that dispute
19 [2007] BLR 30.

20
[2008] EWHC 3434 (TCC).
21
[2008] EWHC 282 (TCC); [2008] BLR 250.
22
[2007] EWHC 2421 (TCC).
23 [2009] EWHC 2890 (TCC); [2010] BLR 59.
24 For a fuller discussion of the importance of this requirement, see paragraphs 7.78–7.85 above, and the
decision of HHJ Bowsher QC in Grovedeck Ltd v Capital Demolition Ltd [2000] BLR 181.
394
is made up of claims for contract work, variations, extension of time and loss and expense.25
Although concern has been expressed about this approach,26 there has been no reported case
in which a more restricted definition has been adopted. It should be noted that this point is
one of the few arguments that has regularly arisen on adjudication enforcements and which
has not yet been taken to the Court of Appeal. Until that happens, it is thought that the
point will not remain entirely free from doubt. However, for present purposes, it is sug-
gested that, provided sufficient care is taken in the drafting of the notice of adjudication, it
should generally be possible to avoid the complaint that more than one dispute has been
referred to the adjudicator at the same time.
Did the Parties Try to Extend the Scope of the Dispute Beyond that Set
Out in the Notice of Adjudication?
The dispute that the adjudicator has jurisdiction to determine is that set out in the notice 15.15
of adjudication. The notice defines the ambit of the adjudicator’s jurisdiction: see Griffin
and another (t/a K & D Contractors) v Midas Homes Ltd.27 However, this principle has to be
applied sensibly: because the notice of adjudication has been drafted by the claiming party,
it will be unlikely to refer to any or all of the defences likely to be raised by the responding
party. The responding party is generally entitled to rely on all of the defences that may be
open to it to defeat the claim set out in the notice of adjudication: see Pilon Ltd v Breyer
Group PLC.28 However, different considerations will apply if the responding party wishes to
rely on a cross-claim that should have been, but was not, the subject of a valid withholding
notice. In that case, it is not open to the responding party to raise the cross-claim by way
of set-off, because otherwise the whole regime of withholding notices would be rendered
otiose: see Letchworth Roofing Co v Sterling Building Co.29
In What Circumstances is a Withholding Notice Necessary?

Because the concept of the withholding notice was new, there was a certain amount of 15.16
muddle as to the extent to which the responding party needed to serve a withholding notice
in order to defend the detail of the claim being made, with the result that there was a
good deal of unhelpful debate about the respective merits of a strict or a liberal approach to
the need for such notices where no cross-claim was being asserted. Any lingering confusion
was resolved by the Court of Appeal in Rupert Morgan Building Services (LLC) Ltd v Jervis
and Another.30 In general terms, the position now is that, if the construction contract provided
for a series of interim certificates to be issued by the contract administrator or some other
representative of the employer, then the sum due to the contractor on an interim basis was
the amount certified by the certifying officer, subject to any valid withholding notice. Thus,
where a contractor or sub-contractor was in possession of such a certificate, he was entitled
to be paid the sum certified, unless the employer had, within the time limit prescribed by the
contract, served a withholding notice seeking to set off, against the sum certified, other sums
said to be due to the employer. In the absence of such a withholding notice, the contractor
25
See Fastrack Contractors Ltd v Morrison Construction Ltd [2000] BLR 168.
26
See, by way of example, the comments of Lord MacFadyen in Barr Ltd v Law Mining (2001) 80 Con LR 134.
27
[2000] 78 Con LR 152.
28 [2010] EWHC 837 (TCC); [2010] BLR 452.
29 [2009] EWHC 1119 (TCC); [2009] CILL 2717, paragraphs 17–33.
30 [2003] EWCA Civ 1563; [2004] 1 WLR 1867.
395
Enforcement
or sub-contractor was entitled to the sum certified right away; pursuant to the contract, the
paying party was obliged to pay such sum as had been certified.
15.17 As the Court of Appeal pointed out in Rupert Morgan, the position was different where the
claim for an interim payment was based simply upon an invoiced amount which had not
been certified, but merely asserted as due. In those circumstances, the paying party’s con-
tractual obligation was to pay what was due under the contract. Thus, if the paying party
considered that the claim was over-stated, because, say, it included inflated rates or a number
of duplications, then the paying party could set out its position in writing both before and
during the adjudication, and no prior withholding notice was necessary. As Jacob LJ pointed
out in Rupert Morgan, under that type of contractual regime, no withholding notice was
required in respect of works that, on the employer’s case, had not been done: payment was
not due in respect of work not done, so a withholding notice was unnecessary. The 2009 Act
introduces a completely new regime of what might be called counter-notices: see paragraphs
4.22–4.26 above.
Jurisdiction/The Decision
Does the Decision Answer the Dispute Referred in the Notice of Adjudication?
15.18 Again, although there is no Court of Appeal authority on this point, it is considered that the
cases identified above at paragraphs 7.86–7.93 provide clear guidance on the issue of
whether the decision has dealt properly with the dispute referred. In general terms, the
broad interpretation of the word ‘dispute’, based on Judge Thornton’s definition in Fastrack
Contractors Ltd v Morrison Construction Ltd 31 means that it is inherently unlikely that the
matters dealt with by the adjudicator in his decision will not, in one way or another, be
covered by the dispute originally referred in the notice of adjudication. It is really only
where the adjudicator deals with something that neither party expected that a valid juris-
dictional objection is created: see R Durtnell and Sons Ltd v Kaduna Ltd32 and Primus Build
Ltd v Pompey Centre Ltd and Another.33
Does the Decision Fail to Address the Dispute Properly?

15.19 This issue is dealt with above in detail in paragraphs 7.86–7.95 (jurisdiction) and 13.26–13.39
(fairness). In general terms, the adjudicator has a wide scope to address the dispute in the
way that he considers appropriate. It is not for him to address every last sub-issue and
counter-point raised in the party’s submissions. If, however, he fails to deal with an
important element of the claim or the defence then he may be found to have illegiti-
mately restricted his jurisdiction (see Amec Group Ltd v Thames Water Utilities Ltd 34),
although it is thought that this point more conveniently arises as a breach of natural
justice. The critical point is, however the complaint is put, that the adjudicator’s failure
must go to a significant or substantial element of claim or defence: see Pilon Ltd v Breyer
Group PLC.35
31
[2000] BLR 168; 75 Con LR 33; (2000) 16 Const LJ 273.
32
[2003] BLR 225.
33 [2009] EWHC 1487 (TCC); [2009] BLR 437.
34 [2010] EWHC 419 (TCC).
35 [2010] EWHC 837 (TCC); [2010] BLR 452.
396
If Written Reasons are Required, are They Sufficient?

Adjudicators are not generally required to give reasons but, if the parties request them, then 15.20
they are obliged to provide them and most adjudications conclude with a written decision.
The reasons should be sufficient to show that the adjudicator has dealt with the issues
remitted to him and what his conclusions are on those issues: see the cases discussed at para-
graphs 3.93–3.97 above and in particular the decision of Jackson J in Carillion Construction
Ltd v Devonport Royal Dockyard 36 and the decision of Akenhead J in Balfour Beatty Engineering
Services (HY) Ltd v Shepherd Construction Ltd.37 In the latter case, the judge stressed that the
fact that the adjudicator did not deal with every single argument of fact or law will not mean
that the decision is necessarily unreasoned. The adjudicator must deal with those arguments
that are sufficient to establish the route by which the decision has been reached.
Was the Decision Reached/Issued Within the Statutory/Extended Period?

The failure to reach a decision within the statutory time limit, as extended by the parties, 15.21
will be fatal to the validity of the decision: see the discussion at paragraphs 3.76–3.82
above and in particular the Scottish case of Ritchie Brothers (PWC) Ltd v David Philip
(Commercials) Ltd.38 If, however, the evidence is that the decision was reached within the
time then, if it is issued a few hours later, even if that means the following day, the decision
is probably not annulity: see Barnes & Elliott Ltd v Taylor Woodrow Holdings Ltd.39
However, an unexplained delay of three days between the conclusion of the decision and
its issue to the parties will be sufficient to render the decision a nullity: see Lee v Chartered
Properties (Building) Ltd.40
Natural Justice
Was the Adjudicator Actually or Apparently Biased?
Allegations of actual bias are very rare: see paragraphs 12.01–12.02 above. The test for 15.22
apparent bias is whether the circumstances would lead a fair-minded and informed
observer to conclude that there was a real possibility, or a real danger, that the adjudicator
was biased. The only reported case in which the adjudicator’s links to one side was alleged to
give rise to bias was in Fileturn Ltd v Royal Garden Hotel Ltd 41 and, despite the evidence of a
connection, it was held not to be sufficient to meet the fair-minded observer test. Allegations
of bias have usually only been upheld when the adjudicator has had unilateral communi-
cations with one party in the adjudication.
Did the Size/Nature of the Claim Make It Inherently Unsuitable for Adjudication?
This topic is explored in detail in paragraphs 13.13–13.25 above. Essentially, it is up to the 15.23
adjudicator to ask himself whether he has sufficiently appreciated the nature of any issue
referred to him before giving a decision on that issue, including the submissions of each
party, and whether he or she was satisfied that he or she could do broad justice between the
36
[2005] EWHC 778 (TCC); [2005] BLR 310.
37
[2009] EWHC 2218 (TCC); [2009] 127 Con LR 110.
38
[2005] SLT 341.
39 [2003] EWHC 3100; [2004] BLR 111.
40 [2010] EWHC 1540 (TCC); [2010] BLR 500.
41 [2010] EWHC 1736 (TCC); [2010] BLR 512.
397
Enforcement
parties: see CIB Properties Ltd v Birse Construction Ltd.42 As a result, it is most unlikely that
the TCC would grant an injunction restraining the further pursuit of an adjudication on this
ground, even if the claim was made at a deliberately inconvenient time and involved a large
number of files: see The Dorchester Hotel Ltd v Vivid Interiors Ltd.43 Although from time to
time responding parties have alleged that the claim that they have to meet was too compli-
cated and/or too large to be dealt with fairly within the adjudication process, that submission
has never been upheld. Similarly, the mere fact that the adjudicator puts the parties under
pressure to provide information more quickly than they would like is ‘an inevitable conse-
quence of the adjudication process’ (Edenbooth Ltd v Cre8 Developments Ltd 44) and will not
in the usual case amount to a breach of natural justice.
Did the Adjudicator Fail to Address a Key Issue?
15.24 This topic is discussed at paragraphs 13.26–13.39 above. There are essentially three ways in
which this can arise:
1. where the adjudicator addresses a matter which was outside the scope of the original
adjudication;
2. where he fails to address a matter in issue; and
3. where he failed to consider a further or final submission made by one of the parties.
As to (1), the inclusion within the decision of something which was outside the scope of
the original adjudication, the cases demonstrate that this objection is rarely successful.
Most of the complaints have been rejected on the grounds that the matter which the
adjudicator addressed was not a new issue, but merely a new argument or new material in
support of an existing position: see PT Building Services Ltd v ROK Build Ltd.45 On the
other hand, if the adjudicator decides something which neither party expected, or which
both parties were agreed he should not decide, then the decision will not be enforced: see,
for example, R Durtnell & Sons Ltd v Kaduna Ltd 46 and Prumus Build Ltd v Pompey Centre
and Another.47
15.25 As to (2) (the alleged failure to address a matter in issue), the cases demonstrate that the
success or failure of this allegation will depend entirely upon the nature of the issue that
the adjudicator allegedly ignored. On the one hand, if it was, say, the critical part of the
responding party’s defence, then that may well lead to the conclusion that the decision
should not be enforced: see Thermal Energy Construction Ltd v AE & E Lentjes UK 48 and
Pilon Ltd v Breyer Group PLC.49 On the other hand, the mere fact that the adjudicator
had not dealt in his decision with every sub-issue or argument raised may be inevitable and
does not mean that there had been a breach of natural justice: see HS Works Ltd v Enterprise
Managed Services Ltd 50 and Amec Group Ltd v Thames Water Utilities Ltd.51 And as to (3),
42 [2004] EWHC 2365 (TCC); [2005] 1WLR 2252.

43 [2009] EWHC 70 (TCC); [2009] Bus LR 1026.
44 [2008] EWHC 570 (TCC); [2008] CILL 2592.
45 [2008] EWHC 3434 (TCC).
46
[2003] EWHC 517 (TCC); [2003] BLR 225.
47
[2009] EWHC 1487 (TCC); [2009] BLR 437.
48
[2009] EWHC 408 (TCC).
49 [2010] EWHC 837 (TCC); [2010] BLR 452.
50 [2009] EWHC 729 (TCC); [2009] BLR 378.
51 [2010] EWHC 419 (TCC).
398
namely where the adjudicator failed to consider a further or final submission, the courts
have generally been sympathetic to the adjudicator in such circumstances. GPS Marine
Contractors Ltd v Ringway Infrastructure Services Ltd 52 is authority for the proposition that,
in a fast-moving adjudication process, the adjudicator is not obliged to allow late sub-
missions and, even if they are provided, he is not obliged to read them.
Did the Adjudicator Fail to Consult the Parties Prior to the Decision?
It is of course trite that, within the confines of the limited adjudication timetable, the 15.26
adjudicator must allow each party sight of, and the opportunity to comment upon, the
other side’s submissions or pleadings. As noted above, that is, of course, subject to the final
stages where, in order to complete his decision within the statutory period, the adjudica-
tor may prohibit the service of further submissions. But greater difficulties have arisen
when adjudicators have come up with their own solution to the dispute, either off their
own bat or with the assistance of a third party, and then failed to share that potential solu-
tion with the parties. The cases discussed at paragraphs 13.41–13.53 demonstrate the
various ways in which adjudicators have fallen foul of this basic rule. This is particularly
important when the adjudicator’s preliminary view or potential solution is at odds with
the agreed position between the parties: see, for example, Shimizu Europe Ltd v LBJ
Fabrications Ltd.53
Does the Decision Cut Across the Decision in an Earlier Adjudication?

This issue is discussed at paragraphs 13.58–13.62 and 14.36–14.44 above. The Court of 15.27
Appeal decision Quietfield Ltd v Vascroft Construction Ltd 54 makes plain that an adjudi-
cator acts in breach of natural justice if he decides something that has already been decided
in an earlier adjudication. Benfield Construction Ltd v Trudson (Hatton) Ltd 55 is perhaps
the most brazen example of a case in which an adjudicator purported to reach a com-
pletely different decision on a dispute that had already been decided, in enequivocal
terms, by the first adjudicator. The later adjudication decision was therefore not
enforced.
Was the Breach of Natural Justice Material?

For the reasons noted in paragraphs 13.10–13.12 above, it is not enough for the party 15.28
seeking to resist enforcement to show that there has been an arguable breach of natural
justice. That party must go on to demonstrate that the breach has been material: a point
has been over-looked that was either decisive or of considerable potential importance to
the outcome of the resolution of the dispute (see Cantillon Ltd v Urvasco Ltd 56). It is
thought that, if an allegation of apparent bias has been made out, it is not also necessary to
demonstrate that the apparent bias has had a material effect. By analogy with the arbitra-
tion cases,57 it is likely that the mere fact of bias will be sufficient to demonstrate
materiality.
52 [2010] EWHC 283 (TCC); [2010] BLR 377.

53
[2003] BLR 381.
54
[2007] BLR 67.
55
[2008] EWHC 2333 (TCC); [2008] CILL 2633.
56 [2008] EWHC 282 (TCC); [2008] BLR 250.
57 ASM Shipping Ltd of India v TTMI Ltd of England [2005] EWHC 2238 (Comm); [2006] 2 All ER
(Comm) 122; Norbrook Laboratories v A Tank [2006] EWHC 1055 (Comm); [2006] 2 Lloyd’s Rep 485.
399
Enforcement
The Severability of the Decision

15.29 The inevitable consequence of a complex dispute, decided in a short time period and the
subject of a lengthy decision, is that, from time to time, the adjudicator will be found, in
relation to one aspect of the adjudication, to have acted in excess of jurisdiction or in breach
of the rules of natural justice. Should that failure taint the whole decision or is an adjudi-
cator’s decision capable of being severed, so that the part of it that was within the jurisdiction
and was reached without any breach of the rules of natural justice is still capable of enforce-
ment? The issue had arisen, albeit tangentially in a number of cases that are analysed
elsewhere in this book.58 However, it is in the more recent case of Cantillon Ltd v Urvasco
Ltd 59 that the issue was addressed directly.
15.30 Having considered the authorities noted above, Akenhead J went on to summarise the
position at paragraph 64 of his judgment, by reference to a paper in the Construction Law
Journal, in these terms:
(1) Where two or more disputes are referred to an adjudicator, a valid objection to one
decision on jurisdiction or natural justice grounds, will not necessarily affect the
validity and enforceability of the adjudicator’s decision on the other dispute or
disputes.
(2) Where a single dispute is referred to one adjudicator, it may not be severed so as to excise
a part of the decision to which valid objection is taken, on jurisdiction or natural justice
grounds, leaving the balance valid and enforceable. A decision on the single dispute is
either valid and enforceable or invalid and not enforceable.
(3) It follows that an adjudicator’s decision may not be corrected to take account of a jurisdic-
tion objection, with the result that a sum larger than that in the adjudicator’s decision may
be enforced by a claimant.
At paragraph 65 the judge then went on to make some additional observations, making it
plain that these were obiter, which are principally concerned with the situation where the
decision properly addresses more than one dispute, either because that was permitted by the
contract or because the parties agreed that the adjudicator would have that power. Sub-
paragraph (f ) reiterates the point, that where the decision was on one dispute or difference,
and there had been a material breach of natural justice or the adjudicator had acted in excess
of jurisdiction, the decision would not be enforced.

15.31 Accordingly, since the vast majority of adjudicator’s decisions relate to a single dispute, it
follows that the vast majority of those decisions will not be severable. Thus, in Quartzelec Ltd
v Honeywell Control Systems Ltd 60 the judge referred to the judgment in Cantillon and said
that, whilst it may at first impression appear unfair that a party, who is otherwise liable to pay
on an adjudicator’s decision the sum of £135,000, should be able to avoid any liability at all
because the adjudicator failed to consider a defence worth £36,500, it was a consequence of
the court’s inability to sever the decision. Whilst this judgement has been criticised for other
58
Amec Capital Projects Ltd v Whitefriars City Estates Ltd [2005] BLR 1; Griffin and Another v Midas Homes
Ltd [2000] 78 Con LR 152; KNS Industrial Services (Birmingham) Ltd v Sindall Ltd [2001] 75Con LR 71;
Shimizu Europe Ltd v Auto Major Ltd [2002] BLR 113 and RSL (South West) Ltd v Stansell Ltd [2003] EWHC
1390 (TCC).
59 [2008] EWHC 282 (TCC); [2008] BLR 250.
60
[2008] EWHC 3315 (TCC); [2009] BLR 328.
400
reasons,61 there can be no doubt that, on the basis of the analysis in Cantillon, the judge was
right to say that the decision could not be severed. Similarly, in Cleveland Bridge (UK) Ltd v
Whessoe-Volker Stevin Joint Venture 62 Ramsey J refused to sever the decision that related to
claims arising out of both construction operations under s105(1) of the Act, and excluded
operations under s105(2), which the adjudicator had no jurisdiction to decide. The unhappy
consequences of that result were that CB were deprived of about £100,000 that would have
otherwise been due in relation to those works that the adjudicator had the jurisdiction to
decide. Ramsey J said that it was not for the court to decide how the decision should be
divided up between the parts within the adjudicator’s jurisdiction and the parts outside. That
was not a role that the court should adopt.
Accordingly, the present position remains that, where there is a single dispute, the decision 15.32
on that dispute cannot be severed for the purposes of enforcement. The only reported cases
in which a different result may have occurred are Bovis Lend Lease Ltd v The Trustees of The
London Clinic 63 where, at paragraph 69 of his judgement, in a passage that was plainly obiter,
Akenhead J said that he might have concluded that, even if the adjudicator had had no juris-
diction to deal with the claim for loss and expense, he would have enforced that part of the
decision that demonstrably related to the extension of time claim and the recovery by the
contractor of liquidated damages. This was on the basis that the decision was, in the judge’s
words, ‘eminently severable’. This does not seem to have been based on the suggestion that
the adjudicator was dealing with more than one dispute.64 In Pilon Ltd v Breyer Group PLC 65
the TCC judge reiterated that, because there was one dispute in that case, the decision was
not severable. But he went on to say:
I acknowledge that it may soon be time for the TCC to review whether, where there is a
single dispute, if it can be shown that a jurisdiction/natural justice point is worth a fixed
amount which is significantly less than the overall sum awarded by the adjudicator, severance
could probably be considered. That was, after all, the basis on which summary judgement
applications were routinely decided before the 1996 Act.
Can the Paying Party Set Off a Separate Claim Against

the Sum Awarded by the Adjudicator?
The relevant authorities are dealt with in detail in Chapter 9 above. Rights of set-off will 15.33
ultimately depend on the true construction of the contract and the nature of the adjudi-
cator’s decision. In general terms, however, it can be said that the paying party will find
it extremely difficult to set off against the sum awarded by the adjudicator its own separ-
ate claim, particularly in circumstances where that claim could have been raised in the
adjudication, but for the absence of a timeous withholding notice. However, in this
regard, it should be noted that, in Parsons Plastics (Research and Development) Ltd v Purac
Ltd,66 the Court of Appeal decided that the respondents had a set-off against the sum
61 See the commentary on the case at [2009] BLR 329–330 and Pilon Ltd v Breyer Group PLC [2010]
EWHC 837 (TCC); [2010] BLR 452, paragraphs 19–21.

62
[2010] EWHC 1076 (TCC); [2010] BLR 415.
63
[2009] EWHC 64 (TCC); [2009] 123 Con LR 15.
64
See also Adonis Construction v O’Keefe Soil Remediation [2009] EWHC 2047 (TCC); [2009] CILL 2784,
paragraphs 49–50.
65 [2010] EWHC 837 (TCC); [2010] BLR 452.
66
[2002] BLR 334.
401
Enforcement
awarded by the adjudicator, even though the respondents had failed to serve a valid
withholding notice. The learned editors of the Building Law Reports described this as a
‘curious result’ and it is respectfully suggested that Parsons Plastics is perhaps best regarded
as a case confined to the particular terms of the sub-contract in question.
15.34 The decision of the Court of Appeal in Ferson Contractors Ltd v Levolux A.T. Ltd 67 is perhaps
of more general application. There, Mantell LJ concluded that the purpose of s108 of the
1996 Act would be defeated if the losing party was permitted to avoid the consequences of
defeat by raising a new set-off against the sum awarded by the adjudicator. He said that the
contract had to be construed so as to give effect to the intention of Parliament, rather than to
defeat it, and that, accordingly, the set-off provisions in the contract had to be read in such a
way that meant that they did not apply to monies due by reason of an adjudicator’s decision.
He distinguished Parsons Plastics on the basis that, in that case, the Court of Appeal did not
have to consider what impact s108 of the 1996 Act might have on the construction of the
relevant contract provisions concerned with set-off.68
Summary Judgment
15.35 From the outset, the courts have made plain that the right way for a party to enforce the
decision of an adjudicator is to seek summary judgment based on the decision. In Macob,
Dyson J said that, whilst he had no doubt that the court had jurisdiction to grant a mandatory
injunction to enforce an adjudicator’s decision, the best method of enforcement was by way
of summary judgment. He said that the mere fact that the decision may later be revised was
not a good reason for saying that summary judgment was inappropriate. The grant of
summary judgment did not pre-empt any later decision that an arbitrator or a court might
make. It merely reflected the fact that there was no defence to the claim to enforce the decision
of the adjudicator at the time of judgment.
15.36 The same point was emphasised by the Court of Appeal in Bouygues.69 At paragraph 29 of his
judgment in that case, Chadwick LJ said that summary judgment was the proper method of
enforcement.
In the ordinary case I have little doubt that an adjudicator’s determination under section 108
of the 1996 Act, or under contractual provisions incorporated by that section, ought to be
enforced by summary judgment. The purpose of the Act is to provide a basis upon which pay-
ment of an amount found by the adjudicator to be due from one party to the other (albeit that
the determination is capable of being re-opened) can be enforced summarily.
Summary
15.37 One of the first cases in which the relevant principles of enforcement were drawn together
was in the judgment of HHJ Thornton QC in Sherwood & Casson Ltd v MacKenzie Ltd.70
67
[2003] EWCA Civ 11; [2003] BLR 118.
68
An adjudicator’s decision may have a different status to a certificate or an obligation to pay a specified sum under
the contract, making the exercise of the right of set-off more difficult: see paragraph 21 of the judgment in Westwood
Structural Services Ltd v Blyth Wood Park Management Co Ltd [2008] EWHC 3138 (TCC); [2009] CILL 2666.
69 [2000] BLR 522.
70 (2000) TCLR 418.
402
There, at paragraph 24, he summarised the approach of the courts to disputed enforcement
applications by reference to the five propositions set out verbatim in paragraph 2.10 above.
These include the general rules that:
• A decision of an adjudicator whose validity is challenged as to its factual or legal con-
clusions or as to procedural error will usually be enforced.
• A decision that is erroneous, even if the error is disclosed by the reasons, will still not
ordinarily be capable of being challenged and will usually be enforced.
• A decision may be challenged on the ground that the adjudicator was not empowered
by the 1996 Act to make the decision, either because there was no underlying con-
struction contract between the parties or because he had gone outside the terms of
reference.
• The court will guard against characterising a mistaken answer to an issue, which is within
an adjudicator’s jurisdiction, as being an excess of jurisdiction. Furthermore, the court
should give a fair, natural and sensible interpretation to the decision in the light of the
disputes that are the subject of the reference.
• An issue as to whether a construction contract ever came into existence is a challenge to the
jurisdiction of the adjudicator, and so long as it is reasonably and clearly raised, must be
determined by the court on the balance of probabilities with, if necessary, oral and docu-
mentary evidence.
Although this summary was provided in the early days of adjudication and adjudication 15.38
enforcement, it has stood up very well as a guide to the principles that the courts will adopt
when considering any application to enforce the decision of an adjudicator. Coming up to
date, the most comprehensive recent guidance can be found at paragraphs 80 and 81 of the
judgment of Jackson J in Carillion Construction Ltd v Devonport Royal Dockyard Ltd.71
Paragraph 80 contained the four general propositions that are set out verbatim at para-
graph 7.04 above. Paragraph 81 included the five more specific propositions that are again
set out verbatim at paragraphs 3.72 and 3.93 above. Both these paragraphs were expressly
approved by the Court of Appeal.72 In his own conclusions, at paragraphs 85–87 of his
judgment (cited verbatim at paragraph 7.113 above), Chadwick LJ stated that ‘It should
be only in rare circumstances that the courts will interfere with the decision of an adjudica-
tor.’ Whilst it was only too easy to identify points upon which to present a challenge under
the labels ‘excess of jurisdiction’ or ‘breach of natural justice’, he emphasised that the courts
would give no encouragement to an approach that could be aptly described as ‘scrabbling
around to find some argument, however tenuous, to resist payment’. He said that the 1996
Act provided a means of meeting the legitimate cash-flow requirements of contractors and
their sub-contractors; it was not enacted in order to provide definitive answers to complex
questions.
In what is perhaps the plainest indication of the courts’ approach to enforcement appli- 15.39
cations, Chadwick LJ said, at paragraph 87 of his judgment, that in the overwhelming
majority of cases, the proper course for the unsuccessful party in an adjudication was to pay
the amount that the adjudicator had ordered that he should pay. If he did not accept that
decision, he could take subsequent legal or arbitral proceedings in order to establish what
71 [2005] All ER (D) 366 (Apr).

72 [2005] EWCA Civ 1358; [2006] BLR 15.
403
Enforcement
he considered was the true position. Chadwick LJ made plain that to seek to challenge the
adjudicator’s decision on the ground that he had exceeded his jurisdiction or breached
the rules of natural justice was likely, save in the plainest cases, to lead to a substantial
waste of time and expense. Many of the authorities cited in this and earlier chapters only
serve to make good that conclusion.
404
16
ADJUDICATION BUSINESS IN THE TCC
Introduction 16.01 The Consequences of Losing an

Enforcement Generally 16.02 Adjudication 16.23
Summary Judgment in the TCC 16.05 Injunctions 16.32
General 16.05 Part 8/Declaratory Relief 16.39
The Defendant’s Position 16.12 Other Procedural Routes 16.48
Interest and Costs 16.15 Staying Court Proceedings for
Interest 16.15 Adjudication 16.49
Costs 16.18
The TCC is ordinarily the court in which the enforcement of an adjudicator’s decision
and any other business connected with adjudication is undertaken. Adjudicators’
decisions predominantly arise out of adjudications which are governed by the
mandatory provisions of the Housing Grants Construction and Regeneration Act
1996 (HGCRA). These provisions apply automatically to any construction contract
as defined in the legislation. Some adjudicators’ decisions arise out of standard forms
of contract which contain adjudication provisions and others arise from ad-hoc
agreements to adjudicate. The TCC enforcement procedure is the same for all three
kinds of adjudication.
The Technology and Construction Court Guide (2nd edn,
October 2005, second revision October 2010), paragraph 9.1.1
Introduction
The Technology and Construction Court (TCC) is the only nationwide specialist civil 16.01
court, dealing with all aspects of construction-related litigation. It therefore habitually
handles all types of disputes relating to adjudication, and has developed its own specific
procedures to dispose efficiently of the various types of adjudication business. Obviously, the
most important aspect of this work, in which the TCC in both London and the regions has
played a major part in recent years, is in respect of applications for the enforcement of
adjudicators’ decisions. But the TCC also deals with applications to injunct ongoing
adjudication proceedings; applications for declarations arising out of adjudications or the
specific decision of the adjudicator; and applications to stay court or arbitration proceedings
temporarily in order to allow an adjudication to take place. The relevant practice and
procedure in respect of each of these adjudication-related areas of dispute are noted in the
remainder of this chapter.
405
Enforcement
Enforcement Generally
16.02 The principal purpose of adjudication is to resolve the dispute that has arisen between the
parties by way of a speedy decision. That decision then becomes temporarily binding, until
the underlying dispute is litigated, arbitrated, or settled. In those circumstances, after the
1996 Act came into effect in May 1998, it quickly became apparent that there was a clear
need for the courts to provide a similarly swift enforcement procedure, in order to ensure
that the victor in the adjudication was not then kept out of his money for months. It has
been made clear on many occasions since the 1996 Act came into force that the right
approach on enforcement is the issuing of court proceedings in the TCC, coupled with an
application for summary judgment pursuant to CPR Part 24.1 Despite this, in the early
days, a number of difficulties arose when the successful party in the adjudication sought to
enforce the adjudicator’s decision in courts that were unfamiliar with the summary nature
of the adjudication process, the general prohibition against set-off, and the concept of
‘temporary finality’.
16.03 As noted above, the TCC was and remains therefore the obvious place in which the success-
ful party should seek to enforce the decision of the adjudicator. The TCC has developed its
own special procedure, discussed in greater detail below, to enable enforcement proceedings
to be disposed of promptly. Since the special procedure operated by the TCC is in force in
all of the TCC courts across the country (notably in London, Birmingham, Manchester,
Cardiff, Leeds, Bristol and Newcastle) it is thought that the TCC is the appropriate forum
for all adjudication-related proceedings, particularly the enforcement of the adjudicator’s
decision.
16.04 Because the TCC has a particular procedure for the enforcement of adjudicators’ decisions,
and because other courts do not, considerable amounts of time and costs can be wasted if the
enforcement proceedings are not commenced in the TCC. By way of example, in Harlow &
Milner Ltd v Linda Teasdale (No 1) 2 the claimant had originally sought to enforce the
adjudicator’s decision by issuing a statutory demand and pursuing bankruptcy proceedings
in the county court. Six months were wasted, and considerable costs incurred, before the
statutory demand was set aside by consent and the parties agreed that the matter would be
referred to the TCC. The TCC judge promptly enforced the decision of the adjudicator.
However, he declined to award the claimant the costs of the earlier bankruptcy proceedings,
expressing the view that the appropriate method of enforcement was to issue proceedings in
the TCC and that, if this course had been followed at the outset, a good deal of time and cost
would therefore have been saved. The judge accepted that the issue of a bankruptcy petition
could not, of itself, be described as the wrong way of enforcing the adjudicator’s decision but,
given that there was a procedure expressly tailored by the TCC to allow the prompt and
efficient enforcement of adjudicator’s decisions, the court had to consider very carefully an
application for the costs of other proceedings, commenced in addition to the enforcement
action, particularly where, in the end, it was the enforcement proceedings that had proved to
be the right course for the claimant to take.
1 See Dyson J (as he then was) in Macob Civil Engineering Ltd v Morrison Construction Ltd [1999] BLR 93,
100, second column.

2
[2006] EWHC 54 (TCC).
406
Adjudication Business in the TCC
Summary Judgment in the TCC

General
The specific procedure designed to ensure the speedy and just resolution of all disputed 16.05
enforcement proceedings is set out in the draft directions at Appendix F of the 2nd edition
of The Technology and Construction Court Guide, published in October 2005. Those draft
directions are reproduced here as Appendix D. They presuppose that the claimant will make
an application for summary judgment pursuant to CPR Part 24. The important elements of
this procedure are analysed briefly below.
There is no Practice Direction and no claim form specifically designed with adjudication 16.06
business in mind. Thus, in most cases, because enforcement proceedings are in respect of a
sum of money awarded by the adjudicator, CPR Part 7 proceedings are usually appropriate.
Only in the rare situation where the enforcement proceedings are known to raise a question
that is unlikely to involve a substantial dispute of fact, and no monetary judgment is sought,
will it be appropriate for the parties to use CPR Part 8.
In a typical enforcement case, there will be a short claim form. The claim form should identify 16.07
the construction contract and, in particular, the terms of that contract that conferred jurisdic-
tion upon the adjudicator. If the adjudication was conducted in accordance with any
particular set of procedural rules, those should also be identified in the claim form. The claim
form will then go on to identify shortly the adjudicator’s decision, the fact that the sum
identified in that decision has not been paid, and the claim for that sum, together with
any relevant interest and other monies due, such as some or all of the adjudicator’s fees.
The claim form should be accompanied by an application notice setting out in clear terms
the procedural directions that are being sought. Those directions should be based upon the
standard directions set out in Appendix D.
It will almost invariably be the case that, alongside the claim form and the application 16.08
notice setting out the directions that are sought, the claimant will issue an application
for summary judgment under CPR Part 24. That application will be accompanied by a
short witness statement in support. That statement will identify/exhibit the relevant
parts of the contract and the adjudicator’s decision. It is usually unnecessary for the
statement to contain any further information, although if, for example, the responding
party took a point at the start of the reference as to the adjudicator’s jurisdiction, and it
is obvious to the applicant that this point will be maintained in any subsequent enforce-
ment proceedings, it will usually be helpful for the applicant to identify that point in the
statement and to explain how and why, in the applicant’s view, the jurisdiction point is
a bad one.
The judge will consider the application for directions and almost invariably make an order in 16.09
the general terms set out in Appendix D. In making those directions the judge will consider
a variety of matters including:
1. the date by which the claim form and summary judgment documentation should be
served on the defendant, if that has not already happened;
2. the abridged period of time in which the defendant must file his acknowledgment of
service, usually three days;
407
Enforcement
3. the date for service by the defendant of any witness statement in opposition to the
enforcement;
4. the date for service of any further material (if appropriate) from the claimant;
5. the fixing of the hearing of the summary judgment application, together with dates for
the lodging of bundles, skeleton arguments and the like.
It is less wasteful of time if the judge makes these directions on the basis of the documenta-
tion provided to him by the claimant. However, the judge will always give the defendant
liberty to apply, so it is always open to the defendant to inform the court that, because of
information unknown to the court at the time that the directions were made, certain variations
to the original directions order may be necessary.
16.10 The whole purpose of the particular procedure developed by the TCC for the enforcement
of adjudicators’ decisions is to ensure that the speed and efficiency of the adjudication process
is mirrored in any subsequent enforcement proceedings. Thus, the TCC endeavours to list
an enforcement hearing within 28 days of the issue of the claim form. In a relatively straight-
forward case, where the claimant has issued its summary judgment application at the same
time as the claim form, the judge will give the defendant about 14 days to put in its own
evidence in response, along with the defence. The claimant may then be given a shorter
period, say four days, in which to put in any further material in reply. Thereafter, bundles can
be prepared and skeleton arguments exchanged, so that a hearing can take place within
another 7 to 14 days. However, because adjudication enforcement applications are usually
listed on a Friday, and the TCC judges can have notoriously full lists on Fridays (partly, of
course, as a result of adjudication enforcement applications), it can sometimes be necessary to
list the enforcement application either on a weekday or on a Friday five or six weeks after the
issue of the claim form. Despite these potential difficulties, the statistics show that the great
majority of enforcement applications are heard within 28 days of the issue of the claim form.
16.11 By the time of the enforcement hearing itself, the parties will have exchanged skeleton
arguments and the judge will probably have had an opportunity to go through those argu-
ments with some care in advance of the oral argument. Following the oral argument, the judge
will endeavour to give judgment then and there although, since the points that can be raised
at enforcement hearings are many and varied, it is sometimes necessary for the judge to
reserve judgment for a few days and hand down a written judgment, particularly in a case
that raised a novel point of wider significance to the adjudication community. Although the
enforcement hearing has been called ‘the trial on documents and witness statements of
preliminary issues concerning the enforceability of the decision of an adjudicator’,3 this will
usually involve a straightforward application of CPR Part 24, with no oral evidence.
The Defendant’s Position

16.12 A defendant faced with a claim brought by way of enforcement proceedings has three options.
First, he can admit the claim. Secondly, he can seek to settle the dispute encompassed by the
original adjudicator’s decision. Thirdly, of course, he can continue to oppose the claim made.
Although in the majority of cases this is done by a defendant responding to the claim and
providing details of the grounds of its opposition, it is not unknown for a defendant simply
to ignore the claim and not to respond at all.
3 RWE NPower PLC v Alstom Power Ltd [2009] B40 (TCC).
408
If the sum is admitted, the admission should be made plain as soon as possible, and the court 16.13
should be notified so that the hearing date can be vacated. It should be noted that, in such
cases, the court has a discretion to award the claiming party sums in addition to the fixed
costs. The reasons for that, in particular the costs of putting together both the claim form and
the Part 24 application, were set out in Amber Construction Services Ltd v London Interspace
HG Ltd,4 discussed in detail in paragraph 16.18 below. Sometimes, although liability to pay
the underlying sum might be admitted, the defendant will seek to reach a commercial
agreement in respect of matters such as interest, costs and time to pay. It is not unknown for
there then to be a dispute as to whether or not the claim has been compromised. Thus, at the
hearing, the court may sometimes have to deal first with the issue as to whether or not a
settlement had been reached because the underlying claim would only have to be considered
if the court concluded that there was no such settlement. In Southern Electric v Mead
Realisations5 the dispute as to the terms of settlement was a straightforward dispute as to the
construction of various documents and the judge was able to reach a concluded view about it.
That is not so easy if the disputed terms of the settlement were made orally. That was the
situation in Able Construction (UK) Ltd v Forest Property Development Ltd.6 In the rather
unusual circumstances of that case, the judge decided that the short and self-contained issue
could be dealt with by way of oral evidence at the enforcement hearing, noting that the
enforcement proceedings ‘ought to be flexible enough to ensure that the raising of a point of
this kind can be addressed, if at all possible, straight away. It is not generally acceptable for a
party seeking to avoid judgement arising out of an adjudicator’s decision to raise an issue that
requires oral evidence, in the hope and expectation that this would mean that the deter-
mination of the enforcement claim would have to be adjourned.’
Unhappily, it is not uncommon for the defendant to do nothing at all and to fail to respond 16.14
either to the claim or the communications from the court. Such a stance brings with it the
risk of indemnity costs (see below). But such a situation also imposes particular obligations
on the claimant, as set out in Coventry Scaffolding Company (London) Ltd v Lancsville
Construction Ltd.7 In that case, the judge said that, when it became clear that it was likely that
a defendant was not going to participate, a claimant should consider carefully the desirability
of proceeding by way of obtaining a judgement in default. Once it was clear that there had
been service of claim form and the other documents required by the court order, there was
no procedural reason why judgement in default should not be obtained. The judge encour-
aged claimants in that situation to do just that. That would give rise to a saving in costs and
a saving in the court’s time, because it would then be possible for other matters to be listed
for the time when the enforcement hearing had been due to be heard.
Interest and Costs

Interest
Many construction contracts identify the appropriate rate of interest to be applied to late 16.15
payment. If the court enforces an adjudicator’s decision under such a contract, then the rate
4
[2007] EWHC 3042 (TCC). See also Southern Electric v Mead Realisations [2009] EWHC 2947 (TCC).
5 [2009] EWHC 2947 (TCC).
6 [2009] EWHC 159 (TCC).
7 [2009] EWHC 2995 (TCC).
409
Enforcement
of interest applicable from the date on which the sum should have been paid, to the date of
the judgment, will usually be the rate of interest stated in the construction contract. If no rate
is stated in the contract, it is common for the adjudicator to be asked to decide what rate of
interest is appropriate and, if he has identified a rate in his decision, then it will usually be
appropriate for the judge to utilise that rate for the period between the decision and the judg-
ment on enforcement. Another approach is simply to take the ordinary judgment rate of
interest for the period between the date of the decision and the date of the judgment.
16.16 Although it came into force at about the same time as the first proliferation of adjudication
decisions and enforcement proceedings, the Late Payment of Commercial Debts (Interest)
Act 1998 was not the subject of any significant judicial pronouncements for a decade, an
omission that, given that it provided for a rate of 8 percent over base, was a matter of some
surprise. However, following the decision of the Court of Appeal in Ruttle Plant Hire Ltd v
Secretary of State Environment Food and Rural Affairs 8 claimants seeking to enforce the decisions
of adjudicators began to claim interest at this ‘punitive’ rate.9 In Able Construction (UK)
Ltd v Forest Property Development Ltd 10 the judge upheld that claim as a matter of discretion.
He described it as ‘just the sort of case which that Act was designed to cover: a debt which is
agreed to be overdue and where there is no reason whatsoever for its non-payment’. He went
on to say that, in circumstances like this, where cash flow was so important, it was necessary
for the courts to utilise the 1998 Act, wherever appropriate, to arrive at a significant rate of
interest. However in Fenice Investments Inc v Jerram Falkus Construction Ltd 11 the same judge
concluded that, although (if it had been open to him) he would have made a similar order, he
should not do so because the claimant had made no claim under the Late Payment Act and it
would be wrong and unfair for such a claim to be introduced without notice at the last minute.
16.17 By far the most comprehensive discussion of the application of the Late Payment Act to
adjudication enforcement can be found in paragraphs 79–96 of the judgment of Edwards-
Stuart J in Yuanda (UK) Co Ltd v WWG Gear Construction Ltd.12 In that case, the contract
between the parties provided for a rate of interest at 0.5 percent over base. Yuanda argued
that this was not a ‘substantial remedy’ within the meaning of s8(1) of the Act, with the result
that the provision was void and should be replaced by the current rate under the 1998 Act of
8 percent over base. In determining whether the contractual remedy was a substantial remedy,
pursuant to s9(2) of the 1998 Act, the judge had regard to all the relevant circumstances at
the time when the contract was agreed. Furthermore, although the judge concluded that it
was not the intention of Parliament to treat a contractual rate of interest for late payment as
not meeting the ‘substantial remedy’ test simply because it was materially lower than the
statutory rate, he decided that in all the circumstances the rate of interest provided by the
contract was not a substantial remedy and therefore had to be replaced by the statutory
rate of 8 percent over base.
Costs
16.18 The costs of any enforcement proceedings are in the discretion of the court. This discretion
will extend even to the situation where the claim form has been issued and the defendant has
8
[2009] EWCA Civ 97; [2009] BLR 301.
9
That is how it was described by Counsel in Banham Marshalls v Lincolnshire CC [2007] EWHC 402.
10 [2009] EWHC 159 (TCC).
11 [2009] EWHC 3272 (TCC); [2009] 128 Con LR 124.
12 [2010] EWHC 720 (TCC); [2010] 1 CLC 491.
410
formally admitted the claim. In Amber Construction Services Ltd v London Interspace HG
Ltd 13 the issue was whether, in such circumstances, the claimant was only entitled to fixed
costs or whether the court retained a discretion to allow a considerably larger claim for costs.
The court concluded that it had the wider discretion, principally because of the relatively
high level of costs that are incurred in adjudication enforcement proceedings and the need
for a claimant who wished to follow the usual TCC procedure to accompany the claim form
not only with a particulars of claim but a Part 24 application, accompanied by a witness
statement exhibiting the relevant documents. In such circumstances, the judge decided that
it was inevitable that the costs would exceed by a very substantial amount the fixed costs
called for in CPR 45.
If the claim is not admitted, but the claimant is successful at the enforcement hearing, he will 16.19
often seek his costs on an indemnity basis. In the ordinary case, where a respectable but
ultimately unsuccessful point is taken by the defendant, that will usually not be appropriate.
But if the judge is not persuaded that there was ever any defence to the claim for enforce-
ment, costs on an indemnity basis will be awarded.14
It is not uncommon for a responding party/defendant to fail to pay the sum ordered by the 16.20
adjudicator, thereby obliging the claimant to issue enforcement proceedings, and then
remain unco-operative throughout those enforcement proceedings before deciding, a day or
two prior to the hearing of the summary judgment application, to offer the clamant the sum
identified by the adjudicator. In those circumstances, the court will be readily disposed to
order the claimant’s costs to be paid on an indemnity basis. In Gray & Sons Builders (Bedford)
Ltd v Essential Box Company Ltd 15 the defendant indicated the day before the hearing that it
did not oppose the application for summary judgment. By reference to a number of cases,
including Wates Construction Ltd v HGP Greentree Allchurch Evans Ltd 16 the TCC judge
concluded that an order for indemnity costs was appropriate. He said that the defendant
knew or ought to have known that it had no defence to the claim to enforce the adjudicator’s
decision, and that it was unreasonable for the defendant to continue to give the impression
that the application was resisted, thereby letting the claimant incur costs and obliging the court
to make arrangements for a contested hearing, only for the defendant to concede, the day
before the hearing, that they had no valid grounds for contesting the application.17 Of course,
the mere fact that indemnity costs have been ordered does not mean that the claimant is
entitled as of right to all the costs expended; the order simply imposes on the defendant
(rather than the claimant) the burden of showing that the draft bill is unreasonable.18
Notwithstanding this, it must always be remembered that the test for indemnity costs is a 16.21
high one and will not ordinarily be granted. Thus, in Supablast (Nationwide) Ltd v Story Rail
Ltd,19 Akenhead J found that there was ‘an absence of reality’ about the defendant’s argument
that there was more than one sub-contract, but, because he did not consider that the
13 [2007] EWHC 2042. See also Southern Electric v Mead Realisations [2009] EWHC 2947 (TCC).
14 See, by way of example, Harlow & Milner Ltd v Linda Teasdale (No 1) [2006] EWHC 54 (TCC) and the
cases referred to in paragraph 16.20.
15
[2006] EWHC 2520 (TCC); [2006] 108 Con LR 49.
16
[2005] EWHC 2174 (TCC); [2006] BLR 45.
17
See also Harris Calnan Construction Ltd v Ridgewood (Kensington) Ltd [2007] EWHC 2738 (TCC);
[2008] Bus LR 636,
18 Gipping Construction Ltd v Eaves Ltd [2008] EWHC 3134 (TCC).
19 [2010] EWHC 56 (TCC); [2010] BLR 211.
411
Enforcement
argument was put forward in bad faith, unprofessionally or wholly unreasonably, he declined
to order indemnity costs. Similarly, in Mead General Building Ltd v Dartmoor Properties Ltd 20
the judge declined to make an order for indemnity costs on the grounds that the argument
put forward by Dartmoor in support of a stay of execution was at least arguable, even if it had
ultimately proved to be unsuccessful. The judge reiterated that it was not appropriate to
make an indemnity costs order simply because a point raised by a defendant had failed.
16.22 In the same case, the judge expressed his concern about the vast amount of documentation
that had been put in by the claimant in the enforcement claim, the costs of which they
wanted to recover. The judge said that the vast bulk of this material was neither necessary nor
relevant and that, on an enforcement claim, the claimant should simply identify the part
of the contract that contained the adjudication provisions, and the adjudicator’s decision.
It was only if the defendant took points about jurisdiction or natural justice that anything
else became relevant. More widely, in Primus Build Ltd v Pompey Centre Ltd and another,21
the same TCC judge expressed his concern about the level of costs that had been incurred
in relation to an unsuccessful application to enforce an adjudicator’s decision. Although
the claim was for £100,000 and the decision was in the sum of just under £50,000, the
adjudicator’s fees alone were over £10,000 and the enforcement proceedings themselves cost
a total of £30,000. Once the costs of the adjudication incurred by both parties were factored
in, considerably more had been spent on costs and fees than could have been recovered in
relation to the claim itself, even if Primus had obtained summary judgement.
The Consequences of Losing an Adjudication

16.23 The potentially harsh consequences of defeat in adjudication can be illustrated by two cases,
the first involving three terraced houses in Leeds, the second concerned with one of the most
iconic buildings in England. The first is Harlow & Milner Ltd v Linda Teasdale.22 In that case
Mrs Teasdale bought three terraced properties in Leeds as part of a proposed pension plan
with her husband. The properties were affected by asbestos contamination. With the help of
grants from Leeds City Council, she intended to refurbish the properties, keep two, and sell
the third. Mrs Teasdale entered into a contract with Harlow & Milner to carry out the
refurbishment works, where the vast bulk of the contract sum was payable by the council by
way of grant monies. Unfortunately, Mrs Teasdale failed to appreciate that, whatever the
position as between her and the council (and their payment of the necessary grants), she was
liable under the construction contract to pay Harlow & Milner in respect of their interim
payments.
16.24 Almost inevitably, large sums by way of interim payment accrued to Harlow & Milner,
whilst the council failed to pay such sums to Mrs Teasdale. There was a shortfall which
Mrs Teasdale could not pay. There was an adjudication, at the conclusion of which the adju-
dicator decided that Harlow & Milner were entitled to the vast bulk of the monies sought.
Mrs Teasdale did not pay and Harlow & Milner (after wasting many months on abortive
bankruptcy proceedings) commenced enforcement proceedings in the TCC. Mrs Teasdale
20
[2009] EWHC 200 (TCC); [2009] BLR 225.
21 [2009] EWHC 1487 (TCC); [2009] BLR 437.
22 (No 1) is reported at [2006] EWHC 54 (TCC); (No 2) is reported at [2006] EWHC 535 (TCC); and
(No 3) is reported at [2006] EWHC 1708 (TCC); [2006] BLR 359.
412
did not appear at the summary judgment application and in any event had no defence to the
claim. Judgment was therefore given in favour of Harlow & Milner.23
Mrs Teasdale did not pay the judgment sum. Accordingly, Harlow & Milner obtained an 16.25
interim charging order. At the application to make that order final, Mrs Teasdale’s solicitors
sent a letter that argued that there was now an ongoing construction arbitration between
the parties, and that in those circumstances it would be wrong to make a final charging
order. The judge concluded that such an argument was ‘quite hopeless’, pointing out that
Mrs Teasdale had been ordered by the adjudicator to pay the outstanding sums to Harlow &
Milner nine months earlier and she had failed to do so.24 The judge said, at paragraph 6 of
his judgment:
The Defendant is not entitled to ignore the judgment of this court and to delay her payment
to the Claimant in the hope that ‘something may turn up’. Her solicitor’s suggestion that the
Charging Order should in some way be suspended, until the result of the arbitration is known,
would wholly undermine the adjudication process. If it were right, it would mean that any
party who was on the receiving end of an adjudicator’s decision could, if they wanted to avoid
the result, commence arbitration proceedings against the successful party, and then argue
that the adjudicator’s decision should abide the eventual outcome of that arbitration. It was
precisely to avoid such delaying tactics that the statutory adjudication process was created in
the first place.
Inevitably, Harlow & Milner issued an application for an order for sale pursuant to CPR 16.26
73.10. That was the first hearing at which Mrs Teasdale was represented, although it was the
third and final stage in the enforcement process. Again the principal defence that was raised
concerned the ongoing arbitration between Mrs Teasdale and the contractors, and the
court was again asked not to make the order because of the possibility that the arbitration
would conclude with a decision in Mrs Teasdale’s favour. The judge rejected that approach,
pointing out that the authorities were clear: a party who was ordered to make a payment
pursuant to an adjudicator’s decision could not seek to avoid making such payment by
setting off other claims that it had or might have had.25 In addition, the judge noted that all
those decisions went against parties who were in the same position as (or a stronger position
than) Mrs Teasdale, because she simply had a claim in the relatively early stages of arbitration.
He pointed out that, since the law was that a party with a cross-claim which had accrued
after the adjudicator’s decision could not set that off against the sum awarded by the
adjudicator, then a fortiori a losing party, who simply had the hope that an arbitrator’s award
somewhere down the line would overturn the adjudicator’s original decision, could not
be entitled to set off that hope against the sum due pursuant to that decision. The judge
went on to say:
Standing back from the authorities for a moment, it is worth considering what the effect
would be if I acceded to the defendant’s request not to make the order for sale because of the
on-going arbitration. It would mean that any unsuccessful party in adjudication would
know that, if they refused to pay up for long enough, and started their own arbitration, they
could effectively render the adjudicator’s decision of no effect. It would be condoning, in
clear terms, a judgment debtor’s persistent default, and its complete refusal to comply with
23
[2006] EWHC 54 (TCC).
24 [2006] EWHC 535 (TCC).
25 See, for example, Interserve Industrial Services Ltd v Cleveland Bridge (UK) Ltd [2006] EWHC 741 and
Hillview Industrial Developments (UK) Ltd v Botes Building Ltd [2006] EWHC 1365 (TCC).
413
Enforcement
the earlier judgments of the court. For those reasons, it is a position which I am simply
unable to adopt.26
16.27 The judge therefore made the order for sale against Mrs Teasdale. He said that the case
illustrated the sometimes harsh consequences of the system of construction adjudication
introduced by the 1996 Act. However, having expressed his considerable sympathy for
Mrs Teasdale and the difficulties that she faced, he was obliged to conclude that those diffi-
culties stemmed, not from the adjudication process itself, but from the way in which the
contractual arrangements had been set up in the first place. It will often be the case that the
decision of an adjudicator will have harsh consequences for the loser but, very often, that will
be explicable, not because of some default or unfairness on the part of the adjudicator, but
because of the way in which the contractual arrangements had originally been framed.27
16.28 The background surrounding the other illustrative case could not be more different. A group
of offshore companies bought the In & Out Club in Piccadilly, and Mentmore Towers in
Buckinghamshire, in order to run them as an exclusive international member’s club.
Professionals were engaged to carry out detailed design works but the project stalled and the
professionals were not paid. The engineers, Packman Lucas, referred the dispute about their
fees to adjudication and obtained a decision in their favour worth in excess of £400,000. The
defendants did not pay. Accordingly, Packman Lucas enforced the adjudicator’s decision by
obtaining interim and then final charging orders in respect of the hugely valuable properties
referred to above. Then, with the charging orders in place and no indication that the sums
would be paid, the defendants started their own proceedings against Packman Lucas seeking
declarations as to the sums due and the return of fees allegedly over paid. Packman Lucas
sought to stay those proceedings until the defendant companies had paid what was due
under the original adjudication decisions.
16.29 The application for a stay was decided by Akenhead J.28 He granted the stay on the basis
that the defendant companies were simply ignoring the contractual and statutory require-
ments that they should honour the adjudicator’s decisions and were avoiding the ‘pay
now argue later’ approach adumbrated by the 1996 Act. He found that they were guilty of
unreasonable and oppressive behaviour and that there were also some elements of bad faith,
because they were putting forward claims that they knew were significantly exaggerated.
The defendant companies’ response to the judgment was not to pay up but instead to
commence their own adjudication proceedings. Again, Packman Lucas sought a stay of
those adjudication proceedings until the sums due under the original adjudicator’s decision
were paid. That application was dealt with by Edwards-Stuart J and, for similar reasons,
he granted the stay sought.29
16.30 Finally, Packman Lucas sought an order to sale in respect of a property in Charles Street owed
by the defendants and Mentmore Towers itself. The judge declined to make an order on the
Charles Street property only because the possibility of an imminent sale had been raised and
he did not consider that it was appropriate to make an order that might put that sale in
jeopardy. However, in relation to Mentmore Towers, the parties were agreed that an order for
26
[2006] EWHC 1708 (TCC); [2006] BLR 359.
27 See also Shaw v Massey Foundation & Pilings Ltd [2009] EWHC 493 (TCC), paragraph 15.
28 Anglo Swiss Holdings Ltd and others v Packman Lucas Ltd [2009] EWHC 3212 (TCC); [2010] BLR 109.
29 Mentmore Towers Ltd v Packman Lucas Ltd [2010] EWHC 457 (TCC); [2010] BLR 393.
414
sale was appropriate and that the only dispute was the figure to be inserted in to the order as
the minimum price to be achieved by any sale. The judge arrived at a figure of £16 million.
Although it was irrelevant for the final disposition of the Packman Lucas claim for an order
for sale, it should be noted that there were also judgments and orders, in significant sums,
outstanding against the same defendant companies as a result of the fees claim brought by
the architects, Fitzroy Robinson. Final charging orders had also been made, on the same
properties, in their favour.30
The only reported case in which an unsuccessful party in an adjudication escaped the 16.31
full consequences of their failure is Kier Regional Ltd v City & General (Holborn) Ltd (No2).31
For the reasons discussed at paragraph 14.51 above, that was principally because of the
particular concatenation of events in that case. Kier had originally obtained a charging order
and only belatedly realised that it was not sufficient security for the adjudicator’s decision
but, by then, the arbitration between the parties, in which every aspect of that decision
would be contested, was imminent. In the circumstances, the judge declined to make any
further orders to enforce the original decision.32
Injunctions
A party to an adjudication might seek injunctive relief from the courts in two circumstances. 16.32
First, as an alternative to the enforcement/summary judgment procedure discussed in the
preceding paragraphs, a party might seek a mandatory injunction as a means of ensuring that
the losing party complies with the adjudicator’s decision. Secondly, at an earlier stage in the
adjudication proceedings, the responding party might seek to obtain an injunction to restrain
the further progress of the adjudication itself.
As to the former situation, namely the successful party’s attempt to enforce an adjudication 16.33
by way of injunction, this was discussed by Dyson J in his judgment in Macob Civil
Engineering Ltd v Morrison Construction Ltd.33 Dyson J held that the mere fact that the
adjudicator’s decision may later be revised was not a good reason for saying that summary
judgment was inappropriate. The grant of summary judgment did not pre-empt any later
decision that an arbitrator may make. Although he considered that the court had the
jurisdiction to grant a mandatory injunction to enforce an adjudicator’s decision, he held

that it would rarely be appropriate to grant such injunctive relief to enforce an obligation by
one contracting party to pay the other. In particular, he said that a mandatory injunction to
enforce a payment obligation carried with it the potential for contempt proceedings in the
event of a failure to comply, and it was difficult to see why the sanction for failure to pay in
accordance with an adjudicator’s decision should be more draconian than for failure to
honour a money judgment entered by the court. For these reasons, he concluded that an
application for summary judgment was much the better course for the successful party
in adjudication to pursue.
30
The judgements in Fitzroy Robinson Ltd v Mentmore Towers Ltd are at [2009] EWHC 1552 (TCC); [2009]
BLR 505; [2009] EWHC 3365 (TCC); [2010] BLR 165; and [2010] EWHC 98 (TCC).
31
[2008] EWHC 2454 (TCC); [2009] BLR 90.
32 In Shaw v Massey Foundation & Pilings Ltd [2009] EWHC 493 (TCC), paragraph 15, the same judge
described Kier as a ‘wholly exceptional’ case.

33 [1999] BLR 93.
415
Enforcement
16.34 As a result of the decision in Macob, and the clear reasoning that underpinned it, it is not
suggested that the successful party should ordinarily utilise the injunction mechanism to
enforce the adjudicator’s decision. The summary judgment process under CPR Part 24 will
usually be a much better option.
16.35 As to the other potential use of injunction proceedings, namely to injunct ongoing
adjudication proceedings (because, say, the responding party contends that the adjudicator
does not have the necessary jurisdiction), such injunctions have only been granted in fairly
limited circumstances. Injunctions have been granted where the court has concluded that
the relevant contract was not a construction contract for the purposes of the 1996 Act;34 or
where the adjudicator was found not to have been validly appointed under the relevant
contract provisions.35 However, it is important to note that this jurisdiction will be exercised
sparingly. In Workplace Technologies Plc v E Squared Ltd 36 HHJ Wilcox was faced with a
submission by the claimant that the contract had been concluded before the 1996 Act came
into force and was therefore excluded from its operation. The claimant therefore sought an
injunction to restrain the adjudicator from proceeding with the adjudication which the
defendant (who alleged that the contract was caught by the 1996 Act) had commenced.
Judge Wilcox declined to grant an injunction, saying that the balance of convenience
favoured allowing the adjudication process to continue. He pointed out that if the court
granted an injunction without determining the issue of the date of the contract, then it
inexorably followed that it might be interfering in a valid adjudication, to its clear detriment.
The purpose of adjudication would then be frustrated. On the other hand, it was not appro-
priate for the court to determine the issue as to the date of the contract, since that was the
very issue that the adjudicator had to decide.37
16.36 But if the necessary test is made out, the court will grant the necessary injunction. Thus,
in Mentmore Towers Ltd and others v Packman Lucas Ltd 38 Edwards-Stuart J granted an
injunction restraining the claimants from pursuing three adjudications because those same
claimants had failed to comply with earlier adjudicator’s decisions that required them to pay
large sums by way of fees, which decisions they had effectively ignored. And if an application
for an injunction is made on the grounds that the adjudicator had no jurisdiction then, if the
application fails and the Part 8 claim is dismissed, the adjudicator is free to get on with the
adjudication proceedings.39
16.37 If an injunction is sought in respect of an ongoing adjudication, the applicant should gener-
ally follow the procedure set out in CPR 25 and, in particular, 25PD. Assuming that the
application is urgent, so that no claim form will have been issued by the time of the hearing,
the applicant must prepare the application notice, evidence in support (including details of
how and why the adjudicator does not have the necessary jurisdiction, or the specific reason
why the injunction is being sought) and a draft order, and provide these documents to the
34 See for example ABB Power Construction Ltd v Norwest Holst Engineering Ltd [2000] TCLR 831.
35 See, for example, John Mowlem & Co Plc v Hydra-Tight & Co Plc [2001] 17 Const LJ 358.
36 [2000] CILL 1607.
37
In The Dorchester Hotel Ltd v Vivid Interiors Ltd [2009] EWHC 70 (TCC); [2009] BLR 135, the TCC
judge confirmed at paragraph 15 of his judgment that Judge Wilcox was not saying that the court did not have
the jurisdiction to grant an injuction, merely that such an injuction will only rarely be granted, ‘which is a very
different thing’.
38 [2010] EWHC 457 (TCC); [2010] BLR 393.
39 Banner Holdings Ltd v Colchester Borough Council [2010] EWHC 139 (TCC); 131 Con LR 77.
416
court in order that a suitable hearing date can be fixed. It is suggested that these documents
should also be served on the respondent, in order that proper notice is given and a mutually
convenient hearing date can be fixed. It is important that, in the vast majority of cases at least,
notice of the application should be given to the other side: it will only be in the most unusual
circumstances that the court will consider an application to injunct an ongoing adjudication
in the absence of the respondent. In certain circumstances, it might also be necessary, or at
least prudent, to notify the adjudicator of the application for an injunction.
The court will usually require an undertaking in respect of the service of the claim form, 16.38
if that has not already happened. In addition, if the injunction sought or granted is interim
in nature, cross-undertakings in damages may also be necessary. At the hearing of the appli-
cation itself, the problem for the court will usually be to decide the issue that lies at the heart
of the injunction application (Is this a construction contract? Does the adjudicator have the
jurisdiction to decide this dispute?) without trespassing on the issue that has been referred to
the adjudicator. This can sometimes be difficult and, if it is, the court is likely to decline the
application, for the reasons summarised by Judge Wilcox in Workplace Technologies.
Part 8/Declaratory Relief

Applications for declaratory relief arising out of adjudication proceedings arise in three 16.39
different ways. First, there may be an application for a declaration by a party who contends
that the adjudicator in an ongoing adjudication does not have the necessary jurisdiction.
In practice, this is simply a variation on the injunction application discussed above. Secondly,
there is an application for a declaration by the successful party to an adjudication that the
adjudicator’s decision is binding on the other party. Thirdly, and becoming increasingly
common, there is the application by the losing party for some form of declaratory relief
aimed at the validity or enforceability of the adjudicator’s decision.
As to the first situation, a party who contests the jurisdiction of the adjudicator has a choice. 16.40
Either he can raise the jurisdiction issue in the adjudication itself, and make plain that his
continued participation in the adjudication is without prejudice to his jurisdictional arguments,
or he can instead seek an injunction to restrain the adjudication or a declaration from the
TCC that the adjudicator does not have the necessary jurisdiction. In many, perhaps most,
cases, there are advantages in maintaining the jurisdictional dispute in the adjudication itself.
This is particularly true in circumstances where a party, who contends that the adjudicator
does not have the necessary jurisdiction, also considers that he has a good defence on the merits.
In that situation, that party may well feel that it is in his interests to run both the jurisdictional
point and the merits points together in the adjudication in the hope that, one way or the
other, the claim will be defeated. On the other hand, if the adjudication is likely to involve
an extensive analysis of a large amount of material, and the responding party is adamant
that the adjudicator does not have the jurisdiction to embark on such a process, it may be in
the responding party’s interests to seek a declaration straight away. That would, of course,
be the only way in which the responding party’s position on costs could be protected.40
40
In Birmingham City Council v Paddison Construction Ltd [2008] EWHC 2254 (TCC); [2008] BLR 622
there had already been one adjudication and the claimant successfully sought a declaration that the second
adjudicator had no jurisdiction because he was being asked to decide the same claim that had been rejected in
the first adjudication.
417
Enforcement
16.41 It is thought that the court’s power to grant a declaration in an ongoing adjudication is not
limited to the situation where the claimant contends that the adjudicator does not have the
necessary jurisdiction. In The Dorchester Hotel Ltd v Vivid Interiors Ltd 41 the Part 8 declaration
claim was to the effect that the adjudication should not proceed because there was a serious
risk of a breach of natural justice. Plainly, such an application is difficult to sustain, being
something in the nature of a pre-emptive strike and, on the facts of that case, the application
was refused. But the TCC judge also dealt with the threshold question as to whether the
court even had the jurisdiction to consider the application. He considered that the court did
have that jurisdiction because it was consistent with both common sense and the TCC’s aim
to provide assistance in ongoing adjudications, albeit only in those limited circumstances
where that was appropriate. He went on to say that if an adjudication was fundamentally
flawed in some way, or may be just about to go off the rails irretrievably, then it was sensible
and appropriate for the parties to be able to have recourse to the TCC, because otherwise a
good deal of time and money would be spent on an adjudication that would ultimately be
wasted. The judge drew an analogy with the decision of Akenhead J in CJP Builders Ltd v
William Verry Ltd 42 where the judge had refused to enforce an adjudicator’s decision because
the adjudicator had wrongly failed to have regard to the responding party’s response. The TCC
judge in Dorchester Hotel said that, if that issue had been raised before the court during the
adjudication, it was idle to suggest that a different result would not have occurred or that the
judge would not have had the jurisdiction to make the order allowing the extension and
requiring the adjudicator to have regard to the response. In that way, a good deal of effort,
time and cost would have been saved. Accordingly the judge concluded that he did have the
jurisdiction to consider the application for a declaration in that case.
16.42 If a party seeks a declaration from the TCC that the adjudicator does not have the necessary
jurisdiction to deal with an ongoing adjudication then, in view of the likely urgency of the
application, the court will endeavour to ensure that the hearing is fixed as soon as possible.
There are a number of instances in which this has been achieved within seven days of the issue
of the claim form. Indeed, a claim form is not always required, provided that the necessary
undertaking to issue such a document is provided. The process is very similar (and can be
seen as an alternative) to an application to injunct an adjudication, as discussed in paragraphs
16.32–16.38 above.
16.43 A second situation in which a declaration might be sought (to confirm the binding nature of
the adjudicator’s decision), although less common, can sometimes be important, particularly
where the dispute concerns accrued contractual rights, not money due. Take the situation
where the claiming party seeks a declaration from an adjudicator that he is entitled to a
lengthy extension of time. The adjudicator accedes to the claim. The adjudicator’s decision
is therefore temporarily binding and will have significant knock-on consequences on all
kinds of matters, such as the contractor’s entitlement to loss and expense and the employer’s
inability to levy liquidated damages for the period of the extension. It is not uncommon, in
such situations, for the employer’s team to endeavour to limit the consequences of the
adjudicator’s decision whilst the contract is being administered on site. In those circum-
stances, it can often be appropriate for the contractor to seek a declaration from the court
that the adjudicator’s decision is binding and also, if appropriate, seek particular declarations
41 [2009] EWHC 70 (TCC); [2009] Bus LR 1026.

42 [2008] EWHC 2025 (TCC); [2008] BLR 545.
418
as to the consequences of that decision. Applications of this kind are treated by the court
in a similar way to an application for summary judgment on the basis of an adjudicator’s
decision, and the court will endeavour to fix such hearings within 28 days of the relevant
application.
The third situation in which the court’s powers under CPR Part 8 to grant declaratory relief 16.44
have been utilised is where a party who has lost the adjudication seeks a final determination
of an issue by way of a declaration which, if successful, would have the effect of nullifying
the adjudicator’s decision. As noted above, attempts to follow this course have become
increasingly common in recent years, although the starting-point can be traced back to Jarvis
Facilities Ltd v Alstom Signalling Ltd.43 There Alstom pre-empted Jarvis’ application to enforce
an adjudicator’s award in its favour by immediately issuing Part 8 proceedings seeking
declarations that Jarvis was not entitled to payment of the sums awarded by the adjudicator.
Perhaps unsurprisingly, Jarvis protested at this novel approach but the judge overruled those
protests and confirmed that, as a matter of principle, the court could be asked finally to
determine an issue that arose in the adjudication that, if the finding was adverse to the party
relying on the decision, would have the inevitable consequence that the enforcement
application would fail.
That this was a legitimate use of the court’s powers was confirmed in two subsequent cases. 16.45
In Walter Lilly & Co Ltd v DMW Developments Ltd 44 the TCC judge referred to Jarvis and
confirmed that, subject to the nature and scope of the point in issue, and the amount of
evidence or argument required to deal with it, the TCC always endeavoured to deal promptly
with any dispute arising out of an adjudicator’s decision. The attraction of CPR Part 8 was
that if offered the means by which a dispute could be finally determined in a speedy and
cost-effective way. But the judge also confirmed that the party wishing to use Part 8 for this
purpose had to be able to demonstrate that the dispute in question fell within its relatively
narrow confines. In that case, although declarations were granted, they were of limited com-
pass. And in Dalkia Energy and Technical Services Ltd v Bell Group UK Ltd 45 the same judge
again confirmed the use of Part 8 in the appropriate circumstances. In that case, the defendant
argued that Part 8 was unsuitable because there were matters of fact in dispute which could
not be resolved without hearing oral evidence. The judge accepted that there was one issue
that could not be resolved on paper but said that that dispute was of very limited relevance
to the issues that he had to decide. Moreover, the claimant could not be criticised for using
Part 8 in such circumstances because he would not necessarily have known that such a point
was going to be raised at all. In the circumstances, therefore, the judge decided that the case
was suitable for Part 8.46
The most important case on this topic is now Geoffrey Osborne Ltd v Atkins Rail Ltd 47 where 16.46
the adjudicator had omitted to deduct amounts already paid in respect of two particular
items of work which he had valued. The result was that he concluded that Osborne was owed
over £500,000 whilst, but for the error (which the adjudicator accepted), the position was
that Osborne was not owed anything and, on the adjudicator’s figures, had actually been
43
[2004] EWHC 1285 (TCC).
44
[2008] EWHC 3139 (TCC); [2009] TCLR 3.
45 [2009] EWHC 73 (TCC); 122 Con LR 66.
46 See also Vitpol Building Services v Samen [2008] EWHC 2283 (TCC); (2009) 25 Const LJ 319.
47 [2009] EWHC 2425 (TCC); [2010] BLR 363.
419
Enforcement
overpaid by £400,000. Edwards-Stuart J relied on the approach in Jarvis and concluded that,
in that case, there was no reason why the court could not make a final determination of the
very limited issue raised by the Part 8 claim, particularly as there was no dispute that the
adjudicator had made a mistake. Moreover, there was no bar to the court reaching that final
determination of the issue, because there was no arbitration clause. The situation there can
be contrasted with that in Pilon Ltd v Breyer Group PLC 48 where the matter raised by the
losing party was not suitable for Part 8 because it was not a simple and straightforward issue,
and where there was in any event an arbitration clause, which meant that an arbitrator, not
the court, had to make the final determination.
16.47 It is thought that, in the general run of adjudication enforcement cases, a successful Part 8
claim of the kind that prevailed in Geoffrey Osborne will be the exception rather than the
rule.49 In Fenice Investments Inc v Jerram Falkus Construction Ltd 50 the TCC judge said, at
paragraph 48 of his judgement, that a losing party who makes a challenge to the decision by
using the CPR Part 8 procedure can do so, but in the ordinary case he must, in the meantime,
pay the sum found to be due. In Forest Heath District Council v ISG Jackson Ltd 51 the council
sought a declaration under Part 8 against the defendant, Jackson, in order to obtain a final
determination of an issue that had previously been determined by the adjudicator. The issue
concerned why Jackson had changed from a pre-finished to a site-applied paint system.
The adjudicator had found that this change arose as a result of the late finalisation of the
steelwork design but the council challenged that conclusion. Ramsey J concluded that
the dispute was unsuitable for Part 8. There were disputes as to whether there was late
steelwork design information and a dispute as to the impact of any such late design upon
Jackson’s decision to carry out painting on site. Those matters were not capable of being
resolved under Part 8 or even by means of a hybrid Part 8 procedure involving a short
hearing.52 The judge also went on to say that the declaration sought would be unlikely to
serve a useful purpose or do justice between the parties because other questions relating to
the actual cause of delay required to be resolved at the same time. By analogy with the
approach of the court in ordering the trial of preliminary issues, Ramsey J said that it was a
case where there was a dispute between the parties relating to the overall extension of time,
and the court would be unwilling to order a preliminary issue concerned with the cause of
the decision to paint steel work on site where that opened up an area of factual investigation,
and where the ultimate outcome in terms of extension of time would be unclear.
Other Procedural Routes

16.48 Depending on the facts of the particular case, there are a number of other procedural routes
open to the parties following an adjudicator’s decision. Thus, for example, in Enterprise
Managed Services Ltd v East Midland Contracting Ltd,53 the adjudicator’s decision was in
favour of East Midland. However there was a term of the contract that prohibited ‘any action
48 [2010] EWHC 837 (TCC); [2010] BLR 452.

49 The particular cirumstances are those previously noted (obviousness of error, no arbitration clause etc).
Although the editors of the BLR at [2010] BLR 365 suggest that Osborne is ‘a difficult case’, it is thought that,
on a proper analysis, it is a very straightforward application of well-worn principles of adjudication
enforcement.
50
[2009] EWHC 3272 (TCC); 128 Con LR 124.
51 [2010] EWHC 322 (TCC).
52 Vitpol Building Services v Michael Samen [2008] EWHC 2283 (TCC); (2009) 25 Const LJ 319.
53 [2007] EWHC 727 (TCC).
420
or proceeding other than adjudication’ until the main contract works had been certified as
practically complete. Thus, when Enterprise issued proceedings seeking to reverse the
adjudicator’s decision, East Midland issued their own applications seeking a declaration that
the court had no jurisdiction to decide the claim under CPR Part 11 and, in addition, an
order striking out the claim pursuant to CPR Part 3.4 or alternatively an order for summary
judgement against the claimant on the claim pursuant to CPR Part 24.
Staying Court Proceedings for Adjudication

Assume that A and B have a binding adjudication agreement, but that, in breach of that 16.49
agreement, A commences proceedings against B in the TCC, without first referring the
dispute to adjudication. B may then issue an application in those proceedings for a stay of
the court action until the matter has been adjudicated. The application must be supported
by a witness statement. The assigned TCC judge will then fix a date for the hearing of the
application to stay the proceedings. Again, the TCC recognises the need to arrange such
hearings speedily, and they will usually be fixed for a date within 28 days of the original
application. Directions are usually necessary as to the preparation of a hearing bundle, and
the exchange of skeleton arguments.
As to whether or not B’s application for a stay would be successful in those circumstances, the 16.50
relevant authorities are set out in the judgment of the TCC judge in DGT Steel and Cladding
Limited v Cubitt Building and Interiors Ltd.54 If a binding adjudication agreement can be
demonstrated, the persuasive burden may shift to the party who has commenced the court
proceedings in breach of that agreement, to show good reason why the discretion that
arises from the inherent jurisdiction of the court should not be exercised in favour of the
stay. However, it should not be thought that such an agreement creates an obligation to
adjudicate; adjudication is a right, but it is not compulsory.55
The courts’ inherent jurisdiction to grant a stay of existing court proceedings, commenced in 16.51
breach of an agreement to utilise other forms of dispute resolution, was discussed by the
House of Lords in Channel Tunnel Group Limited v Balfour Beatty Construction Limited.56
That was a case in which the contract provided for the initial reference of disputes to a panel
of experts, with all remaining disputes to be the subject of arbitration in Brussels. In the
leading speech, Lord Mustill said that the courts had an inherent, albeit discretionary, power
to stay proceedings in such circumstances. This approach was followed by the judge in Cott
UK Ltd v F E Barber Ltd.57 In that case, the contract contained an agreement that any dispute
should be referred to an expert for his determination. The judge concluded that, in conse-
quence, a stay of the court proceedings could be granted, and that the persuasive burden
then shifted to the claimant to demonstrate how or why a stay should not, as a matter of
discretion, be granted. On the facts of that case, the claimant discharged that burden and
the stay was refused because the expert determination procedure was so unclear as to be
unenforceable. In Cable & Wireless plc v IBM United Kingdom Ltd,58 Colman J adopted the
54
[2007] EWHC 1584 (TCC); [2007] BLR 371.
55
See paragraphs16.54–16.57.
56 [1993] AC 334.
57 [1997] 3 All ER 540.
58 [2002] EWHC 2059 (Comm); [2002] 2 All ER (Comm) 1041.
421
Enforcement
same approach in respect of an agreement to refer disputes to alternative dispute resolution.

He concluded that the ADR procedure envisaged by the contract was of sufficient certainty to
be enforceable and, in the exercise of the court’s discretion, the court proceedings were stayed.
16.52 By analogy, it would appear that this approach is appropriate to cases in which the underlying
contractual agreement is that, in the first instance, disputes are to be referred to adjudication.
There are a number of authorities dealing specifically with adjudication. Cape Durasteel
Ltd v Rosser & Russell Building Services Ltd 59 was a decision of HHJ Lloyd QC that was
concerned with a contractual agreement to adjudicate, and decided before the 1996 Act. The
judge concluded that there was a binding and enforceable agreement to adjudicate and that,
having regard to all the circumstances, it was appropriate to order that the action be stayed
pending adjudication. Furthermore, the decision of Dyson J in Herschel Engineering Ltd v
Breen Property Ltd 60 was also concerned with the situation in which there were concurrent
court and adjudication proceedings. There, the judge concluded that the claiming party
was entitled to seek a prompt result in adjudication, notwithstanding the existence of the
court proceedings, and he therefore refused the application for an injunction restraining the
adjudication. He was not asked to grant, and therefore did not consider, a temporary stay of
the court proceedings pending the outcome of the adjudication.
16.53 Each of these authorities was considered by the TCC judge in DGT Steel Ltd and Cladding v
Cubitt Building & Interiors Ltd.61 At paragraph 12 of his judgment in that case, the judge
derived from them the following three principles:
1. The court will not grant an injunction to prevent one party from commencing adjudi-
cation proceedings, even if there are already ongoing court or arbitration proceedings in
respect of the same dispute (see Herschel v Breen).62
2. The court has an inherent jurisdiction to stay court proceedings issued in breach of an
agreement to adjudicate (see Cape Durasteel ), just as it has the inherent jurisdiction to
stay such proceedings where any other enforceable agreement for ADR might exist
(see Channel Tunnel, Cott, and Cable & Wireless).
3. The courts’ discretion as to whether or not to grant a stay in such circumstances should
be exercised on the basis that, if a binding adjudication agreement has been demon-
strated, the persuasive burden is on the party seeking to resist the stay to demonstrate
how or why, in all the circumstances, the stay should not be granted (see Cott and
Cable & Wireless).
16.54 In DGT Steel, there was considerable debate about whether the adjudication agreement in
that case was compulsory, with the parties obliged to submit any dispute to adjudication, or
simply optional, with the parties having the right (but not the obligation) to submit disputes
to adjudication. The judge concluded that, ultimately, it made little difference in that case
because, even if the agreement was not compulsory, the type of adjudication agreement
envisaged by the 1996 Act, which gave each party the right to adjudicate a dispute (no matter
which side of the dispute they might be on), constituted a binding agreement that gave each
party the right, in appropriate circumstances, to seek to enforce their entitlement by way
59
(1995) 46 Con LR 75.
60 [2000] BLR 272.
61
[2007] EWHC 1584 (TCC); [2008] Bus LR 132.
62 See also the subsequent case of Mentmore Towers and others v Packman Lucas [2010] EWHC 457 (TCC);
[2010] BLR 393.
422
of an application for a stay. The issue as to whether or not such an agreement was compulsory
arose again in Cubitt Building and Interiors Ltd v Richardson Roofing (Industrial) Ltd.63
Akenhead J concluded that, both as a matter of construction of the contract in question, and
the 1996 Act, there was no pre-condition or indeed obligation requiring either party to refer
any dispute to adjudication. There was simply a right that each party had to proceed to
adjudication at any time if that is what it wanted.
In addition to the consideration of the points of principle noted above, the judgment in 16.55
DGT Steel is also of interest because it was dealing with a very common factual situation. The
basis of DGT’s claim in court was, in essence, their final account claim. However, the dispute
encompassed by the earlier adjudication was limited to questions concerned with Cubitt’s
alleged non-compliance with the interim payment and withholding notice regime provided
by the contract. As the adjudicator had correctly pointed out in his decision, the nature of
the dispute referred to him meant that he was not required or entitled to consider the
underlying merits of DGT’s claim. DGT lost on the technical points and subsequently
commenced proceedings in the TCC. However, as noted above, their claim in the TCC
expressly raised all the underlying issues of valuation, which were disputed by Cubitt on
their merits. In seeking to resist the application for a stay, DGT argued that they had already
submitted their claim to adjudication, and were therefore entitled to bring that claim to
court. However, the judge ruled that, although the sum of money sought in the court
proceedings was the same as that which had been claimed in the adjudication, the principal
issue in the court proceedings, namely the merits of DGT’s valuation, had never been referred
to adjudication and was therefore a new dispute. In all the circumstances, he granted the stay
sought by Cubitt.
As noted already, the other case on whether or not a stay of court proceedings should be 16.56
granted in order to permit an adjudication to proceed is Cubitt Building and Interiors Ltd v
Richardson Roofing (Industrial) Ltd, referred to above. Akenhead J made it plain that there
would not be an automatic stay of any legitimately constituted proceedings, whether in
arbitration or in court, where there was merely a discretionary right to adjudicate, as opposed
to a binding pre-conditional adjudication requirement. There would be times, however,
when it would be appropriate to build in to the court or arbitration timetable a 28-day
period to enable one party to adjudicate if, for any good reason, it could not sensibly pursue
adjudication at the same time as the court or arbitration proceedings. But that was different
from a stay. A party who had started court or arbitration proceedings was entitled to have
those proceedings resolved as reasonably expeditiously as the court could achieve and justice
demanded; it should not be forced to have those proceedings delayed or stayed by itself being
forced to adjudicate, when it did not want to exercise its right to do so. On the facts in that
case, the question of a stay was ultimately a matter for the arbitrator (because Cubitt were
trying to prevent Richardson from pursuing a claim in arbitration) but the judge made plain
that, had it been a matter for the court, he would not have granted the stay. That was primarily
because there had already been two adjudications and one decision on Richardson’s claim for
outstanding certified sums. Cubitt had had over three years to pursue any of its claims by way
of adjudication and had chosen not to do so. The judge said that ‘it would be an odd and
unfortunate state of affairs if it were able to delay the prosecution of the substantive proceed-
ings to enable it to pursue a course which it has failed to take over the period of time.’
63 [2008] EWHC 1020 (TCC); [2008] BLR 354.
423
Enforcement
16.57 Ultimately, however, whether or not the TCC grants a stay of court proceedings so as to
facilitate adjudication will depend on the facts of the case in question. Thus in Vitpol Building
Service v Michael Samen 64 the claimant had issued proceedings in court for various declara-
tions designed to determine the terms of the contract. The particular motive that they had
for doing this was because, on their case, the contract included a standard form which would
permit them to adjudicate, in circumstances where, without the form, adjudication was not
possible because the work was being done for a residential occupier.65 Whilst the claim had
originally been commenced under Part 8, following receipt of the defendant’s defence it
appeared that the disputes in relation to the contract were wider and more fundamental
than had been appreciated at the outset. The TCC judge concluded that the court had the
jurisdiction to hear that dispute which was, on analysis, a relatively straightforward dis-
pute about the terms, and where most of the relevant material would be found in the
contemporaneous documents. Thus, even if some oral evidence was necessary, some form of
hybrid procedure between Parts 7 and 8 was quite possible. There was no other reason why
the court should decline to deal with the claim so the defendant’s application for a stay was
refused. By contrast, in London Borough of Camden v Makers UK Ltd 66 Akenhead J refused
Camden’s submission that, if the judgment in default that it had obtained against Makers
was set aside, it should only be set aside on condition that Makers be prohibited from
pursuing any further claims in adjudication. He said that a party to a construction contract
had a statutory right to adjudicate upon any dispute at any time, and the fact that court or
arbitration proceedings had been instituted did not prevent or bar a party’s statutory or
contractual right to adjudicate.
64 [2008] EWHC 2283 (TCC); (2009) 25 Const LJ 319.

65 Section 106 of the 1996 Act.
66 [2009] EWHC 605 (TCC); 124 Con LR 32.
424
17
STAY OF EXECUTION
Introduction 17.01 The Financial Difficulties of the

RSC Order 47 17.02 Judgment Creditor 17.13
Cross-Claim of Judgment Debtor 17.04 Time to Pay 17.28
Insolvency of Judgment Creditor 17.07 Other Circumstances 17.29
In considering what is just and fair in an application for a stay of execution of a

summary judgment under Part 24 in circumstances such as these, the court must be
careful not to reallocate the commercial risks accepted by the parties who engage in a
construction contract mindful of the provisions of the Housing Grants Construction
Regeneration Act 1996 and subject to the general safeguards of insolvency law.
His Honour Judge Wilcox in Total M&E Services Ltd v ABB
Building Technologies Ltd 1
Introduction
The whole purpose of the 1996 Act, and the Scheme for Construction Contracts, was to 17.01
provide a quick answer to disputes that would be temporarily binding. In practice, of course,
that usually means that the adjudicator decides that one party has to pay a sum of money
to the other. On occasion, those sums have been large. In some circumstances, the losing
parties have endeavoured to avoid making the required payments. One of the ways in which
they have sought to achieve this is by seeking a stay of execution pursuant to RSC Order 47.
However, as demonstrated in the authorities set out below, the courts have generally
endeavoured to ensure that the stay mechanism is not used in such a way so as to frustrate
the purpose of adjudication.
RSC Order 47
RSC Order 47, preserved in Section A of the Civil Procedure Rules 1998, provides as 17.02
follows:
1–(1) Where a judgment is given or an order made for the payment by any person of money,
and the court is satisfied, on an application made at the time of the judgment or order,
or at any time thereafter, by the judgment debtor or other party liable to execution—
1 [2002] EWHC 248 (TCC); [2002] 87 Con LR 154.
425
Enforcement
(a) that there are special circumstances which render it inexpedient to enforce the
judgment or order, or
(b) that the applicant is unable from any cause to pay the money,
then, notwithstanding anything in rule 2 or 3, the court may by order stay the execu-
tion of the judgment or order by writ of fieri facias either absolutely or for such period
and subject to such conditions as the court thinks fit.
(2) An application under this rule, if not made at the time the judgment is given or order
made, must be made in accordance with CPR Part 23 and may be so made notwithstanding
that the party liable to execution did not acknowledge service of the claim form or serve a
defence or take any previous part in the proceedings.
(3) The grounds on which an application under this rule is made must be set out in the
application notice and be supported by a witness statement or affidavit made by or on
behalf of the applicant substantiating the said grounds and, in particular, where such
application is made on the grounds of the applicant’s inability to pay, disclosing his
income, the nature and value of any property of his and the amount of any other liabilities
of his.
(4) The application notice and a copy of the supporting witness statement or affidavit must,
not less than four clear days before the hearing, be served on the party entitled to enforce
the judgment or order.
(5) An order staying execution under this rule may be varied or revoked by a subsequent
order.
17.03 Usually, a stay of execution will be sought in one of two typical cases: if the judgment debtor
has a cross-claim that has yet to be determined and which, so it is said, will make it inexpedient
to enforce the judgment; or if the financial position of the judgment creditor is such that, in
all the circumstances, a stay should be granted. However, the authorities make it clear that
slightly different considerations may apply when the judgment that is sought to be stayed is
a judgment enforcing the decision of an adjudicator.
Cross-Claim of Judgment Debtor

17.04 Even in an ordinary case, the existence of a cross-claim against the judgment creditor will not
usually give rise to a stay of execution: see Wagner v Laubscher Brothers & Co.2 However, there
are a number of reported cases where the existence of a separate claim by the losing party,
which cuts across the basis of the original judgment, has given rise to a stay: see, for example,
Hillcourt v Teliasonera AB,3 where the court stayed execution of a judgment based on an
arbitrator’s award arising out of a breach of an agreement for lease, in circumstances where
later information demonstrated that the judgment debtor had a reasonable case for rescission
of the lease.
17.05 However, where the judgment is based on the decision of an adjudicator, then it is submitted
that, generally, no set-off or cross-claim could justify a stay of execution. In paragraphs
9.20–9.40 above, there is a discussion of those authorities which make plain that a losing
party is not generally entitled to raise, against the adjudicator’s decision, some sort of set-off
and cross-claim. In those circumstances, the principle underlying the decision in Hillcourt
would simply not be available to the party seeking to stay the execution of a judgment based
on an enforceable adjudicator’s decision. Generally, and subject of course to the terms of the
contract between the parties, to allow the losing party in an adjudication to avoid making
2 [1970] 2 QB 313, CA.

3 [2006] EWHC 508 (Ch).
426
Stay of Execution
prompt payment by raising the existence of a cross-claim would be contrary to the whole
purpose and intent of the 1996 Act.
It is a fundamental principle of adjudication enforcement that a defendant is not entitled to 17.06
a stay of execution on the basis that it has its own adjudication claim that is to be resolved in
the relatively near future. In Interserve Industrial Services Ltd v Cleveland Bridge UK Ltd 4
Jackson J (as he then was) concluded that there was no entitlement to a stay on such a
ground. It is respectively submitted that this must be right; if a court grants a stay because of
a possible result in a forthcoming adjudication, the whole principal of ‘pay now argue later’
would be fatally undermined. HHJ Kirkham came to the same conclusion in Avoncroft
Construction Ltd v Sharba Homes (CN) Ltd5 where the defendant argued that there should be
a stay because it had its own claim in a second adjudication, worth £880,000, and the decision
was due in about two weeks’ time. The judge rejected that submission, relying on the
judgement in Interserve.
Insolvency of Judgment Creditor

At the opposite end of the scale, if the judgment creditor is in liquidation, then that is a 17.07
ground either to refuse summary judgment, or to stay execution. In Bouygues (UK) Ltd v
Dahl-Jensen (UK) Ltd 6 the Court of Appeal upheld the decision of Dyson J, and said that,
although the award contained an error, it was an error that the adjudicator made whilst
acting within his jurisdiction, and thus his award would stand and was enforceable. However,
in his judgment, Chadwick LJ went on to explain that Dahl-Jensen’s liquidation meant that
it would be wrong for the sums awarded by the adjudicator to be paid to them. By reference
to rule 4.90 of the Insolvency Rules 1986, he concluded that payment of the sums identified
in the adjudicator’s decision would lead to injustice:
33 . . . If Bouygues is obliged to pay to Dahl-Jensen the amount awarded by the adjudicator,
those monies, when received by the liquidator of Dahl-Jensen, will form part of the fund
applicable for distribution amongst Dahl-Jenson’s creditors. If Bouygues itself has a claim
under the construction contract, as it currently asserts, and is required to prove for that claim
in the liquidation of Dahl-Jensen, it will receive only a dividend pro rata to the amount of its
claim. It will be deprived of the benefit of treating Dahl-Jensen’s claim under the adjudicator’s
determination as security for its own cross-claim . . .
35. . . . In circumstances such as the present, where there are latent claims and cross-claims
between parties, one of which is in liquidation, it seems to me that there is a compelling reason
to refuse summary judgment on a claim arising out of an adjudication which is, necessarily,
provisional. All claims and cross-claims should be resolved in the liquidation, in which full
account can be taken and a balance struck. That is what rule 4.90 of the Insolvency Rules 1986
requires.
In Bouygues, the Court of Appeal did not set aside the summary judgment order because the 17.08
point about the Insolvency Rules 1986 had not been taken before the judge and was not
embraced by Bouygues ‘with any enthusiasm’ on the appeal. However, the same ultimate
effect was achieved by the stay of execution imposed by the Court of Appeal. In Hart v Fidler
and another,7 the liquidation of the contractor was one of three separate reasons upon which
4 [2006] EWHC 741 (TCC).

5 [2008] EWHC 933 (TCC); [2008] TCLR 7.
6
[2000] BLR 522.
7
[2006] EWHC 2857 (TCC); [2006] All ER (D) 232 (Nov).
427
Enforcement
the court relied in refusing to enforce the decision of the adjudicator. The TCC judge
considered that to enter judgment in such circumstances might amount to an inaccurate
assertion of the parties’ substantive rights in the liquidation, because such a judgment would
be based upon a decision which was only temporarily binding. There was at least a risk of
inaccuracy and that therefore, in accordance with the judgment of Chadwick LJ in Bouygues,
insolvency was a compelling reason to refuse summary judgment.
17.09 In Harwood Construction Ltd v Lantrode Ltd 8 the claimant contractor was not in liquidation,
but a petition had been presented and was due to be heard some two weeks after the appli-
cation for summary judgment. The TCC judge was unable to say whether or not the petition
would succeed. Accordingly, the judge gave judgment for the claimant contractor, but with
execution stayed until the hearing of the petition for winding-up. If the winding-up order
was made at the subsequent hearing, the stay would continue. If the petition was dismissed,
then the stay would cease and the contractor would be entitled to immediate payment of the
judgment sum.
17.10 A similar issue arose in Mead General Building Ltd v Dartmoor Properties Ltd.9 In that case
Mead, the claiming contractor seeking to enforce an adjudicator’s decision in its favour,
was subject to a Creditor’s Voluntary Arrangement (CVA). The TCC judge said that the
fact that a claimant was the subject of a CVA was a relevant factor to be taken into
account when the court decided whether or not to grant a stay. On the other hand, he
said that the mere fact of the CVA was not, of itself, decisive of the issue as to whether or
not the claimant would be unable to repay any sums paid out in accordance with the
judgment, such that a stay of execution must be ordered. He said that the circumstances
of both the CVA and the claimant’s current trading position would be relevant to any
consideration of a stay of execution. On the basis of the information available, the judge
concluded that it was Dartmoor’s failure to pay that was the principal reason for Mead’s
financial difficulties. Accordingly, taken together with the view of the CVA supervisor
that Mead could successfully trade out of their temporary difficulties, the judge concluded
that no stay was appropriate.
17.11 Although in Pilon Ltd v Breyer Group PLC 10 the judge concluded for other reasons that
the adjudicator’s decision should not be enforced, he also held that, if the decision was
enforceable, he would have granted a stay of execution in favour of Breyer. Pilon were also
the subject of a CVA and, in contrast to the position in Mead, their financial plight was not
Breyer’s responsibility. Furthermore, separate evidence demonstrated that Pilon’s current
credit rating was very bad and there was no positive statement from the CVA supervisor
of the type available to the court in Mead. For that reason, in that case, the fact that the
contractor was the subject of a CVA meant that a stay would have been granted in all the
circumstances.11
8 24 November 2000, a decision of HHJ Seymour QC in the TCC in London.

9 [2009] EWHC 200 (TCC); [2009] BLR 225.
10 [2010] EWHC 837 (TCC); [2010] BLR 452.
11
The judgement in Pilon v Breyer is also of interest because, at paragraph 46, the judge dealt with the issue
as to which party has the burden of demonstrating that any sums awarded would or would not be paid back.
The judge did not accept that the burden was on Pilon, the claimant, even though much of the material relevant
to a consideration of the issue would come from their own accounts. He said that the claim made by Breyer
was that any money that they paid out was unlikely to be repaid and the burden was therefore on them to make
good that submission.
428
Stay of Execution
It is of course possible for an insolvent claimant to reflect that fact of its insolvency in the 17.12
order sought from the court. In London Borough of Camden v Makers UK Ltd (No2) 12 the
adjudication that the judge had earlier allowed Makers to pursue13 had resulted in a decision
in their favour in excess of £1 million. In acknowledgement of their insolvency, Makers
sought enforcement but to the limited extent that the sum awarded was paid into court or
into an escrow account awaiting the outcome of the impending full trial. The court ordered
a stay of execution without conditions, because Makers remained insolvent and would be
unable to repay anything if it lost the impending trial. Makers were however given specific
permission to apply to lift the stay following the judgment on the issues of liability. The judge
concluded that it was not appropriate to order money to be paid into court or into an escrow
account, because it locked Camden out of a large sum of money that they would otherwise
be able to use in the discharge of their functions as a local authority.
The Financial Difficulties of the Judgment Creditor

The greatest difficulties arise in those cases where the party seeking to enforce the decision of 17.13
the adjudicator is, or is said to be, in financial difficulties. In such circumstances, the judg-
ment debtor will often argue that, since they are seeking a return of the monies awarded by
the adjudicator, it would be unfair if they had to pay over that amount now, only to discover,
following their success on the ultimate determination of the dispute, that the judgment
creditor can no longer afford to pay the money back. As a matter of principle, this argument is
open to the judgment debtor in support of a stay of execution of the summary judgment.
As a matter of practice, however, this argument can be far from straightforward.
The first, and most obvious, point to make is that an assertion of financial difficulties is just 17.14
that, an allegation that may well be disputed, and that cannot therefore result in as clear-cut
a situation as where the judgment creditor is in liquidation. The court then has to embark on
a delicate balancing exercise in which the natural instinct to give effect to the adjudicator’s
efforts must be weighed against any evidence that a real injustice might be perpetrated if the
money is paid out to a company that is just about to go into liquidation. It then becomes a
matter of discretion as to whether the court, in considering the evidence as to the judgment
creditor’s financial difficulties, concludes that they are so severe that any repayment is most
unlikely and that, in the round, it is therefore ‘inexpedient to enforce the judgment’.
It is suggested that the starting point for any consideration of the way in which the court 17.15
should exercise its discretion in these circumstances is the decision of the Court of Appeal in
Sir Lindsay Parkinson & Co v Triplan Ltd.14 That was a case concerned with security for costs.
However, amongst the matters that Lord Denning MR identified as being relevant to the
exercise of the court’s discretion, he referred to the issue of whether the claimant’s want of
means had been brought about by any conduct on the part of the defendant, such as delays
in making payment. That is also directly relevant to the situation where the judgment debtor
is seeking to rely on the judgment creditor’s financial difficulties in order to obtain a stay, in
circumstances where the judgment debtor may be responsible for those self-same financial
difficulties. In Wimbledon Construction Company 2000 Ltd v Derick Vago15 the TCC judge
12
[2009] EWHC 2944 (TCC).
13 [2008] EWHC 1836 (TCC); [2008] BLR 470.
14 [1973] QB 609.
15 [2005] EWHC 1086 (TCC); [2005] BLR 374.
429
Enforcement
held that the matters listed by Lord Denning in Sir Lindsay Parkinson, particularly the
possibility that the claimant’s want of means had been brought about by the defendant, was
of general application to the exercise of the court’s discretion under Order 47 when considering
whether or not to grant a stay of execution.
17.16 There can be no doubt that the financial circumstances of the claimant are at least potentially
relevant on any application for a stay. In other words, the mere fact that the claimant is
entitled to judgment to enforce an adjudicator’s decision in his favour does not mean that a
stay of execution will automatically be refused. In one of the early enforcement cases, Herschel
Engineering Ltd v Breen Property Ltd 16 Dyson J refused the application for a stay, because he
found that there was no evidence that, if the defendant was successful in the subsequent
proceedings, the claimant would be unable to repay the sum awarded by the adjudicator.
However, the judge expressly noted that, had the position been otherwise, and there was a
real doubt as to the claimant’s ability to repay, he would ‘probably have granted a stay of
execution’ pending the final determination of the separate proceedings.
17.17 In Rainford House Ltd v Cadogan Ltd 17 HHJ Seymour QC rejected the submission that
a stay of execution should not be granted in principle, because to grant a stay would be
to deprive the claimant of the benefit of the 1996 Act. Instead he found that the financial
position of the claimant was a matter that could be relied on by the defendant in an
application for a stay of execution. In that case, he concluded that the evidence put for-
ward by the defendant raised a strong prima facie case that the claimant was currently
insolvent, and that such evidence had not been contradicted or explained. He therefore
drew the inference that the present financial position of the claimant meant that they
would be unable to repay the amount of the judgment sum if it was later found that the
adjudicator’s decision was incorrect. A stay of execution was therefore imposed. In Ashley
House Plc v Galliers Southern Ltd 18 the same judge found that, although Galliers were
entitled to summary judgment in the amount of the adjudicator’s decision, their ‘parlous
financial condition’ meant that there would have to be a stay of execution. The stay was
ordered on the agreed condition that the amount awarded by the adjudicator would be
paid into court. The judge rejected the contention that Galliers’ financial difficulties
arose out of Ashley House’s conduct.
17.18 How is the court to exercise its discretion in circumstances where there is evidence and
argument from both sides as to the claimant’s financial position? The first case in which
that problem was considered in any detail was in the second part of the dispute in
Herschel Engineering Ltd v Breen Property Ltd (No 2).19 The TCC judge held that the test
was comparable to that for security for costs and that therefore the points listed by Lord
Denning MR in Sir Lindsay Parkinson were relevant and applicable. In particular, in
Herschel, the judge found that there was no substantial difference between the financial
position of the claimant company at the time that it entered into the contract, and the
time of the application. At the time of the contract, the judge said that the claimant
company was an unknown entity in financial terms; since that was the company with
which the defendant had chosen to contract and had entrusted with the work, it would
16
[2000] BLR 272.
17 [2001] BLR 416.
18 [2002] Adj LR 02/15.
19 A decision of HHJ Lloyd QC, unreported, 28 July 2000, TCC.
430
Stay of Execution
now be wrong for the defendant to take advantage of that position to impose a stay of
execution. He concluded:
19. In my view, on an application for a stay where a party has entered into a contract with a
company whose financial status is or may be uncertain and finds itself liable to pay money to
that company under an adjudicator’s decision, the question may properly be posed: is this not
an inevitable consequence of the commercial activities of the applicant that it finds itself in the
position that it is in? It has, as it were, contracted for the result. That is not normally a ground
for avoiding the consequences of a debt created by the contractual mechanism (which is how,
in the absence of express terms, adjudication operates: see section 114 of the Act). It is very easy
(and prudent and relatively inexpensive) to carry out a search or to obtain credit references
against a company whose financial status and standing is unknown. Not to do so inevitably
places a person at a significant disadvantage. It has only itself to blame if the company selected
by it proves not to have been substantial (as opposed to a material deterioration in its finances
since the date of contract).
A similar result was reached in Michael John Construction v Golledge & Ors 20 where the 17.19
TCC judge concluded from the evidence that the claimant contractor was not in a sig-
nificantly worse financial position than it had been at the time when the contract was
made. Thus the defendant employers ‘got the result they contracted for and cannot now
use the claimant’s financial ill-health to avoid judgment’. A stay of execution was again
refused.
The absence of any significant change in the financial position of the claimant company 17.20
between the making of the contract and the date of judgment, or the fact that any financial
difficulties might be linked back to the defendant’s conduct in any event, are the two most
common factors that have led the courts to refuse applications for a stay of execution, even
where there is evidence of financial difficulties. In Total M&E Services Ltd v ABB Building
Technologies Ltd 21 HHJ Wilcox set out the competing evidence as to the financial position of
the claimant. He concluded that, in the exercise of his discretion, a stay should not be
imposed, in part because the capacity of the defendant to pay back the sums in the future was
directly linked to its present entitlement to the sums decided by the adjudicator, and in part
because there had been no real change in the claimant’s financial status since the making of
the contract. More widely, he summarised the court’s approach to applications for a stay
in these terms:
52. Where a stay is sought the court must consider all the circumstances. It must consider
whether there are special circumstances which render it inexpedient to enforce the judgment.
The risk of an inability to repay on due time is one of a number of factors to be taken account
of in the balancing exercise. Where the risk is high, as where there is strong uncontradicted
evidence of a present inability to pay or a company is in administration, the stay may be appro-
priate on terms safeguarding the disputed money. The burden is clearly upon the party seeking
a stay to adduce evidence of a very real risk of future non-payment. The balancing exercise is
of course subject to the overriding considerations of Part 1 of the CPR ensuring justice and
fairness between the parties. In considering what is just and fair in an application for a stay of
execution of a summary judgment under Part 24 in circumstances such as these the court must
be careful not to re-allocate the commercial risks accepted by the parties who engage in a con-
struction contract mindful of the provisions of the Housing Grants Construction Regeneration
Act 1996 and subject to the general safeguards of insolvency law.
20 [2006] EWHC 71 (TCC); [2006] TCLR 3.

21 [2002] EWHC 248 (TCC); [2002] 87 Con LR 154.
431
Enforcement
That passage was cited with approval by Forbes J in JW Hughes Building Contractors Ltd v
GB Metal Work Ltd.22 In that case the judge found that, on all the evidence, it could not
possibly be said that there was a high risk of an inability to repay the money, and the stay
was rejected.
17.21 As noted above, a number of the reported cases stress that the burden of demonstrating an
entitlement to a stay is firmly on the judgment debtor and that, if the relevant evidence is
served late, or if it is unclear on that evidence what the precise financial position of the
claimant might be, the stay will usually be refused. Thus in Absolute Rentals Ltd v Glencor
Enterprises Ltd 23 Judge Wilcox refused an application for a stay because the material ques-
tioning the claimant’s financial viability was served late and it was impossible to say on the
evidence what its precise financial standing was. He made it plain that it was entirely possible
that, even if the claimant was impecunious, that derived from the defendant’s default.24
There are a number of other cases in which the same judge (and other TCC judges) has
refused an application for a stay on the basis of a lack of compelling evidence as to the
judgment creditor’s alleged financial difficulties.25
17.22 In AWG Construction Services Ltd v Rockingham Motor Speedway Ltd 26 HHJ Toulmin CMG
QC observed that, whilst it was not possible to say how far an applicant had to go in putting
evidence before a court in support of a stay, it should be noted that the court should not grant
a stay unless, consistent with the overriding objective in the CPR, the justice of the case
demanded it. He went on to say:
186. In general, a court must balance (a) the intention of the legislation that adjudication
should be enforced summarily; (b) the right of the successful party not to be prejudiced by
being kept out of its money; and (c) in cases where there is a serious risk that a party will not
be able to recover the money, that the defendant is not being seriously prejudiced in a way
not contemplated by the Act which is silent as to the position where a defendant runs more
than a nominal risk of being unable to recover money after trial or arbitration award.
In addition, Judge Toulmin indicated that one matter that the court might consider is the
diligence with which the defendant pursued its cross-claim or challenge to the adjudicator’s
original decision. If the claimant was to be kept out of its money at all, it should be for the
shortest reasonable time, so that the right approach might well be to grant a stay for a limited
time originally, with extensions depending on the conduct of the parties. By contrast, a failure
by the defendant to pursue its cross-claim or challenge with diligence may itself be a bar to a
successful application for a stay of execution.
22
[2003] EWHC 2421 (TCC).
23
28 February 2000; CILL July/August 2000.
24
It has been argued that Judge Wilcox’s suggestion, in his judgment in Absolute Rentals, that granting a stay
would frustrate the Scheme, was contrary to the view expressed by Dyson J and others to the effect that, in appro-
priate circumstances, a stay could be ordered, notwithstanding the judgment creditor’s success in the adjudication.
However, it is submitted that Judge Wilcox’s comments need to be looked at in the context of his rejection of the
application for a stay on the basis of both late and disputed evidence. It is not thought that there is any difference
between his approach and that of the other Judges to the principles applicable to applications for a stay.
25 See two other decisions of HHJ Wilcox in Nolan Davis v Stephen Catton (unreported, 2000 TCC No 590);
and Multiconcept Developments v Abacus (unreported, 2002). In Multiplex Constructions (UK) Limited v West
India Quay Development Company (Eastern) Limited [2006] EWHC 1569 (TCC); [2006] 111 Con LR 33,
Ramsey J refused a stay, despite the fact that the contractor was ‘currently suffering large losses on the Wembley
stadium project’. He said that it was being supported by its parent company and there was no evidence that such
support was likely to be withdrawn.
26 [2004] EWHC 888 (TCC); [2004] TCLR 6.
432
Stay of Execution
The relevant principles for an application for a stay of execution were considered in detail in 17.23
Wimbledon Construction Co 2000 Ltd v Derek Vago.27 Having considered a number of the
cases set out above, the TCC judge concluded that the principles applicable to such an
application were as follows:
26. In a number of the authorities which I have cited above the point has been made that each
case must turn on its own facts. Whilst I respectfully agree with that, it does seem to me
that there are a number of clear principles which should always govern the exercise of the
court’s discretion when it is considering a stay of execution in adjudication enforcement
proceedings. Those principles can be set out as follows:
a) Adjudication (whether pursuant to the 1996 Act or the consequential amendments to
the standard forms of building and engineering contracts) is designed to be a quick
and inexpensive method of arriving at a temporary result in a construction dispute.
b) In consequence, adjudicators’ decisions are intended to be enforced summarily and
the claimant (being the successful party in the adjudication) should not generally be
kept out of its money.
c) In an application to say the execution of summary judgment arising out of an adjudicator’s
decision, the court must exercise its discretion under Order 47 with considerations a)
and b) firmly in mind (see AWG).
d) The probable inability of the claimant to repay the judgment sum (awarded by the
Adjudicator and enforced by way of summary judgment) at the end of the substantive
trial, or arbitration hearing, may constitute special circumstances within the meaning
of Order 47 rule 1(1)(a) rendering it appropriate to grant a stay (see Herschel ).
e) If the claimant is in insolvent liquidation, or there is no dispute on the evidence that
the claimant is insolvent, then a stay of execution will usually be granted (see Bouygues
and Rainford House).
f ) Even if the evidence of the claimant’s present financial position suggested that it is
probable that it would be unable to repay the judgment sum when it fell due, that
would not usually justify the grant of a stay if:
(i) the claimant’s financial position is the same or similar to its financial position at
the time that the relevant contract was made (see Herschel ); or
(ii) The claimant’s financial position is due, either wholly, or in significant part, to
the defendant’s failure to pay those sums which were awarded by the adjudicator
(see Absolute Rentals).
This summary of the applicable principles has been adopted in a number of subsequent 17.24
decisions.28 In Ale Heavy Lift v MSD (Darlington) Ltd,29 HHJ Toulmin CMG QC followed
this approach. Although, as he put it, ‘Ale’s accounts are in a state that would give cause for
some serious degree of concern’, their financial position was the same as, or similar to, the
time when the contract had been made. He therefore declined to exercise his discretion in
favour of a stay. In reaching this conclusion, he also had regard to the fact that the defendant
had not yet commenced any proceedings to recover the sums awarded by the adjudicator.
In McConnell Dowell Contractors (Aust) Pty Ltd v National Grid Gas Plc,30 a decision of 17.25
Jackson J, he rejected the application for a stay, but only because McConnell were prepared
27
[2005] EWHC 1086 (TCC); [2005] BLR 374.
28
See also Jacques and Another v Ensign Contractors Ltd [2009] EWHC 3383 (TCC), where the evidence
showed that the employer would be unable to repay the judgment sum and none of the particular exceptions
applied, so that a stay in respect of about half the total was imposed.
29 [2006] EWHC 2080 (TCC).
30 [2007] BLR 92.
433
Enforcement
to offer a bond in respect of monies that might have to be paid back at a later date. In addition,
as the learned editors of the Building Law Reports have pointed out,31 the correct position
where the claimant is in insolvent liquidation is that, since the grant of summary judgment
is inappropriate, judgment should not be entered at all. There would therefore be nothing for
the defendant to seek to stay.32
17.26 The two exceptions noted at paragraph 26(f ) of the judgement in Wimbledon (paragraph
17.23 above) have been the subject of a number of reported cases. Particular cases where a
stay was not ordered because the claimant company was in the same financial position as
when the contract was first made include Air Design (Kent) Ltd v Deerglen ( Jersey) Ltd 33
where, despite the fact that Air Design only had net assets of £831, a stay was not imposed
because they were in no worse financial position now than when the contract was made. The
judge said that the fact that Deerglen had no access to the accounts at the time that the con-
tract was made did not change that conclusion. Cases where the financial circumstances of
the claimant were the direct responsibility of the defendant employer include Mead General
Building Ltd v Dartmoor Properties Ltd 34 where the judge concluded that the CVA to which
Mead was subject had been directly caused by Dartmoor’s failure to pay the sums found by
the adjudicator to be due. Mead was too small a business to be able to withstand losses of the
magnitude created by Dartmoor. And cases where both of these exceptions have been dem-
onstrated to exist include SG South Ltd v King’s Head Cirencester LLP and another 35 where the
claimants financial position at the time of the contract demonstrated convincingly its lack of
value and credit worthiness and that, in addition the injection of the £94,000 found to be
due by the arbitrator would have given the claimant a much greater chance of continuing
with its business. In all of these cases, no stay of execution was imposed.
17.27 By contrast, a case where neither of these exceptions was made out was JPA Design and
Build Ltd v Sentosa (UK) Ltd.36 JPA were a shell company and the judge accepted that
some aspects of their financial position remained as they had been at the time that the
contract was entered into. But the judge went on to find that their financial position had
significantly altered after that point, because the evidence demonstrated that, since the
contract was made, their turnover had increased six-fold. Unfortunately, so too had their
losses. Since the judge also rejected the submission that those financial difficulties were
created by Sentosa, a case for a stay was made out. The evidence demonstrated that, even
if the full amount due of £300,000 had been paid by Sentosa to JPA, that would not
significantly have affected JPA’s underlying difficulties and they would have remained in
debt for very large sums. Accordingly, in that case, a stay was imposed.
Time to Pay
17.28 It can sometimes be appropriate for judgment to be entered, but with the judgment sum
payable in instalments, or payable after a longer period than the usual 14 days. The court has
31
At pages 375–376 of their report of the Wimbledon case.
32
As discussed in paragraph 17.08.
33
[2008] EWHC 3047 (TCC); [2009] CILL 2657.
34 [2009] EWHC 200 (TCC); [2009] BLR 225.
35 [2009] EWHC 2645 (TCC); [2010] BLR 47.
36 [2009] EWHC 2312 (TCC); [2009] 50 EG 68.
434
Stay of Execution
a discretion to permit an unsuccessful defendant time to pay: see Yoram Ansalem v Raivid.37
In Gipping Construction Ltd v Eaves Ltd,38 the judge was persuaded that it was a case where
the parties should discuss time for payment, and he gave the defendant permission to apply
at a later stage to extend the 14-day period. But there must be cogent evidence as to why
instalments are appropriate and the usual position will be that the total due will be ordered
to be paid within 14 days: see Jacques v Ensign Contractors Ltd.39
Other Circumstances
There are a number of other cases which demonstrate the wider circumstances in which the 17.29
court has been asked to impose a stay, unlinked to financial concerns. Perhaps the best-
known example of this is the decision in Kier Regional Ltd v City & General (Holborn) Ltd
(No2) 40 discussed at paragraph 14.51 above, where the court decided, on the unusual facts
of the case (the relative antiquity of the decision and the imminence of the arbitration) that,
even if third party debt orders had been appropriate, they would not have been ordered and
that, moreover, a stay was appropriate to restrain Kier from taking any further enforcement
proceedings until the arbitration had been concluded. In a similar application of the same
principle, in Workspace Management Ltd v YJL London Ltd 41 the judge declined to enforce an
arbitration award, in circumstances where there was also an outstanding adjudication
decision the other way. The judge went on to say that, if he had entered judgment for the
claimant, he would have stayed execution, because of the general merits of the situation
(claims and cross-claims on both sides) and the imminence of an award in the arbitration in
which all the relevant matters were to be finally determined.
Other attempts to stay enforcement proceedings for more general purposes have largely been 17.30
unsuccessful. Thus in Balfour Beatty Construction Northern Ltd v Modus Corovest (Blackpool)
Ltd 42 the defendant sought to stay the enforcement proceedings in order that a mediation,
in accordance with the terms of the contract, could take place. The judge declined that application
on the basis that the mediation agreement was, on a proper analysis, no more than an agree-
ment to agree, and that a stay was only appropriate if the claimant was not entitled to
summary judgement, which meant that the court still had to go on to consider the merits of
the claims and counterclaims. The stay was refused and, on analysis of the relevant material,
summary judgement was entered. Similarly, in SG South Ltd v Swan Yard (Cirencester) Ltd 43
the judge refused the defendant’s application for a stay. The defendant argued that the claims
would be resolved when the final account was agreed between the parties and had commenced
proceedings in another part of the High Court to determine the quantum of the final account.
The judge concluded that it was inappropriate to stay enforcement proceedings in such
circumstances and that the adjudicator’s decision had to be honoured.44
37 [2009] EWHC 3226 (TCC).

38 [2008] EWHC 3134 (TCC).
39 [2009] EWHC 3383 (TCC), paragraphs 52–53.
40 [2008] EWHC 2454 (TCC); [2009] BLR 90.
41
[2009] EWHC 2017 (TCC); [2009] BLR 497.
42
[2008] EWHC 3029 (TCC); [2009] CILL 2660 paragraphs 14–21.
43
[2010] EWHC 376 (TCC); [2010] 19 EG 110.
44 This is only another unsuccessful way in which the losing party has endeavoured to put off paying the
sums due in accordance with the decision: see the references to a stay for arbitration or adjudication in paragraphs
2.175–2.179.
435
Part VI
A PRACTICAL GUIDE TO ADJUDICATION
18. Commencing an Adjudication 439

19. The Adjudication Itself 449
20. The Adjudicator’s Decision 457
18
COMMENCING AN ADJUDICATION
Introduction 18.01 Response to the Notice of Adjudication 18.11

So You Think You Want to be an Appointment of Adjudicator 18.14
Adjudicator? 18.02 A Challenge to the Nominated Adjudicator 18.20
Notice of Adjudication 18.06 Referral Notice 18.25
Introduction
There is no shortage of written material purporting to provide guidance as to the best way of 18.01
approaching and running an adjudication. Some of this advice is now out of date, and some
of it is of questionable accuracy. However, mention should be made of two helpful guides
prepared by the Construction Umbrella Bodies Adjudication Task Group, in conjunction
with the Construction Sector Unit of the Department of Trade & Industry. The first, entitled
‘Users’ Guide to Adjudication’, and published in April 2003, is a useful summary of the
various steps in any adjudication. The second is a document entitled ‘Guidance for
Adjudicators’, which, although even older (being produced in July 2002), is nonetheless a
helpful summary of the principles that any adjudicator must bear in mind when embarking
on an adjudication. These documents are referred to below as, respectively, the Users’ Guide
and the Guidance for Adjudicators.
So You Think You Want to be an Adjudicator?

A question that often arises—for the parties, for the nominating bodies, even for adjudi- 18.02
cators themselves—concerns the qualities that make a good adjudicator. What are they?
Are they different from those that make good arbitrators, or even good judges? Is adjudi-
cator X better than adjudicator Y? The three following characteristics would seem to be
essential:
1. the ability to manage time, both the adjudicator’s own and that of the parties. An
adjudicator needs to be able to plan in detail the course of the adjudication from the
outset, so as to ensure that the decision is completed on time. For the last week or so of
the 28 or 42 days, the adjudicator’s own timetable should identify times by which impor-
tant parts of the decision must be completed;
2. the ability to grasp the essential issues quickly and, thereafter, to focus attention firmly on
those issues. An adjudicator must not get distracted by peripheral matters;
439
A Practical Guide To Adjudication
3. the ability to treat the parties fairly and courteously, no matter what the provocation
might be, and wherever possible, to take on board the submissions made by each side,
even if the suspicion might be that the documents are not adding to the adjudicator’s
understanding of the issues between the parties.
18.03 There are also characterisics that are not always helpful to a good adjudicator. The desire to
work out an answer to each sub-issue is much more of a hindrance than a help. In addition,
a detailed specialist understanding of the underlying issues can sometimes cause problems;
adjudicators are asked to decide points because of their decision-making qualities and their
general familiarity with the technical background. If the adjudicator has a very specific
knowledge of the technical point in issue then he or she needs to try even harder to ensure
that his or her decision is based on the evidence, and not their own technical knowledge or
even prejudice.
18.04 At a meeting of Society of Construction Law on 11 May 2010, the author identified what
were referred to as the seven golden rules for adjudicators. They were:
1. Be Bold: Adjudicators have a unique jurisdiction, where the need to have the right answer
has been subordinated to the need to have an answer quickly. Adjudicators must remem-
ber that adjudication is all about ensuring that, where appropriate, payment gets to the
right people at the right time.
2. Address Jurisdiction Issues Early and Clearly: Adjudicators should always deal expressly
with any jurisdictional challenge, and they should not abdicate the responsibility for pro-
viding an answer, even if it is not binding. They should consider the challenge applying
common sense, but must avoid being too jaundiced. There will be occasions (however
rare) when the jurisdictional challenge is made out, and in those circumstances, the adju-
dicator is going to save everybody a lot of time, money and effort by resigning then and
there.
3. Identify and Answer the Critical Issue(s): Adjudicators must ignore, unless it is
unavoidable, the sub-issues and the red herrings. They should avoid being long-winded
and instead concentrate on what they know to be the real point. Everything else will
usually fall into place.
4. Be Fair: Wherever possible, the adjudicator should properly consider every aspect of the
parties’ submissions. If the adjudicator has planned out a timetable from the outset then
the parties will know what they need to do and when, and disputes over (for instance) the
admissibility of last-minute submissions will be much less frequent.
5. Provide a Clear Result: Most decisions are lengthy and detailed. The adjudicator must
always try and ensure that, at the end, they make plain precisely what each party must do
as a consequence of the decision.
6. Do It on Time: The adjudicator must complete the decision within the statutory
period or any agreed extended period. They must not allow the timetable to drift. It is
counter-productive to expand an adjudication from six weeks to three months, because
it means that the parties have to spend a fortune, which they probably cannot recover,
for a decision that either of them could challenge subsequently. And when the adjudi-
cator has completed the decision, it should be issued immediately. It ruins everything
if, as happened in one recent case, the adjudicator completes the decision just as the
time was expiring, and then sits on it for three days before deciding to send it out to
the parties.
440
Commencing an Adjudication
7. Do Not Make Silly Mistakes: The adjudicator must always make sure that he or she has
taken into account the payments that have been made to date, and whether the figures
that they are dealing with are net or gross. When ordering one party to make a payment
to the other, the adjudicator must set that out in clear terms and make sure that the names
are the right way round.
With that overview in mind, it is convenient to look at some of the nuts and bolts involved 18.05
in commencing an adjudication.
Notice of Adjudication
For the reasons explained in greater detail at paragraphs 3.14–3.17 and 7.47–7.60 above, 18.06
the notice of intention to refer a dispute to adjudication (which will be referred to
throughout as the notice of adjudication) is, in many ways, the most important document
in any adjudication, because it defines the dispute that the adjudicator has to decide. In
most adjudications, it will be important that the notice of adjudication provides the
following information:
1. a brief description of the contract, together with the names and addresses of the parties
to that contract;
2. a brief description of the dispute that has arisen between the parties;
3. a clear description of the nature/type of redress being sought in the adjudication, and
what the claiming party wants the adjudicator to do.
It is sometimes said that the proper subject of both the notice of adjudication, and the
subsequent referral notice, is the dispute itself, and that therefore such notices should set out
both sides’ opposing positions that have created that dispute. Although it can be sometimes
be useful for the referring party to identify, in short order, what it understands the response
to its claim to be, it is thought to be unnecessary for the referring party to devote too much
time to such an exercise when preparing the notice of adjudication and the referral notice,
particularly given that the responding party will have its own opportunity to set out its
position in detail when it responds to the referral notice.
The most important thing for the referring party to ensure is that, unless the form of contract 18.07
specifically permits the referral of multiple disputes at the same time, the notice of adju-
dication identifies just one single dispute. Thus the description of the dispute between the
parties in the notice must be set out with that requirement in mind. In the vast majority of
adjudications, it is wrong in principle, and potentially fatal to the entire adjudication, if the
notice of adjudication talks about the existence of disputes (plural) between the parties. Take
the common situation where a contractor’s application for an interim payment has not been
paid (either in whole or in part) by the employer. That interim application for payment
might include claims for unpaid contract work, variations, the expenditure of prime cost items,
an extension of time, and loss and expense. However, it must be remembered that, despite all
those disparate elements, the single dispute between the parties was and remains the employer’s
failure to pay the sum claimed by way of an interim payment. The notice of adjudication
should therefore identify the non-payment of the sum claimed by way of interim payment
as comprising the single dispute between the parties. Only then, if it is appropriate, will it be
necessary to go on to identify how the unpaid sum has been made up. Any reference in the
441
notice of adjudication to the existence of more than one dispute is likely to lead to a challenge
to the adjudicator’s jurisdiction by the responding party.
18.08 It is also important to ensure that the notice of adjudication makes quite clear what relief is
sought; to identify precisely what the referring party wants the adjudicator to do. It is not
enough for a contractor simply to identify the submission of an interim payment applica-
tion and its non-payment by the employer. The referring party should go on to say that, in
consequence of the non-payment, it seeks an order for the payment of the outstanding sum,
together with any other consequential matters, such as interest and, more unusually, costs.
Similarly, if the contractor claims that he is entitled to a particular period by way of an
extension of time, then the notice of adjudication needs to spell out that the contractor is
seeking a declaration from the adjudicator to that effect.
18.09 Of course, it is common for an adjudicator to reach a view which gives the referring party
some, but by no means all, of his outstanding claim. It can sometimes be said that, if the
contractor is claiming £100,000 by way of outstanding payment, and no other relief is
sought in the notice of adjudication, the adjudicator does not have the power to award the
contractor, say, £35,000. Such technical points can be avoided if, within the notice of
adjudication, the referring party makes clear that, in the alternative to his specific claims, he
is asking the adjudicator to award such other sum as he sees fit.
18.10 The later, and more detailed, document produced by the referring party is the referral notice,
discussed in greater detail at paragraphs 18.25–18.29 below. However, it should be remem-
bered that the referral notice must generally be served within seven days of the notice of
adjudication. It is usually sensible, therefore, for the referring party to have prepared his
referral notice at the same time as his notice of adjudication, so as to avoid the risk that the
referral notice will not be ready in time. A failure to comply with the seven-day period might
be fatal to the adjudication, and require its re-commencement. If the referring party prepares
the documents at the same time, then in practice, it can often make sense for the referral
notice to be drafted first, and in detail, so that the notice of adjudication can then be
abstracted, almost as a summary, from the referral notice itself. It can be dangerous for a party
to issue a notice of adjudication in general terms and only then get down to preparing the
detailed referral notice. First, as already noted, there is a risk that the referral notice will not
be ready in time. Secondly, there is also the risk that, when the detailed work is done in
explaining the individual claims in the referral notice, there may be changes of emphasis or
presentation that might reveal that the wording of the notice of adjudication is unclear or
even wrong. For these reasons, it is usually appropriate for these two important documents
to be drafted simultaneously.
Response to the Notice of Adjudication

18.11 When the responding party receives the notice of adjudication, there are a number of matters
that it needs to consider as a matter of urgency. The first is whether there is a contract in
existence at all; if so, whether the contract is a construction contract; and/or whether the
notice is in accordance with the adjudication provisions in the contract between the parties.
If the responding party considers that there is no contract at all, or that the contract is not a
construction contract, or that the notice of adjudication is not in accordance with the
contract, or there is some other reason that the adjudicator does not have the necessary
442
jurisdiction (for example that the incorrect nominating body has been approached, or
someone other than the named adjudicator has been nominated), then the responding party
must notify the referring party of this jurisdictional challenge straight away.
It is often the case that the responding party will feel that the alleged dispute is no such thing, 18.12
either because the claim being made is not one that has ever been made before, or because the
notice of adjudication has followed a matter of days (sometimes just hours) after the sub-
mission of the underlying claim, with the result that the responding party considers that he
has not had a proper opportunity to consider the claim prior to the service of the notice of
adjudication. Again, if the responding party considers that either of those circumstances
applies, then he must notify the claiming party immediately, because such complaints also
go to jurisdiction. However, whilst the submission of an entirely new claim by way of a notice
of adjudication will almost always be illegitimate, the provision of a notice of adjudication
hot on the heels of a contractual claim may not give rise to a successful jurisdictional
challenge. For the reasons explained in paragraphs 2.97–2.106 and 7.47–7.77 above, the
courts have given a wide meaning to the term ‘dispute’, and the reported cases demonstrate
that, provided that the responding party has had at least some time to consider the claim
presented under the contract, then a failure to respond to such a claim may well be sufficient
to create a dispute between the parties that could then be referred to adjudication.
It is often said, and with considerable force, that the adjudication process can be slanted in 18.13
favour of the referring party. Certainly, this is nowhere more apparent than at the com-
mencement of the adjudication. The referring party will have had weeks (if not months) in
which to prepare both the detailed referral notice and the notice of adjudication. Once the
notice of adjudication has been served, the clock is ticking against the responding party.
In such circumstances, it is suggested that the responding party should respond as soon as
possible to the notice of adjudication, in clear but concise terms. In the vast majority of cases,
the response to the notice of adjudication is not the appropriate place for the responding
party to wax lyrical on every detail of the underlying claim: instead, the responding party will
almost always get an opportunity to do that in its response to the referral notice. Accordingly,
it is important that, at the outset of the adjudication, the responding party concentrates on
the bigger picture and, on receipt of the notice of adjudication, confines his response to any
headline points concerned with jurisdiction and, if appropriate, the fundamental absence of
merit in the claim. However, whilst in the vast majority of cases the key document from the
responding party will be the response to the referral notice, it is worth noting that the Scheme
for Construction Contracts does not expressly entitle the responding party to submit any
such document. That said, it would take considerable courage, or considerable stupidity, for
an adjudicator to refuse to allow the responding party to respond to the detail of the referral
notice, or to ignore any such response document.
Appointment of Adjudicator
Some contracts will name the adjudicator. The appointment of that adjudicator to deal with 18.14
the particular dispute that has subsequently arisen between the parties will then be a straight-
forward matter. Difficulties only arise if that adjudicator has died or is too ill to deal with the
adjudication or, more commonly, if he is too busy to deal with the adjudication in the
relevant period. In those circumstances it is very important that the named adjudicator is
443
entirely frank with the parties at the outset. Difficulties have arisen in the reported cases
where a named adjudicator has taken on the dispute, possibly because he did not consider
that he had an alternative, and then failed to deal with the adjudication in the statutory
period. If an adjudicator named in a contract knows that he is unlikely to be able to produce
the decision within the relevant period, he should make that plain to the parties at the outset.
The parties can then make an informed choice as to whether to utilise the named adjudicator
and allow him an extended period to complete his decision or, if not, to activate the default
mechanism within the contract for the appointment of an alternative adjudicator.
18.15 Many contracts do not contain provisions as to a named adjudicator. Instead, they will
identify an adjudicator nominating body, such as the RICS, RIBA, AICA or TeCSA. In
such cases, the referring party will write to the relevant nominating body and ask for an
adjudicator to be appointed. That request must be accompanied by a copy of the notice
of adjudication.
18.16 As noted above, the 1996 Act, the Scheme for Construction Contracts, and most of the
standard forms of construction and engineering contract all identify a seven-day period
after the service of the notice of adjudication in which the appointment of the adjudicator
must be accomplished. That means that the referring party must do all that it possibly can
to ensure that any request for nomination, and the notice of adjudication, are provided to
the nominating body at the same time as the service of the notice of adjudication on the
responding party. All too often, the request to the nominating body is sent off in the post,
and sometimes does not arrive for two or three days. This puts the nominating body
under unfair pressure, often requiring it to nominate an adjudicator within a day or so of
receiving the request. It is therefore recommended that the request to the nominating
body and the copy of the notice of adjudication are provided either by hand or by fax to
the nominating body at the same time that the notice of adjudication is served on the
responding party.
18.17 The nominating body must nominate an adjudicator as soon as possible. It is important to
avoid the situation that arose in at least one of the reported cases1 where the nomination of
the adjudicator happened late on day seven and the referral notice was served the following
day, thereby allowing the responding party to take a point (which was ultimately unsuccessful)
as to the failure to serve the referral notice within the required seven days. However, the
seven-day period will generally be enforced by the courts,2 so it is important always to make
sure that, if it is possible to do so, the period is observed. Bodies who nominate adjudicators
regularly have a procedure and a fixed turn-around time (often five days) for dealing with the
nomination process, and it is important that the referring party keeps tabs on the request
for nomination so as to ensure that the nominating body acts promptly in identifying the
proposed adjudicator.
18.18 A practical difficulty can sometimes arise in the situation where the responding party is
anxious to ensure that a particular person is not nominated as the adjudicator. This can
happen where there have been a series of adjudications under the same contract and the
responding party feels, whether rightly or wrongly, that person X, who has conducted a
number of the previous adjudications, has made decisions with which they have been
1 See Cubitt Building & Interiors Ltd v Fleetglade Ltd [2006] EWHC 3413 (TCC); [2006] 110 Con LR 36.
2 See Hart Investments v Fidler and Another [2006] EWHC 2857 (TCC); [2007] BLR 303.
444
unhappy. If the referring party writes to the nominating body asking them to nominate a
particular adjudicator (or, in some cases, not to nominate a particular adjudicator), then it is
suggested that such a letter must be copied to the responding party. Failure to do so
might give rise to a subsequent debate about the validity of the appointment of a chosen
adjudicator in circumstances where the responding party did not know that a particular
person was being requested, and would have raised a bona fide objection if they had known.
If the responding party objects to the person being suggested by the referring party, or wishes 18.19
to object in any event to the appointment of person X, he should write immediately to the
nominating body to say so, and should again ensure that the relevant communication is
faxed or emailed. The reasons for the objection should be set out in clear terms. It will then
be for the nominating body to reach a conclusion as to the objection, and whether or not,
notwithstanding the terms of the objection, person X should be appointed as the adju-
dicator. There are a number of cases in which, despite the objections of the responding
party, person X was appointed as the adjudicator. There are no reported cases in which the
responding party has sought to challenge such a decision in the courts, but it is thought
that such a challenge might be arguable in appropriate circumstances. It is therefore
recommended that the nominating body keeps a short note of the rationale behind its
decision to appoint person X as the adjudicator, notwithstanding the responding party’s
objection to such a nomination.
A Challenge to the Nominated Adjudicator

Whatever points might have been taken in response to the notice of adjudication, it is very 18.20
important that, if a responding party has a jurisdictional challenge, he should write to the
adjudicator immediately on his appointment setting out the reasons why it is said that the
adjudicator does not have the necessary jurisdiction. The jurisdictional challenge should
be set out clearly, setting out the specific reasons why, in the events which have occurred, it
is said that the adjudicator does not have the necessary jurisdiction. In making its juris-
dictional points, the responding party should endeavour to ensure that any references to
existing authorities are kept to a minimum. Each case is different and each case turns on its
own facts. Furthermore, adjudicators are wary of jurisdictional challenges and can become
sceptical as to the merits of any challenge where a half-page point is supported by a lever arch
file of legal authorities of questionable relevance.

Once the responding party has identified his jurisdictional challenge, then it is necessary for 18.21
the adjudicator to respond promptly. In some cases, the adjudicator will agree with the
challenge and resign, although it is common in practice for the adjudicator to allow the
referring party to comment on the challenge that has been made before resigning. This is also
good practice: it can often be the case that what looks like a cast-iron jurisdictional argument
melts away when the referring party has explained it more fully, and provided the adjudicator
with copies of those documents not proffered by the responding party. In most of the reported
authorities, the adjudicator has concluded that he has the necessary jurisdiction and has
continued with the adjudication. In those circumstances, the responding party has three
possible choices to make. First, it can refuse to take part in the adjudication altogether.
Secondly, it can take part in the adjudication but make it clear that its participation is
without prejudice to its objection on jurisdiction. Thirdly, it can agree to be bound by the
adjudicator’s decision on jurisdiction and/or waive the lack of jurisdiction, and expressly
consent to be bound by the result of the adjudication.
445
18.22 The first option, namely a refusal to take part in the adjudication process altogether, is a
high-risk strategy for a responding party to adopt. Indeed, it is not recommended unless it is
accompanied by an application to the TCC for a declaration that the adjudicator does not
have the necessary jurisdiction. It does not make much commercial sense for a party to refuse
to take part in an adjudication process at all, in circumstances where the result might lead to a
money award against that party for millions of pounds, no matter how strong the jurisdictional
challenge might be thought to be. Much better in most cases will be the second option out-
lined above, whereby the responding party agrees to take part in the adjudication, but only
on the strict understanding that such participation is without prejudice to its jurisdictional
challenge. As noted above, this is a particularly effective tactic if, regardless of the jurisdiction
position, the responding party believes that it has a good case on the merits of the underlying
dispute. Finally, a party with a jurisdictional challenge can choose to waive that challenge or
agree to be bound by the adjudicator’s view that he has the necessary jurisdiction. This is
appropriate in circumstances where the jurisdictional challenge, even though arguably cor-
rect, is entirely technical and gives rise to no real benefit to the responding party at all.
18.23 Should the adjudicator consider, of his own volition, and regardless of the points that may or
may not have been made by the parties, whether or not he has the necessary jurisdiction?
It is thought that he should. If the adjudicator does not have the necessary jurisdiction, then,
prima facie, his decision is a nullity, regardless of the lack of an objection at the time. Of
course, it is right that the lack of objection may give rise to an ad hoc jurisdiction (see Chapter
5 above), but it is much wiser for the adjudicator to address himself to the question of juris-
diction at the outset of the adjudication, irrespective of the points made by the parties. In HG
Construction Ltd v Ashwell Homes (East Anglia) Ltd,3 Ramsey J spoke expressly about the
adjudicator considering of his own volition whether he was being asked to decide a matter
on which there was already a binding decision by another adjudicator.
18.24 Once the adjudicator has decided that he does have the necessary jurisdiction, it is not
recommended that the responding party continues to bombard the adjudicator with
further and better ways of putting the jurisdictional challenge. It is surprising how often a
responding party will ignore the adjudicator’s ruling on jurisdiction and continue, through-
out the statutory period, to write endless letters complaining that the adjudicator does not
have the necessary jurisdiction. This is counter-productive for two reasons. First, it is most
unlikely that an adjudicator, who has concluded that he has the necessary jurisdiction, will
change his mind because the point is put in a different way part way through the adju-
dication process. Secondly, repeated reiterations of the jurisdiction point might lead the
adjudicator to conclude that the responding party has no case on the merits at all, and is
reduced to arguing purely technical points to try and stave off ultimate defeat. For both these
reasons, it is strongly recommended that a responding party who has lost a jurisdiction
challenge in front of the adjudicator makes it plain that he does not accept that decision but
then goes on, without prejudice to this challenge, to participate in the process as if the
adjudicator was correct, in order to deal with the detail of the underlying dispute.4
3 [2007] EWHC 144 (TCC); [2007] BLR 175.

4 Section 2 of the Guidance for Adjudicators makes plain that an adjudicator should investigate any jurisdic-
tional challenge and, if the adjudicator concludes that he does have the necessary jurisdiction, proceed with the
adjudication, having first obtained confirmation from the referring party that it wishes the adjudication to continue.
This is a sensible precaution: sometimes, in the light of a jurisdictional challenge, a referring party might prefer to
abandon the first adjudication, get its tackle in order and re-launch a second adjudication at a later date.
446
Referral Notice
As explained above, the referral notice is the document in which the referring party 18.25
should set out in detail the reasons why it should be granted the relief that it seeks in the
adjudication. In anything but the simplest of cases, the referral notice should be drafted in a
similar way to a points of claim, setting out the parties, the contract, and the legal and factual
basis of claim. Attached to the referral notice should be all the documents relied on in
support of the claim. This will include not only copies of the relevant parts of the contract,
but copies of the relevant meeting minutes and letters between the parties, site diaries and
the like and even, in an appropriate case, signed witness statements.
The Users’ Guide provides helpful tips as to the correct drafting of a referral notice. It 18.26
makes plain that the referral notice should be consistent with the notice of adjudication,
explain the nature of the dispute and how it arose, detail the facts that are relied on, and
provide the documentary evidence to support those facts. It suggests that it is not appro-
priate to include with the referral notice evidence that the other side has not seen before. In
certain circumstances that is wise advice: the inclusion within the referral notice of an expert’s
report which seeks to explain the 20-week extension of time that has been claimed, in a way
that has never before been identified, gives rise to the real risk that the responding party will
be able to argue that the referral notice relates to a dispute that has not yet arisen, and the
adjudicator therefore has no jurisdiction. On the other hand, it is not always appropriate to
exclude evidence that has not been seen before. Take, by way of example, a contractor’s claim
for work done pursuant to a variation that was instructed orally by the architect, and that
the contractor recorded in writing and sent to the architect as a confirmation of a verbal
instruction. The referral notice will include that written confirmation of a verbal instruction
(‘CVI’). However, there could be no possible objection, if it was thought appropriate, for the
representative of the contractor to whom the oral instruction was given provided, in addition
to the CVI, a short signed statement in which he confirmed the details of the instruction and
therefore the correctness of the CVI itself.
It is important to ensure that the material that is provided with the referral notice has been 18.27
carefully edited, with only the relevant documentation being attached to the referral notice
itself. The problem in construction contracts is that there is often a large amount of minutes,
memos and correspondence. It is unwise to include anything other than directly relevant
material with the referral notice because of the time constraints and the pressure on the
adjudicator to reach his decision promptly; on the other hand, sufficient of the relevant
correspondence and minutes ought to be provided so as to ensure that a balanced picture is
given to the adjudicator. If a large amount of documentation must be provided with the
referral notice, it is a big mistake for the referring party to assume that the material speaks for
itself. The adjudicator needs to be taken through that material in the body of the referral
notice, so that any documents of particular importance are emphasised. It is never sensible
to attach a huge clip of correspondence and expect the adjudicator to struggle through it
himself, without a guide, in order to find the particularly relevant documents.
It is usually sensible for the referral notice, and the material attached to it, to be arranged in 18.28
chronological order. In this way, the contract will be identified first, and subsequently the
particular events and matters of fact which lie at the heart of the dispute which the adjudicator
has to decide. Although it can sometimes be tempting to deal, in the referral notice and the
447
supporting documents, with the individual elements of the story one by one, there is a
grave risk that, if the overall chronology is departed from, the result will be muddle and
confusion.
18.29 The referral notice represents the referring party’s best, and often only, opportunity to put its
claim in detail. It is commonly assumed that the referring party has a right of reply to the
responding party’s response. Although the adjudicator will endeavour to ensure that the
referring party is given at least a limited right of reply, there may just be insufficient time to
allow the preparation of a detailed reply. Moreover, given that the referring party has had a
lengthy period in which to prepare a detailed referral notice, responding parties will often
complain, with some justification, if they have to respond to the referral notice within a short
period of time, only to find that the referring party is then given an additional opportunity
to have another go at the material. Accordingly, it is sensible for the referring party to
approach the preparation of the referral notice on the basis that it is their one and only oppor-
tunity to explain their claim in their own way and by reference to their own documents. Thus
the claims in the referral notice should always be kept simple and straightforward, with the
cross-referencing to the attached documents clear and user-friendly. It can often be a good
idea to present a summary of the claim at the outset so that, when working through the
detail, the adjudicator can keep in mind the overall shape of the claim. As the Users’ Guide
rightly points out, the claiming party may have little opportunity to persuade the adjudicator
to accept any arguments that have not clearly been set out in the referral notice.
448
19
THE ADJUDICATION ITSELF
Directions 19.01 Documentation 19.15

Response to Referral Notice 19.04 Timescale and Requested
Referring Party’s Reply 19.06 Extensions 19.19
Meetings, Evidence and Hearings 19.08 Natural Justice 19.23
Meetings 19.08 Conflict of Interest 19.24
Evidence 19.09 Reciprocity 19.26
Hearings 19.11 Inquisitorial or Adversarial? 19.28
Visits 19.13 Intimidatory Tactics 19.30
Directions
Only once the referral notice has been served should the adjudicator make directions for the 19.01
conduct of the adjudication. He should consider the detail of the referral notice and then
consider how the dispute should be managed through to his decision. The most important
thing for him to do is to liaise with the parties (either by way of a conference call or, if necessary,
a meeting) and set a timetable for the adjudication. This in turn requires consideration of a
number of separate matters.
First, the adjudicator should consider whether or not he can complete the adjudication 19.02
within the statutory time limit. If he cannot, or he considers that there is a risk that he
cannot, he should inform the parties immediately, so as to seek their agreement at an early
stage to an extended period. This is dealt with in greater detail in paragraphs 19.19–19.22
below. Thereafter, assuming that he is able to complete the adjudication within the 28 days
(or some other extended period) then he should order the responding party to serve a
detailed response to the referral notice. This is dealt with in greater detail in paragraphs
19.04–19.05 below. He should then consider whether it would be appropriate to allow the
referring party a short period to put in any material in reply; although, as noted in paragraph
18.29 above, the referring party will ordinarily assume that he has the right to put in such a
reply, it can often be inappropriate to allow the referring party a second bite of the cherry,
and to use up some of the limited time available on such a process. This is dealt with in
Once the adjudicator has made directions for the provision of a detailed response to the 19.03
referral notice, then he should consider whether or not to hold an oral hearing. Sometimes,
particularly in an adjudication which involves complex points of law, it will be important for
the adjudicator to give each party the opportunity of making oral submissions as to the relevant
449
principles of law to be applied. Similarly, in a case where it is likely that there will be major
disputes of fact that would be difficult to resolve by way of documents alone, he might
consider requiring the parties to attend a hearing with the relevant witnesses. These points
are also considered in detail below. He may be asked to make orders in respect of further
documents although, if the referring party has attached the relevant documents to the referral
notice, and the responding party intends to attach any further documents that it considers
to be of relevance to his response to the referral notice, then it will not usually be necessary
for such further orders relating to documents to be made.
Response to Referral Notice

19.04 Just as the referral notice is the referring party’s principal opportunity to set out the detail of
its case, so the response to that notice is the key document to be produced by the responding
party. The points made above in respect of the referral notice are all equally applicable to the
response: the document should be couched in clear and simple language; it should approach
the points chronologically; and it should attach those additional documents that the
responding party wishes the adjudicator to consider before reaching his decision. It is important
that the responding party makes the document as user-friendly as possible. Unless it is
impossible or impractical to do so, the responding party should set out its response on a
paragraph-by-paragraph or section-by-section basis, so that the adjudicator can see, side by
side, the claiming party’s assertion and the responding party’s response to that assertion.
19.05 Responding parties are often tempted to attach all the relevant documents, regardless of
whether or not those documents have already been included with the referral notice. This is
usually a mistake; since time is short, the adjudicator cannot be expected to wade through a
second mass of documents, most of which he already has. The responding party should con-
sider the documents attached to the referral notice. Where they are complete and clearly
numbered, the responding party can refer to those documents in their own response, without
needing to copy them again. Where the documents are incomplete, and the omissions are
significant, then the responding party should copy and attach just the documents that have
been omitted. It will only be in the rare case, where so many important documents have been
omitted from the referral notice, that a responding party is justified in attaching the whole
run of documentation again.
Referring Party’s Reply

19.06 As previously noted, referring parties often consider that they have the automatic right to
reply to the response to the referral notice. This is incorrect. Indeed, in smaller cases, it is
thought that the adjudicator should not automatically grant the referring party any such
entitlement. Instead, the adjudicator should give the referring party the opportunity to persuade
him that, in all the circumstances, a reply is appropriate. Of course, there will be cases where
a reply is vital, because otherwise some entirely new point taken by the responding party will
not have been answered. If there has been no previous discussion about a reply, but the
adjudicator considers that, in the light of the response, such a document would be of
assistance, he should endeavour to limit the reply to particular topics or, better still, specific
paragraphs in the response. He should also require that document to be served very shortly
450
The Adjudication Itself
after the response. In a statutory adjudication with a total period of 28 days, the most important
thing is to ensure that the responding party has had sufficient time to respond to the referral
notice. In a complex case, that might occupy as much as half of the 28-day period. In those
circumstances, the period for a reply should be kept to a few days, otherwise the adjudicator
will run out of time. Moreover, this could hardly be said to be unfair, given the time that the
referring party has had originally in which to prepare its referral notice. It also follows that
that it will only be in a rare case that there will be either the time or the necessity for a second
round submission from the responding party.
Although the procedure identified above has its merits in smaller cases, it is right to note that, 19.07
in practice, and certainly in larger disputes, it can be more efficient for the adjudicator simply
to assume at the outset that a reply will be both useful and necessary. In such circumstances,
the adjudicator will normally allow for the service of a reply in the timetable that is agreed/
ordered at the commencement of the adjudication. This has the advantage of preventing
delays whilst the issue of whether or not a reply should be provided is debated in the
correspondence.
Meetings, Evidence and Hearings

Meetings
Depending on the nature and scope of the adjudication, it will often be the case that the 19.08
adjudicator does not require any meeting at all with the parties. In some adjudications, he
might schedule a meeting at the outset, to discuss and agree the timetable, and possibly a
further meeting, after the response has been provided, in which he can ask questions of the
parties and their experts, in order to clarify any technical matters or other outstanding issues.
The adjudicator will control these meetings, and invite the parties to address him on the
specific matters on which he requires assistance. It is usually wise for an adjudicator to provide,
in advance of such a meeting, an agenda of the specific matters to be covered. Meetings of this
type are primarily to be regarded as part of the adjudicator’s investigation into the dispute.
Evidence
In many adjudications, the only material that the adjudicator will need in order to reach his 19.09
decision will be the contract and the relevant correspondence, minutes and other contempor-
aneous documentation attached to the referral notice and/or the response. However, there
will be some disputes that cannot be resolved without the production of written evidence.
For example, there may be an important dispute about what was said or not said at a particular
site meeting that was not minuted. In those circumstances, the referring party may want to
provide, with the referral notice, a short signed statement from their representative setting
out his recollection of what was said. The responding party may wish to do likewise.
It will be a rare case that will require extensive expert evidence but, in larger adjudications, it 19.10
may be necessary for the parties to attach experts’ reports to their principal pleadings. For
example, a claim for an extension of time, or for financial compensation arising out of
unforeseen ground conditions, may not be capable of satisfactory proof unless supported by
an expert’s report. If the referring party is providing such a report as part of his referral notice
then he needs to ensure that at least the substance of that report, if not the report itself, has
already been made available to the responding party. A failure to do so might give rise to the
451
argument that the claim being pursued in the adjudication is new and that therefore a
dispute has not yet crystallised between the parties.
Hearings
19.11 In a large adjudication, the adjudicator might be asked to decide, or might himself conclude,
that such is the scale of the legal and factual differences between the parties, a more formal
oral hearing is necessary. Most hearings of this type will be largely taken up with oral submis-
sions by either side in which they elaborate upon the points made in the referral notice and
the response. Such submissions will focus on, but not necessarily be confined to, the legal
points that have arisen. It is common, however, for the adjudicator to endeavour to control
the hearing by identifying those matters on which he wishes to hear the parties, those on
which he does not, and limiting the time available to each party for the making of such
submissions.
19.12 It is rare for an adjudicator to require oral evidence to be given in an adjudication. However,
this is principally because of the time constraints, rather than the existence of any sort of
rule that outlaws the reception of such oral evidence in adjudication. Indeed, there will be
some disputes in respect of which the adjudicator may have no alternative but to hear oral
evidence and make decisions on the basis of which evidence or oral explanation he accepts,
if he is going to resolve the dispute properly. Take again the example of the dispute as to what
was said at a particular site meeting. If the adjudicator is faced with two entirely conflicting
statements as to the contents of the discussions on a particular occasion, he would probably
have to arrange for a hearing at which this evidence can be tested orally. It is almost inevitable
that he is going to have to conclude that one or other of the parties is mistaken as to what was
said at the meeting and it is unlikely, in the absence of any other relevant contemporaneous
documentation, that he could reach such a conclusion without hearing oral evidence.
Likewise, if extensive experts’ reports have been attached by both parties to the referral notice
and/or the response, the adjudicator may feel it necessary to arrange a short hearing at which
the principal points advocated by each expert can be tested by way of cross-examination.
Visits
19.13 Many adjudications arise out of ongoing projects. Furthermore, it will often be the case that
the subject matter of the dispute that is being referred to adjudication either arises out of (or
can be demonstrated by reference to) the physical situation on site. Disputes as to defects, the
physical constraints of a particular site or part of a site, the conditions encountered in the
ground, and the proximity of other buildings or amenities, often lie at the heart of adjudication
disputes. In all those circumstances, it is plainly desirable for the adjudicator to visit the site
and to carry out a detailed inspection. But not having such a view will be unlikely to give rise
to a sustainable criticism: see paragraph 13.65(1) above.
19.14 If an adjudicator decides on a site visit, then it is sensible for a number of things to happen
in connection with the proposed visit. First, he must try and give as much notice of the visit
as possible, in order that the necessary arrangements can be made. Secondly, it is always
wise for each party to have one representative to attend on the adjudicator at the visit so
that they can deal with any questions that the adjudicator might wish to ask. If the adjudi-
cator wants a particular representative to be present, because he considers that he may wish
452
to ask that representative detailed questions as he undertakes his inspection, then he should
notify the parties and explain, at least in general terms, what questions he wishes to ask.
Thirdly, the adjudicator needs to ensure that the visit goes ahead with a reasonable amount
of formality. It is a very dangerous course for the adjudicator to use the opportunity of a
site visit to try and speak to the parties on some sort of ‘off-the-record’ basis or to endeav-
our to move the adjudication into some sort of mediation process. The adjudicator should
never hold conversations with the representative of one party in the absence of the repre-
sentative of the other.
Documentation
The adjudicator must decide what the relevant information is in any given case. He also 19.15
needs to avoid the situation, which is sadly all too common, in which documents are drip-fed
into the process, with new documents being provided by either side shortly before, or
even at the expiry of, the 28-day period. Such an uncontrolled ‘tit-for-tat’ exchange of docu-
mentation during the 28-day period might be seen as an indication that the adjudicator is
not in control of the adjudication.
As noted above, the referral notice should contain all the relevant documentation on which 19.16
the referring party relies in support of its case. If there is some reason to doubt this, the adju-
dicator is advised to obtain a written assurance from the referring party that that is indeed the
case. In order to limit further documentation, the adjudicator should require the responding
party to attach all further documentation said to be relevant to the response to the referral
notice, with the aim of ensuring that all relevant documents have been exchanged following
the submission by the responding party of its response to the referral notice.
Thereafter, the adjudicator can order that no further documents be exchanged by the parties 19.17
unless the party who wishes to rely on any such additional documentation has made plain
what that documentation is, and how and why it was not previously provided in the adjudi-
cation, and the adjudicator has considered such representations and decided to allow in the
additional material, giving the other side a proper opportunity to comment upon it.
The Guidance for Adjudicators suggests that one way of reducing difficulties with documen- 19.18
tation is for the adjudicator to limit at the outset the amount of material to be submitted by
each party. In simple and more straightforward adjudications this is a good idea. However,
in more complicated adjudications, it is not recommended. Any limitation imposed by the
adjudicator at the outset will be entirely artificial and arbitrary, and there is a real risk that, in
endeavouring to comply with such arbitrary rules, one or both of the parties will not be able
to explain their position properly. In extreme cases, it is suggested that this would amount to
a breach of natural justice.
Timescale and Requested Extensions

Once the adjudicator has been nominated, and received the referral notice, he should inform 19.19
the parties as to whether or not he can complete the adjudication within the statutory period.
If he cannot, he should say so immediately and either seek an extension or resign. Assuming
that the adjudicator can complete the adjudication within the period then the only other
453
time when he might need to review that conclusion is on receipt of the response to the
referral notice. That is the moment when the nature and scale of the dispute in the adjudi-
cation should finally have become apparent. It may be that at that point the adjudicator
will conclude that he needs further time.
19.20 If, on receipt of the response to the referral notice, the adjudicator considers that he requires
an extension of the statutory period, he should immediately say so to the parties, identifying
the nature of the extension required and the reasons why it is necessary. It is thought that,
if the request for an extension is made at that point, and the extension is not long, the parties
ought normally to agree to it. Thereafter, there should be no reason why the adjudicator
should not produce his decision within the extended period that he has sought. If an exten-
sion has been granted, it is extremely important that the adjudicator meets his side of the
bargain. Parties to adjudications are left frustrated and angry when, on day 27, and without
any warning, the adjudicator writes to seek another 14 or 21 days in which to complete his
decision.
19.21 It is important that adjudicators are aware that the parties will not automatically consent to
the extensions that they seek, particularly if the extensions are sought late and without
warning. Neither should an adjudicator endeavour to bully the parties into agreeing the
extension, something which has happened in one or two of the reported cases. The best
advice for an adjudicator is to ensure that, following receipt of the response to the referral
notice, he has blocked out sufficient time to ensure that the decision can be set out within the
statutory (or extended) period.
19.22 Of course, there will inevitably be situations when the adjudicator, through no fault of
his own, finds himself obliged to ask for more time at a late stage in the process. This will
usually occur when one party provides important documentation late on, and the other side
reasonably seeks further time to consider, and respond to, that material, leaving the adjudicator
with no option but to seek a consequential extension of his own time to complete the decision.
In those circumstances, the adjudicator should immediately ask for the shortest extension
possible, making it clear that the request is to be treated as part of the application by the
recipient of the late documentation for further time. The TCC has made it clear that, in those
circumstances, the parties should reply promptly to the adjudicator’s request, and in clear
terms. A failure by one or both parties to respond at all will, in ordinary circumstances, be
treated as an assent to the extension sought.1
Natural Justice
19.23 Adjudicators are acutely aware that they must act in accordance with the rules of natural
justice. However, because these rules are only ever identified in general terms, some adjudi-
cators are not always familiar with the concepts involved. Set out below is a brief guide to
some of the problems that have been known regularly to occur in adjudication.
Conflict of Interest
19.24 The UK construction industry is a relatively small world, and there is always a real possibility
that the adjudicator will know those involved in the relevant events on behalf of one of the
1 See AC Yule & Son v Speedwell Roofing & Cladding Limited [2007] EWHC 1360 (TCC); [2007] BLR 499.
454
parties to the adjudication. If the adjudicator has any substantive link or connection with
one of the parties, he must draw that connection to the attention of both parties at the outset,
making it clear that if either party objected as a result, he would resign. Such offers might
rarely be taken up, but the old adage that justice must be seen to be done is of particular
importance to the adjudication process, where everything is done so quickly. Providing a
clear indication of any connection is the best way of neutering the point at the outset. The
risk is always that, if the adjudicator’s connection to one of the parties, however trivial, is not
identified until after the adjudication has concluded, the loser will endeavour to use it to
avoid honouring the decision. For that reason, it is often best for the adjudicator to make
plain any connection at all, on the basis that, if it is remote and inconsequential, he can also
indicate that he does not consider that it warrants even the offer of resignation.2
Sometimes, the connection will be so obscure as to be unknown to the adjudicator at the 19.25
time of the appointment, and will emerge at some point part way through the adjudication.
If that happens, the advice is again the same: the adjudicator must bring the connection to
the attention of the parties and seek their views. If, in either situation, the party with whom
there is no connection wishes the adjudicator to resign, even just out of caution, then the
adjudicator should consider such a course very carefully.
Reciprocity
The adjudicator must continually ask himself whether or not he is acting fairly. One of the 19.26
ways in which he can test that is by ensuring that each party has had the opportunity of
commenting on any documents submitted by the other. Of course, there comes a time,
towards the end of the process, when the adjudicator has to stop receiving documents from
the parties in order to prepare his decision. It is for that reason that a clear timetable should
be set out by the adjudicator at the outset of the adjudication, with a clear ‘last date’ by which
any new material can be provided, with the express warning that any material sent thereafter
will not be considered unless the parties also consent to an extension of the 28-day period.
Reciprocity is also important in relation to all of the adjudicator’s communications with the 19.27
parties. The adjudicator should never communicate with one party in the absence of another,
either at meetings or over the telephone. Copies of letters sent to one party should always be
sent to the other as well. If, in exceptional circumstances, contact with one party alone is necessary
or unavoidable, the adjudicator should keep a detailed record of what was said and then send
that record to both parties as soon as practicable. Adjudicators should not field unsolicited
telephone calls from one party unless it is of vital importance that he does so. Telephone con-
ferencing is by far the best way for the adjudicator to deal with telephone communications.
Inquisitorial or Adversarial?
The 1996 Act makes clear that the adjudicator’s role is inquisitorial and investigatory. It is 19.28
therefore up to the adjudicator to investigate the facts that he considers to be relevant and to
arrive at his own conclusion as to the answer to the dispute that has arisen. To that extent, the
process is different to litigation or arbitration which, at its simplest, is an adversarial process,
at the end of which the judge or arbitrator has to choose between the two alternative cases
advanced before him.
2 See paragraphs 12.01 and 12.15.
455
19.29 However, as a matter of practice, adjudications are not perhaps as different to litigation as
might at first be thought. For a start, there are the clear time limits within which the
adjudicator must operate. In such a limited timeframe, it is very difficult for the adjudicator
to do more than enquire into and consider the information with which he has been provided
by both sides. Inevitably, therefore, the adjudication process becomes much more akin to a
judge deciding between two competing cases than a start-from-scratch inquisitorial investi-
gation. Secondly, an adjudicator must be very careful not to stray too far from the information
being provided by both parties. There are a number of reported cases in which the adjudicator’s
decision has been based more on instinct and intuition than on the material with which he
has been provided in the adjudication. Such decisions may well offend against the rules of
natural justice and, if so, they will not be enforced by the courts.
Intimidatory Tactics
19.30 It is interesting to note that section 3 of the Guidance for Adjudicators is entitled ‘Intimidatory
Tactics’. This warns the adjudicator that some parties in adjudications adopt intimidatory
tactics to bully the adjudicator into adopting a particular course of action. The Guide
indicates that such tactics may include spurious challenges on jurisdictional grounds; causing
delay; deliberate confusion of the adjudicator through the use of technical or esoteric legal
arguments; and threatening to take legal action against the adjudicator himself. It is regret-
table that such tactics are considered to be so widespread that the Task Group felt it necessary
to provide guidance in how to deal with them, but there can be no doubt that, in a small
minority of adjudications, the representatives of one (and sometimes both) of the parties
bombard the adjudicator with four or five argumentative letters a day, often running to
scores of pages. Such tactics are to be depreciated and will be the subject of criticism by the
courts.3
19.31 Adjudicators who are faced with these tactics must be firm. Whilst they should always receive
and consider any submissions received from either party, they should point out in clear terms
if they consider that one party is failing to address the underlying issues and is, instead,
spending too long on peripheral or jurisdictional matters. If the adjudicator feels that one
party is adopting an intimidatory tone, he should ask them to stop, making it clear that such
an approach is unhelpful. However, the adjudicator must at all times endeavour to refrain
from losing his temper, in part because tactics of this sort are often adopted by one party in
the hope that the adjudicator will overreach himself, and do something that will then invalid-
ate his decision. One way in which an adjudicator can test the correctness of any difficult
decision that he is about to take is to ask himself: how will this look, and how will my letters
read, to a judge who has not had any prior involvement in the dispute when, in two or three
months’ time, he is studying the papers in advance of the enforcement hearing?
3
In Michael John Construction v Golledge & others [2006] TCLR 3, the TCC judge criticised the lengthy and
repetitive letters written to the adjudicator by the claims consultant acting for the responding party, pointing
out that the consultant was so keen to make his quasi-legal points to the adjudicator on an almost daily basis,
and in great detail, that he omitted to address the real disputes at all.
456
20
THE ADJUDICATOR’S DECISION
Reasons 20.01 Ancillary Matters 20.10

Completion and Communication 20.04 Fees and Costs 20.10
Effect of the Decision 20.13
Errors 20.07
Reasons
It is often forgotten that, under the Scheme for Construction Contracts, the adjudicator is 20.01
not required to give reasons unless at least one of the parties requires them. Thus it is neces-
sary for one or both of the parties to notify the adjudicator as soon as possible that they
require him to give reasons for his decision. In a case of any complexity, it is almost always
sensible to require the adjudicator to give reasons; otherwise, there will always be at least the
risk that the adjudicator has not properly thought through the basis for his decision. Indeed,
it is recommended that the adjudicator should make plain to the parties at the outset that,
unless they tell him to the contrary, he is proposing to give reasons. This is because, at common
law, a reasoned decision is almost always required from any decision-making tribunal; and
because the preparation of written reasons will itself improve and focus the process by
which the adjudicator comes to his decision.
Clearly, in a complex dispute, the production by the adjudicator of written reasons will be a 20.02
lengthy, and therefore time-consuming, task. It is unfair to require the adjudicator to give
reasons when notification of such a requirement has only been communicated to him a few
days before the expiry of the statutory period. Accordingly, as a matter of practice, it is
sensible for adjudicators to ask the parties at the outset of the adjudication whether they
require reasons or, alternatively, to fix an early date by which any request to give reasons must
be made. As a precaution, it is recommended that adjudicators should always operate on the
basis that they will be required to give written reasons, so that they allow sufficient time for
the preparation of a fully reasoned decision within the overall 28-day (or extended) period.
As for the reasons themselves, they ‘should be sufficient to show that the adjudicator has dealt 20.03
with the issues remitted to him and what his conclusions are on those issues’.1 They must be
comprehensible, but they do not need to provide an answer to every issue raised. They need
to explain in short terms how the decision has been reached, with an explanation for each
significant step in the reasoning process. When it is finished, it is a good idea to sign it before
1 See Carillion v Royal Devonport Dockyard Ltd, at first instance: [2005] BLR 310.
457
sending it out, although that is not necessarily essential: see Treasure & Son v Dawes.2 Much
more important is for the adjudicator to ensure that the decision clearly sets out what the
adjudicator wants to happen: that, for example, the employer must pay the contractor
£100,000 within seven days. It is wholly unsatisfactory for the parties not to understand
what the result of the adjudication might be, even when they have read through the decision
twice.3 Adjudicators should always remember that, when the decision is received by the
parties, they will inevitably turn to the last page first.
Completion and Communication

20.04 The decision must be completed within the 28 days, or any extended period that has been
agreed by the parties. It has been suggested in the past that the courts have allowed a certain
amount of leeway in connection with the time for completing the decision. This is incorrect;
there is no persuasive authority for the proposition that an adjudicator can take any addi-
tional time over and above the 28 days (or the extended period) in which to complete his
decision. This has been reiterated in a number of recent cases.4 Accordingly, an adjudicator
must ensure that the decision is completed within the relevant period and must provide all
necessary directions in order to achieve this result.
20.05 The courts have been a little more relaxed about the time in which the completed decision is
then communicated to the parties. If the decision is completed within the 28 days (or the
extended period) then, provided that that decision is communicated to the parties as soon as
possible thereafter, it will not necessarily be fatal if the decision is not received by the parties
until after the expiry of the 28 days, or the agreed extended period. However, it is very important
that this is not abused. As the judge pointed out in Cubitt Builders & Interiors Ltd v Fleetglade
Ltd,5 in these days of electronic communication there really should be very little delay in
the communication of the decision itself, once it has been completed. In Cubitt, because
the decision was completed in the middle of the night, he concluded that communication
of the decision at just after noon the following day was acceptable, but observed that any
delay in excess of that may well not have amounted to communication of the decision ‘forth-
with’, as required by the terms of the contract in that case.
20.06 For these reasons, adjudicators are well-advised to operate on the basis that, once they have
completed their decision, they will send it out electronically and therefore immediately.
Accordingly, there ought to be no significant delay in the communication of the decision to
the parties. Thus, it is appropriate for adjudicators to plan on sending out their decision to
the parties absolutely no later than 4.30 pm on the 28th day following the commencement
of the adjudication.
2 [2007] EWHC 2420 (TCC); [2008] BLR 24.

3 Alleged difficulties arising from the adjudicator’s failure to be clear as to the result can be seen in the follow-
ing cases over the last three years: Ledwood Mechanical Engineering Ltd v Whessoe Oil and Gas Ltd [2007] EWHC
2743 (TCC); [2008] BLR 198 paragraphs 26–28; Birmingham City Council v Paddison Construction Ltd [2008]
EWHC 2254 (TCC); [2008] BLR 622, paragraphs 8–14; Workspace Management Ltd v YJL London Ltd [2009]
EWHC 2017 (TCC); [2009] BLR 497, paragraphs 14–16; Hart v Smith [2009] EWHC 2223 (TCC); (2009)
159 NLJ 1296, paragraphs 43–47; and ROK Building Ltd v Celtic Composting Systems Ltd [2009] EWHC 2664
(TCC); [2009] 130 Con LR 61, paragraphs 20, 24–25.
4 See the discussion in Chapter 2 at paragraphs 2.114–2.132.
5 [2006] EWHC 3413 (TCC); [2006] 110 Con LR 36.
458
The Adjudicator’s Decision
Errors
The point has already been made (see paragraphs 8.15–8.25 above) that, once an adjudicator’s 20.07
decision has been completed and sent out then, prima facie, it becomes enforceable, even
if the decision may contain an error or mistake. However, there will be times when the
adjudicator will recognise an error almost as soon as the decision has been sent out, either
because it has been pointed out to him by the parties or because, on re-reading the decision
following its communication, the adjudicator has spotted the mistake for himself. What
happens then? Some adjudication agreements give the adjudicator the power to make
corrections. If the adjudication agreement contains no such provision, but the adjudicator
is satisfied that there is an error, he should correct the error and notify the parties of the
correction as soon as possible.
It seems to be generally accepted that, depending on the nature of the error and the time in 20.08
which that error is corrected, an adjudicator may have the power to correct mistakes even after
his decision has been sent out to the parties. In Bloor Construction (UK) Ltd v Bowmer &
Kirkland (London) Ltd 6 the judge concluded that the rectification of an error by the adjudi-
cator within hours of the communication of the original decision, in circumstances where both
parties and the adjudicator agreed that it was a genuine error, was in accordance with an implied
term of the adjudication agreement that such slips could be corrected by the adjudicator in that
way.7 However, it is clear that such a proviso will only work in relatively rare circumstances. One
party may consider that an error has been made, but the other may not, whilst the adjudicator
may also not be persuaded that he has made any sort of error at all. The so-called slip rule is
probably operable only in circumstances where the adjudicator accepts that an error has been
made, and neither party could sensibly argue to the contrary. Furthermore, if the mistake is
not corrected promptly, it would again be most unlikely that any sort of slip rule could apply.
The careful adjudicator is best advised to check and re-check his draft decision before send-
ing it out, so as to ensure that no slips of any kind are contained within it.
In the Guidance for Adjudicators, it is suggested that it may sometimes be appropriate for 20.09
the adjudicator to issue his decision in draft, inviting the parties to scrutinise it for accidental
errors. It is thought that this is a potentially dangerous course, given that neither the Act nor
the Scheme contains any provision for the production of such draft decisions. Furthermore,
from a practical perspective, it is difficult to see where, in a 28-day adjudication, a period of
days could be found for the provision of a draft decision to the parties; the consideration by
the parties of that draft decision; the communication by the parties to the adjudicator of any
purported errors (as opposed to the inevitable re-arguing of the points on which, according
to the draft decision, one or other party will have lost); the consideration by the adjudicator
of the points made by each party on the draft decision; and the issuing of the final decision.
For these reasons, therefore, the prudent adjudicator is advised to assume that he will not
send out a draft decision to the parties (because he will simply not have the time to do so) and
that his decision will have been carefully checked before it is communicated to the parties.
If, of course, the adjudicator is concerned about his comprehension of any particular aspect
6
[2000] BLR 314.
7
In Edmond Nuttall Ltd v Sevenoaks District Council unreported, 14 April 2000, Dyson J concluded that the
existence of such a slip rule was at least arguable. The point has never been considered by the Court of Appeal.
459
of the dispute before completing his decision, he should seek clarification on that matter
some days before the decision is completed.
Ancillary Matters
Fees and Costs
20.10 The adjudicator will require his fees to be paid by the parties, or possibly by the party that he
considers has ‘lost’ the adjudication. Often these fees will appear high (particularly to the party
who has to pay them) because, although the adjudicator’s hourly rate may have been agreed in
advance, there is no effective means by which the parties can limit the amount of time that the
adjudicator spends on the dispute. It is thought sensible for an adjudicator to keep the parties
informed of the fees that he is incurring as the adjudication progresses and, indeed, many adju-
dicators issue an invoice part way through the adjudication process with the expectation that
at least some of their fees will have been paid by the time that the decision is completed.
20.11 If the adjudicator has notified the parties that he is going to appoint an expert, lawyer or
assessor to provide assistance, then the costs of that advice will form part of the adjudicator’s
fee claim, and will therefore be recoverable in the same way. Again, it is often difficult for the
parties to keep any sort of check on these fees until after they have been incurred. However,
unless it can be shown that the adjudicator acted outside his jurisdiction in appointing such
third parties, it would appear that such fees are also payable.
20.12 The usual position as to the legal costs incurred is that each party to the adjudication will have
to pay their own costs. Again, particularly in a complex adjudication, these costs will be quite
high. For example, a responding party faced with a final account claim, and given just two or
three weeks to respond to the detail, will incur a large amount of costs in dealing with
the points raised in such a short amount of time. Unless there is an agreement between the
parties to the contrary, those costs will not be recoverable from the other side, no matter how
great the success of the responding party in defeating those claims.
Effect of the Decision

20.13 The vast majority of adjudications are about money, and most adjudicators’ decisions will
identify a sum of money to be paid by one party to the other. In the vast majority of cases, the
paying party is entitled to be paid the sum identified in the adjudicator’s decision. If the sum
is not paid, the payer is entitled to commence enforcement proceedings in the TCC, follow-
ing the conclusion of which the successful party is likely to recover interest on the sum due
at the judgment rate, whilst his costs may well be assessed on an indemnity basis.
20.14 For those reasons, save in exceptional circumstances, the losing party in an adjudication is
best advised to pay the sum identified by the adjudicator before further sums by way of interest
and costs are incurred by the successful party. The losing party may be extremely aggrieved
with the decision and consider it wrong in fact or in law. In those circumstances, having
taken advice, the losing party can issue its own proceedings in court in order to recover the
sums paid in accordance with the decision. But it is only in those rare cases where an adjudi-
cator has failed to comply with the rules of natural justice, or has reached a decision that was
outside his jurisdiction, that a losing party has any prospect at all of being able, lawfully, to
hang on to the money ordered to be paid by the adjudicator. In most cases, the losing party
should do what the sponsors of the 1996 Act always hoped to achieve: pay now, argue later.
460
Appendices
Appendix A: Part II of the Housing Grants,

Construction and Regeneration
Act 1996 463
Appendix B: Statutory Instrument 1998 No 648 469
Appendix C: Statutory Instrument 1998 No 649 473
Appendix D: Draft Directions in Adjudication
Enforcement Proceedings 481
Appendix E: Part 8 of the Local Democracy,
Economic Development and
APPENDIX A
Part II of the Housing Grants, Construction

and Regeneration Act 1996
[Construction Contracts]
[Introductory Provisions]
104 Construction contracts.

(1) In this Part a ‘construction contract’ means an agreement with a person for any of the following—
(a) the carrying out of construction operations;
(b) arranging for the carrying out of construction operations by others, whether under sub-contract
to him or otherwise;
(c) providing his own labour, or the labour of others, for the carrying out of construction
operations.
(2) References in this Part to a construction contract include an agreement—
(a) to do architectural, design, or surveying work, or
(b) to provide advice on building, engineering, interior or exterior decoration or on the laying-out
of landscape, in relation to construction operations.
(3) References in this Part to a construction contract do not include a contract of employment (within
the meaning of the Employment Rights Act 1996).
(4) The Secretary of State may by order add to, amend or repeal any of the provisions of subsection (1),
(2) or (3) as to the agreements which are construction contracts for the purposes of this Part or are to
be taken or not to be taken as included in references to such contracts.
No such order shall be made unless a draft of it has been laid before and approved by a resolution of
each of House of Parliament.
(5) Where an agreement relates to construction operations and other matters, this Part applies to it only
so far as it relates to construction operations.
An agreement relates to construction operations so far as it makes provision of any kind within sub-
section (1) or (2).
(6) This Part applies only to construction contracts which—
(a) are entered into after the commencement of this Part, and
(b) relate to the carrying out of construction operations in England, Wales or Scotland.
(7) This Part applies whether or not the law of England and Wales or Scotland is otherwise the applicable
law in relation to the contract.
105 Meaning of ‘construction operations’.

(1) In this Part ‘construction operations’ means, subject as follows, operations of any of the following
descriptions—
(a) construction, alteration, repair, maintenance, extension, demolition or dismantling of buildings,
or structures forming, or to form, part of the land (whether permanent or not);
(b) construction, alteration, repair, maintenance, extension, demolition or dismantling of any
works forming, or to form, part of the land, including (without prejudice to the foregoing) walls,
roadworks, power-lines, telecommunication apparatus, aircraft runways, docks and harbours,
railways, inland waterways, pipe-lines, reservoirs, water-mains, wells, sewers, industrial plant
and installations for purposes of land drainage, coast protection or defence;
(c) installation in any building or structure of fittings forming part of the land, including (without
prejudice to the foregoing) systems of heating, lighting, air-conditioning, ventilation, power supply,
drainage, sanitation, water supply or fire protection, or security or communications systems;
463
Appendix A
(d) external or internal cleaning of buildings and structures, so far as carried out in the course of their
construction, alteration, repair, extension or restoration;
(e) operations which form an integral part of, or are preparatory to, or are for rendering complete,
such operations as are previously described in this subsection, including site clearance, earth-
moving, excavation, tunnelling and boring, laying of foundations, erection, maintenance or
dismantling of scaffolding, site restoration, landscaping and the provision of roadways and other
access works;
(f ) painting or decorating the internal or external surfaces of any building or structure.
(2) The following operations are not construction operations within the meaning of this Part—
(a) drilling for, or extraction of, oil or natural gas;
(b) extraction (whether by underground or surface working) of minerals; tunnelling or boring, or
construction of underground works, for this purpose;
(c) assembly, installation or demolition of plant or machinery, or erection or demolition of steelwork
for the purposes of supporting or providing access to plant or machinery, on a site where the
primary activity is—
(i) nuclear processing, power generation, or water or effluent treatment, or
(ii) the production, transmission, processing or bulk storage (other than warehousing) of
chemicals, pharmaceuticals, oil, gas, steel or food and drink;
(d) manufacture or delivery to site of—
(i) building or engineering components or equipment,
(ii) materials, plant or machinery, or
(iii) components for systems of heating, lighting, air-conditioning, ventilation, power supply,
drainage, sanitation, water supply or fire protection, or for security or communications
systems, except under a contract which also provides for their installation;
(e) the making, installation and repair of artistic works, being sculptures, murals and other works
which are wholly artistic in nature.
(3) The Secretary of State may by order add to, amend or repeal any of the provisions of subsection
(1) or (2) as to the operations and work to be treated as construction operations for the purposes
of this Part.
(4) No such order shall be made unless a draft of it has been laid before and approved by a resolution of
each House of Parliament.
106 Provisions not applicable to contract with residential occupier.

(1) This Part does not apply—
(a) to a construction contract with a residential occupier (see below), or
(b) to any other description of construction contract excluded from the operation of this Part by
order of the Secretary of State.

(2) A construction contract with a residential occupier means a construction contract which principally
relates to operations on a dwelling which one of the parties to the contract occupies, or intends to
occupy, as his residence.
In this subsection ‘dwelling’ means a dwelling-house or a flat; and for this purpose—
‘dwelling-house’ does not include a building containing a flat; and
‘flat’ means separate and self-contained premises constructed or adapted for use for residential
purposes and forming part of a building from some other part of which the premises are divided
horizontally.
(3) The Secretary of State may by order amend subsection (2).
(4) No order under this section shall be made unless a draft of it has been laid before and approved by a
107 Provisions applicable only to agreements in writing.

(1) The provisions of this Part apply only where the construction contract is in writing, and any other agree-
ment between the parties as to any matter is effective for the purposes of this Part only if in writing.
The expressions ‘agreement’, ‘agree’ and ‘agreed’ shall be construed accordingly.
464
(2) There is an agreement in writing—

(a) if the agreement is made in writing (whether or not it is signed by the parties),
(b) if the agreement is made by exchange of communications in writing, or
(c) if the agreement is evidenced in writing.
(3) Where parties agree otherwise than in writing by reference to terms which are in writing, they make
an agreement in writing.
(4) An agreement is evidenced in writing if an agreement made otherwise than in writing is recorded by
one of the parties, or by a third party, with the authority of the parties to the agreement.
(5) An exchange of written submissions in adjudication proceedings, or in arbitral or legal proceedings
in which the existence of an agreement otherwise than in writing is alleged by one party against
another party and not denied by the other party in his response constitutes as between those parties
an agreement in writing to the effect alleged.
(6) References in this Part to anything being written or in writing include its being recorded by any means.
Adjudication
108 Right to refer disputes to adjudication.
(1) A party to a construction contract has the right to refer a dispute arising under the contract for
adjudication under a procedure complying with this section.
For this purpose ‘dispute’ includes any difference.
(2) The contract shall—
(a) enable a party to give notice at any time of his intention to refer a dispute to adjudication;
(b) provide a timetable with the object of securing the appointment of the adjudicator and referral
of the dispute to him within 7 days of such notice;
(c) require the adjudicator to reach a decision within 28 days of referral or such longer period as is
agreed by the parties after the dispute has been referred;
(d) allow the adjudicator to extend the period of 28 days by up to 14 days, with the consent of the
party by whom the dispute was referred;
(e) impose a duty on the adjudicator to act impartially; and
(f ) enable the adjudicator to take the initiative in ascertaining the facts and the law.
(3) The contract shall provide that the decision of the adjudicator is binding until the dispute is finally
determined by legal proceedings, by arbitration (if the contract provides for arbitration or the parties
otherwise agree to arbitration) or by agreement.
The parties may agree to accept the decision of the adjudicator as finally determining the dispute.
(4) The contract shall also provide that the adjudicator is not liable for anything done or omitted in the
discharge or purported discharge of his functions as adjudicator unless the act or omission is in bad
faith, and that any employee or agent of the adjudicator is similarly protected from liability.
(5) If the contract does not comply with the requirements of subsections (1) to (4), the adjudication
provisions of the Scheme for Construction Contracts apply.
(6) For England and Wales, the Scheme may apply the provisions of the Arbitration Act 1996 with such
adaptations and modifications as appear to the Minister making the scheme to be appropriate.
For Scotland, the Scheme may include provision conferring powers on courts in relation to adjudica-
tion and provision relating to the enforcement of the adjudicator’s decision.
Payment
109 Entitlement to stage payments.
(1) A party to a construction contract is entitled to payment by instalments, stage payments or other
periodic payments for any work under the contract unless—
(a) it is specified in the contract that the duration of the work is to be less than 45 days, or
(b) it is agreed between the parties that the duration of the work is estimated to be less than
45 days.
(2) The parties are free to agree the amounts of the payments and the intervals at which, or circumstances
in which, they become due.
465
Appendix A
(3) In the absence of such agreement, the relevant provisions of the Scheme for Construction Contracts
apply.
(4) References in the following sections to a payment under the contract include a payment by virtue of
this section.
110 Dates for payment.

(1) Every construction contract shall—
(a) provide an adequate mechanism for determining what payments become due under the con-
tract, and when, and
(b) provide for a final date for payment in relation to any sum which becomes due.
The parties are free to agree how long the period is to be between the date on which a sum becomes
due and the final date for payment.
(2) Every construction contract shall provide for the giving of notice by a party not later than five days
after the date on which a payment becomes due from him under the contract, or would have become
due if—
(a) the other party had carried out his obligations under the contract, and
(b) no set-off or abatement was permitted by reference to any sum claimed to be due under one or
more other contracts,
specifying the amount (if any) of the payment made or proposed to be made, and the basis on which
that amount was calculated.
(3) If or to the extent that a contract does not contain such provision as is mentioned in subsection (1)
or (2), the relevant provisions of the Scheme for Construction Contracts apply.
111 Notice of intention to withhold payment.

(1) A party to a construction contract may not withhold payment after the final date for payment of a sum
due under the contract unless he has given an effective notice of intention to withhold payment.
The notice mentioned in section 110(2) may suffice as a notice of intention to withhold payment if
it complies with the requirements of this section.
(2) To be effective such a notice must specify—
(a) the amount proposed to be withheld and the ground for withholding payment, or
(b) if there is more than one ground, each ground and the amount attributable to it,
and must be given not later than the prescribed period before the final date for payment.
(3) The parties are free to agree what that prescribed period is to be.
In the absence of such agreement, the period shall be that provided by the Scheme for Construction
Contracts.
(4) Where an effective notice of intention to withhold payment is given, but on the matter being referred
to adjudication it is decided that the whole or part of the amount should be paid, the decision shall
be construed as requiring payment not later than—
112 Right to suspend performance for non-payment.
(1) Where a sum due under a construction contract is not paid in full by the final date for payment and
no effective notice to withhold payment has been given, the person to whom the sum is due has the
right (without prejudice to any other right or remedy) to suspend performance of his obligations
under the contract to the party by whom payment ought to have been made (‘the party in
default’).
(2) The right may not be exercised without first giving to the party in default at least seven days’ notice
of intention to suspend performance, stating the ground or grounds on which it is intended to suspend
performance.
(3) The right to suspend performance ceases when the party in default makes payment in full of the
amount due.
466
(4) Any period during which performance is suspended in pursuance of the right conferred by this
section shall be disregarded in computing for the purposes of any contractual time limit the time
taken, by the party exercising the right or by a third party, to complete any work directly or indirectly
affected by the exercise of the right.
Where the contractual time limit is set by reference to a date rather than a period, the date shall be
adjusted accordingly.
113 Prohibition of conditional payment provisions.
(1) A provision making payment under a construction contract conditional on the payer receiving pay-
ment from a third person is ineffective, unless that third person, or any other person payment by
whom is under the contract (directly or indirectly) a condition of payment by that third person, is
insolvent.
(2) For the purposes of this section a company becomes insolvent—
(a) on the making of an administration order against it under Part II of the Insolvency Act 1986,
(b) on the appointment of an administrative receiver or a receiver or manager of its property
under Chapter I of Part III of that Act, or the appointment of a receiver under Chapter II of
that Part,
(c) on the passing of a resolution for voluntary winding-up without a declaration of solvency under
section 89 of that Act, or
(d) on the making of a winding-up order under Part IV or V of that Act.
(3) For the purposes of this section a partnership becomes insolvent—
(a) on the making of a winding-up order against it under any provision of the Insolvency Act 1986
as applied by an order under section 420 of that Act, or
(b) when sequestration is awarded on the estate of the partnership under section 12 of the Bankruptcy
(Scotland) Act 1985 or the partnership grants a trust deed for its creditors.
(4) For the purposes of this section an individual becomes insolvent—
(a) on the making of a bankruptcy order against him under Part IX of the Insolvency Act
1986, or
(b) on the sequestration of his estate under the Bankruptcy (Scotland) Act 1985 or when he grants a
trust deed for his creditors.
(5) A company, partnership or individual shall also be treated as insolvent on the occurrence of any event
corresponding to those specified in subsection (2), (3) or (4) under the law of Northern Ireland or of
a country outside the United Kingdom.
(6) Where a provision is rendered ineffective by subsection (1), the parties are free to agree other terms
for payment.
In the absence of such agreement, the relevant provisions of the Scheme for Construction Contracts
apply.
Supplementary provisions
114 The Scheme for Construction Contracts.
(1) The Minister shall by regulations make a scheme (‘the Scheme for Construction Contracts’) containing
provision about the matters referred to in the preceding provisions of this Part.
(2) Before making any regulations under this section the Minister shall consult such persons as he
thinks fit.
(3) In this section ‘the Minister’ means—
(a) for England and Wales, the Secretary of State, and
(b) for Scotland, the Lord Advocate.
(4) Where any provisions of the Scheme for Construction Contracts apply by virtue of this Part in
default of contractual provision agreed by the parties, they have effect as implied terms of the contract
concerned.
(5) Regulations under this section shall not be made unless a draft of them has been approved by resolu-
tion of each House of Parliament.
467
Appendix A
115 Service of notices, &c.

(1) The parties are free to agree on the manner of service of any notice or other document required or
authorised to be served in pursuance of the construction contract or for any of the purposes of this
Part.
(2) If or to the extent that there is no such agreement the following provisions apply.
(3) A notice or other document may be served on a person by any effective means.
(4) If a notice or other document is addressed, pre-paid and delivered by post—
(a) to the addressee’s last known principal residence or, if he is or has been carrying on a trade, profession
or business, his last known principal business address, or
(b) where the addressee is a body corporate, to the body’s registered or principal office,
it shall be treated as effectively served.
(5) This section does not apply to the service of documents for the purposes of legal proceedings, for
which provision is made by rules of court.
(6) References in this Part to a notice or other document include any form of communication in writing
and references to service shall be construed accordingly.
116 Reckoning periods of time.

(1) For the purposes of this Part periods of time shall be reckoned as follows.
(2) Where an act is required to be done within a specified period after or from a specified date, the period
begins immediately after that date.
(3) Where the period would include Christmas Day, Good Friday or a day which under the Banking and
Financial Dealings Act 1971 is a bank holiday in England and Wales or, as the case may be, in
Scotland, that day shall be excluded.
117 Crown application.

(1) This Part applies to a construction contract entered into by or on behalf of the Crown otherwise than
by or on behalf of Her Majesty in her private capacity.
(2) This Part applies to a construction contract entered into on behalf of the Duchy of Cornwall
notwithstanding any Crown interest.
(3) Where a construction contract is entered into by or on behalf of Her Majesty in right of the Duchy
of Lancaster, Her Majesty shall be represented, for the purposes of any adjudication or other proceed-
ings arising out of the contract by virtue of this Part, by the Chancellor of the Duchy or such person
as he may appoint.
(4) Where a construction contract is entered into on behalf of the Duchy of Cornwall, the Duke of
Cornwall or the possessor for the time being of the Duchy shall be represented, for the purposes of
any adjudication or other proceedings arising out of the contract by virtue of this Part, by such person
as he may appoint.
468
APPENDIX B
Statutory Instrument 1998 No 648

Construction, England and Wales
The Construction Contracts (England and Wales) Exclusion Order 1998

Made 6th March 1998
Coming into force in accordance with article 1(1)
The Secretary of State, in exercise of the powers conferred on him by sections 106(1)(b) and 146(1) of the
Housing Grants, Construction and Regeneration Act 19961 and of all other powers enabling him in that
behalf, hereby makes the following Order, a draft of which has been laid before and approved by resolution
of, each House of Parliament:
Citation, commencement and extent
1. (1) This Order may be cited as the Construction Contracts (England and Wales) Exclusion Order
1998 and shall come into force at the end of the period of 8 weeks beginning with the day on
which it is made (‘the commencement date’).
(2) This Order shall extend to England and Wales only.
Interpretation
2. In this Order, ‘Part II’ means Part II of the Housing Grants, Construction and Regeneration Act 1996.
Agreements under statute
3. A construction contract is excluded from the operation of Part II if it is—
(a) an agreement under section 38 (power of highway authorities to adopt by agreement) or section
278 (agreements as to execution of works) of the Highways Act 1980;2
(b) an agreement under section 106 (planning obligations), 106A (modification or discharge of
planning obligations) or 299A (Crown planning obligations) of the Town and Country Planning
Act 1990;3
(c) an agreement under section 104 of the Water Industry Act 19914 (agreements to adopt sewer,
drain or sewage disposal works); or
(d) an externally financed development agreement within the meaning of section 1 of the
National Health Service (Private Finance) Act 19975 (powers of NHS Trusts to enter into
agreements).
Private finance initiative
4. (1) A construction contract is excluded from the operation of Part II if it is a contract entered into
under the private finance initiative, within the meaning given below.
(2) A contract is entered into under the private finance initiative if all the following conditions are
fulfilled—
1 1996 c.53.
2
1980 c.66: section 38 was amended by and section 278 substituted by the New Roads and Street Works
Act 1991 (c.22) sections 22 and 23.
3
1990 c.8: section 106 was substituted and the other sections inserted by section 12 of the Planning and
Compensation Act 1991 (c.34).
4 1991 c.56.
5 1997 c.56.
469
Appendix B
(a) it contains a statement that it is entered into under that initiative or, as the case may be, under
a project applying similar principles;
(b) the consideration due under the contract is determined at least in part by reference to one or
more of the following—
(i) the standards attained in the performance of a service, the provision of which is the
principal purpose or one of the principal purposes for which the building or structure is
constructed;
(ii) the extent, rate or intensity of use of all or any part of the building or structure in ques-
tion; or
(iii) the right to operate any facility in connection with the building or structure in question;
and
(c) one of the parties to the contract is—
(i) a Minister of the Crown;
(ii) a department in respect of which appropriation accounts are required to be prepared
under the Exchequer and Audit Departments Act 18666;
(iii) any other authority or body whose accounts are required to be examined and certified
by or are open to the inspection of the Comptroller and Auditor General by virtue of an
agreement entered into before the commencement date or by virtue of any enactment;
(iv) any authority or body listed in Schedule 4 to the National Audit Act 19837 (nationalised
industries and other public authorities);
(v) a body whose accounts are subject to audit by auditors appointed by the Audit
Commission;
(vi) the governing body or trustees of a voluntary school within the meaning of section 31
of the Education Act 19968 (county schools and voluntary schools), or
(vii) a company wholly owned by any of the bodies described in paragraphs (i) to (v).
Finance agreements
5. (1) A construction contract is excluded from the operation of Part II if it is a finance agreement,
within the meaning given below.
(2) A contract is a finance agreement if it is any one of the following—
(a) any contract of insurance;
(b) any contract under which the principal obligations include the formation or dissolution of
company, unincorporated association or partnership;
(c) any contract under which the principal obligations include the creation or transfer of secur-
ities or any right or interest in securities;
(d) any contract under which the principal obligations include the lending of money;
(e) any contract under which the principal obligations include an undertaking by a person to be
responsible as surety for the debt or default of another person, including a fidelity bond,
advance payment bond, retention bond or performance bond.
Development agreements
6. (1) A construction contract is excluded from the operation of Part II if it is a development agree-
ment, within the meaning given below.
(2) A contract is a development agreement if it includes provision for the grant or disposal of a rele-
vant interest in the land on which take place the principal construction operations to which the
contract relates.
(3) In paragraph (2) above, a relevant interest in land means—
(a) a freehold; or
6
1866 c.39.
7
1983 c.44: amended by the Telecommunications Act 1984, (c.12) Schedule 7, Part III; the Oil and Pipelines
Act (c.42) Schedule 20, paragraph 36, S.I. 1991/510, article 5(4) and the Coal Industry Act 1994, (c.21)
Schedule 9, paragraph 29.
8 1996 c.56.
470
(b) a leasehold for a period which is to expire no earlier than 12 months after the completion of
the construction operations under the contract.
Signed by authority of the Secretary of State
Nick Raynsford
Parliamentary Under-Secretary of State, Department of the Environment, Transport and the Regions
6th March 1998
471
APPENDIX C

Construction, England and Wales
The Scheme for Construction Contracts

(England and Wales) Regulations 1998
Made—6th March 1998
Coming into force—1st May 1998
The Secretary of State, in exercise of the powers conferred on him by sections 108(6), 114 and 146(1) and
(2) of the Housing Grants, Construction and Regeneration Act 1996,1 and of all other powers enabling
him in that behalf, having consulted such persons as he thinks fit, and draft Regulations having been
approved by both Houses of Parliament, hereby makes the following Regulations:
Citation, commencement, extent and interpretation
1. (1) These Regulations may be cited as the Scheme for Construction Contracts (England and Wales)
Regulations 1998 and shall come into force at the end of the period of 8 weeks begining with the
day on which they are made (the ‘commencement date’).
(2) These Regulations shall extend only to England and Wales.
(3) In these Regulations, ‘the Act’ means the Housing Grants, Construction and Regeneration Act 1996.
2. Where a construction contract does not comply with the requirements of section 108(1) to (4) of the
Act, the adjudication provisions in Part I of the Schedule to these Regulations shall apply.
3. Where—
(a) the parties to a construction contract are unable to reach agreement for the purposes mentioned
respectively in sections 109, 111 and 113 of the Act, or
(b) a construction contract does not make provision as required by section 110 of the Act,
the relevant provisions in Part II of the Schedule to these Regulations shall apply.
4. The provisions in the Schedule to these Regulations shall be the Scheme for Construction Contracts
for the purposes of section 114 of the Act.
Signed by authority of the Secretary of State

Nick Raynsford
Parliamentary Under-Secretary of State, Department of the Environment, Transport and the Regions
6th March 1998
Schedule
Regulations 2, 3 and 4

Part I -
Adjudication
Notice of Intention to seek Adjudication
1. (1) Any party to a construction contract (the ‘referring party’) may give written notice (the ‘notice of
adjudication’) of his intention to refer any dispute arising under the contract, to adjudication.
1
1996 c.53.
473
Appendix C
(2) The notice of adjudication shall be given to every other party to the contract.
(3) The notice of adjudication shall set out briefly—
(a) the nature and a brief description of the dispute and of the parties involved,
(b) details of where and when the dispute has arisen,
(c) the nature of the redress which is sought, and
(d) the names and addresses of the parties to the contract (including, where appropriate, the
addresses which the parties have specified for the giving of notices).
2. (1) Following the giving of a notice of adjudication and subject to any agreement between the parties
to the dispute as to who shall act as adjudicator—
(a) the referring party shall request the person (if any) specified in the contract to act as
adjudicator, or
(b) if no person is named in the contract or the person named has already indicated that he is
unwilling or unable to act, and the contract provides for a specified nominating body to select
a person, the referring party shall request the nominating body named in the contract to select
a person to act as adjudicator, or
(c) where neither paragraph (a) nor (b) above applies, or where the person referred to in (a)
has already indicated that he is unwilling or unable to act and (b) does not apply, the
referring party shall request an adjudicator nominating body to select a person to act as
adjudicator.
(2) A person requested to act as adjudicator in accordance with the provisions of paragraph (1) shall
indicate whether or not he is willing to act within two days of receiving the request.
(3) In this paragraph, and in paragraphs 5 and 6 below, an ‘adjudicator nominating body’ shall mean
a body (not being a natural person and not being a party to the dispute) which holds itself out
publicly as a body which will select an adjudicator when requested to do so by a referring party.
3. The request referred to in paragraphs 2, 5 and 6 shall be accompanied by a copy of the notice of
adjudication.
4. Any person requested or selected to act as adjudicator in accordance with paragraphs 2, 5 or 6 shall be
a natural person acting in his personal capacity. A person requested or selected to act as an adjudicator
shall not be an employee of any of the parties to the dispute and shall declare any interest, financial or
otherwise, in any matter relating to the dispute.
5. (1) The nominating body referred to in paragraphs 2(1)(b) and 6(1)(b) or the adjudicator nominat-
ing body referred to in paragraphs 2(1)(c), 5(2)(b) and 6(1)(c) must communicate the selection
of an adjudicator to the referring party within five days of receiving a request to do so.
(2) Where the nominating body or the adjudicator nominating body fails to comply with paragraph
(1), the referring party may—
(a) agree with the other party to the dispute to request a specified person to act as adjudi-
cator, or
(b) request any other adjudicator nominating body to select a person to act as adjudicator.
(3) The person requested to act as adjudicator in accordance with the provisions of paragraphs
(1) or (2) shall indicate whether or not he is willing to act within two days of receiving the
request.
6. (1) Where an adjudicator who is named in the contract indicates to the parties that he is unable or
unwilling to act, or where he fails to respond in accordance with paragraph 2(2), the referring
party may—
(a) request another person (if any) specified in the contract to act as adjudicator, or
(b) request the nominating body (if any) referred to in the contract to select a person to act as
adjudicator, or
(c) request any other adjudicator nominating body to select a person to act as adjudicator.
(2) The person requested to act in accordance with the provisions of paragraph (1) shall indicate
whether or not he is willing to act within two days of receiving the request.
7. (1) Where an adjudicator has been selected in accordance with paragraphs 2, 5 or 6, the referring
party shall, not later than seven days from the date of the notice of adjudication, refer the dispute
in writing (the ‘referral notice’) to the adjudicator.
474
(2) A referral notice shall be accompanied by copies of, or relevant extracts from, the construction
contract and such other documents as the referring party intends to rely upon.
(3) The referring party shall, at the same time as he sends to the adjudicator the documents referred
to in paragraphs (1) and (2), send copies of those documents to every other party to the dispute.
8. (1) The adjudicator may, with the consent of all the parties to those disputes, adjudicate at the same
time on more than one dispute under the same contract.
(2) The adjudicator may, with the consent of all the parties to those disputes, adjudicate at the same
time on related disputes under different contracts, whether or not one or more of those parties
is a party to those disputes.
(3) All the parties in paragraphs (1) and (2) respectively may agree to extend the period within which
the adjudicator may reach a decision in relation to all or any of these disputes.
(4) Where an adjudicator ceases to act because a dispute is to be adjudicated on by another person
in terms of this paragraph, that adjudicator’s fees and expenses shall be determined in accordance
with paragraph 25.
9. (1) An adjudicator may resign at any time on giving notice in writing to the parties to the dispute.
(2) An adjudicator must resign where the dispute is the same or substantially the same as one
which has previously been referred to adjudication, and a decision has been taken in that
adjudication.
(3) Where an adjudicator ceases to act under paragraph 9(1)—
(a) the referring party may serve a fresh notice under paragraph 1 and shall request an adjudica-
tor to act in accordance with paragraphs 2 to 7; and
(b) if requested by the new adjudicator and insofar as it is reasonably practicable, the parties shall
supply him with copies of all documents which they had made available to the previous
adjudicator.
(4) Where an adjudicator resigns in the circumstances referred to in paragraph (2), or where a
dispute varies significantly from the dispute referred to him in the referral notice and for that
reason he is not competent to decide it, the adjudicator shall be entitled to the payment of such
reasonable amount as he may determine by way of fees and expenses reasonably incurred by him.
The parties shall be jointly and severally liable for any sum which remains outstanding following
the making of any determination on how the payment shall be apportioned.
10. Where any party to the dispute objects to the appointment of a particular person as adjudicator, that
objection shall not invalidate the adjudicator’s appointment nor any decision he may reach in
accordance with paragraph 20.
11. (1) The parties to a dispute may at any time agree to revoke the appointment of the adjudicator. The
adjudicator shall be entitled to the payment of such reasonable amount as he may determine by
way of fees and expenses incurred by him. The parties shall be jointly and severally liable for
any sum which remains outstanding following the making of any determination on how the
payment shall be apportioned.
(2) Where the revocation of the appointment of the adjudicator is due to the default or misconduct
of the adjudicator, the parties shall not be liable to pay the adjudicator’s fees and expenses.
Powers of the adjudicator
12. The adjudicator shall—
(a) act impartially in carrying out his duties and shall do so in accordance with any relevant terms of
the contract and shall reach his decision in accordance with the applicable law in relation to the
contract; and
(b) avoid incurring unnecessary expense.
13. The adjudicator may take the initiative in ascertaining the facts and the law necessary to determine the
dispute, and shall decide on the procedure to be followed in the adjudication. In particular he may—
(a) request any party to the contract to supply him with such documents as he may reasonably
require including, if he so directs, any written statement from any party to the contract support-
ing or supplementing the referral notice and any other documents given under paragraph 7(2),
(b) decide the language or languages to be used in the adjudication and whether a translation of any
document is to be provided and if so by whom,
475
Appendix C
(c) meet and question any of the parties to the contract and their representatives,
(d) subject to obtaining any necessary consent from a third party or parties, make such site visits and
inspections as he considers appropriate, whether accompanied by the parties or not,
(e) subject to obtaining any necessary consent from a third party or parties, carry out any tests or
experiments,
(f ) obtain and consider such representations and submissions as he requires, and, provided he has
notified the parties of his intention, appoint experts, assessors or legal advisers,
(g) give directions as to the timetable for the adjudication, any deadlines, or limits as to the length
of written documents or oral representations to be complied with, and
(h) issue other directions relating to the conduct of the adjudication.
14. The parties shall comply with any request or direction of the adjudicator in relation to the adjudication.
15. If, without showing sufficient cause, a party fails to comply with any request, direction or timetable
of the adjudicator made in accordance with his powers, fails to produce any document or written
statement requested by the adjudicator, or in any other way fails to comply with a requirement under
these provisions relating to the adjudication, the adjudicator may—
(a) continue the adjudication in the absence of that party or of the document or written statement
requested,
(b) draw such inferences from that failure to comply as circumstances may, in the adjudicator’s
opinion, be justified, and
(c) make a decision on the basis of the information before him attaching such weight as he thinks fit
to any evidence submitted to him outside any period he may have requested or directed.
16. (1) Subject to any agreement between the parties to the contrary, and to the terms of para-
graph (2) below, any party to the dispute may be assisted by, or represented by, such advisers or
representatives (whether legally qualified or not) as he considers appropriate.
(2) Where the adjudicator is considering oral evidence or representations, a party to the dispute may not
be represented by more than one person, unless the adjudicator gives directions to the contrary.
17. The adjudicator shall consider any relevant information submitted to him by any of the parties to the
dispute and shall make available to them any information to be taken into account in reaching his
decision.
18. The adjudicator and any party to the dispute shall not disclose to any other person any information
or document provided to him in connection with the adjudication which the party supplying it has
indicated is to be treated as confidential, except to the extent that it is necessary for the purposes of,
or in connection with, the adjudication.
19. (1) The adjudicator shall reach his decision not later than—
(a) twenty eight days after the date of the referral notice mentioned in paragraph 7(1), or
(b) forty two days after the date of the referral notice if the referring party so consents, or
(c) such period exceeding twenty eight days after the referral notice as the parties to the dispute
may, after the giving of that notice, agree.
(2) Where the adjudicator fails, for any reason, to reach his decision in accordance with paragraph (1)
(a) any of the parties to the dispute may serve a fresh notice under paragraph 1 and shall request
an adjudicator to act in accordance with paragraphs 2 to 7; and
(b) if requested by the new adjudicator and insofar as it is reasonably practicable, the parties
shall supply him with copies of all documents which they had made available to the previous
adjudicator.
(3) As soon as possible after he has reached a decision, the adjudicator shall deliver a copy of that
decision to each of the parties to the contract.
Adjudicator’s decision
20. The adjudicator shall decide the matters in dispute. He may take into account any other matters which
the parties to the dispute agree should be within the scope of the adjudication or which are matters
under the contract which he considers are necessarily connected with the dispute. In particular, he may—
(a) open up, revise and review any decision taken or any certificate given by any person referred to
in the contract unless the contract states that the decision or certificate is final and conclusive,
476
(b) decide that any of the parties to the dispute is liable to make a payment under the contract
(whether in sterling or some other currency) and, subject to section 111(4) of the Act, when that
payment is due and the final date for payment,
(c) having regard to any term of the contract relating to the payment of interest decide the circum-
stances in which, and the rates at which, and the periods for which simple or compound rates of
interest shall be paid.
21. In the absence of any directions by the adjudicator relating to the time for performance of his deci-
sion, the parties shall be required to comply with any decision of the adjudicator immediately on
delivery of the decision to the parties in accordance with this paragraph.
22. If requested by one of the parties to the dispute, the adjudicator shall provide reasons for his decision.
Effects of the decision
23. (1) In his decision, the adjudicator may, if he thinks fit, order any of the parties to comply peremptorily
with his decision or any part of it.
(2) The decision of the adjudicator shall be binding on the parties, and they shall comply with it until
the dispute is finally determined by legal proceedings, by arbitration (if the contract provides for
arbitration or the parties otherwise agree to arbitration) or by agreement between the parties.
24. Section 42 of the Arbitration Act 1996 shall apply to this Scheme subject to the following
modifications—
(a) in subsection (2) for the word ‘tribunal’ wherever it appears there shall be substituted the word
‘adjudicator’,
(b) in subparagraph (b) of subsection (2) for the words ‘arbitral proceedings’ there shall be substi-
tuted the word ‘adjudication’,
(c) subparagraph (c) of subsection (2) shall be deleted, and
(d) subsection (3) shall be deleted.
25. The adjudicator shall be entitled to the payment of such reasonable amount as he may determine by
way of fees and expenses reasonably incurred by him. The parties shall be jointly and severally liable
for any sum which remains outstanding following the making of any determination on how the pay-
ment shall be apportioned.
26. The adjudicator shall not be liable for anything done or omitted in the discharge or purported dis-
charge of his functions as adjudicator unless the act or omission is in bad faith, and any employee or
agent of the adjudicator shall be similarly protected from liability.
Part II
Payment
Entitlement to and amount of stage payments
1. Where the parties to a relevant construction contract fail to agree—

(a) the amount of any instalment or stage or periodic payment for any work under the contract, or
(b) the intervals at which, or circumstances in which, such payments become due under that
contract, or
(c) both of the matters mentioned in sub-paragraphs (a) and (b) above,
the relevant provisions of paragraphs 2 to 4 below shall apply.
2. (1) The amount of any payment by way of instalments or stage or periodic payments in respect of a
relevant period shall be the difference between the amount determined in accordance with sub-
paragraph (2) and the amount determined in accordance with sub-paragraph (3).
(2) The aggregate of the following amounts—
(a) an amount equal to the value of any work performed in accordance with the relevant con-
struction contract during the period from the commencement of the contract to the end of the
relevant period (excluding any amount calculated in accordance with sub-paragraph (b)),
(b) where the contract provides for payment for materials, an amount equal to the value of any
materials manufactured on site or brought onto site for the purposes of the works during the
period from the commencement of the contract to the end of the relevant period, and
477
Appendix C
(c) any other amount or sum which the contract specifies shall be payable during or in respect of
the period from the commencement of the contract to the end of the relevant period.
(3) The aggregate of any sums which have been paid or are due for payment by way of instalments,
stage or periodic payments during the period from the commencement of the contract to the end
of the relevant period.
(4) An amount calculated in accordance with this paragraph shall not exceed the difference between—
(b) the aggregate of the instalments or stage or periodic payments which have become due.
Dates for payment
3. Where the parties to a construction contract fail to provide an adequate mechanism for determining
either what payments become due under the contract, or when they become due for payment, or
both, the relevant provisions of paragraphs 4 to 7 shall apply.
4. Any payment of a kind mentioned in paragraph 2 above shall become due on whichever of the follow-
ing dates occurs later—
(a) the expiry of 7 days following the relevant period mentioned in paragraph 2(1) above, or
(b) the making of a claim by the payee.
5. The final payment payable under a relevant construction contract, namely the payment of an amount
equal to the difference (if any) between—
(b) the aggregate of any instalment or stage or periodic payments which have become due under the
contract,
shall become due on the expiry of—
(a) 30 days following completion of the work, or
6. Payment of the contract price under a construction contract (not being a relevant construction con-
tract) shall become due on
(a) the expiry of 30 days following the completion of the work, or
7. Any other payment under a construction contract shall become due
(a) on the expiry of 7 days following the completion of the work to which the payment relates, or
Final date for payment
8. (1) Where the parties to a construction contract fail to provide a final date for payment in relation to
any sum which becomes due under a construction contract, the provisions of this paragraph shall
apply.
(2) The final date for the making of any payment of a kind mentioned in paragraphs 2, 5, 6 or 7, shall
be 17 days from the date that payment becomes due.
Notice specifying amount of payment
9. A party to a construction contract shall, not later than 5 days after the date on which any payment—
(a) becomes due from him, or
(b) would have become due, if—
(i) the other party had carried out his obligations under the contract, and
(ii) no set-off or abatement was permitted by reference to any sum claimed to be due under one
or more other contracts,
give notice to the other party to the contract specifying the amount (if any) of the payment he has
made or proposes to make, specifying to what the payment relates and the basis on which that amount
is calculated.
478
Notice of intention to withhold payment

10. Any notice of intention to withhold payment mentioned in section 111 of the Act shall be given not
later than the prescribed period, which is to say not later than 7 days before the final date for payment
determined either in accordance with the construction contract, or where no such provision is made
in the contract, in accordance with paragraph 8 above.
Prohibition of conditional payment provisions
11. Where a provision making payment under a construction contract conditional on the payer receiv-
ing payment from a third person is ineffective as mentioned in section 113 of the Act, and the parties
have not agreed other terms for payment, the relevant provisions of—
(a) paragraphs 2, 4, 5, 7, 8, 9 and 10 shall apply in the case of a relevant construction contract, and
(b) paragraphs 6, 7, 8, 9 and 10 shall apply in the case of any other construction contract.
Interpretation
12. In this Part of the Scheme for Construction Contracts—
‘claim by the payee’ means a written notice given by the party carrying out work under a construction
contract to the other party specifying the amount of any payment or payments which he considers
to be due and the basis on which it is, or they are calculated;
‘contract price’ means the entire sum payable under the construction contract in respect of the work;
‘relevant construction contract’ means any construction contract other than one—
(a) which specifies that the duration of the work is to be less than 45 days, or
(b) in respect of which the parties agree that the duration of the work is estimated to be less than
45 days;
‘relevant period’ means a period which is specified in, or is calculated by reference to the construction
contract or where no such period is so specified or is so calculable, a period of 28 days;
‘value of work’ means an amount determined in accordance with the construction contract under
which the work is performed or where the contract contains no such provision, the cost of any work
performed in accordance with that contract together with an amount equal to any overhead or profit
included in the contract price;
‘work’ means any of the work or services mentioned in section 104 of the Act.
479
APPENDIX D
Draft Directions in Adjudication Enforcement Proceedings
Upon reading the Claim Form, Particulars of Claim, the Claimant’s without notice application
dated the day of 200[ ] and the evidence in support thereof
IT IS ORDERED THAT:
1. The Claimant’s solicitor shall [as soon as practicable after receipt of this Order]/[by 4pm on day of [ ]]
serve upon the Defendant:
a. The Claim Form and Response Pack
b. This Order
c. The Claimant’s Application Pursuant to Part 24 and the Claimant’s evidence in support.
2. The time for the Defendant to file its acknowledgement of service is abridged to [ ] days.
3. The Claimant hereby has permission to issue an application pursuant to CPR Part 24 without an
acknowledgement of service or Defence having been filed.
4. The Part 24 application will be heard on the day of at [ ] am/pm at. Estimated Length of Hearing
hours[ ].
5. Any further evidence in relation to the Part 24 Application shall be served and filed
a. By the Defendant, [14 days after the service of the documents in Paragraph 1 above/at least 5 work-
ing days before the date fixed for the hearing of the Application] [on day the day of [ ]]
b. By the Claimant, in response to that of the Defendant, [at least 3 working days before the date
fixed for the hearing of the Application] [on day the day of 200[ ]] and in either case no later than
4.00pm upon that day.
6. The Claimant’s solicitor shall file a paginated bundle comprising
a. The witness statements provided in support of the application, together with any exhibits;
b. The witness statements provided in opposition to the application together with exhibits;
c. Any witness statements in reply, together with exhibits;
d. Photocopies of relevant authorities.
This bundle is to be provided no later than [2 working days before the hearing of the Application] [on
day of [ ]].
7. The parties shall file and serve skeleton arguments by no later than [4.00pm one clear working day
before the hearing/1pm the last working day before the hearing]* [on day the day of [ ]]
8. The costs of and incidental to these directions are reserved to the Part 24 hearing.
Permission to apply in respect of such costs in the absence of such hearing.
9. The parties have permission to apply to the court on 48 hours written notice to the other to seek to set
aside or vary these directions.
* Depending whether the hearing is estimated to last in excess of ½ day or not
481
APPENDIX E
Local Democracy, Economic Development and

Construction Act 2009
Part 8 Construction Contracts

138 Application of Construction contracts legislation
(1) The Housing Grants, Construction and Regeneration Act 1996 (c. 53) is amended as follows.
(2) In section 106 (provisions not applicable to contract with residential occupiers), in subsection (1),
omit paragraph (b) and the preceding ‘or’.
(3) After that section insert—
‘106A Power to disapply provisions of this Part
(1) The Secretary of State may by order provide that any or all of the provisions of this Part, so far as
extending to England and Wales, shall not apply to any description of construction contract
relating to the carrying out of construction operations (not being operations in Wales) which is
specified in the order.
(2) The Welsh Ministers may by order provide that any or all of the provisions of this Part, so far as
extending to England and Wales, shall not apply to any description of construction contract
relating to the carrying out of construction operations in Wales which is specified in the order.
(3) The Scottish Ministers may by order provide that any or all of the provisions of this Part, so far as
extending to Scotland, shall not apply to any description of construction contract which is speci-
fied in the order.
(4) An order under this section shall not be made unless a draft of it has been laid before and approved
by resolution of—
(a) in the case of an order under subsection (1), each House of Parliament;
(b) in the case of an order under subsection (2), the National Assembly for Wales;
(c) in the case of an order under subsection (3), the Scottish Parliament.’
(5) In section 146 (orders etc)—
(a) in subsection (2), for ‘Secretary of State’ substitute ‘ the authority making them’;
(b) in subsection (3)(a), after ‘106(4)’ insert ‘, 106A’.
139 Requirement for construction contracts to be in writing

(1) In the Housing Grants, Construction and Regeneration Act 1996, section 107 (provisions applicable
only to contracts in writing) is repealed.
(2) In section 108 of that Act (right to refer disputes to adjudication)—
(a) in subsection (2), after ‘The contract shall’ insert ‘ include provision in writing so as to’;
(b) in subsections (3) and (4), after ‘provide’ insert ‘ in writing’.
140 Adjudicator’s power to make corrections
In the Housing Grants, Construction and Regeneration Act 1996 (c. 53), in section 108 (right to refer
disputes to adjudication), after subsection (3) insert—
‘(3A) The contract shall include provision in writing permitting the adjudicator to correct his deci-
sion so as to remove a clerical or typographical error arising by accident or omission.’
141 Adjudication costs
In the Housing Grants, Construction and Regeneration Act 1996, after section 108 insert—
483
Appendix E
‘108A Adjudication costs: effectiveness of provision

(1) This section applies in relation to any contractual provision made between the parties to a con-
struction contract which concerns the allocation as between those parties of costs relating to the
adjudication of a dispute arising under the construction contract.
(2) The contractual provision referred to in subsection (1) is ineffective unless—
(a) it is made in writing, is contained in the construction contract and confers power on the
adjudicator to allocate his fees and expenses as between the parties, or
(b) it is made in writing after the giving of notice of intention to refer the dispute to adjudication.’
142 Determination of payments due
(1) In the Housing Grants, Construction and Regeneration Act 1996, section 110 (dates for payment)
is amended as follows.
‘(1A) The requirement in subsection (1)(a) to provide an adequate mechanism for determining what
payments become due under the contract, or when, is not satisfied where a construction con-
tract makes payment conditional on—
(a) the performance of obligations under another contract, or
(b) a decision by any person as to whether obligations under another contract have been
performed.
(1B) In subsection (1A)(a) and (b) the references to obligations do not include obligations to
make payments (but see section 113).
(1C) Subsection (1A) does not apply where—
(a) the construction contract is an agreement between the parties for the carrying out of con-
struction operations by another person, whether under sub-contract or otherwise, and
(b) the obligations referred to in that subsection are obligations on that other person to carry
out those operations.’
(3) After subsection (1C) (as inserted by subsection (2) above) insert—
‘(1D) The requirement in subsection (1)(a) to provide an adequate mechanism for determining
when payments become due under the contract is not satisfied where a construction contract
provides for the date on which a payment becomes due to be determined by reference to the
giving to the person to whom the payment is due of a notice which relates to what payments
are due under the contract.’
143 Notices relating to payment
(1) In the Housing Grants, Construction and Regeneration Act 1996 (c. 53), in section 109 (entitlement
to stage payments), in subsection (4), for ‘under the contract’ substitute ‘ provided for by the contract’.
(2) In section 110 of that Act (dates for payment), omit the following—
(a) subsection (2), and
(b) in subsection (3), ‘or (2)’.
(3) After section 110 of that Act insert—
‘110A Payment notices: contractual requirements
(1) A construction contract shall, in relation to every payment provided for by the contract—
(a) require the payer or a specified person to give a notice complying with subsection (2) to the
payee not later than five days after the payment due date, or
(b) require the payee to give a notice complying with subsection (3) to the payer or a specified
person not later than five days after the payment due date.
(a) in a case where the notice is given by the payer—
(i) the sum that the payer considers to be or to have been due at the payment due date in
(ii) the basis on which that sum is calculated;
(b) in a case where the notice is given by a specified person—
484
Local Democracy, Economic Development and Construction Act 2009
(i) the sum that the payer or the specified person considers to be or to have been due at
the payment due date in respect of the payment, and
(ii) the basis on which that sum is calculated.
(a) the sum that the payee considers to be or to have been due at the payment due date in
(4) For the purposes of this section, it is immaterial that the sum referred to in subsection (2)(a) or
(b) or (3)(a) may be zero.
(5) If or to the extent that a contract does not comply with subsection (1), the relevant provisions
of the Scheme for Construction Contracts apply.
(6) In this and the following sections, in relation to any payment provided for by a construction
contract—
• ‘payee’ means the person to whom the payment is due;
• ‘payer’ means the person from whom the payment is due;
• ‘payment due date’ means the date provided for by the contract as the date on which the pay-
ment is due;
• ‘specified person’ means a person specified in or determined in accordance with the provisions
of the contract.
110B Payment notices: payee’s notice in default of payer’s notice
(1) This section applies in a case where, in relation to any payment provided for by a construction
contract—
(a) the contract requires the payer or a specified person to give the payee a notice complying with
section 110A(2) not later than five days after the payment due date, but
(b) notice is not given as so required.
(2) Subject to subsection (4), the payee may give to the payer a notice complying with section
110A(3) at any time after the date on which the notice referred to in subsection (1)(a) was
required by the contract to be given.
(3) Where pursuant to subsection (2) the payee gives a notice complying with section 110A(3), the
final date for payment of the sum specified in the notice shall for all purposes be regarded
as postponed by the same number of days as the number of days after the date referred to in
subsection (2) that the notice was given.
(4) If—
(a) the contract permits or requires the payee, before the date on which the notice referred to
in subsection (1)(a) is required by the contract to be given, to notify the payer or a speci-
fied person of—

(i) the sum that the payee considers will become due on the payment due date in respect of
the payment, and
(ii) the basis on which that sum is calculated, and
(b) the payee gives such notification in accordance with the contract,
that notification is to be regarded as a notice complying with section 110A(3) given pursuant
to subsection (2) (and the payee may not give another such notice pursuant to that subsection).’
144 Requirement to pay notified sum
(1) In the Housing Grants, Construction and Regeneration Act 1996 (c. 53), for section 111 (notice
of intention to withhold payment) substitute—
‘111 Requirement to pay notified sum
(1) Subject as follows, where a payment is provided for by a construction contract, the payer must
pay the notified sum (to the extent not already paid) on or before the final date for payment.
(2) For the purposes of this section, the ’notified sum’ in relation to any payment provided for by a
construction contract means—
(a) in a case where a notice complying with section 110A(2) has been given pursuant to and in
accordance with a requirement of the contract, the amount specified in that notice;
485
Appendix E
(b) in a case where a notice complying with section 110A(3) has been given pursuant to and
in accordance with a requirement of the contract, the amount specified in that notice;
(c) in a case where a notice complying with section 110A(3) has been given pursuant to and in
accordance with section 110B(2), the amount specified in that notice.
(3) The payer or a specified person may in accordance with this section give to the payee a notice of
the payer’s intention to pay less than the notified sum.
(4) A notice under subsection (3) must specify—
(a) the sum that the payer considers to be due on the date the notice is served, and
It is immaterial for the purposes of this subsection that the sum referred to in paragraph (a) or
(b) may be zero.
(5) A notice under subsection (3)—
(a) must be given not later than the prescribed period before the final date for payment, and
(b) in a case referred to in subsection (2)(b) or (c), may not be given before the notice by refer-
ence to which the notified sum is determined.
(6) Where a notice is given under subsection (3), subsection (1) applies only in respect of the sum
specified pursuant to subsection (4)(a).
(7) In subsection (5), ‘prescribed period’ means—
(a) such period as the parties may agree, or
(b) in the absence of such agreement, the period provided by the Scheme for Construction
Contracts.
(8) Subsection (9) applies where in respect of a payment—
(a) a notice complying with section 110A(2) has been given pursuant to and in accordance with
a requirement of the contract (and no notice under subsection (3) is given), or
(b) a notice under subsection (3) is given in accordance with this section,
(c) but on the matter being referred to adjudication the adjudicator decides that more than the
sum specified in the notice should be paid.
(9) In a case where this subsection applies, the decision of the adjudicator referred to in subsection
(8) shall be construed as requiring payment of the additional amount not later than—
(10) Subsection (1) does not apply in relation to a payment provided for by a construction contract
where—
(a) the contract provides that, if the payee becomes insolvent the payer need not pay any sum
due in respect of the payment, and
(b) the payee has become insolvent after the prescribed period referred to in subsection (5)(a).
(11) Subsections (2) to (5) of section 113 apply for the purposes of subsection (10) of this section
as they apply for the purposes of that section.’
(2) In section 112 of that Act (right to suspend performance for non-payment)—
(a) in subsection (1), for the words from ‘Where’ to ‘given’ substitute ‘ Where the requirement in
section 111(1) applies in relation to any sum but is not complied with,’;
(b) in subsection (3), for ‘the amount due’ substitute ‘ the sum referred to in subsection (1)’.
145 Suspension of performance for non-payment
(1) In the Housing Grants, Construction and Regeneration Act 1996 (c. 53), section 112 (right to
suspend performance for non-payment) is amended as follows.
(2) In subsection (1), after ‘performance of ’ insert ‘ any or all of ’.
‘(3A) Where the right conferred by this section is exercised, the party in default shall be liable to
pay to the party exercising the right a reasonable amount in respect of costs and expenses reasonably
incurred by that party as a result of the exercise of the right.’
(4) In subsection (4), after ‘pursuance of ’ insert ‘, or in consequence of the exercise of,’.
486
INDEX
Abatement change of name 5.77

sums certified as due 9.06–9.12 costs 5.85
sums claimed as due 9.13–9.19 enforcement 5.83–5.84
Actual bias reasoned decisions 5.86
bars to enforcement 15.22 scope of adjudication referrals 5.78–5.81
meaning 12.01–12.02 slip rule 5.82
Ad hoc adjudication Adjudicators
see also Contractual adjudication; Statutory see also Decisions; Fees; Jurisdiction
adjudication appointment
costs 10.06–10.017 apparent bias 12.09–12.15
general principles 6.01 bars to enforcement 15.11–15.12
jurisdiction challenges to nominated
appeals 6.11 adjudicators 18.20–18.24
common cause of litigation 6.02 need for separate dealings with
construction operations 6.06–6.07 parties 12.16–12.19
effect of 1996 Act 6.05 objections to appointment of
enforcement 6.08 adjudicator 3.56–3.57
estoppel 6.18–6.19 practice and procedure 18.14–18.19
express terms of agreement 6.10 requirements necessary to confer
judicial statement of principle 6.21 jurisdiction 7.28–7.46
need to raise objections early 6.20 revocation of appointment 3.58–3.59
parties’ ability to confer jurisdiction 6.03–6.04 appointment under statutory Scheme
reservation of right to challenge 6.12–6.17 alternative appointment mechanisms 3.29
‘without prejudice’ correspondence 6.09 complexity 3.19
Adjudication see Ad hoc adjudication; Contractual further referrals following resignation 3.30
adjudication; Statutory adjudication notice to referring party 3.23
Adjudication notices selection of replacements 3.24–3.28
bars to enforcement 15.15, 15.18 statutory provisions 3.18
contents 3.32–3.33 timing 3.20–3.21
description of dispute 3.16 willingness to act 3.22
form and contents 18.06–18.10 conflicts of interest 19.24–19.25
importance 3.15 JCT 1998 Form
interrelationship with defence matters 3.17 appointment 5.09–5.12

requirements necessary to confer effect of failure to comply 5.21–5.22
jurisdiction 7.47–7.60 impartiality 5.20
responses 18.11–18.13 powers
service of documents 2.195 application of time limits 3.76–3.82
statutory provisions 3.14, 3.31 consideration of relevant information 3.69–3.75
subcontracts form Dom/1 5.48 constraints of impartiality 3.62–3.64
subcontracts form Dom/2 5.55 statutory provisions 3.60
time limits 3.35–3.40 taking the initiative 3.65–3.68
treatment of technical points 3.34 to investigate own jurisdiction 7.09–7.16
Adjudication rules qualities
CEDR Rules 5.87 essential 18.02
CIC Model Adjudication Procedure unhelpful 18.03
costs and fees 5.91, 10.12 referral of contract under statutory scheme
fair hearings 5.90, 12.18 ‘binding’ nature of decision 2.138–2.143
slip rule 8.33 requirement for compliance with natural
temporary finality 5.88 justice 2.133–2.137
time limits 5.89 requirement for decision within 28
provision for costs 10.10 days 2.114–2.132
TeCSA Rules statutory provisions 2.93
487
Index
Adjudicators (Cont.) Bias

resignation see also Impartiality
fees 3.55 actual bias 12.01–12.02
overlap between different apparent bias
adjudications 3.51–3.54 appointment of same adjudicator 12.09–12.10
relevant circumstances 3.48–3.50 general principles 11.11–11.13
statutory provisions 3.47 material circumstances 12.03–12.08
‘seven golden rules’ 18.04 need for separate dealings with parties 12.16–12.19
Apparent bias bars to enforcement 15.22
appointment of same adjudicator 12.09–12.10 conduct of hearings 12.22
bars to enforcement 15.22 general principles
circumstances of appointment 12.11–12.15 apparent bias 11.11–11.13
general principles 11.11–11.13 automatic disqualification 11.10
material circumstances 12.03–12.08 matters not leading to bias 11.20–11.22
need for separate dealings with parties 12.16–12.19 relevant matters leading to bias 11.14–11.19
Appeals scope 11.09
ad hoc adjudication 6.11 knowledge of ‘without prejudice’ offers 12.20–12.21
‘binding’ nature of decision under statutory
adjudication 2.138–2.143 CEDR Rules 5.87
general purpose of HGCRA 1996 2.06–2.15 Certificates for payment
Latham Report recommendations 1.15–1.17 abatement and set-off 9.06–9.12
Parliamentary debate on HGCR Bill 1.24–1.25 entitlement to interim payments 2.158–2.160
Appointment of adjudicator JCT 1998 Form 5.29–5.30
alternative appointment mechanisms 3.29 requirements of referral notice 7.57
apparent bias statutory Scheme 3.119
circumstances of appointment 12.11–12.15 summary of general principles 9.43
need for separate dealings with parties 12.16–12.19 CGC/Works Contracts 5.64–5.67
same adjudicator 12.09–12.10 CIC Model Adjudication Procedure
bars to enforcement 15.11–15.12 costs and fees 5.91, 10.12
challenges to nominated adjudicators 18.20–18.24 fair hearings 5.90, 12.18
complexity 3.19 slip rule 8.33
further referrals following resignation 3.30 temporary finality 5.88
JCT 1998 Form 5.09–5.12 time limits 5.89
notice to referring party 3.23 Complex cases
objections to appointment of bars to enforcement 15.23
adjudicator 3.56–3.57 fair hearings 13.13–13.25
practice and procedure 18.14–18.19 reasoned decisions 20.02
requirements necessary to confer jurisdiction severability of decisions 15.29–15.32
appointment in accordance with Compromise agreements 7.107–7.109
contract 7.33–7.38 Conflicts of interest 19.24–19.25

contract in writing 7.39–7.43 Construction contracts
correct parties 7.44–7.46 amendment provisions of 2009 Act
need for construction contract 7.28–7.32 slip rule 4.10–4.11
revocation of appointment 3.58–3.59 written requirements 4.06–4.09
selection of replacements 3.24–3.28 bars to enforcement
statutory provisions 3.20–3.21 doubts about existence 15.06–15.08
timing 3.20–3.21 written agreement to adjudicate 15.10
willingness to act 3.22 written requirements 15.09
Approbation 14.22–14.29 Latham Report recommendations 1.10–1.12
Arbitration requirements necessary to confer jurisdiction
ICE Conditions 5.70, 5.73 appointment in accordance with contract 7.33–7.38
set-off against award 9.41–9.42 contract in writing 7.39–7.43
status and effect of earlier decisions 14.01–14.03 correct parties 7.44–7.46
stays for arbitration 2.175–2.178 need for construction contract 7.28–7.32
statutory definition 2.16–2.23
Bankruptcy statutory exclusions
effect on payment obligations 2.173 finance and development agreements 2.42–2.44
effect on stay of execution 17.07–17.12 residential occupiers 2.45–2.50
means of enforcement 14.52–14.56 Statutory Instrument 1998 No 648 App B
488
Index
written requirements enforcement 5.83–5.84

applicability 2.54 reasoned decisions 5.86
conflicting objectives 2.53 scope of adjudication referrals 5.78–5.81
existence of necessary formalities for binding slip rule 5.82
contract 2.72 unfair contract terms 13.71–13.80
implied terms 2.83–2.85 Costs
letters of intent 2.73–2.76 absence of statutory provisions 10.02–10.15
multiple contracts 2.86 ad hoc jurisdiction 10.06–10.17
oral variations 2.77–2.82 adjudicators’ powers 3.91–3.92
pending reform 2.51 amendment provisions of 2009 Act 4.12–4.15
price 2.70–2.71 CIC Model Adjudication Procedure 5.91, 10.12
requirement for whole agreement to be in contractual provisions 10.08–10.13
writing 2.55–2.69 historical overview of industry problems 1.05
statutory estoppel in separate procedure 20.12
proceedings 2.87–2.92 TCC practice and procedure 16.18–16.22
statutory provisions 2.52 TeCSA Rules 5.85
Construction operations Cross-claims
ad hoc adjudication 6.06–6.07 effect on stay of execution 17.04–17.06
approach of TCC to excepted operations 2.38–2.41 recovery of interim payments 9.02–9.03
Parliamentary debate on HGCR Bill 1.19 requirements of referral notice 7.53–7.55
relationship with construction contracts 2.16–2.23 set-off against adjudicator’s decision
statutory definition 2.24–2.31 exceptions 9.35–9.36
statutory exceptions 2.32–2.37 general rule 9.21–9.34
Contractual adjudication liquidated damages 9.37–9.40
see also Ad hoc adjudication; Statutory adjudication origins 9.20
CEDR Rules 5.87 summary of general principles 9.43–9.44
CIC Model Adjudication Procedure
costs and fees 5.91, 10.12 Decisions
fair hearings 5.90, 12.18 see also Enforcement
slip rule 8.33 bars to enforcement
temporary finality 5.88 failure to address particular issues 15.19
time limits 5.89 reasons 15.20
importance of contractual provisions 5.01–5.07 referral to notice of adjudication 15.18
JCT 1998 Form 5.08 time limits 15.21
adjudication clause 5.08, 5.42–5.43 completion and communication to
decisions within 28 days 5.23–5.26 parties 20.04–20.06
effect of adjudicator’s failure to comply 5.21–5.22 costs 3.91–3.92
final certificates 5.29–5.30 effect
impartiality 5.20 enforcement of peremptory orders 3.109
multiple disputes 5.19 fees 3.110–3.112

nomination or appointment of statutory provisions 3.99
adjudicator 5.09–5.12 temporary finality 3.100–3.108
oral variations 5.31 effect of errors of law 8.04–8.14
payment provisions 5.32–5.35 errors 20.07–20.09
referral for adjudication within 7 days 5.13–5.18 general purpose of HGCRA 1996 2.01–2.15
temporary finality of decision 5.27–5.28 interest on awards 3.87–3.90
JCT Intermediate Form 5.41 JCT 1998 Form 5.23–5.26
JCT Minor Works contract temporary finality 5.27–5.28
payment provisions 5.40 within 28 days 5.23–5.26
residential occupiers 5.36–5.38 Latham Report recommendations 1.15–1.17
set-off for liquidated damages 5.39 need for connection with dispute 7.86–7.96
other standard forms payment of award 20.13–20.14
CGC/Works Contracts 5.64–5.67 reasons 3.93–3.97
standard forms of subcontracts adequacy 3.95–3.96
Dom/1 5.44–5.54 bars to enforcement 15.20
Dom/2 5.55–5.63 formalities 3.97
TeCSA Rules general practice 20.01–20.03
change of name 5.77 general principles 3.93–3.94
costs 5.85 TeCSA Rules 5.86
489
Index
Decisions (Cont.) multiple disputes 3.41–3.46

referral of contract under statutory scheme no limit on type of dispute 2.144–2.145
‘binding’ nature of decision 2.138–2.143 requirements necessary to confer jurisdiction
requirement for decision within crystallisation prior to referral 7.61–7.77
28 days 2.114–2.132 insufficient connection between dispute and
statutory provisions 2.93 decision 7.86–7.96
requirement for decision within 28 days multiple disputes 7.78–7.85
JCT 1998 Form 5.23–5.26 scope and extent of notice 7.47–7.60
referral of contract under statutory statutory provisions 2.93
scheme 2.114–2.132 subcontracts form Dom/1 5.47–5.51
revising and reviewing 3.84–3.86 Doctrine of election 14.22–14.29
set-off against Documents
exceptions 9.35–9.36 procedure 19.15–19.18
general rule 9.21–9.34 requirements of referral notice 7.58
liquidated damages 9.37–9.40 subcontracts form Dom/2 5.62
origins 9.20
severability in complex cases 15.29–15.32 Election doctrine 14.22–14.29
signing by adjudicator 3.98 Enforcement
status and effect ad hoc adjudication
contractual cause of action 14.19–14.21 estoppel 6.18–6.19
doctrine of election 14.22–14.29 judicial statement of principle 6.21
insolvency 14.52–14.56 need to raise objections early 6.20
overview 14.01–14.03 reservation of right to challenge 6.12–6.17
presumption of validity 14.16–14.18 withholding notices 6.08
requirement for valid decision 14.04–14.15 draft directions App D
Scotland 14.57 effect of errors of law 8.04–8.14
subsequent proceedings 14.45–14.51 general approach 15.02–15.05
temporary finality 14.30–14.44 general purpose of HGCRA 1996 2.06–2.15
statutory provisions 3.83 jurisdictional challenges
stays appointment of adjudicator 15.11–15.12
for adjudication 2.179 issues surrounding the construction
for arbitration 2.175–2.178 contract 15.06–15.10
temporary finality issues surrounding the decision 15.19–15.21
CEDR Rules 5.87 issues surrounding the dispute 15.13–15.18
CIC Model Adjudication Procedure 5.88 natural justice issues
effect 3.100–3.108 bias 15.22
JCT 1998 Form 5.27–5.28 complex cases 15.23
meaning and scope 2.138–2.143 effect of earlier decisions 15.27
status and effect of decisions 14.30–14.35, failure to address particular issues 15.24–15.25
14.36–14.44 failure to consult parties 15.26

Declaratory relief 16.39–16.47 material breaches 15.28
Delay see Time limits need to reserve position on jurisdiction
Determination provisions adequately 7.17–7.22
CGC/Works Contracts 5.65 peremptory orders 3.109
subcontracts form Dom/1 5.54 relevant principles 15.37–15.39
Development agreements 2.42–2.44 service of documents 2.196–2.197
Directions set-off against adjudicator’s decision
directions 19.01–19.03 exceptions 9.35–9.36
draft for enforcement proceedings App D general rule 9.21–9.34
general considerations 19.01 liquidated damages 9.37–9.40
oral hearings 19.03 origins 9.20
Disputes set-off of separate claims 15.33–15.34
bars to enforcement severability of decisions in complex cases 15.29–15.32
crystallisation at time of notice 15.13 status and effect of decisions
matters outside notice of adjudication 15.15 contractual cause of action 14.19–14.21
multiple disputes 15.14 doctrine of election 14.22–14.29
withholding notices 15.16–15.17 insolvency 14.52–14.56
‘crystallisation’ 2.97 overview 14.01–14.03
meaning and scope 2.98–2.107 presumption of validity 14.16–14.18
490
Index
requirement for valid decision 14.04–14.15 errors of fact 8.36–8.38

Scotland 14.57 matters outside dispute 13.27–13.28
subsequent proceedings 14.45–14.51 submissions and rejoinders 13.36–13.39
temporary finality 14.30–14.44 procedural ambush 13.54–13.57
stay of execution procedure 19.09–19.10
attempts to overcome statutory objectives 17.01
Civil Procedure Rule 17.02–17.03 Failure to address particular issues
effect of cross-claim 17.04–17.06 bars to enforcement 15.19, 15.24–15.25
financial difficulties of creditor 17.13–17.27 the dispute itself 13.29–13.35
insolvency as ground for refusal 17.07–17.12 errors of fact 8.36–8.38
time to pay 17.28 matters outside dispute 13.27–13.28
wider circumstances 17.29–17.30 overview 13.26
summary judgments 15.35–15.36 submissions and rejoinders 13.36–13.39
TCC practice and procedure Fair hearings
costs 16.18–16.22 application to construction adjudication 13.05–13.09
declaratory relief 16.39–16.47 CIC Model Adjudication Procedure 5.90, 12.18
injunctions 16.32–16.38 communications with parties
interest on awards 16.15–16.17 failure to consult 13.41–13.47
overview 16.01–16.04 indications of preliminary view 13.51–13.53
practical consequences of losing case 16.23–16.31 taking advice from others 13.48–13.50
stay of existing court proceedings 16.49–16.57 unilateral communications 13.40
striking out 16.48 complex cases 13.13–13.25
summary judgments 16.05–16.14 failure to address particular issues
TeCSA Rules 5.83–5.84 bars to enforcement 15.19, 15.24–15.25
time to pay 17.28 the dispute itself 13.29–13.35
unfair contract terms 13.71–13.80 errors of fact 8.36–8.38
Errors of fact matters outside dispute 13.27–13.28
contractual adjudication 5.07 overview 13.26
failure to address particular issues 8.36–8.38 submissions and rejoinders 13.36–13.39
failure to take account of arguments 8.24–8.25 general principles
fraud 8.39–8.41 importance 11.23–11.24
general purpose of HGCRA 1996 2.06–2.15 knowledge of opponent’s case 11.30–11.33
identity of parties 8.20–8.22 need for hearing 11.27–11.29
overview 8.01–8.03 need for real prejudice 11.25–11.26
payment computations 8.23 preliminary investigations 11.39–11.41
procedure 20.07–20.09 procedure 11.34–11.36
slip rule 8.26–8.35 reasoned decisions 11.37–11.38
Errors of law human rights 13.66–13.70
contractual adjudication 5.07 material breach required 13.10–13.12
effect on adjudicator’s decision 8.04–8.14 meaning and scope 13.01–13.04

failure to address particular issues 8.36–8.38 procedural difficulties
overview 8.01–8.03 ambush 13.54–13.57
procedure 20.07–20.09 miscellaneous points 13.63–13.65
touching upon jurisdiction 8.15–8.20 restraint from previous decisions 13.58–13.62
Estoppel requirements under statutory
ad hoc adjudication 6.18–6.19 adjudication 2.133–2.137
compliance with statutory written restraint on adjudicators’ powers 3.62–3.64
requirements 2.87–2.92 Fees
Evidence adjudicator acting outside jurisdiction 10.18–10.20
consideration of relevant information by CIC Model Adjudication Procedure 5.91
adjudicator 3.69–3.75 failure to comply with time limit 10.23
documents general practice 10.15–10.16
procedure 19.15–19.18 impartiality 3.64
requirements of referral notice 7.58 JCT 1998 Form 5.43
subcontracts form Dom/2 5.62 liens 10.24–10.29
errors of fact 8.24–8.25 procedure 20.10–20.11
failure to address particular issues reasonableness 10.21–10.22
bars to enforcement 15.19, 15.24–15.25 resignation of adjudicator 3.55, 10.17
the dispute itself 13.29–13.35 statutory Scheme 3.110–3.112, 10.14
491
Index
Finance agreements 2.42–2.44 decisions 3.83–3.113

Fraud 8.39–8.41 multiple disputes 3.41–3.46
notice of adjudication 3.14–3.17
Hearings objections to appointment of adjudicator 3.56–3.57
see also Fair hearings ‘pay when paid’ clauses 3.132–3.133
directions 19.03 payment and withholding notices 3.129–3.131
problems arising under natural justice piecemeal or wholesale incorporation of
balancing the inquisitorial and adversarial Scheme 3.04–3.13, 3.114
approaches 19.28–19.29 purpose of Scheme 3.01–3.03
reciprocity 19.26–19.27 referral notices 3.18–3.30
procedure 19.11–19.12 reform proposals 3.113
Housing Grants, Construction and Regeneration resignation of adjudicator 3.47–3.55
Act 1996 revocation of appointment of
construction contracts adjudicator 3.58–3.59
defined 2.16–2.23 stage payments 3.115–3.121
residential occupiers 2.45–2.50 text of ss 104-117 App A
statutory exclusions 2.42–2.44 written requirements
construction operations amendment provisions of 2009 Act 4.06–4.09
approach of TCC to excepted operations 2.38–2.41 applicability 2.54
defined 2.24–2.31 conflicting objectives 2.53
statutory exceptions 2.32–2.37 existence of necessary formalities for binding
general purpose of Pt II 2.01–2.15 contract 2.72
miscellaneous provisions implied terms 2.83–2.85
application of statutory Scheme 2.191–2.192 letters of intent 2.73–2.76
‘pay when paid’ clauses 2.186–2.190 multiple contracts 2.86
service of documents 2.193–2.197 oral variations 2.77–2.82
statutory provisions 2.180 pending reform 2.51
suspension of work for non-payment 2.181–2.185 price 2.70–2.71
Parliamentary debates requirement for whole agreement to be in
on Bill 1.19–1.30 writing 2.55–2.69
on original scheme for adjudication 1.31–1.34 statutory estoppel in separate proceedings 2.87–2.92
payment provisions statutory provisions 2.52
general entitlement to interim Human rights
payments 2.155–2.161 apparent bias 11.13
nature and timing of withholding fair hearings 13.66–13.70
notices 2.164–2.168 ‘impartiality’ defined 3.62
reform proposals 2.147
relationship with other terms 2.169–2.174 ICE Conditions 5.68–5.73
removal of complexities 2.148–2.154 Impartiality
set-off 2.162–2.163 see also Bias

statutory provisions 2.146 JCT 1998 Form 5.20
stays for adjudication 2.179 requirements under statutory
stays for arbitration 2.175–2.178 adjudication 2.133–2.137
referral of contract for adjudication restraint on adjudicators’ powers 3.62–3.64
‘binding’ nature of decision 2.138–2.145 subcontracts form Dom/2 5.63
meaning and scope of ‘dispute’ 2.97–2.107 Implied terms
meaning of notice ‘at any time’ 2.107–2.113 application of statutory Scheme 2.191–2.192
no limit on type of dispute 2.144–2.145 compliance with statutory written
overview of detailed issues arising 2.94 requirements 2.83–2.85
requirement for compliance with natural piecemeal or wholesale incorporation of
justice 2.133–2.137 Scheme 3.04–3.13
requirement for decision within statutory provisions 2.180
28 days 2.114–2.132 Injunctions
right or obligation 2.95–2.96 jurisdictional challenges 16.40
statutory provisions 2.93 protective measures in Scotland 14.57
statutory Scheme subcontracts form Dom/1 5.46
adjudicators’ powers 3.60–3.82 TCC practice and procedure 16.32–16.38
appointment of adjudicator 3.18–3.30 Insolvency
dates for payment 3.122–3.125 effect on payment obligations 2.173
492
Index
effect on stay of execution 17.07–17.12 estoppel 6.18–6.19

means of enforcement 14.52–14.56 express terms of agreement 6.10
Interest on awards judicial statement of principle 6.21
adjudicators’ powers 3.87–3.90 need to raise objections early 6.20
TCC practice and procedure 16.15–16.17 parties’ ability to confer jurisdiction 6.03–6.04
Interim payments reservation of right to challenge 6.12–6.17
abatement and set-off ‘without prejudice’ correspondence 6.09
sums certified as due 9.06–9.12 adjudicator’s fees when acting outside
sums claimed as due 9.13–9.19 jurisdiction 10.18–10.20
historical overview of problems 1.01–1.03 adjudicator’s powers to investigate own
JCT 1998 Form 5.32–5.35 jurisdiction 3.65, 7.09–7.16
Latham Report recommendations 1.10 approbation and reprobation 14.22–14.29
practical consequences of losing case 16.23–16.31 bars to enforcement
requirements of HGCRA 1996 appointment of adjudicator 15.11–15.12
general entitlement to interim issues surrounding the construction
payments 2.155–2.161 contract 15.06–15.10
removal of complexities 2.148–2.154 issues surrounding the decision 15.19–15.21
statutory provisions 2.146 issues surrounding the dispute 15.13–15.18
standard forms of subcontracts Dom/1 5.45 central issue in many disputes 7.01–7.04
statutory Scheme 3.115–3.121 CGC/Works Contracts 5.66
suspension of work for non-payment effect of compromise agreements 7.107–7.109
amendment provisions of 2009 Act 4.27–4.28 errors of law relating to 8.15–8.20
failures amounting to repudiation 2.181–2.185 general principles
statutory provisions 2.180 overview 7.26–7.27
underlying problems for contractors 9.02–9.05 summary of judicial approach 7.111–7.113
Intimidatory tactics 19.30–19.31 need to reserve position adequately 7.17–7.22
notice of adjudication
JCT standard forms description of dispute 3.16
effect of insolvency on payments 2.173 importance 3.15
incorporation of statutory Scheme 3.05 statutory provisions 3.14
JCT 1998 Form options available for challengers 7.05–7.08
adjudication clause 5.08 procedure for raising objection 7.110
decisions within 28 days 5.23–5.26 relevance of earlier adjudications 7.97–7.106
effect of adjudicator’s failure to comply 5.21–5.22 relevant disputes
final certificates 5.29–5.30 crystallisation prior to referral 7.61–7.77
impartiality 5.20 insufficient connection between dispute and
multiple disputes 5.19 decision 7.86–7.96
nomination or appointment of multiple disputes 7.78–7.85
adjudicator 5.09–5.12 scope and extent of notice 7.47–7.60
oral variations 5.31 resolution of challenges by court 7.23–7.25

payment provisions 5.32–5.35 slip rule 8.35
referral for adjudication within 7 days 5.13–5.18 subcontracts form Dom/2 5.59–5.60
temporary finality of decision 5.27–5.28 valid appointment of adjudicator required
JCT Intermediate Form 5.41 appointment in accordance with
JCT Minor Works contract contract 7.33–7.38
payment provisions 5.40 contract in writing 7.39–7.43
residential occupiers 5.36–5.38 correct parties 7.44–7.46
set-off for liquidated damages 5.39 need for construction contract 7.28–7.32
Latham Report recommendations 1.17
Parliamentary debate on HGCR Bill 1.26 Latham Report
residential occupiers 2.46 background and underlying industry
Joint Contracts Tribunal see JCT standard forms problems 1.01–1.06
Jurisdiction overview 1.07–1.09
ad hoc adjudication proposals for adjudication procedure 1.13–1.18
appeals 6.11 recommended contract terms 1.10–1.12
common cause of litigation 6.02 statutory adoption 4.02
construction operations 6.06–6.07 subsequent consultation 4.02
effect of 1996 Act 6.05 Letters of intent 2.73–2.76
enforcement 6.08 Liens 10.24–10.29
493
Index
Liquidated damages importance 11.23–11.24

JCT Minor Works contract 5.39 knowledge of opponent’s case 11.30–11.33
set-off against adjudicator’s decision 9.37–9.40 material breach required 13.10–13.12
Local Democracy, Economic Development and meaning and scope 13.01–13.04
Construction Act 2009 need for hearing 11.27–11.29
adoption of Latham Report recommendations 4.02 need for real prejudice 11.25–11.26
amendments to adjudication provisions preliminary investigations 11.39–11.41
costs 4.12–4.15 procedural difficulties 13.54–13.65
power to disapply 4.04–4.05 procedure 11.34–11.36
slip rule 4.10–4.11 reasoned decisions 11.37–11.38
written requirements 4.06–4.09 requirements under statutory
amendments to payment provisions adjudication 2.133–2.137
payment notices 4.16–4.21 restraint on adjudicators’ powers 3.62–3.64
requirement to pay and counter-notices 4.22–4.26 general principles
suspension of work for non-payment 4.27–4.28 history and development 11.04–11.08
overview of main changes 4.03 introduction 11.01–11.03
reform proposals practical problems
payment provisions 2.147 balancing the inquisitorial and adversarial
statutory Scheme 3.113 approaches 19.28–19.29
written requirements 2.51 conflicts of interest 19.24–19.25
text of ss 138-145 App E reciprocity 19.26–19.27
requirements under statutory
Mandatory adjudication adjudication 2.133–2.137
central question of statutory scheme 2.95–2.96 unfair contract terms 13.71–13.80
Latham Report recommendations 1.18 NEC standard forms 5.74–5.75
Meetings 19.08 Nominated adjudicators
Multiple disputes challenges to 18.20–18.24
bars to enforcement 15.14 contractual provisions 18.14
form and contents of adjudication notice 18.07 Notices
JCT 1998 Form 5.19 of adjudication
requirements necessary to confer bars to enforcement 15.15, 15.18
jurisdiction 7.78–7.85 contents 3.32–3.33
severability of decisions 15.29–15.32 description of dispute 3.16
form and contents 18.06–18.10
Natural justice importance 3.15
bars to enforcement interrelationship with defence matters 3.17
bias 15.22 requirements necessary to confer
complex cases 15.23 jurisdiction 7.47–7.60
earlier decisions 15.27 responses 18.11–18.13
failure to address particular issues 15.24–15.25 service of documents 2.195

failure to consult parties 15.26 statutory provisions 3.14, 3.31
material breaches 15.28 subcontracts form Dom/1 5.48
bias subcontracts form Dom/2 5.55
actual bias 12.01–12.02 time limits 3.35–3.40
apparent bias 11.11–11.13, 12.03–12.19 treatment of technical points 3.34
automatic disqualification 11.10 amendment provisions of 2009 Act
conduct of hearings 12.22 payment notices 4.16–4.21
knowledge of ‘without prejudice’ offers 12.20–12.21 requirement to pay and counter-notices 4.22–4.26
matters not leading to bias 11.20–11.22 appointment of adjudicator 3.23
relevant matters leading to bias 11.14–11.19 interim payments 2.161
scope 11.09 JCT 1998 Form 5.32–5.35
fair hearings referral notices
application to construction adjudicator’s powers 3.55, 3.60
adjudication 13.05–13.09 amounting to written agreement 7.39
CIC Model Adjudication Procedure 5.90, 12.18 commencement of 28 day period 2.118
communications with parties 13.40–13.50 contents and purpose 3.31–3.34
complex cases 13.13–13.25 contractual adjudication 5.14–5.18, 5.21
failure to address particular issues 13.26–13.39 DOM/2 5.55
human rights 13.66–13.70 effect of delay 3.37–3.39
494
Index
extension of jurisdiction 7.57–7.60 general entitlement to interim

form and contents 18.25–18.29 payments 2.155–2.161
purpose 18.06 nature and timing of withholding
referring party’s reply 19.06–19.07 notices 2.164–2.168
responses 19.04–19.05 reform proposals 2.147
time limits 14.06, 15.12 relationship with other terms 2.169–2.174
referral of contract under statutory scheme removal of complexities 2.148–2.154
meaning of notice ‘at any time’ 2.107–2.113 set-off 2.162–2.163
statutory provisions 2.93 statutory provisions 2.146
withholding notices stays for adjudication 2.179
general entitlement to interim payments 2.156 stays for arbitration 2.175–2.178
ICE Conditions 5.71–5.72 statutory Scheme
nature and timing 2.164–2.168 dates for payment 3.122–3.125
origins of mechanism 9.04–9.05 final date for payment 3.126–3.128
Parliamentary debate on HGCR Bill 1.26 ‘pay when paid’ clauses 3.132–3.133
requirements for 9.14 payment and withholding notices 3.129–3.131
statutory Scheme 3.129–3.131 stage payments 3.115–3.121
subcontracts form Dom/1 5.52 suspension of work for non-payment
summary of general principles 9.43 failures amounting to repudiation 2.181–2.185
statutory provisions 2.180
Oral variations underlying problems for contractors 9.01–9.05
compliance with statutory written Peremptory orders 3.109
requirements 2.77–2.82 Practical completion 7.104
JCT 1998 Form 5.31 Price 2.70–2.71
Private finance agreements 2.42–2.44
Parliamentary debates Procedure
Housing Grants, Construction and Regeneration see also Adjudication Rules; Scheme for
Bill 1.19–1.30 Construction Contracts; TCC practice and
on original scheme for adjudication 1.31–1.34 procedure
Parties appointment of adjudicator 18.14–18.19
communications prejudicial to fair hearing challenges to nominated adjudicators 18.20–18.24
failure to consult 13.41–13.47 costs 20.12
indications of preliminary view 13.51–13.53 decisions
taking advice from others 13.48–13.50 completion and communication to
unilateral communications 13.40 parties 20.04–20.06
errors of fact 8.20–8.22 errors 20.07–20.09
intimidatory tactics 19.30–19.31 reasons 20.01–20.03
meetings 19.08 directions 19.01–19.03
valid appointment of adjudicator 7.44–7.46 documentary evidence 19.15–19.18
‘Pay when paid’ clauses evidence 19.09–19.10

extension of prohibition 2.186–2.190 fair hearings 11.34–11.36
Latham Report 1.12 fees 20.10–20.11
statutory provisions 2.180 general purpose of HGCRA 1996 2.04
statutory Scheme 3.132–3.133 hearings 19.11–19.12
Payment provisions jurisdictional challenges 7.110
amendment provisions of 2009 Act Latham Report recommendations 1.13–1.18
payment notices 4.16–4.21 meetings 19.08
requirement to pay and counter-notices 4.22–4.26 payment of award 20.13–20.14
suspension of work for non-payment 4.27–4.28 problems arising under natural justice
Dom/1 5.45 balancing the inquisitorial and adversarial
errors of fact 8.23 approaches 19.28–19.29
ICE Conditions 5.69 conflicts of interest 19.24–19.25
JCT 1998 Form 5.32–5.35 reciprocity 19.26–19.27
JCT Minor Works contract 5.40 referral notices
jurisdiction referring party’s reply 19.06–19.07
relevance of earlier adjudications 7.99 responses to referral notice 19.04–19.05
requirements of referral notice 7.49–7.50 stay of execution 17.02–17.03
Latham Report recommendations 1.10–1.12 timescales and requested extensions 19.19–19.22
requirements of HGCRA 1996 visits 19.13–19.14
495
Index
Professional services statutory provisions 3.60

inclusion as part of construction operations 2.19–2.20 taking the initiative 3.65–3.68
standard forms 5.76 appointment of adjudicator
alternative appointment mechanisms 3.29
Reasoned decisions complexity 3.19
adequacy 3.95–3.96 further referrals following resignation 3.30
bars to enforcement 15.20 notice to referring party 3.23
formalities 3.97 selection of replacements 3.24–3.28
general practice 20.01–20.03 statutory provisions 3.18
general principles 3.93–3.94 timing 3.20–3.21
TeCSA Rules 5.86 willingness to act 3.22
Reciprocity 19.26–19.27 decisions
Referral for adjudication costs 3.91–3.92
see also Notices of adjudication; Referral notices effect 3.99–3.112
‘binding’ nature of decision 2.138–2.145 interest on awards 3.87–3.90
JCT 1998 Form 5.13–5.18 reasons 3.93–3.97
meaning and scope of ‘dispute’ 2.97–2.107 revising and reviewing 3.84–3.86
meaning of notice ‘at any time’ 2.107–2.113 signing by adjudicator 3.98
overview of detailed issues arising 2.94 statutory provisions 3.83
requirement for compliance with natural fees 10.14
justice 2.133–2.137 jurisdiction to amend compromise agreements 7.109
requirement for decision within 28 days 2.114–2.132 multiple disputes 3.41–3.46
right or obligation 2.95–2.96 notice of adjudication
statutory provisions 2.93 description of dispute 3.16
TeCSA Rules 5.78–5.81 importance 3.15
Referral notices interrelationship with defence matters 3.17
adjudicator’s powers 3.55, 3.60 statutory provisions 3.14
amounting to written agreement 7.39 objections to appointment of adjudicator 3.56–3.57
commencement of 28 day period 2.118 Parliamentary debate 1.31–1.34
contents and purpose 3.31–3.34 payment provisions
contractual adjudication 5.21, 5.14–5.18 dates for payment 3.122–3.125
Dom/2 5.55 final date for payment 3.126–3.128
effect of delay 3.37–3.39 ‘pay when paid’ clauses 3.132–3.133
extension of jurisdiction 7.57–7.60 payment and withholding notices 3.129–3.131
form and contents 18.25–18.29 stage payments 3.115–3.121
purpose 18.06 piecemeal or wholesale incorporation 3.04–3.13, 3.114
referring party’s reply 19.06–19.07 provision for fair hearings 13.05
responses 19.04–19.05 purpose of Scheme 3.01–3.03
time limits 14.06, 15.12 referral notices
Reprobation 14.22–14.29 contents 3.32–3.33

Residential occupiers statutory provisions 3.31
diminished importance of provisions 2.46 time limits 3.35–3.40
JCT Minor Works contract 5.36–5.38 treatment of technical points 3.34
scope and limitations 2.47–2.48 reform proposals 3.113
statutory exclusions 2.45 resignation of adjudicator
unnecessary complexities 2.49–2.50 fees 3.55
Resignation of adjudicator overlap between different
fees 3.55, 10.17 adjudications 3.51–3.54
further referrals following resignation 3.30 relevant circumstances 3.48–3.50
overlap between different adjudications 3.51–3.54 statutory provisions 3.47
relevant circumstances 3.48–3.50 revocation of appointment of adjudicator 3.58–3.59
statutory provisions 3.47 stage payments 3.115–3.121
Rules see Adjudication rules Statutory Instrument 1998 No 649 App C
Scotland
Scheme for Construction Contracts jurisdiction of HGCRA 1996 2.23
adjudicators’ powers protective measures 14.57
application of time limits 3.76–3.82 Service of documents
consideration of relevant information 3.69–3.75 general principles 2.193–2.197
constraints of impartiality 3.62–3.64 statutory provisions 2.180
496
Index
Set-off objections to appointment of adjudicator 3.56–3.57

against adjudicator’s decision ‘pay when paid’ clauses 3.132–3.133
exceptions 9.35–9.36 payment and withholding notices 3.129–3.131
general rule 9.21–9.34 payment provisions 2.146–2.179
liquidated damages 9.37–9.40 piecemeal or wholesale incorporation of
origins 9.20 Scheme 3.04–3.13, 3.114
against arbitral awards 9.41–9.42 purpose of Scheme 3.01–3.03
enforcement of separate claims 15.33–15.34 referral notices 3.18–3.30
general difficulties arising 2.162–2.163 referral of contract for adjudication 2.93–2.145
JCT 1998 Form 5.35 reform proposals 3.113
JCT Minor Works contract 5.39 residential occupiers 2.45–2.50
summary of general principles 9.43–9.44 resignation of adjudicator 3.47–3.55
sums certified as due 9.06–9.12 revocation of appointment of adjudicator 3.58–3.59
sums claimed as due 9.13–9.19 stage payments 3.115–3.121
Slip rule written agreements 2.51–2.92
amendment provisions of 2009 Act 4.10–4.11 Latham Report
CIC Model Adjudication Procedure 8.33 overview 1.07–1.09
scope and application 8.26–8.35 proposals for adjudication procedure 1.13–1.18
TeCSA Rules 5.82 recommended contract terms 1.10–1.12
Small contracts statutory adoption 4.02
JCT Minor Works contract subsequent consultation 4.02
payment provisions 5.40 Local Democracy, Economic Development and
residential occupiers 5.36–5.38 Construction Act 2009
set-off for liquidated damages 5.39 adoption of Latham Report recommendations 4.02
Latham Report recommendations 1.14 amendments to adjudication provisions 4.04–4.15
Parliamentary debate on HGCR Bill 1.14 amendments to payment provisions 4.16–4.28
Stage payments see Interim payments overview of main changes 4.03
Standard forms Parliamentary debates
see also JCT standard forms Housing Grants, Construction and Regeneration
jurisdiction to amend compromise agreements 7.109 Bill 1.19–1.30
NEC standard forms 5.74–5.75 on original scheme for adjudication 1.31–1.34
other standard forms referral of contract under statutory scheme
CGC/Works Contracts 5.64–5.67 ‘binding’ nature of decision 2.138–2.143
ICE Conditions 5.68–5.73 meaning and scope of ‘dispute’ 2.97–2.107
professional services 5.76 meaning of notice ‘at any time’ 2.107–2.113
provision for costs 10.08 no limit on type of dispute 2.144–2.145
provision for fair hearings 13.05 overview of detailed issues arising 2.94
sub-contractors requirement for compliance with natural
Dom/1 5.44–5.54 justice 2.133–2.137
Dom/2 5.55–5.63 requirement for decision within 28

Statutory adjudication days 2.114–2.132
see also Ad hoc adjudication; Contractual adjudication right or obligation 2.95–2.96
background and underlying industry statutory provisions 2.93
problems 1.01–1.06 Statutory Scheme see Scheme for Construction
effect of failure of contractual terms 5.01–5.07 Contracts
Housing Grants, Construction and Regeneration Stays
Act 1996 for adjudication 2.179
adjudicators’ powers 3.60–3.82 for arbitration 2.175–2.178
appointment of adjudicator 3.18–3.30 court proceedings pending
approach of TCC to excepted operations 2.38–2.41 adjudication 16.49–16.57
construction contracts 2.16–2.87 of execution
decisions 3.83–3.113 attempts to overcome statutory objectives 17.01
exceptions to statutory operations 2.32–2.37 Civil Procedure Rule 17.02–17.03
excluded contracts 2.42–2.44 effect of cross-claim 17.04–17.06
final date for payment 3.126–3.128 financial difficulties of creditor 17.13–17.27
general purpose of Pt II 2.01–2.15 insolvency as ground for refusal 17.07–17.12
miscellaneous provisions 2.180–2.197 practical consequences of losing case 16.29
multiple disputes 3.41–3.46 time to pay 17.28
notice of adjudication 3.14–3.17 wider circumstances 17.29–17.30
497
Index
Striking out 16.48 adjudicators’ powers 3.76–3.82

Sub-contractors appointment of adjudicator 3.30
abatement and set-off assessment of timescales and requested
sums certified as due 9.08 extensions 19.19–19.22
sums claimed as due 9.13 bars to enforcement 15.21
CGC/Works Contracts 5.67 CIC Model Adjudication Procedure 5.89
construction operations communication of decision to parties 20.04–20.06
activities falling within statutory directions 19.02
provisions 2.26–2.28 effect of failure on fees 10.23
approach of TCC to excepted operations 2.38–2.41 final date for payment 3.126–3.128
statutory exceptions 2.32–2.37 Parliamentary debate on scheme 1.31
Latham Report recommendations 1.14 procedural ambush 13.54
‘pay when paid’ clauses referral notices 3.35–3.40
extension of prohibition 2.186–2.190 referral of contract under statutory Scheme
Latham Report 1.12 meaning of notice ‘at any time’ 2.107–2.113
statutory provisions 2.180 requirement for decision within 28
relevance of earlier adjudications 7.100 days 2.114–2.132
standard forms statutory provisions 2.93
Dom/1 5.44–5.54 requirement for decision within 28 days
Dom/2 5.55–5.63 JCT 1998 Form 5.23–5.26
Summary judgments referral of contract under statutory
general principles 15.35–15.36 Scheme 2.114–2.132
TCC practice and procedure requirements necessary to confer jurisdiction 7.96
generally 16.05–16.11 subcontracts form Dom/2 5.61
options available to defendant 16.12–16.14
Suspension of work for non-payment Unfair contract terms 13.71–13.80
amendment provisions of 2009 Act 4.27–4.28
failures amounting to repudiation 2.181–2.185 Variation of works
statutory provisions 2.180 compliance with statutory written
requirements 2.77–2.82
TCC practice and procedure JCT 1998 Form 5.31
costs 16.18–16.22 Latham Report recommendations 1.10
declaratory relief 16.39–16.47 Visits 19.13–19.14
injunctions 16.32–16.38
interest on awards 16.15–16.17 Winding-up
overview 16.01–16.04 effect on payment obligations 2.173
practical consequences of losing case 16.23–16.31 effect on stay of execution 17.07–17.12
stay of existing court proceedings 16.49–16.57 means of enforcement 14.52–14.56
striking out 16.48 Withholding notices
summary judgments bars to enforcement 15.16–15.17

generally 16.05–16.11 general entitlement to interim payments 2.156
options available to defendant 16.12–16.14 ICE Conditions 5.71–5.72
TeCSA Rules nature and timing 2.164–2.168
change of name 5.77 origins of mechanism 9.04–9.05
costs 5.85 Parliamentary debate on HGCR Bill 1.26
enforcement 5.83–5.84 relevance of earlier adjudications 7.101
reasoned decisions 5.86 requirements for 9.14
scope of adjudication referrals 5.78–5.81 statutory Scheme 3.129–3.131
slip rule 5.82 subcontracts form Dom/1 5.52
Temporary finality summary of general principles 9.43
CEDR Rules 5.87 ‘Without prejudice’ communications
CIC Model Adjudication Procedure 5.88 acceptance of jurisdiction 16.40
effect 3.100–3.108 ad hoc adjudication 6.09
JCT 1998 Form 5.27–5.28 knowledge leading to bias 12.20–12.21
meaning and scope 2.138–2.143 Written agreements
status and effect of decisions amendment provisions of 2009 Act 4.06–4.09
generally 14.30–14.35 applicability 2.54
subsequent adjudications 14.36–14.44 bars to enforcement 15.06–15.10
Time limits conflicting objectives 2.53
498
Index
existence of necessary formalities for binding price 2.70–2.71

contract 2.72 requirement for whole agreement to be in
implied terms 2.83–2.85 writing 2.55–2.69
letters of intent 2.73–2.76 requirements necessary to confer
multiple contracts 2.86 jurisdiction 7.39–7.43
oral variations 2.77–2.82 statutory estoppel in separate proceedings 2.87–2.92
pending reform 2.51 statutory provisions 2.52
499

Coulson On Construction Adjudication

Uploaded by

Document Information

Original Description:

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Coulson On Construction Adjudication

Uploaded by

Copyright:

Available Formats

Copyright © 2011. Oxford University Press. All rights reserved.

Coulson, Peter. <i>Coulson on Construction Adjudication</i>,

Library of Congress Cataloging-in-Publication Data

Table of Cases xvii

PART I STATUTORY ADJUDICATION

2. Part II of the Housing Grants, Construction and Regeneration Act 1996

3. The Statutory Scheme

4. The Local Democracy, Economic Development and Construction Act 2009

PART II OTHER FORMS OF ADJUDICATION

PART III THE ADJUDICATOR’S JURISDICTION

The Dispute 7.47

8. Errors of Law and Fact

9. Abatement and Set-Off

10. Costs and Fees

PART IV NATURAL JUSTICE

Amec Capital Projects Ltd v Whitefriars City Estates Ltd 12.05

13. A Fair Hearing

Addressing the Issues 13.26

15. Principles of Enforcement

Jurisdiction/The Dispute 15.13

16. Adjudication Business in the TCC

Summary Judgment in the TCC 16.05

17. Stay of Execution

PART VI A PRACTICAL GUIDE TO ADJUDICATION

19. The Adjudication Itself

Meetings, Evidence and Hearings 19.08

20. The Adjudicator’s Decision

Appendix A: Part II of the Housing Grants, Construction and Regeneration

Amber Construction Services Ltd v London Interspace

Balfour Beatty Construction Northern Ltd v Modus Corovest

Beck Peppiatt Ltd v Norwest Holst Construction Ltd [2003]

Buxton Building Contractors Ltd v The Governors of Durand

Codrington v Codrington [1875] LR7HL 854 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14.22

Coventry Scaffolding Company (London) Ltd v Lancsville Construction

Debeck Ductwork Installation Ltd v TE Engineering Ltd, unreported,

FG Minter v Dawnays 13 BLR 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.90

GKN Foundations Ltd v Wandsworth London Borough Council

GPS Marine Contractors Ltd v Ringway Infrastructure

HG Construction v Ashwell Homes [2007] EWHC 144 (TCC);

Hadmor Productions Ltd v Hamilton [1983] 1 AC 191 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.08

Herschel Engineering Ltd v Breen Property Ltd [2000]

IDE Contracting Ltd v RG Carter (Cambridge) Ltd [2004] EWHC 36

KNS Industrial Services (Birmingham) Ltd v Sindall Ltd

Lakshmijit v Faiz Sherani [1974] AC 605, PC . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.181

M Rhode Construction v Nicholas Markham-David [2006]

Mahon v Air New Zealand [1984] AC 808 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.08, 11.32

McNabb v United States 318 US 332 (1943) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.23

Co (Eastern) Ltd [2006] EWHC 1569 (TCC); [2006]

Northern Developments (Cumbria) Ltd v J&J Nichol

OSC Building Services Ltd v Interior Dimensions Contracts Ltd

Pilon Ltd v Breyer Group PLC [2010] EWHC 837 (TCC);

Quality Street Properties (Trading) Ltd v Elmwood (Glasgow) Ltd

R v Cripps ex parte Muldoon [1984] QB 686 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8.29

R v Huntington DC ex parte Cowan [1984] 1 WLR 501 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.29

T&T Fabrications Ltd v Hubbard Architectural Metalwork Ltd [2008]

VGC Construction Ltd v Jackson Civil Engineering Ltd [2008] EWHC

Wagner v Laubscher Brothers & Co [1970] 2 QB 313, CA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17.04

BLR 3008. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.38, 5.02, 5.14, 8.18

A. Treaties and Conventions xxxiii

A. TREATIES AND CONVENTIONS s 107(5) . . . . . . . . . . . . . . . . . . . . 7.39, 7.81

s 101 . . . . . . . . . . . . . . . . . . . . . . . . . . 2.48 3.03, 3.04

ss 112–115 . . . . . . . . . . . . . . . . 2.180-2.197 Insolvency Rules 1986 (SI 1986/1925)