The enforcement of adjudicators’ awards under the Housing Grants, Construction and Regeneration Act 1996

The effect of ‘advice’ in a decision

Sleaford Building Services Ltd v Isoplus Piping Systems Ltd^[2]

The unusual feature of this case was the claim for relief by the referring party that the adjudicator “advise” the parties on two issues: whether the subcontractor had been negligent in the way it had installed certain fittings and also whether the payment ‘prerequisites’ had been complied with.

The adjudicator did as asked and gave ‘advice’ on those issues though it was clear from her decision she did not intend her advice to be binding. The court took a pragmatic view and decided that the ‘advice’ (whether right or wrong) was binding until there was a final determination, as the ‘advice’ did not impact the core findings as to valuation and payment or the validity of the decision.

Must a decision expressly state that every ‘line of defence’ had been considered?

AGB Scotland v Darren McDermott^[3]

An adjudicator cannot rely on a general assertion that they had considered all submissions and documents. There has to be some effort to address the lines of defence advanced and to explain the basis upon which they were accepted or rejected, or the decision would be unenforceable.

Where an adjudicator did not consider a line of defence, the decision may (though not necessarily would) be unenforceable. It was not necessary for the adjudicator to have expressly referred in their decision to every issue considered if it was plain on reading the decision that they must have considered the line of defence in question.

Broad Justice at high speed

Atalian Servant AMK Ltd v B W (Electrical Contractors) Ltd^[4]

Under the contract the final account statement (FAS) was ‘final and binding’ unless modified by agreement or (in this case) the payee commenced adjudication or court proceedings within 20 working days. Adjudication (and court) proceedings were commenced within that time. The first adjudicator resigned and a second adjudication notice was served.

The court held that the adjudication proceedings did not come to an end on the resignation of the first adjudicator, and BWE had followed the correct procedure in serving a new notice. The court also found there was no procedural unfairness. The adjudicator gave due notice to the parties of his line of thinking on what was termed ‘beck and call’ and the number of man hours worked and invited comment. AMK responded in detail and repeatedly on these matters.

The court noted the adjudicator took on “a nigh impossible task” having to consider an enormous volume of materials in such short time meaning the decision was bound to involve “broad justice at high speed”.

Payment provision – ‘days’ or ‘clear days’

Elements Europe Ltd v FK Buildings Ltd^[5]

The successful party in adjudication (Elements) applied to enforce the adjudicator’s award in its favour and the loser (FK) brought Part 8 proceedings to decide a short point of construction of a payment provision in a JCT standard form which, if upheld, would mean the award was wrongly made. Although the parties settled their dispute after a full hearing, judgement was given by agreement as it dealt with a point of some importance concerning the date and time of the making of payment applications.

The court held that the requirement in contract clause 4.6.3.1 to make a payment application “so as to be received not later than 4 days prior to the Interim Valuation Date for the relevant payment …” did not mean 4 ‘clear days’ before that date, but 4 days before the date, meaning it could be done on the fourth day before that date. The payment application in question was sent in the evening outside site working hours but received by at least one recipient on the evening of the fourth day. Held it had been validly made. The law did not deal in parts of a day.

Kenneth Salmon MCIArb is a qualified solicitor in England, Wales and Eire. He is a Ciarb qualified and CMC accredited Mediator and Chair of Education at Ciarb North West Branch. Kenneth is a construction specialist currently working as a consultant to Slater Heelis Limited. He has extensive experience of all forms of dispute resolution including arbitration, adjudication, expert determination and mediation.

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