UK Adjudicators January 2022 Newsletter Highlights Key Construction Law Updates

WWW.UKADJUDICATORS.CO.UK
JANUARY 2022 NEWSLETTER
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EDITORS COMMENTS
Apologies for the late issuing of this newsleter
but we have been monitoring the
governement’s approach to COVID-19 and its
new variant Omnicron to see what events can
be undertaken.
2022 is an important year for UK Adjduciators
as it marks the fifth year since we began
making adjudicator nominations. Over the last
five years we have made in excess of a
thousand nominations and have not charged a
nomination fee in respect of most of them,
except for those made under the CIC-LVD-
MAP.
The 16 October 2022 will mark the fifth year
since UK Adjudicators began making
nominations of adjudicators in the United
Kingdom, if you would be interested in
attending a lunch on Sunday the 16 October
2022 in London please do let me know.
Matt Drake is organising an event in the North
West in the first quarter of 2022 and further
information will be made available shortly.
UKA was open for nominations 365 days of the
year last year and this including making
nominations on Christmas Eve and New years
Eve, most of the other main ANBs shut down
for the festive period.
The SCL London Annual lunch is taking place on
the 11 February 2022 at the Grosvenor House
A J W Marriott Hotel Park Lane London W1K
7TN, UK Adjduciators have a table and will be
hosting a bar for guests. Do let us know if you
would like to drop by for a drink.
Our new website is under constructionwhich
will be rolled out later in the year.
In closing I would like to wish you all a very a
safe and prosperous New Year.
Sean Gibbs LLB(Hons) LLM MICE FCIOB FRICS
FCIARB, is the Chief Executive Officer of
Hanscomb Intercontinental and is available to
sit as an arbitrator, adjudicator, mediator,
quantum expert and dispute board member.
sean.gibbs@hanscombintercontinental.co.uk

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THE COURT’S DISCRETION TO
REFUSE ENFORCEMENT IS NARROW
– IRISH CASELAW UPDATE
On 11 January 2022, the Irish High Court
delivered another judgment in relation to the
enforcement of an adjudicator’s decision. In
John Paul Construction Limited v Tipperary Co-
Operative Creamery Limited [2022] IEHC 3, the
responding party attempted to resist
enforcement on the basis that the adjudicator
breached fair procedures and natural justice.
The grounds of resistance included that (1) the
adjudicator ignored a substantial defence by
not considering a certain part of the Response
document, (2) the adjudicator allowed the
referring party to introduce a new claim
relating to preliminaries during the
adjudication process, and (3) the adjudicator
reopened an issue already decided in an earlier
adjudication. Unfortunately, the difficult
question of whether adjudication is amenable
to judicial review was left for another day.
In enforcing the adjudicator’s decision, Simons
J held that the adjudicator had properly
considered the defences put forward by the
responding party. The part of the Response,
which was alleged to have been ignored by the
adjudicator was an introductory narrative that
was developed in more detail throughout the
Response. The adjudicator had quite properly
descended to the level of detail for each
individual claim item contained in the
Response. In doing so Simons J noted that ‘the
greater includes the lesser’ and the
adjudicator’s approach ensured that the claim
was ‘examined in context rather than in the
abstract.’ The assertion that the adjudicator
allowed the referring party to introduce a new
claim for preliminaries was dismissed. This was
not a new claim but simply a refinement and
better particularisation of a preliminaries claim
already made in the adjudication. The
allegation that an issue was already
determined in a previous adjudication also
failed. Simons J concluded that the issues were
different because the first adjudication
concerned the valuation of variations,
whereas; the second adjudication concerned
prolongation costs.
More generally, the judgment in John Paul
Construction Limited contains useful guidance
for adjudication in Ireland. The court’s
discretion to refuse to enforce is narrow and
the court will not be drawn into a detailed
review of the underlying merits of the
adjudicator’s decision under the guise of
identifying a breach of fair procedures. There
is less of a need for rigorous court intervention
at the time of adjudication as the adjudicator’s
decision is provisional only and merely imposes
an obligation to pay in the interim. The
unsuccessful party is entitled to a full rehearing

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in the courts or arbitration as the case maybe.
However, the court will not lend its authority
to enforce an adjudicator’s decision, even on a
temporary basis, where there has been an
obvious material breach of fair procedures. It
would be unfair to enforce a ‘lopsided
decision.’ The burden rests on the party
resisting the enforcement to demonstrate such
a breach took place.
The court when considering whether an
adjudicator failed to consider a defence will
adopt a pragmatic approach. The court will
have regard to the adjudicator’s decision in the
round and not ‘parsed line-by-line.’ It is
sufficient that the substance of the defence is
addressed by the adjudicator in the decision.
However, where a responding party has raised
a number of defences, such as, time bar
provisions, defences on the merits or raised
counterclaims, the adjudicator should make a
finding on each of the distinct defences. An
important distinction is drawn between
rejecting a line of defence and failing to
consider a defence. It is permissible for an
adjudicator to conclude that responding party
is not entitled to pursue a particular line of
defence, which is different from failing to
consider a defence. Similarly, a distinction is
drawn between the dismissal of a defence on
its merits and failure to consider a line of
defence. Simons J gave an example of an
adjudicator failing to consider set-off on the
mistaken assumption that it did not come
within the scope of the dispute. In such
circumstances, the court might well refuse
enforcement. However, the situation is
different where the adjudicator has considered
the set-off on its merits, but mistakenly
concluded that it did not meet the criteria for
contractual set-off. Here, the courts would
enforce the decision.
A concern exists that parties are entitled to an
oral hearing as part of the adjudication
process. This flows from the principles of
natural justice enshrined in Article 40.3 of
Bunreacht na hÉireann. In John Paul
Construction Limited Simons J considered that
the responding party rightly withdrew a
challenge concerning an allegation that the
adjudicator had acted unfairly by not directing
an oral hearing. Simons J noted that, having
regard to the expeditious nature of
adjudication, it will be rare, if ever, an
adjudicator is required to convene an oral
hearing. Making all due allowances for the
provisional nature of an adjudicator’s decision
and the expedited nature of adjudication, a
party maintains the right to be heard before an
adjudicator reaches a decision. However, the
right to be heard implies a right to have one’s
submissions considered but that does not
necessarily extend to the right to convene an
oral hearing.

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Paul Hughes | Senior Associate
Sharpe Pritchard LLP
T: +44 (0)20 7405 4600
E: phughes@sharpepritchard.co.uk
www.sharpepritchard.co.uk
BUILDING DESIGN PARTNERSHIP
LTD V STANDARD LIFE ASSURANCE
LTD [2021] EWCA CIV 1793
The Court of Appeal refused a professional
consultant’s appeal against a refusal to strike
out and/or grant summary judgment against a
pleading, which advanced a case against that
professional pleaded by way of sampling and
extrapolation.
The Court of Appeal held that a claim based on
sampling and extrapolation may be pleaded on
that basis in principle. In this matter it was held
that such a claim should not be struck out (and
that summary judgment should not be entered
against a party advancing such a claim) where
such a claim could not be shown to be bound
to fail. In so holding, the court approved
decisions in which first instance courts had
permitted a case going to trial based upon a
claim pleaded on a similarly extrapolated basis,
that of Amey LG Ltd v Cumbria County
Council [2016] EWHC 2856 (TCC) and Imperial
Chemical Industries Ltd v Merit Merrell
Technology Ltd (No 2) [2017] EWHC 1763
(TCC), 173 Con LR 137. Lord Justice Birss
confirmed that pleading and / or proving a case
based upon extrapolation does not require
that extrapolation to be supported by
statistical confidence or random sampling.
George William Gibbs - Consultant

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MANSION PLACE LTD V FOX
INDUSTRIAL SERVICES LTD [2021]
EWHC 2972 (TCC)
The Claimant, Mansion Place Limited (“MPL”),
is a property developer who was doing an
extension and refurbishment of student
accommodation at Hockley Point in
Nottingham, (the “Works”). The Defendant,
Fox Industrial Services Limited (“Fox”), is a
construction contractor.
Fox was engaged in February 2020 to perform
the Works pursuant to an amended form of the
JCT Design and Build Contract (2016 edition)
(“the Contract”). Performance of the works
was delayed from the outset and the parties
differed as to the cause of delays. Fox put
forward this was due to issues in relation to the
Covid-19 Pandemic and because MPL failed to
give timely possession of the site and clear it of
students. MPL contended delay was due to
Fox’s failure to commit sufficient labour and
resources to the Works. On 22 October 2020,
Fox served an Interim Payment Application and
on 13 November 2020, MPL served a Pay Less
Notice and several notices of intention to
deduct liquidated and ascertained damages
(“LADs”). Fox consequently referred the
dispute to adjudication. The issues before the
court were (1) was the conversation held on 14
October 2020 legally binding as had been
determined by the adjudicator and (2) if the
conversation was not binding, was MPL
stopped from seeking LADs.
On or around the same time as the above,
there was a telephone conversation between
the Managing Director of Fox and a director of
MPL. The contents of the call are disputed. Fox
argued MPL agreed to forego any entitlement
to LADs in return for Fox foregoing the right to
claim payment for loss and expense because of
delay. MPL disagreed. On 11 January 2021, the
adjudicator decided the conversation had
resulted in a binding agreement and the
amount certified in the Interim Payment
Application of £367,103.44, was due plus
interest.
On 29 September 2020, MPL sent a notice of
non-completion in respect of Section 2 of the
Works. Fox responded on 02 October 2020
reiterating its claim to be entitled to an
extension of time and compensation for the
delay. Further non-completion notices were
sent on 06 October 2020 and then, the above
conversation took place.

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Following this decision, MPL commenced
proceedings for relief on the basis there was no
agreement from the call. Fox counterclaimed
seeking declarations giving effect to its
interpretations of the dealings of the
conversation and of the parties’ rights under
the Contract.
The Judge, in considering the validity of the
agreement reached on the telephone
concluded that he was satisfied that, despite
the differing evidence, each man was seeking
to give his honest recollection of what had
been said. This was formed, in part, by the
demeanour of the witnesses in the witness
box. He considered their evidence through the
“prism of the contemporaneous documents; of
their subsequent actions…” which meant that
the Judge considered the conduct of the
parties after the call. For MPL, these factors
were (i) Mr. Ramanathan instigated the call to
encourage Fox to complete the Work while
bypassing the legal stances regarding the
delay; (ii) MPL continued to prepare its claim
for LADs and (iii) there were internal MPL
documents which showed concern that Fox
would potentially leave the site or deliberately
delay the works and the dropping of the LAD
claim could be commercially a sensible move.
Fox, on the other hand, relied upon (i) the
“gentleman’s agreement” which was reached
on the phone; an email shortly after the call
which referred to MPL being “good to their
word” and an email of 09 November 2020
which prepared a response to MPL’s letter.
Whilst the email of 09 November 2020 was an
internal email, the Judge was satisfied that this
reflected a genuine understanding of the
conversation which took place.
As for the additional arguments run by Fox,
Justice Eyre reviewed each in turn. Firstly,
following consideration of the Contract, the
proper interpretation for serving a Non-
Completion Notice provides for Completion
Date to remain as defined with the
consequences which follow from failure to
complete the works by that date until a new
Completion Date is actually fixed.
Consequently, MPL was not precluded from
serving a Non-Completion Notice and would
have been able to claim LADs. Regarding the
second point, whether the LADs clause was
inoperable, the Judge followed the current
case law and relied on Fox’s negotiations with
MPL on this clause, noting there was
commercial understanding between the two
parties. Therefore, Justice Eyre decided that
the provision would not have been struck out.
As for if the clause was inoperable, Justice Eyre
decided the LADs was operable because the
clause operated by applying a specific
calculation regarding how LADs would be paid

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and the amount of reduction that would be
applied.
This case is an important reminder that witness
evidence is important- particularly in the
context of oral conversations. In doing so, the
court will consider the contemporary actions
of the parties following the call and how this
compares to evidence produced at trial.
Therefore, the case is a reminder , to review
their recording procedures and ensure, as a
matter of good business practice, detailed
notes are drafted following inter-party
discussions.
Nicholas Gould
Fenwick Elliott LLP
Aldwych House
71 91 Aldwych
London
WC2B 4HN
T +44 (0)20 7421 1986
ngould@fenwickelliott.com
www.fenwickelliott.com
KEY CASES 2021
Matthew Grellier and Kenneth Salmon of
Slater Heelis Solicitors have provided us with
their adjudication key cases for 2021. Their
detailed commentary can be found at the rear
of the newsletter.
Case 1: Contractual requirement to adjudicate
not a fetter on the statutory right
The Fraserburgh Harbour Commissioners v
McLaughlin & Harvey Ltd [2021] CSOH 8 (26
January 2021) Lady Wolffe
Case 2: Jurisdiction overlapping with
substantive issues
Ex Novo Ltd v MPS Housing Ltd [2020] EWHC
3804 (TCC) (17 December 2020 HHJ Eyre QC)
Case 3: Jurisdiction – Excess of and failure to
exhaust – reservation of position
Hochtief Solutions AG and others v Maspero
Elevatori S.p.A. [2021] CSIH 19 (15 February
2021) (Lord President, Lord Menzies, Lord
Woolman)

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Case 4: Jurisdiction – Adjudicator’s powers
under NEC3 Option W1.3(5) – Waiver
following decision
Croda Europe Ltd v Optimus Services Ltd
[2021] EWHC 332 (TCC) (19 February 2021)
HHJ Roger ter Haar QC
Case 5: Jurisdiction – dispute arising under
separate contracts
Delta Fabrication & Glazing Ltd v Watkins
Jones & Son Ltd [2021] EWHC 1034 (TCC) HHJ
Sarah Watson
Case 6: Jurisdiction – timing of service of
adjudication notice
C Spencer Ltd v MW Tech Projects UK Ltd
[2021] EWHC 1284 (TCC) Waksman J
Case 7: Injunction to restrain adjudication
Marbank Construction Ltd v G&D Brickwork
Contractors Ltd [2021] EWHC 1985 (TCC) 28
June 2021 O’Farrell J
Case 8: Right to Adjudicate – whether
collateral warranty is construction contract
Toppan Holdings Ltd and Abbey Health Care
(Mill Hill) Ltd v Simply Construct (UK) LLP
[2021] EWHC 2110 (TCC) 27 July 2021 Martin
Bowdery QC
Case 9: Set off – failure to consider defence –
validity of payment notice – severance.
Downs Road Developments LLP v Laxmanbhai
Construction (UK) Ltd [2021] EWHC 2441
(TCC) 7 September 2021 (HHJ Eyre QC)
Case 10: Dispute – meaning – sum due on
three payment application was a single
dispute
Quadro Service Ltd v Creagh Concrete
Products Ltd [2021] EWHC 2589 (Ch) 19 Aug
2021 (HHJ Sarah Watson QC)
Matthew Grellier
Partner & Head of Construction
matthew.grellier@slaterheelis.co.uk
0161 672 1427 / 07753 464 740

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Kenneth Salmon
Consultant Solicitor
kenneth.salmon@slaterheelis.co.uk
0161 672 1436 / 07786 702 140
INVALID PAYMENT CLAIMS AND
NOTICES UNDER CONSTRUCTION
CONTRACTS
A key part of the interim payment process in
construction projects is the issuing of
payment notices by payee and payer alike.
Two recent UK cases demonstrate a strict
approach being taken by the courts to the
validity of payment notices.
Introduction
In the UK, the use of payment notices in
relation to construction contracts is mandated
by the Housing Grants, Construction and
Regeneration Act 1996 (as amended) (the
"Act"), which applies to construction contracts
involving works performed within (but not
outside) the UK. The Act operates so that a
payer (e.g. an employer) is obliged to pay the
full amount set out in a valid payment notice
issued by a payee (e.g. a contractor) if the
payer fails to serve a valid "pay less" notice in
time. This may be the case even if the payee is
not entitled under the contract to the full
amount which it claims for the relevant work
performed.
Similar legislation operates in a number of
countries, including Singapore, Australia, New
Zealand, Malaysia and Canada. The broad

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purpose of this legislation is to assist the cash
flow of businesses that carry out construction
work. The scheme of the legislation requires
each party to a contract to issue payment
claims and notices to each other, at particular
times and giving particular details. If a notice is
not issued validly, in accordance with the
legislation, particular monetary consequences
may follow.
The UK legislation lacks detail on the
requirements for payment claims and notices
under the Act, and when they will (and will not)
be valid. Guidance from the courts on the
application of these provisions is therefore
welcome. Two recent cases shed light on how
payment notice requirements will be
interpreted.
Case 1: Downs Road Development LLP v
Laxmanbhai Construction (U.K.) Ltd [2021]
EWHC 2441 (TCC)
This case concerned a dispute between Downs
Road, the Employer, and Laxmanbhai, the
Contractor, relating to the construction of
residential units and associated works in
London.
The contract was an amended form of the 2011
JCT Design and Build Contract. In line with
section 110A(1) of the Act, the contract
required that the Employer provide a payment
notice to the Contractor no later than five days
after the payment due date.
The Employer, however, took an
unconventional approach to the issuing of
payment notices. For each payment cycle, it
issued two payment notices. The first (issued
no later than five days after each payment due
date) was equivalent to a "holding notice",
specifying a nominal amount due of around £1.
The second, issued some days later, and out of
time, would contain a higher valuation.
One of the questions for the court was the
validity of the notices and whether they
conformed to the statutory requirement
(reflected in the contract) that each payment
notice "shall specify the sum that the party
giving the notice considers to be or have been
due at the due date in respect of the relevant
payment and the basis on which that sum has
been calculated".
As the Employer accepted that the second
payment notice was out of time and
accordingly invalid, the court was only asked to
determine if the first notice was valid.
The court decided that the first notice was
invalid because the sum stated as due (i.e.
around £1) was not one that the Employer
"genuinely considered" to be due, i.e. it was
simply a nominal or holding amount. The
covering email that accompanied the payment
notice supported this conclusion, as did the
fact that this was a practice that the Employer
had repeatedly adopted in previous payment
cycles. Furthermore, the Employer's payment

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notice failed to set out the basis of the
Employer’s calculation, as it did not include any
supporting material or an explanation as to
how the Employer had arrived at its gross
valuation.
Case 2: D McLaughlin & Sons Ltd v East
Ayrshire Council [2021] CSOH 122
This case concerned a dispute between the
Contractor, D McLaughlin & Sons Ltd, and the
Employer, East Ayrshire Council, relating to the
construction of a school extension.
The contract was an amended Standard
Building Contract with Quantities for use in
Scotland (SBC/Q/Scot) 2011. It provided
(consistently with the requirements of the Act)
that the Contractor may issue an Interim
Payment Notice "stating the sum that the
Contractor considers to be or to have been due
to him at the relevant due date in accordance
with clause 4.9.2 and the basis on which that
sum has been calculated".
One of the issues in dispute was how the
validity of an Interim Payment Notice might be
affected by the specification in the notice of an
incorrect due date.
The parties were in agreement that the
relevant due date should be four weeks after
the works commenced, and thereafter the
same date each following month.
However, the parties disagreed on the date
when the works commenced. As a result of this
disagreement, the Contractor's notice
specified a relevant due date that was one day
earlier than what the Employer contended it
should be.
The court did not have to decide when the
works commenced, because the Council's
claim was barred on other grounds. However,
the court rejected the Contractor's argument
that the notice would be valid regardless of
whether the Contractor or Employer was
correct as to the due date. As the service of an
Interim Payment Notice by the Contractor
places the Employer at risk that a failure to
serve a Pay Less Notice at the correct time may
render it liable for the amount claimed, the
Contractor must ensure proper notice is given.
The court reasoned that if the Contractor
specifies an incorrect due date in its payment
notice, this does not meet the requirements of
the Contract or the Act, and therefore the
Contractor's payment notice is invalid.
Commercial Implications
These two cases provide helpful guidance for
parties to construction contracts on the
content and timing requirements of payment
notices.
First, it has been clarified that a requirement to
specify the sum that a payer "considers" due
requires the payer to genuinely consider the

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sum to be due. Given the difficulty in
determining a party's subjective intent, the
courts will assess the genuineness of a party's
valuation by reference to objective facts that
indicate whether a sum stated to be due is
actually what the payer "considers" is due. In
Downs Road, this was clearly not the position
at all, as the Employer issued two different
payment notices for different amounts, and
the first notice (for around £1) could not
rationally be viewed as a sum which the
Employer "considered" was due.
Aside from the (extreme) circumstances in
Downs Road, there are other situations in
which an Employer's payment notice may be
open to attack for not specifying the sum the
Employer genuinely considers to be due. For
example, where an Employer deliberately
refuses to value, or deliberately devalues,
items of work claimed by a Contractor as part
of a commercial or negotiation strategy to
force the Contractor into an unfavourable
position for the purposes of settling the final
account.
What, therefore, the Act and corresponding
contractual provisions require is a bona fide
assessment of a Contractor's payment claim.
There is a similar requirement under forms of
contract used internationally, e.g. the FIDIC
Red and Yellow Books (1999 and 2017) require
the Engineer to issue Interim Payment
Certificates stating the amount that the
Engineer "fairly determines to be due" to the
Contractor. A failure by the Engineer to do so
may have serious consequences for the
Employer, including even the termination of
the contract by the Contractor.
Secondly, where Contractors' payment claims
are concerned, the failure to specify the
correct due date in the payment notice may
invalidate the notice. The Act requires
Contractors' (and Employers') notices to
specify the amount the Contractor "considers
to be due or to have been due at the payment
due date". If, therefore, a Contractor's
payment claim states that it considers the sum
of £X to be due as at date Y, when date Z was
the true due date, the notice does not fulfil the
requirements of the Act (and any contract that
implements these requirements).
In many contracts it is made clear what the
payment due date is (e.g. "the 28th day of each
calendar month"), so there is no ambiguity. But
if it is unclear, one possible solution is for
Contractor and Employer to agree on what this
date should be. Failing that, it may be sufficient
to state that the notice is issued in respect of
the due date of a particular application cycle,
rather than specifying an actual date in the
notice, provided it is otherwise clear and
unambiguous that the payment notice relates
to a specific due date. Such an approach was
endorsed in the English case of Henia
Investments Inc v Beck Interiors Ltd [2015]
EWHC 2433 (TCC).

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Above all, these cases reinforce the notion that
at the outset of each project, employers,
contractors and engineers alike need to set in
place systems and procedures for making and
processing interim payment applications in
accordance with the contract and any
applicable legislation.
Julian Bailey - Partner
White & Case LLP
5 Old Broad Street, London, UK, EC2N 1DW
+44 207 532 1869
jbailey@whitecase.com
Primrose Tay – Associate
White & Case LLP
5 Old Broad Street, London, UK, EC2N 1DW
+44 20 7532 1602
primrose.tay@whitecase.com
ADJDUCIATORS LONDON 2021
ADJDUCIATION & ARBITRATION
CONFERENCE
The conference was another great success with
attendess from across the globe. If you want to
view the six panels videos or read the
conference pack please go to the UK
Adjudicators website.
https://www.ukadjudicators.co.uk/conferenc
es

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TCC COURT JUDGEMENTS
November
• Adferiad Recovery Ltd v Aneurin Bevan
University Health Board [2021] EWHC
3049 (TCC) (16 November 2021)
• Blue Manchester Ltd v Bug-Alu Technic
GmbH & Anor [2021] EWHC 3095
(TCC) (19 November 2021)
• Crest Nicholson Operations Ltd & Anor
v Grafik Architects Ltd & Anor [2021]
EWHC 2948 (TCC) (10 November 2021)
• Kellogg Brown & Root Ltd v Mayor's
Office For Policing And Crime &
Anor [2021] EWHC 3321 (TCC) (18
November 2021)
• Mansion Place Ltd v Fox Industrial
Services Ltd [2021] EWHC 2972
(TCC) (12 November 2021)

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December
• Access for Living v London Borough of
Lewisham [2021] EWHC 3498
(TCC) (23 December 2021)
• Fairgrove Homes Ltd v Monument Two
Ltd [2021] EWHC 3450 (TCC) (21
December 2021)
• Naylor & Ors v Roamquest Ltd &
Anor [2021] EWHC 3507 (TCC) (23
December 2021)
The DRBF International Conference will be
taking place in London in 6 – 8 May 2022.
Leading speakers, lawyers, experts, clients,
dispute board members, dispute board users
and contractors will be attending.
https://www.drb.org/

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FORTHCOMING EVENTS
Tuesday, January 25,
2022 - 6:00 PM
Deceleration (Pacing Delay) and its Compatibility
With Common Law
Online
Chair: Ruth Wilkinson ( Hill Dickinson)
Speaker(s): Tom Francis of Decipher,
Rupa Lakha of Charles Russell
Speechlys & Deirdre Hennessy, Byrne
Wallace
For more info
Wednesday, January 26,
2022 - 9:00 AM
An introduction to Soil Mechanics
Online
Chair: Karim Mariey
Speaker(s): Dr Way Way Moinet - GCG
For more info
Tuesday, February 1,
2022 - 6:30 PM
Memorial Talk John Sims and Ray Turner
London
Venue: National Liberal Club and Online
For more info
Tuesday, February 8,
2022 - 9:00 AM
NEC4: an overview
Online
Moderator: John Tackaberry QC, 39
Essex Chambers
Speaker(s): Andrew Singer QC, Kings
Chambers, Shona Frame, CMS &
Angelyn Rowan, Philip Lee
For more info
Friday, February 11,
2022 - 12:00 PM
The SCL Annual London Lunch
London
Speaker(s): Hannah Fry - Hannah is a
Professor in the Mathematics of Cities.
She is a mathematician, a best-selling
author, an award winning science
presenter and the host of numerous
popular podcasts and television shows
Venue: Grosvenor House A J W Marriott
Hotel Park Lane London W1K 7TN
Full details in this flyer
For more info
Tuesday, March 1, 2022 - 6:30
PM
TBC
London

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Venue: National Liberal Club and Online
For more info
Wednesday, March 2,
2022 - 9:00 AM
Third party funding in 2022: the lawyer, the
arbitrator and the funder's view
Online
Moderator: Michael Dillon - Horizons &
Co
Speaker(s): Joe Durkin - LCM Finance,
Marion Smith QC - 39 Essex Chambers,
Hamish Lal - Akin Gump & John Gordon
SC - Law Library
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Key Cases of 2021
Construction
Adjudication
Case Law
Construction & Engineering

Contents
Case 1: Contractual requirement to adjudicate not a fetter on the statutory right........
The Fraserburgh Harbour Commissioners v McLaughlin & Harvey Ltd [2021]
CSOH 8 (26 January 2021) Lady Wolffe
Case 2: Jurisdiction overlapping with substantive issues........................................................
Ex Novo Ltd v MPS Housing Ltd [2020] EWHC 3804 (TCC) (17 December 2020
HHJ Eyre QC)

Case 3: Jurisdiction – Excess of and failure to exhaust – reservation of position............
Hochtief Solutions AG and others v Maspero Elevatori S.p.A. [2021] CSIH 19 (15
February 2021) (Lord President, Lord Menzies, Lord Woolman)

Case 4: Jurisdiction – Adjudicator’s powers under NEC3 Option W1.3(5) – Waiver
following decision.......................................................................................................................
Croda Europe Ltd v Optimus Services Ltd [2021] EWHC 332 (TCC) (19 February
2021) HHJ Roger ter Haar QC

Case 5: Jurisdiction – dispute arising under separate contracts ............................................
Delta Fabrication & Glazing Ltd v Watkins Jones & Son Ltd [2021] EWHC 1034
(TCC) HHJ Sarah Watson
Case 6: Jurisdiction – timing of service of adjudication notice..............................................
C Spencer Ltd v MW Tech Projects UK Ltd [2021] EWHC 1284 (TCC) Waksman J
Case 7: Injunction to restrain adjudication....................................................................................
Marbank Construction Ltd v G&D Brickwork Contractors Ltd [2021] EWHC 1985
(TCC) 28 June 2021 O’Farrell J
Case 8: Right to Adjudicate – whether collateral warranty is construction contract....
Toppan Holdings Ltd and Abbey Health Care (Mill Hill) Ltd v Simply Construct
(UK) LLP [2021] EWHC 2110 (TCC) 27 July 2021 Martin Bowdery QC
Case 9: Set off – failure to consider defence – validity of payment notice – severance.
Downs Road Developments LLP v Laxmanbhai Construction (UK) Ltd [2021]
EWHC 2441 (TCC) 7 September 2021 (HHJ Eyre QC)
Case 10: Dispute – meaning – sum due on three payment application was a single
dispute...............................................................................................................................................
Quadro Service Ltd v Creagh Concrete Products Ltd [2021] EWHC 2589 (Ch) 19
Aug 2021 (HHJ Sarah Watson QC)
Page 3
Page 5
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Page 4
Page 9
Page 11
Page 13
Page 5

had not been argued. Lady Wolffe cited the finding
of Edward-Stuart J in Anglian[1] that a provision in
identical terms was not a fetter on the “valuable”
right to adjudicate “at any time” (i.e. at a time of his
choosing).
Comment
Although not argued in this case, it was argued in
Anglian that a similar provision to W2.4 denied a
claiming party the right to adjudicate at any time (in
effect of his choosing) since it obliged him to
adjudicate before he could exercise the right to seek
a final determination elsewhere.
That argument failed in Anglian and Lady Wolffe
agreed.
Whilst the parties are free to choose their dispute
resolution processes, NEC3 and NEC4 are industry
standard forms whose provisions are usually
dictated by the employer and not individually
negotiated.
Whilst adjudication has its merits it is not without its
drawbacks. To name but two: not every dispute is
suitable for adjudication; disputes can add tens of
thousands of pounds of irrecoverable costs.
It is also fair to say that because of the prescriptive
time limits for challenging a certificate or decision of
the contract certifier, there is in reality little choice
but to adjudicate with dispatch which rather
negates the option to do so “at any time”.
Case 1: The Fraserburgh Harbour
Commissioners v McLaughlin &
Harvey Ltd [2021] CSOH 8 (26
January 2021) Lady Wolffe
Pursuer engaged Defender to extend
Fraserburgh harbour. They alleged defects in the
works and commenced proceedings in court
(because of possible limitation issues) claiming
over £7m in damages.
The contract was NEC3 2005 with 2006
amendments.
Option W2.1(1) contains a “cascade of dispute
resolution”. Clause W2.4(1) reads
“W2.4 (1) A Party does not refer any dispute under
or in connection with this contract to the tribunal
unless it has first been decided by the Adjudicator
in accordance with this contract.”
Was clause W2.4 a procedural bar to the bringing
of proceedings in court that had not previously
been referred to adjudication followed by a notice
of dissatisfaction under W2.4(2)?
The court decided the meaning and effect of
clause W2.4 was clear. Parties had agreed to
resolve disputes in a specified way, with the merits
to be finally determined by arbitration.
The clause was not a fetter on the basic statutory
right to refer a dispute to adjudication “at any
time” in section 108 of the Act.
The court accepted the provision operated as a
procedural bar on the right to litigate or arbitrate
before there had been an adjudication and a
notice of dissatisfaction given although the point
[1] Anglian Water Services Ltd v Laing O’Rourke Utilities Ltd [2010] EWHC 1529 (TCC) 3
3

There may be an overlap between the two—such as
where it was necessary to decide whether there was
one contract which had been varied, or a series of
contracts. In such a case, the adjudicator’s decision
on the preliminary matter may be binding. But not
always.
The determination was only made within
jurisdiction (and therefore binding) if:
(a) it had to be made, not just as part of the process
of conducting the adjudication, but as a ‘necessary
element’ in deciding the substantive dispute, once
any questions of jurisdiction were resolved.
(b) it was ‘integral’ to the substantive decision.
On the facts, it had not been necessary for the
adjudicator to decide the ‘multiple contracts’ point,
in order to determine the substantive dispute.
The real issue between the parties on that dispute
was whether there was a valid payless notice from
MPS, and a potential valuation matter.
NB MPS had no real prospect of demonstrating
there were multiple contracts. The evidence pointed
to a single contract, with call offs.
Accordingly, the adjudicator had jurisdiction to
decide the dispute, and his decision should be
enforced.
Case 2: Ex Novo Ltd v MPS
Housing Ltd [2020] EWHC 3804
(TCC) (17 December 2020) HHJ
Eyre QC
It is well established that:
(1) parties may, in each adjudication, and absent
agreement, refer only a single dispute arising
under their contract to the adjudicator.
(2) it is "broadly uncontroversial” that an
adjudicator does not have jurisdiction to decide
his/her own jurisdiction unless the parties have
effectively agreed or permitted it.
There is an exception to the usual position on
ruling on own jurisdiction: where there is an
‘overlap’ between the substantive dispute and the
matter of jurisdiction and the former is integral to
the latter.
The question here was: was there 1 contract (later
varied) or 4 separate contracts. Adjudicator found
1 contract awarded ENL £300,000.
MPS argued adjudicator had no jurisdiction, on
the basis that the reference to adjudication
concerned multiple sums due and disputes under
multiple contracts.
HHJ Eyre distinguished
(i) issues that are ‘as a preliminary’ to resolving the
substantive dispute such as a question of
jurisdiction determinations about which were not
binding;
(ii) issues necessary to determine the substantive
dispute which are binding, even if wrong in fact or
law.
4
4

Case 3: Hochtief Solutions AG and
others v Maspero Elevatori S.p.A.
[2021] CSIH 19 (15 February 2021)
(Lord President, Lord Menzies,
Lord Woolman)
On enforcement of an adjudicator’s decision Lord
Clark held:
(i) the adjudicator had not exceeded his
jurisdiction in deciding that a July agreement was
a variation of the subcontract not a new contract;
(ii) he had not failed to exhaust his jurisdiction: he
had taken into account Maspero’s contentions
before concluding that certain design costs were
covered by a clause in the determination
provision of the subcontract;
(iii) Maspero in merely “hinting at a challenge”
had not made an appropriate and clear
reservation “at the outset” such as was required
and had therefore acceded to the adjudicator’s
jurisdiction.
The Inner House rejected Maspero’s appeal
adding that Scots law like English law required a
clear and timely challenge.
Case 4: Croda Europe Ltd v
Optimus Services Ltd [2021]
EWHC 332 (TCC) (19 February
2021) HHJ Roger ter Haar QC
Under an NEC3 Professional Services Contract
(PSC) Optimus agreed to provide services for the
expansion of Croda’s chemical work. The Act did
not apply – the agreement was not one for
No justification for such a limitation. The
power under Option W1.3(5) should be
construed consistently with the like power
under Option W2.3(4) which was unlimited
and allowed a party to refer any dispute. It
would be improbable and uncommercial to
construe W1.3(5) as being a closed list of
powers.
Adjudicator was entitled to create a negative
valuation and payment; even if that were
untrue, it would be a contractual
interpretation open to the adjudicator and
therefore not a ground to resist enforcement.
Optimus had elected to treat the decision as
binding and had waived its right to challenge
enforcement on jurisdictional grounds, by
writing to the adjudicator confirming payment
of his fees and asking him to correct his
decision under the ‘slip rule’, without reserving
its right to raise a jurisdictional challenge.
"construction operations”. But Parties chose
Option W1 providing for adjudication even though
the Act did not apply.
Adjudication 1: The adjudicator decided the gross
value due to Optimus was less than paid but that
he had no power to order repayment of the
excess to Croda.
Adjudication 2: Croda asked for repayment of the
overpayment and succeeded.
Optimus refused to pay and Croda applied for
summary judgment. Optimus said the
adjudicator’s powers to “review and revise any
action or inaction” under Option W1.3(5), did not
extend to finding that the value of Optimus’s
services was less than had been paid and to order
repayment.
Held:
1.
2.
3.
5
5

Case 5: Delta Fabrication &
Glazing Ltd v Watkins Jones &
Son Ltd [2021] EWHC 1034 (TCC)
HHJ Sarah Watson - Jurisdiction -
dispute arising under separate
contracts
It was common ground that Delta entered into
two subcontracts with Watkin Jones: one for
cladding and one for roofing works. Each
subcontract had its own order number and
detailed documentation.
From February 2020, payment under the two
subcontracts was administered together.
Subsequently, a final account sum was agreed for
both subcontracts together.
A dispute arose over the final account which Delta
referred to adjudication. Watkin Jones challenged
the adjudicator’s jurisdiction contending that as
the dispute arose under two separate contracts it
could not be referred to adjudication under the
Act.
They did not give the adjudicator power to decide
his own jurisdiction but they put forward reasons
why he should resign.
The adjudicator made a non-binding decision and
proceeded with the adjudication. He was
persuaded that by reason of there being an
agreement to a single final account figure for both
subcontracts, the parties had agreed to treat
them as one.
Delta’s application to enforce the award in its
favour, rested on three alternative arguments:
(1) There was an agreement to be implied from
conduct to vary or amalgamate the contracts.
Held: The parties’ conduct was inconsistent with
amalgamation. Payment applications and the
final account showed the sums due under each of
the two subcontracts albeit totalled together.
(2) That it was possible for parties to agree to
treat two separate contracts as one for the
purposes of the Act and therefore
adjudication, where, as here, they had
combined payments claimed and due
in applications and the final account.
Held: the argument was without authority and
where the contracts had not been amalgamated
at common law they could not become a single
“construction contract” under the Act.
(3) Watkins Jones was ‘estopped’ from denying
the subcontracts should be treated as one.
Held: The elements of estoppel were not present;
there was no evidence of reliance by Delta or of
detriment to them.
Watkins Jones had not only a real, but a strong
prospect of success at trial. Application for
summary judgment refused.
6
6

Case 6: C Spencer Ltd v MW Tech
Projects UK Ltd [2021] EWHC
1284 (TCC) Waksman J –
Jurisdiction – timing of service of
adjudication notice
CSL applied for summary judgment to enforce
an award in its favour for £3,397,029.03 dated 14
January 2021.
Three defences were raised two of which are
worth mentioning.
Defence 1: Under the Scheme, and s 108(2) of the
Act, it has been held a notice of adjudication has
to be given before the referring party applies for
the appointment of an adjudicator.
Here CSL sent an email to ICHEME (the ANB),
enclosing a copy of the notice of adjudication
and at the same time copied the email to the
responding party, MW.
MW objected that the notice had not been
served before the application to the ANB to
appoint the adjudicator and was ineffective. The
adjudicator made a non-binding decision that
the notice had been effectively given and he had
jurisdiction.
The sub-contract was based on the IChemE Grey
Book and Cl.3.1 provided:
"The party wishing to refer to arbitration any
dispute arising or in connection with a contract
may give a notice at any time to that effect to
the other party".
Clause 4.3 provided:
"Where an adjudicator is not appointed under 4.1 or
4.2, the party issuing the notice may request
ICHEME to nominate an adjudicator. Such request
shall be in writing..."
Held: nothing in the words of clause 3.1 or 4.3
required the sequential issuing of the two types of
document.
There was no previous authority on these provisions.
Cases about service of notices under the Scheme
were unhelpful in construing this sub-contract. The
proof of the pudding was in the eating. On receipt of
the email, MW acted immediately. The 4th edition of
Coulson on Adjudication (2018), 18.16 recommended
that both notices were sent at the same time. That
militated against any idea of unfairness or
impracticality where notices were sent
simultaneously.
MW claimed that being copied in on an email
addressed to ICHEME could not amount to the
"giving of notice" required by cl. 3.1. As a matter of
principle the court could not see why not. Nothing
in cl. 3.1 required formal "service" or stipulated any
mode of giving notice, rather it provided for the
simple giving of notice.
Defence 2: This was a hybrid contract: some works
were governed by the Act, some not. MW argued
that the adjudicator should have taken into account
the value of its counterclaim said to be worth £4.3m,
though they also said he was not entitled to value it
as it arose from the excluded operations. This
approach, described by the judge as “look but don’t
touch”, appeared to be tactical.
Adjudicator had included a ‘nil’ value in his decision,
thus taking the counterclaim out of the adjudication
altogether. He was not valuing something he had
no jurisdiction to deal with. In any event as there
was no payless notice, the adjudicator was not
obliged to take the counterclaim into account.
7
7

Case 7: Marbank Construction Ltd
v G&D Brickwork Contractors Ltd
[2021] EWHC 1985 (TCC) 28 June
2021 O’Farrell J – injunction to
restrain adjudication
In the exercise of its discretion a court may grant
an injunction to restrain a party from pursuing an
adjudication pursuant to s37 of the Senior Courts
Act 1981 applying American Cyanamid principles:
court could only interfere in limited
circumstances.
Background
G&D a sub-contractor had taken CC proceedings
for sums claimed owing over 3 construction
projects.
The court proceedings were struck out. This lead
G&D to refer the three disputes to adjudication
with further ones intimated.
Marbank argued the adjudications were
unreasonable and oppressive. They raised the
same or substantially the same issues as the CC
proceedings which had been struck out. It
intended to pursue Part 8 proceedings to deal
with these jurisdictional points and needed an
injunction to give it time to do so.
In dismissing the application for an injunction,
O’Farrell J noted:
G&D had a right to commence adjudication
proceedings at any time. It was not for Marbank
to dictate when that might be.
Irrecoverable costs were simply a feature of the
process.
Conduct in commencing three sets of
adjudication proceedings were
commonplace
Taken together these features did not
amount to unreasonable or oppressive
behaviour. The court noted that unlike
Mentmore Towers Ltd v Packman Lucas
Ltd[2] the adjudications had not been
enforced and G&D was not in breach of any
court order.
However and significantly, if the subject
matter of the adjudications were to trespass
on a court decision, that could prevent the
adjudicator from having jurisdiction and it
would follow, the court from enforcing any
decision.
Finally following the reasoning of Lord Briggs
in Bresco Electrical Services Ltd v Michael J
Lonsdale (Electrical) Ltd[3] the court was
reluctant to interfere in adjudication.
Jurisdiction was a matter that could and
should be dealt with at the enforcement
stage.
[2] [2010] EWHC 457 (TCC)
[3] [2020] UKSC 25 8
8

Case 8: Toppan Holdings Ltd and
Abbey Health Care (Mill Hill) Ltd v
Simply Construct (UK) LLP [2021]
EWHC 2110 (TCC) 27 July 2021
Martin Bowdery QC – Right to
Adjudicate – whether collateral
warranty is construction contract
Sapphire contracted with Simply to design and
build a residential care home in 2015. The
building contract provided for a collateral
warranty to a future tenant. Sapphire novated
the building contract to Toppan who granted a
lease to Abbey who then operated the care
home. Simply executed a collateral warranty in
favour of Abbey.
In 2019 significant fire safety defects were
discovered and subsequently rectified at
considerable expense. Toppan started an
adjudication against Simply to claim remedial
costs under the novated building contract and
Abbey started an adjudication to claim damages
for loss of income against Simply pursuant to the
Act on the basis that the collateral warranty was
a ‘construction contract’ i.e. one for “construction
operations”.
The same adjudicator was appointed in each
case and he made awards in favour of Toppan
and Abbey which they sough to enforce.
The warranty was a bespoke form in which
Simply warranted as follows:
“(a) the Contractor has performed and will
continue to perform diligently its obligations
under the Contract;
(b) in carrying out and completing the Works
the Contractor has exercised and will continue to
exercise all the reasonable skill care and diligence
to be expected of a, properly qualified competent
and experienced contractor experienced in carrying
out and completing works of a similar nature value
complexity and timescale to the Works;
(c) in carrying out and completing any design
for the Works the Contractor has exercised and will
continue to exercise all the reasonable skill care
and diligence to be expected of a prudent,
experienced competent and properly qualified
architect or as the case may be other appropriate
competent and qualified professional designer
experienced in carrying out and completing the
design for works of a similar nature value
complexity and timescale to the Works.”
In the Abbey adjudication, Simply maintained a
challenge against the adjudicator’s jurisdiction: they
said the collateral warranty was not a construction
contract and there was no right to adjudicate the
dispute arising under it.
In Parkwood Leisure[4], Akenhead J said:
“(a) The fact that the construction contract (if it
is one) is retrospective in effect is not a bar to it
being a construction contract.
It is common for contracts to be finalised after the
works have started and to be retrospective in effect
back to the date of or even before commencement.
If that is what the effect of the parties' agreement is,
then that cannot prevent it from being a
construction contract for the carrying out of
construction operations. Put another way, a
construction contract does not have to be wholly or
even partly prospective.
[4] Parkwood Leisure v Laing O’Rourke [2013] B.L.R. 589 9
9

(b) One must be careful about adopting a
peculiarly syntactical analysis of what words
mean in this statute when it is clear that
Parliament intended a wide definition.
An agreement "for... the carrying out of
construction operations" is a broad expression
and one should be able, almost invariably at
least, to determine from the contract in question
whether it fits within those words, without what
could be a straight-jacketed judicial
interpretation.
(c) Usually and possibly invariably, where one
party to a contract agrees to carry out and
complete construction operations, it will be an
agreement “for the carrying out of construction
operations”.
The warranty in Parkwood includes the verbs
“warrants, acknowledges and undertakes”.
The Abbey warranty did not use “acknowledges
and undertakes”.
It was given 4 years after practical completion of
the original works, 3 years after the settlement
agreement and 8 months after the remedial
works had been carried out and at a time when
no further work was in prospect.
This was a strong pointer against it being an
agreement for the “carrying out of construction
operations” within section 104 of the Act.
Rather it was a warranty as to a state of affairs
past or future akin to a manufacturer’s warranty.
Comment
Amongst other things care should be taken when
drafting the terms of a warranty to give effect to an
intention to provide for (or not to provide for) a right
of adjudication.
If the intention is to provide for such a right this is
best done by introducing an express adjudication
provision (which will result in a contractual right
even if there not a statutory right).
If it is intended there be no such right, then the
obligation being warranted needs to be drafted so
as not to require the warrantor to carry out any
constructions operations (essentially any work).
But in addition the time at which the warranty is
given (before or during or after completion of works)
is a factor which needs to be taken into account as
likely to influence the construction of the warranty.
10
10

Case 9: Downs Road
Developments LLP v
Laxmanbhai Construction (UK)
Ltd [2021] EWHC 2441 (TCC) 7
September 2021 (HHJ Eyre QC) -
Set off – failure to consider
defence – validity of payment
notice – severance
This was a complex case. Claimant Employer
engaged defendant Contractor to build 79
residential units in London on a JCT DB 2011 with
amendments for a contract sum of £27.39m.
Employer served a “holding” notice relied on as a
valid Payment Notice for £0.97p (i.e. a nominal £1
less 3% retention) within the requisite period
(Payment Notice 34). It later served a detailed
Payment Notice (34a) outside the requisite
period. This process had been employed in
previous payment applications 31-33. Contractor’s
interim payment 34 had been for £1,888,660.70
whereas Payment Notice 34a was for £657,218.50
which was paid.
Instead of commencing a ‘smash and grab’
adjudication based on its payment application
Contractor commenced a true value
adjudication over application 34. It wanted to
settle the way in which payment applications
were dealt with and avoid a further adjudication
by the Employer for a true value.
In the adjudication Employer relied on its
Payment Notice 34. It also raised a counterclaim
for a defective capping beam claiming loss of
future rental of £149, 692.
Adjudicator valued application No 34 at
£103,826.98.
He decided the issue over the capping beam was
not part of the dispute i.e. not part of the valuation of
payment application 34 and outside his jurisdiction.
In Court, Employer applied under Part 8 CPR for
declarations including one that the Adjudicator’s
decision was unenforceable for failure to address
the capping beam claim. Contractor sought
declarations that Payment Notices 34 and 34a were
invalid and that the Decision was valid and
enforceable.
Employer conceded Payment Notice 34a was out of
time and invalid but relied Payment Notice 34 as
valid but said the Decision was not binding because
of the failure to address its capping beam cross-
claim.
They contended that whilst Decision was not
binding in respect of the extent of its set off, it was
binding as to value of Payment Notice 34.
In the result the Contractor was no longer able to
rely on Payment Application 34 as a payment notice
and was only entitled to the amount identified by
the adjudicator (which it had paid).
Contractor argued that Payment Notice 34 was
invalid, and Decision, enforceable in its entirety.
Alternatively, if not enforceable in full, it was not
enforceable at all with the consequence that the
notified sum was the amount set out in Payment
Application 34 (see s.111 (1) of the Act); and Employer
was obliged to pay that sum even if the Decision
was enforceable (Employer's redress after payment
was to seek to recover any overpayment).
[4] Parkwood Leisure v Laing O’Rourke [2013] B.L.R. 589 11
11

Payment Notice 34 did not provide ‘an agenda
for adjudication’. It set out no basis for the
gross valuation increase of £1. Contrast its
Payment Notice 34a which put forward a
markedly larger figure and was accompanied
by detailed calculations.
Payment Notice No 34 did not set out the
amount which Employer actually considered
to be due. It was not necessary to show the
Employer was acting in bad faith but equally it
could not be said the notice stated the sum
that Employer genuinely considered to be
due. Payment Notice 34 was invalid and
ineffective.
The adjudicator took too narrow a view of his
jurisdiction. The question of the capping beam
claim was part of the payment dispute. Had
the adjudicator considered the capping beam
claim and concluded that the defence did not
operate to reduce the amount due, his
decision would have been unimpeachable
(whether founded on either the interpretation
of the Contract or on arguments as to the
merits or quantum of the capping beam
claim).
This was a “material” breach of the rules of
natural justice. Apart from anything else it was
worth more in claimed value that the amount
actually awarded.
The Decision could be safely enforced as to the
value of the Interim Payment Application 34.
The starting point was that whenever it was
safe to do so it would and could sever the
good from the bad. Adjudicator was not asked
to make a series of separate decisions. He
reached a single decision with findings and
conclusions in support.
It would be artificial and inappropriate to stop
at any particular point in a chain of reasoning.
Nothing remaining could be safely enforced.
The question whether Employer remained
liable to pay the notified sum on Payment
Application 34 and then seek return of any
overpayment, was “academic” (for the
purposes of the court proceedings) and not
further addressed. Neither party had claimed
any relief based on the invalidity of Payment
Notice 34. In addition matters had moved on
to payment cycle 35 which would be a proper
matter for any further dispute.
Judgment
12
12

Case 10: Quadro Service Ltd v
Creagh Concrete Products Ltd
[2021] EWHC 2589 (Ch) 19 Aug
2021 (HHJ Sarah Watson QC –
Dispute – meaning – sum due on
three payment application was a
single dispute
Section 108(1) of the Act gives a right to refer “a
dispute” to adjudication at any time. The Scheme
at paragraph 1(1) refers to “any dispute” (singular)
and is construed accordingly. Thus, an
adjudicator does not have jurisdiction to
determine more than one dispute in any single
adjudication, unless the parties otherwise agree.
Sometimes, because of complexity, the issues
referred to adjudication form only part of a larger
dispute that has arisen say upon a payment
application.
They were nevertheless held to be part of a single
dispute. They were no more than aspects of a
dispute between the parties as to the proper
amount of a payment certificate. You have to
look at the facts of the case and use common
sense.
Here, rather than being obviously aspects of a
single payment application, the dispute
concerned three separate payment applications.
The adjudicator decided it was a single dispute
and awarded the claimant £40,000.
On enforcement and applying the above
principles, the court looked at the referral, the
surrounding facts in and decided that the
question ‘What was due under three payment
applications?’ comprised a single dispute.
The three applications were linked as they were
cumulative. What was being claimed was the
total sum due under the contract.
Each application could be a sub-issue that was
part of a wider dispute as to the total sum due
to the claimant under the contract as in the
case of a claim for variations
If D was right, it would mean parties incurring
the very significant cost and inconvenience of
three adjudications to recover “a single balance
claimed under a single contract.”
Comment
It appears that the defining factor was that the
referring party was claiming the total sum due
under the contract at the date of the referral to
adjudication, which was a single sum albeit the
product of three applications.
It also appears to have been significant that the
applications were cumulative and therefore
pointing to a total sum due.
The decision cannot be faulted on the facts,
though it does seem to be edging towards the
boundary of what constitutes a single dispute and
‘bundling up’ separate payment applications, at
least where they are not cumulative, may not
achieve the same outcome.
13
13

Legislation
The Act means the Housing Grants, Construction and Regeneration Act 1996 as
amended by the Local Democracy, Economic Development and Construction Act
2009 Pt 8.
The Scheme means the Scheme for Construction Contracts (England & Wales)
Regulations 1998 (the ‘Principal Regulations’) as amended by the Scheme for
Construction Contracts (England & Wales) (Amendment) (England) Regulations 2011
for contracts entered into after 1 October 2011.
Northern Ireland has its own scheme: the Scheme for Construction Contracts in
Northern Ireland 1999 as amended by the Scheme for Construction Contracts in
Northern Ireland (Amendment) Regulations (Northern Ireland) 2012.
Scotland has its own Scheme: Scheme for Construction Contracts (Scotland)
Amendment Regulations 2011 (SI 2011/371), applicable to contracts made on or after 1
November 2011. The new Regulations apply only to contracts for work in Scotland
entered into on or after this date. There are new separate regulations for Wales,
applicable to contracts for construction operations in Wales entered into on or after 1
October 2011.
14
14

Construction & Engineering
Get in touch with our team for more information:

@SlaterHeelisLaw
/slaterheelis
Kenneth Salmon
Consultant Solicitor
kenneth.salmon@slaterheelis.co.uk
0161 672 1436 | 07786 702 140
Matthew Grellier
Partner & Head of Construction
matthew.grellier@slaterheelis.co.uk
0161 672 1427 | 07753 464 740

UK Adjudicators January 2022 Newsletter Highlights Key Construction Law Updates

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