REUTERS | REUTERS/Goran Tomasevic

Adjudicating on multiple adjudications

I recently saw a comment that someone had posted on LinkedIn asking if it was possible for the law just to stay as it is for a while, given the deluge of recent construction case law. I’m sure quite a few of us think that from time to time although, as someone with a regular blog post to write, I don’t want it to go too quiet too often!

Which brings me to one of the latest judgments from Adam Constable QC. It looks like he had a busy September, hearing the dispute in LJH Paving v Meeres Civil Engineering one day, Meadowside Building Developments v 12-18 Hill Street the next day. Plenty has been written about the important points of principle that came out of Meadowside by those involved (for example, see Helena White and Mark Fletcher’s posts), so I’m going to focus on the judgment in LJH Paving. In particular, I’m going to look at the multiple adjudications point (which the keen-eyed might notice wasn’t actually a point raised in the judgment).

LJH Paving v Meeres Civil Engineering

This was a summary judgment application to enforce four adjudicators’ decisions relating to three different construction sub-sub-contracts, each of which were entered into by the sub-contractor (Meeres) and the sub-sub-contractor (LJH).

There was no dispute over three of the decisions and it was agreed they should be enforced. Because of that, we don’t know what those three decisions were about, nor do we know if it was the same adjudicator in each case.

In relation to the fourth decision, Meeres resisted enforcement arguing that the dispute had not crystallised and the adjudicator’s decision related to more than one contract. The parties’ contract related to the “Westfield Works”, which had been completed in February 2018. The dispute arose over LJH’s final account, which the parties seemed unable to agree on and which the adjudicator subsequently valued, ordering Meeres to pay some £132,000 to LJH.

It wasn’t so much the parties’ arguments about crystallisation and multiple contracts that interested me, it was more the fact that there had been multiple adjudications. However, for completeness, I should just mention that the judge rejected both arguments and enforced all four decisions, including the disputed one. On the crystallisation point, he noted that:

  • There was “unarguably a clear dispute between the parties”.
  • On the facts, Meeres’ allegation that insufficient substantiation for the final account had been provided was not a proper ground for resisting enforcement.
  • Meeres was able to request specific evidence in substantiation, which demonstrated that the claim was not nebulous or ill-defined (one of the grounds from Jackson J’s judgment in Amec Civil Engineering Ltd v Secretary of State for Transport).
  • The crystallisation defence had not been properly raised in the adjudication itself, so the right to raise it as a jurisdictional defence in the enforcement proceedings had been lost.

The judge also noted that the adjudicator had addressed (and rejected) the multiple contracts point during the adjudication. Whether the sums claimed fell under this contract was for the adjudicator to decide. (Obiter, the judge said he would have severed the offending part of the adjudicator’s decision, as it was readily identifiable and represented less than 2% of the decision.)

Multiple adjudications

So, back to my multiple adjudications point – there were four decisions arising under “three different construction contracts”.

I’ve written about the consequences of so-called serial adjudication a number of times (most recently, in April), although I’m not sure I’d call this scenario a serial adjudication one. We have no idea when those decisions were made and if they were made by more than one person. In some respects, it does not matter, as the parties can agree to deal with matters how they feel is best in the circumstances. It is only when there is a dispute that parties start to look closely at the terms of section 108 of the Construction Act 1996 and the Scheme for Construction Contracts 1998.

It may seem trite to say that section 108(1) provides that “a party to a construction contract has the right to refer a dispute arising under the contract for adjudication”, but those rules still trip parties up. Similarly, we all know that under Part I of the Scheme for Construction Contracts 1998, an adjudicator may only deal with more than one dispute “at the same time” if all the parties consent to him doing so. The dispute may arise under the same contract (paragraph 8(1)) or be a related dispute under a different contract (paragraph 8(2)).

I’ve recently had a spate of concurrent and overlapping decisions involving the same parties. Sometimes this has been on the same contract (dealing with multiple issues and/or disputes), other times different contracts have been involved. However, it has all been done by consent (so we don’t fall foul of paragraph 8 of the Scheme).

It can be a valuable and efficient way to resolve disputes, particularly with sophisticated parties and their representatives. It can also bring consistency as it is not always easy to interpret and ascertain what a previous adjudicator dealt with or decided. (You’d hope you have a better idea if it was you that was  adjudicating previously!)

However, it can be challenging co-ordinating, managing your time and be required to multi-task (I’m never sure whether multi-tasking means instead of just doing a few things well, I am doing more things badly). The challenges were brought home to me by the pupils who have shadowed me on these multiple adjudications, and who have said it was a challenge for them acting on adjudications concurrently instead of doing one at a time or sequentially. I had to remind them that even with their day jobs, adjudication is a 24/7 process, but they can rest on bank holidays 😉

2 thoughts on “Adjudicating on multiple adjudications

  1. Another well written article. I for one am a great advocate of serial adjudications, not only because of the Lingchi effect, but because in some instances there may be a vast number of areas in dispute and due to cash restrictions being imposed by the other party, it is more sensible to adjudicate in multiple stages. The other important factor is that one part of the dispute may take much longer to evidence and prepare than other more simplistic parts of the dispute. It is therefore advantageous to prepare these larger issues almost simultaneously whilst the other (smaller) adjudications are in motion. This then allows for a continuation of adjudications, and with the aim that by this stage the other party may just come to the table to settle. I say ‘may just’ because it does not work in every instance!!!!

    1. Simon.
      As the representative acting for the successful party I agree with you and advise that I find your analysis to be correct.
      It is unfortunate that parties fail to honour an adjudication decision, leave alone multiple adjudication decisions and that the additional time, cost and involvement in the measures of enforcement, prove necessary to obtain entitlement.

Leave a Reply

Your email address will not be published. Required fields are marked *

Share this post on: