Practical Law

I read an article recently all about who should pay for the reasons in adjudicators’ decisions. Cliff Wakefield, the author, argued that some adjudicators go too far, and write too much, and that their long-windedness costs the parties (usually the losing party) a disproportionate amount of money. He suggested that perhaps it is time that parties started asking adjudicators to limit the number of pages in their decisions. Alternatively, the party asking for reasons should agree to pay for those reasons, regardless of the outcome of the adjudication.

I began to wonder what the point of reasons is? Why do parties want (and expect) reasons, and why is it that the Scheme for Construction Contracts 1998 makes reasons optional (paragraph 22)?

Reasons have a number of uses

To paraphrase Jackson J (in Carillion v Devonport), I think there are at least three reasons for reasons:

• To enable the parties to understand what the adjudicator has decided and why.
• To ensure the adjudicator has decided all the essential elements of the parties’ dispute.
• To assist the court in determining whether the adjudicator’s decision is valid and should be enforced.

How detailed should reasons be?

I think the answer to this is subjective. It depends on the issues you are considering. Some issues require more explanation than others (and you only have to look at the parties’ submissions, to see that they too spend longer on some issues, and that length of submissions is not always related to the value of those items or issues).

That said, Jackson J said an adjudicator only had to include “a brief statement” of his reasoning. More recently, Akenhead J indicated (in Balfour Beatty v Shepherd Construction) that an adjudicator’s reasons should be “intelligible so that parties, objectively, can know what the adjudicator has decided and why”. He also suggested they should be “expressed simply”. If the reasons are not coherent, that would not be a reasoned decision, but that doesn’t mean the reasons cannot be “repetitve, diffuse or even ambiguous”.

I think that all translates to short and easy to understand.

Who should pay for the reasons?

I struggle with the idea that one party should be responsible for the cost of the adjudicator giving reasons, regardless of the outcome of the adjudication. After all, both parties will rely on those reasons when they look at the decision. The adjudicator’s reasons may be the thing that tips the balance between a party challenging a decision and not challenging it; of paying up or continuing to fight.

However, there is some merit in adjudicators refraining from writing “War and Peace” when something so much shorter will suffice. I think only they can know what that is, and being told to keep the reasons to X pages is neither helpful or necessary.

And finally

Ian Dury sang about reasons, in Reasons to be Cheerful (part 3):

“Cheddar cheese and pickle, the Vincent motor sickle
Slap and tickle
Woody Allen, Dali, Dimitri and Pasquale
balabalabala and Volare”

I’m not sure that these words necessarily follow Akenhead J’s guidance, but they are reasons…