REUTERS | Dominic Ebenbichler

Court orders party to adjudicate final account dispute

There is a well-known saying, “beggars can’t be choosers”, which is generally accepted to mean that sometimes you have to accept a situation because it is the only one available to you. I feel a bit like that discussing a recent Fraser J extempore judgment, Meadway Private Clients (Liongate) Ltd v Wildacre Ltd.

What caught my eye in the Lawtel report I was sent was the order to commence an adjudication.

Meadway Private Clients (Liongate) Ltd v Wildacre Ltd

This was a dispute over a hotel refurbishment in Jersey, undertaken by Meadway (the contractor) for Wildacre (the employer). The dispute centred on the non-payment of two of its 2017 interim applications for payment. That non-payment led to Meadway applying for an injunction to freeze Wildacre’s assets. Perhaps it feared that, as a Jersey company, there was an insolvency risk.

At the first court hearing, an interim injunction was granted for £500,000 and, at the same time, Meadway gave an undertaking to issue and serve a claim form. However, it didn’t do that, although the judgment does refer to a failed mediation and an adjudication that Meadway started, which appears to have led to an award of £176,000 in its favour.

At the second court hearing before Fraser J, Wildacre argued (among other things) that the injunction should be discharged because of Meadway’s non-compliance with the undertaking. Not unsurprisingly, Meadway argued that the freezing injunction should be continued.

Fraser J noted that the failure to comply with the undertaking was a serious issue, but Meadway had “got on with an adjudication in respect of the interim payment application and had succeeded” (Wildacre had paid the £176,000 awarded by the adjudicator). Therefore, he continued the freezing order but ordered Meadway to issue and serve a claim form relating to its final account. The value of the injunction was reduced, to reflect Meadway’s final account claim.

Contractor ordered to start adjudication

What I thought was really interesting was the fact that Fraser J also ordered Meadway to commence an adjudication on its final account dispute, and to pay £50,000 into court to “fortify the cross-undertaking”.

This isn’t the first time I’ve seen this type of order, although it is more usual for the order to be made in the context of adjudication enforcement, where a stay may be granted but is conditional on a party commencing adjudication within a set period.

Once again, it indicates the court’s willingness to support adjudication, and to enable parties to get a quick answer.

So you see, I would have preferred an adjudication enforcement or payment case to discuss, but beggars can’t be choosers, I suppose. Let’s hope the rumours of an important Part 8 case on pay less notices, heard by Coulson J earlier this month, are true, and we have something more interesting to write about in a week or two.

MCMS Ltd Matt Molloy

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