REUTERS | Alex Domanski

Should the adjudicator split his costs decision by issue?

I was reading Akenhead J’s decision in Allied v Paradigm and, aside from the issue of whether the adjudicator had jurisdiction (was there one dispute – termination – or two disputes – termination and damages), one comment in particular caught my eye.

At paragraph 34 of the judgment, Akenhead J referred to severability, raising the question of whether the adjudicator’s decision should be enforced in part, if he found that the adjudicator lacked jurisdiction for the whole. (As it happened, he didn’t have to answer this question because the responding party didn’t properly reserve its position to challenge the decision on enforcement, and so fell at the first hurdle.)

However, Akenhead J went on to provide a simple example and said (at paragraph 35):

“…Assuming that the responding party effectively reserves its position on Claim 2, the decision which allows both claims is impugnable in part. Unless the decision is irretrievably un-severable, verbally or mathematically, the decision on Claim 1 will be unenforceable; there may be elements of the decision such as the award of costs which are sufficiently abstruse as to be un-severable and therefore unenforceable in practice.” (my emphasis)

And the words underlined got me thinking…

It is not unusual for the parties to ask for my costs decision to be divided between the issues referred to me but, in light of Akenhead J’s comments, should I start routinely splitting my costs decision between the issues referred, just in case? Should I do this without being invited to do so? And would this help or hinder the parties?

On the basis that it would be impossible for the parties to know how much time I had spent on claim 1 and claim 2 unless I provided a breakdown, would the lack of clarity render that part of my decision unenforceable if not (assuming the court severed the decision)?

I’m not sure if Akenhead J intended to suggest that the adjudicator’s decision on who should pay his costs may be unenforceable if the court severs the decision at enforcement, but this may be an inevitable consequence of his words.

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