As is customary, I’m starting the year with a look at what the year may hold for construction practitioners.
I did this last year too, musing then over what we should be calling the decade we’d just left as we arrived in the twenty-twenties. I also wondered what the next major event in construction law was likely to be (excluding the obvious elephant in the room). Who knew then that just a few weeks later we’d be in the grip of a global pandemic and our world would be turned upside down. By comparison, the end of the transition period came upon us rather suddenly and, although there was considerable chatter about the terms of any trade deal, even that sorted itself out in the end. In one sense, Brexit is over now. It feels a bit like it is yesterday’s news, today’s chip paper! We’ve left the EU and we all have to move on.
Now, if only the pandemic would go away…
Looking forward from 2020
Last year, I had eight items on my list and, as I said then, many had appeared previously. This year, rather than repeating them all again, I want to highlight just one of them – an adjudication enforcement case in Ireland – as that is the one thing that actually happened, sort of.
O’Donovan and another v Bunni and others
In case you missed it, the case is O’Donovan and another v Bunni and others. It is a final account dispute over electrical works that OCS One Complete Solution Ltd carried out for the Cork County Committee of the GAA as part of the redevelopment of the Páirc Uí Chaoimh in Cork. OCS alleges it is owed just over €1 million.
The payment dispute was referred to conciliation, then arbitration (with a hearing due in 2021) before being referred to an adjudicator. The main issue is whether the adjudicator (Mr Bridgeman), who was appointed by the chairman of the Construction Contracts Adjudication Panel (Mr Bunni) has jurisdiction to hear the dispute. This is because the bulk of the works that were carried out by OCS were completed before Ireland’s Construction Contracts Act 2013 came into force in July 2016.
When Mr Bridgeman’s appointment was initially challenged by GAA, he expressed a “view” that he had jurisdiction and would continue, which led to GAA’s court application for judicial review of that decision and a stay of the adjudication pending the determination of those proceedings.
OSC applied to lift the stay, arguing that the Construction Contracts Act had been introduced to provide a “fair and expeditious determination of payment disputes”, and keeping the stay in place was depriving OSC of that statutory right.
The question for the court seems to have boiled down to what was in the best interests of justice. Was this to have an adjudicator issue a decision that might prove to be unenforceable, once the judicial review hearing had taken place, or was it to keep a stay in place until that hearing had taken place and the outcome was known? It looks to have been finely balanced, but the judge opted to keep the stay in place. In his view, that is where the interests of justice were best served and he listed a number of reasons why he reached that conclusion.
I think this is an interesting outcome. We all know that it is extremely difficult to get the TCC to grant a stay or injunction to prevent an adjudication from continuing. Equally, we don’t use the court’s judicial review procedure to look at issues related to an adjudicator’s jurisdiction. Declaratory relief proceedings provide us with answers to such questions, but they are rarely used while the adjudication is underfoot. It is much more likely that one party will reserve its position and carry on, using jurisdictional arguments to resist enforcement (assuming the adjudication does not go that party’s way).
I’m not sure when the judicial review hearing is listed for but I hope this isn’t the start of parties using jurisdictional challenges in Ireland as a way of trying to avoid adjudication. As the last 20 years have demonstrated here, adjudication is a great way of resolving parties’ disputes quickly and (in most cases) cheaply, with most parties accepting the adjudicator’s decision most of the time.
As someone who is forever blowing bubbles, I can’t finish without giving West Ham a mention. They didn’t make it into a cup final but the men’s team did retain their premiership status, finally finishing the league in 16th place (we are currently 10th).
One thought on “Welcome to 2021”
Since writing this new year piece, another Irish judgment has been handed down (Gravity Construction Ltd v Total Highway Maintenance Ltd).
It is an enforcement decision but, because the respondent (Total) agreed to pay the sums awarded to the applicant (Gravity), it only deals with the costs of the application and the form of the court order. This means the judgment does not focus on enforcement issues per se. That is a shame, as it would be good to see how enforcement jurisprudence develops in Ireland.
Still, I think it is an interesting judgment because it clearly demonstrates that starting court proceedings continues to be the stick that parties have to beat non-payers with. Without such proceedings being issued, it is arguable that Total would not have reached the point where it was prepared to honour the adjudicator’s decision.
The judgment doesn’t explain why Total initially adopted a position whereby it was arguing that payment of the adjudicator’s decision should be stayed pending an arbitration to finally resolve the dispute. However, I’m not sure that argument would have got it very far. After all, just like the Construction Act 1996, the Construction Contracts Act 2013 provides (in section 6(10)) that an adjudicator’s decision is binding, pending final resolution by arbitration, court proceedings or by settlement. I’m sure the Irish courts will come to dislike applications to stay as much as the TCC does!
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