Atholl Developments v UBC [2010] CSOH 94

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(1) An award of an adjudicator would not be reduced where errors alleged to have been made by him in his decision failed to show that he had exceeded his jurisdiction or was in material breach of the rules of natural justice. (2) Accordingly an award under the same contract by the same adjudicator in a second adjudication, which was based upon his decision in the first adjudication, should not be reduced on the ground that it was tainted by the first adjudication. (3) Even if the award in the first adjudication had been reduced, the award in the second adjudication would still have been enforceable since the challenge to the first award was not made until after the second award had been issued.

Outer House, Court of Session: Opinion of Lord Glennie


The Petitioner, Atholl Developments (Slackbuie) Limited (“Atholl”) sought Judicial Review of decisions of an adjudicator.  Atholl employed contractor, UBC Group Limited (“UBC”), who undertook to build 51 houses (with associated services) in Inverness.  The contract was a standard form SBCC Scottish Building Contract with Approximate Quantities May 99 Edition (January 2004 Revision) (with additional amendments and incorporations) which contained an adjudication clause. The contract was subject to two separate adjudications.

The dispute between the parties which was the subject of the first adjudication was in relation to the final account produced by UBC.  UBC put forward a final account valued at £7,900,000.  Atholl alleged that the final account should have only been £5,472,125.18.  On review, the Adjudicator decided that the account was worth £6,231,353.30 and made a declaration to that effect. 

UBC then commenced a second adjudication (with the same Adjudicator) seeking an order that, on the basis of the first decision and having regard to the sums UBC had already received, Atholl should pay UBC the sum of £348,033.00.  The Adjudicator made an award directing Atholl to make the payment requested.

Atholl then raised court proceedings for Judicial Review seeking to reduce the first decision of the Adjudicator, claiming that the Adjudicator had in coming to his decision made a number of clear errors and manifest mistakes from which it was to be inferred that the Adjudicator had not paid any attention to certain documents or submissions made by Atholl.  Atholl contended that this amounted to a breach of natural justice.  Atholl also alleged that, in respect of one item in the final account, the Adjudicator had awarded more than UBC were claiming.  Atholl contended that in so doing the Adjudicator had acted in excess of his jurisdiction.

Atholl further claimed that, since the decision in the first adjudication had to fall for the reasons outlined above, the decision of the Adjudicator in the second adjudication was tainted and had to fall along with it. 


The Court was asked to address the following issues:

  • Whether the manifest mistakes alleged to have been made by the Adjudicator in the first adjudication would fall within the grounds available to seek reduction of a decision.
  • Whether, if the first decision of the Adjudicator was reduced for the reasons claimed by Atholl, the decision in the second adjudication would fall along with it.


The Court held:

  • In the first adjudication, the Adjudicator had before him 16 lever arch files to consider in a short space of time as opposed to the small number of documents highlighted to the Court in the concise submissions made by counsel at the Judicial Review hearing.  The Adjudicator had not benefited from the same detailed analysis Atholl provided to the Court in relation to these points.
  • Furthermore, some of the points complained of by Atholl at the Judicial Review hearing had not been “flagged” before the Adjudicator in the adjudication but were left to be discovered by him in the course of comparing different documents. 
  • On the basis of previously decided cases, the Court confirmed again that decisions of adjudicators are to be enforced unless there is good reason not to do so.  A good reason includes: where an adjudicator has exceeded his jurisdiction, or failed to exhaust his jurisdiction; or where there has been a breach of natural justice, but even here the Court will only interfere in the plainest of cases.
  • The Court will not be overly critical of the reasoning put forward by an adjudicator for his decision. It must be intelligible, and it must show that he has considered the issues before him and reached his decision on those issues for reasons which are explained in his decision.  But the reasons need not be explained in great detail, nor need he refer to each document or each submission put before him.
  • It will be assumed, unless the contrary is shown, that an adjudicator has looked at all the relevant materials and given to them such consideration as he considered practicable (having regard to the pressure of time) or appropriate. He is not to be criticised if the scrutiny given by him to a document which comes in at a late stage of the adjudication is less thorough than might have been the case had the document been part of the original submissions to him. 
  • On the facts, Atholl had failed to persuade the Court that the Adjudicator had consciously or unconsciously disregarded Atholl's submissions or the documents which they put before him.  The material drawn to the Court’s attention may well show that the Adjudicator made clear mistakes but the Courts have recognised that adjudication is conducted under pressure of time and may therefore result in a measure of rough justice.
  • Atholl’s argument that the Adjudicator had exceeded his jurisdiction by awarding more in respect of a particular item in the final account than UBC were claiming was based upon a misapprehension of what is encompassed within a dispute.  In a final account dispute there are many sub-issues but it does not follow that each one is a separate dispute so that an error of the type alleged means that there has been an excess of jurisdiction. 
  • The first decision stood, and therefore, so did the second decision.
  • Even if Atholl had succeeded in demonstrating that the first decision should be reduced, it would not follow that the second should also fall.  The decision in the first adjudication was final and binding unless and until it was reduced.  The challenge to the first decision had not been instituted until after the Adjudicator had made his decision in the second adjudication.
  • The Court suggested that if a party wishes to challenge the decision of an adjudicator he should act promptly.  In a case such as the present, any challenge to the first decision should be made when the successful party commences the second adjudication.  It is too late to raise a challenge after the adjudicator has relied upon his first decision when making his second. 
  • The petition was refused and both decisions of the Adjudicator remained binding upon Atholl.

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