Martin Girt v Page Bentley [2002] EWHC 2434

This summary was provided by CMS Cameron McKenna LLP.

For more information visit http://www.cms-cmck.com/Construction/Construction-Disputes

The rules of natural justice apply to adjudications, but the mere fact that an adjudicator has not complied with those rules does not mean that his or her award is unenforceable. What matters is whether the breach of natural justice had a prejudicial effect on the party opposing the enforcement of the determination.

HHJ Wilcox, Technology and Construction Court

12 April 2002

G entered into a contract with B to provide labour-only plastering works at a building in Scotland. A dispute arose as to the amount owing to G for performing those works. The dispute was referred to adjudication.

The Adjudicator determined the dispute in G's favour, awarding it some £53,000 if G could produce a VAT certificate to B, and some £18,000 if G could not produce a certificate. The Adjudicator had not heard any argument from the parties about the correct VAT position. He had taken it upon himself to make his decision on the alternative bases (i.e. depending upon whether or not a VAT certificate was produced).

G sought to enforce the Adjudicator's determination, but only for the amount of £18,000 (i.e. assuming no VAT certificate was produced). G had not sought to recover the greater amount of £53,000, that was awarded on an alternative basis. B opposed enforcement of the determination. The basis for opposition was that the award had been produced in breach of the rules of natural justice, because neither party had been given the opportunity to make any argument on the correct VAT position.

Judge Wilcox rejected B's argument, and accepted that the Adjudicator's determination was enforceable. The Judge pointed out that B had not been able to identify any prejudice suffered as a consequence of the Judge not having received submissions on VAT. After all, G was only seeking to recover the lesser amount of the two alternatives awarded. If any party had been prejudiced by the Adjudicator's conduct, it was probably G and not B.

The rules of natural justice apply to adjudications, but the mere fact that an adjudicator has not complied with those rules does not mean that his or her award is unenforceable. What matters is whether the breach of natural justice had a prejudicial effect on the party opposing the enforcement of the determination.

This summary was provided by CMS Cameron McKenna LLP.

For more information visit http://www.cms-cmck.com/Construction/Construction-Disputes

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