Rohde Construction v Markham-David [2006] EWHC 814 (TCC)

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The Housing Grants, Construction and Regeneration Act 1996 provides that documents relating to an adjudication have effectively been served if they are sent to the defendant’s last known principal residence.  In a decision relating to an application to set aside a judgment in default enforcing the adjudication decision, the Technology and Construction Court suggested that an adjudication decision made in the absence of representations by the defendant because he never received the notice of adjudication and other ancillary documentation may be invalid. 

Jackson J suggested that if it turned out at trial that: (i) the defendant was indeed in ignorance of the adjudication because he had moved to a new address and the current tenants were not forwarding his post; and (ii) the claimant had a ready alternative means of contacting the defendant (through his place of business) and yet had deliberately decided neither to do so nor to communicate this fact to the adjudicator, then it is likely that this would constitute one of those rare and exceptional cases in which the adjudicator’s decision would be set aside by reason of breach of natural justice.

Mr Justice Jackson – Queen’s Bench Division, Technology and Construction Court


In October 1998 the defendant engaged the claimant to carry out some building works.  There were certain differences between the parties concerning the quality of work, delays and the valuation of variations.  While the building works were in progress, the defendant’s marriage came to an end and the defendant moved to a new address.  His ex-wife also moved out of the family home, which was then rented out.  The defendant’s place of business remained the same.
In March 2001, the claimant decided to refer to adjudication his claim for the balance of monies owing to him.  During the course of the adjudication, the notice of adjudication and various other communications were sent to the defendant’s old address.  All correspondence was returned undelivered.  The adjudicator received submissions and evidence from the claimant only and reached the decision that the defendant owed the claimant £37,589.00. 

The defendant never paid the £37,589 to the claimant.  The claimant applied to the Technology and Construction Court for an order for enforcement of the adjudicator’s decision.  The claimant applied for and obtained an order for service by hand both to the defendant’s old family home and to his ex-wife’s new address.  The defendant did not respond or acknowledge service and in March 2002 the court gave judgment in default against the defendant.

Present proceedings

In October 2005, the defendant became aware of the litigation against him in the TCC and in December 2005 applied to set aside the default judgment.  In order for the court to order that the default judgment be set aside, the defendant had to successfully persuade the court that he had a real prospect of successfully defending the claim.  The defendant raised various defences including, in particular, his ignorance that the adjudication was proceeding.

The claimant pointed out that the documents concerning the adjudication were all sent to the claimant’s last known principal residence, which constituted effective service.  However, the defendant contended that the claimant could have easily contacted the defendant through his place of business, which the claimant was familiar with, having carried out work there on behalf of the defendant in the past.


Mr Justice Jackson found that there was a serious issue to be tried, namely whether the claimant had available during the adjudication a ready means of contacting the defendant, which the claimant chose neither to use nor to communicate to the adjudicator.  If the answer to that question was yes, then an issue of law would arise: should an adjudicator’s decision obtained in those circumstances be enforced?

If it turned out that the claimant had available during the adjudication a ready means of contacting the defendant that the claimant chose not to use in order to deprive the defendant of the opportunity to make representations in the adjudication, then Jackson J opined that this might be one of those rare and exceptional cases in which the court would decline to enforce an adjudicator’s decision by reason of breach of natural justice.  Accordingly, the judge concluded that the defendant had available to him a defence with a real prospect of success. 

The defendant had also submitted that the adjudicator’s decision was invalid by reason of having been delivered out of time.  Interestingly, Jackson J thought that the decision probably had been delivered in time, but that in any event a slight delay would not be fatal to the decision.  Subsequent case law has however taken the view that a late decision is always bad.

As to whether the court should exercise its discretion to set aside the default judgment, the court had to weigh up the following competing factors: (a) the prejudice which the claimant would suffer if the judgment is set aside; (b) the prejudice which the defendant would suffer if the judgment is set aside; (c) the interests of justice; and (d) all the circumstances of the case.

Having regard to all of the circumstances, Mr Justice Jackson concluded that if the default judgment stood then there would be a real risk that the defendant would suffer injustice and that this risk of injustice outweighed the prejudice caused to the claimant in setting the judgment aside.   Although four years had passed since the default judgment had been entered, the defendant was seemingly unaware (the judge found the defendant’s evidence persuasive in this respect) of the present action until October 2005.  Since then, he had moved promptly to set aside the judgment.  For these reasons, Jackson J ordered that the default judgment be set aside so that the action could proceed to trial.

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