Watkin Jones v Lidl UK GMBH [2001] HT 01/465

This summary was provided by CMS Cameron McKenna LLP.

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Clause 30.3.3 of JCT98 WCD means that an Employer who wishes to say that sums are not due should serve a notice stating what is due. Failure to do so will mean that the Contractor is entitled to the sum for which he applied pursuant to Clause 30.3.5.

HHJ Humphrey Lloyd QC, Technology & Construction Court

27 December 2001

L entered into a JCT 1998 Contract with Contractor's Design with WJ in respect of a new retail store in Bangor. In accordance with the contract WJ made an application for payment for the net sum of £340,182.24 (plus VAT). L appeared to have mistakenly treated the application as a valuation for final account and did not serve the notice required under the contract stating which amounts were due and did not pay any money to WJ. WJ subsequently brought an adjudication and were successful. They were awarded almost £350,000 on the basis that no notice had been served by L against application 11 in accordance with clause 30.3.3 of the JCT contract. By clause 30.3.5, without such notice, the sum became due and payable.

L then brought a new adjudication as to what sum was properly due on application 11. The adjudicator decided that there was no dispute, this issue having already been decided in the first adjudication. He therefore said he had no jurisdiction and resigned. L served a further, almost identical, notice of adjudication. The second adjudicator believed he had jurisdiction.

WJ brought the matter came before HHJ Lloyd seeking a declaration that the adjudicator who had embarked on the new adjudication did not have the jurisdiction to do so. WJ sought an injunction to restrain L from continuing with the adjudication. L said that the new dispute related to the question of what was the properly calculated sum due under application 11. The Judge held that the subject matter of the new adjudication was a dispute about the value of application 11. That issue had been resolved in the first adjudication where the adjudicator had considered the application for payment and the terms of the contract. Accordingly, there was no dispute and the adjudicator could not proceed.

The Judge distinguished the case of SL Timber Systems v Carillion Construction on the basis that a clause akin to clause 30.3.3 of JCT98 WCD was not included in the Contract in that case. Clause 30.3.3 provided the route for an Employer to dispute the amount due.

Clause 30.3.3 of JCT98 WCD means that an Employer who wishes to say that sums are not due should serve a notice stating what is due. Failure to do so will mean that the Contractor is entitled to the sum for which he applied pursuant to Clause 30.3.5.

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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