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Watson Builders Service [2001] ScotCS 60
This summary was provided by CMS Cameron McKenna LLP.
For more information visit http://www.cms-cmck.com/Construction/Construction-Disputes
An Adjudicator has the power to determine the meaning of the sub-contract terms even if this results in him determining a dispute about the validity of his appointment and therefore his jurisdiction.
Lady Paton, Outer House Court of Session (Scotland)
13 March 2001
W were appointed as main contractors to carry out building works at a church in Glasgow. They entered into a sub-contract with the second respondents, Miller (Preservation) Ltd, in respect of rot eradication. The sub-contract documents comprised a quotation dated 2 February 1999 and counter-offer dated 24 April 1999. The parties agreed that the sub-contract was a "construction contract" within the meaning of s104 of the HGCRA.
A dispute arose in relation to the sub-contract work. Miller sought to refer the dispute to adjudication under HGCRA and applied to the Academy of Construction Adjudicators for the appointment of an adjudicator. W objected to the referral, contending that the sub-contract provided its own mechanism for the appointment of an adjudicator. In particular, W said that certain provisions of the main contract had been incorporated by reference, and that the Academy was not listed as an adjudicator nominating body. Nevertheless the Academy appointed an adjudicator. The parties put the preliminary issue of jurisdiction or the validity of the adjudicator's appointment before him for his determination. He decided that he did not have jurisdiction. At Miller's request, the Academy appointed another adjudicator, namely the first respondent, Graham Harrison. Harrison considered whether the main contract terms as to adjudication had been incorporated, and held that they had not. He therefore decided he had been validly appointed and ruled that W should pay £7917.35 plus VAT. W applied for a judicial review of the decision.
The Court held that in the circumstances it was necessary for the adjudicator, in deciding the appropriate mechanism for appointing an adjudicator, to decide whether certain provisions of the main contract had been incorporated into the sub-contract. In so doing the adjudicator, therefore, had the power to determine the meaning and import of the sub-contract terms even where such an exercise resulted in his determining a dispute about the validity of his appointment and his jurisdiction. In any event, the parties in this case had asked the adjudicator to decide this question, and had unreservedly accepted that it formed part of the dispute, with the consequence that the decision was binding on the parties. In carrying out this exercise and in deciding that he had jurisdiction the adjudicator acted within his powers and the petition for setting aside his decision was refused.
An Adjudicator has the power to determine the meaning of the sub-contract terms even if this results in him determining a dispute about the validity of his appointment and therefore his jurisdiction.
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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