Emcor Drake v Costain [2004] EWHC 2439

This summary was provided by CMS Cameron McKenna LLP.

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

For an adjudicator to reconsider facts and matters that have been previously adjudicated upon is not in itself objectionable. In this case the second adjudicator had not been invited to trespass on the first adjudicator's decision, nor did he do so. Furthermore the necessity to respond quickly to vast quantities of paperwork is one of the well-known hazards of the adjudication process and is not of itself a ground for finding that there has been an abuse of process.

Judge Richard Havery QC, Technology and Construction Court

29 October 2004

The defendant ('CSJV') was the main contractor for the refurbishment of the Great Western Royal Hotel at Paddington. The claimant ('EDS') was a principal sub-contractor. The parties entered into a sub-contract under the standard form sub-contract DOM/2 1981 edition.

The background to this case was that the sub-contract works were not completed by the date of practical completion specified in the sub-contract. EDS subsequently made three claims to CSJV for extensions of time under clause 11.7 of the sub contract. The first claim was made in November 2002 (the 'November claim') on the ground that the works to the bedrooms had been delayed by CSJV. The second claim was made in April 2003 (the 'April claim') and this time EDS sought to rely on additional events giving rise to critical delay. EDS then submitted a further claim in February 2004 (the 'February claim'), which was a revised claim for an extension of time which relied upon material included in the November and April claims.

In May 2003, EDS referred the November claim to adjudication. The adjudicator found against them. In May 2004, EDS referred the February claim to adjudication and this time the award was made in their favour. However CSJV refused to pay. It was this adjudication that EDS sought to enforce in these proceedings.

CSJV resisted the application for enforcement on four grounds:

  • Firstly, the decision made in the first adjudication encompassed and decided the issue between the parties as to what extension of time EDS was entitled to under clause 11.7 of DOM/2. No subsequent adjudicable dispute could or did come into existence relative to that issue.
  • Secondly, in reaching his decision, the second adjudicator both considered facts and matters that had been adjudicated upon and reached conclusions in relation to those facts and matters that were contrary to those that had been reached in the first adjudication and by which he was bound. In doing so he exceeded his jurisdiction.
  • Thirdly, if the second adjudicator did have jurisdiction it was limited to considering what if any extension of time EDS might be entitled to after 30 November 2001 i.e. the date up to which the first adjudicator had decided that EDS was not entitled to an extension of time.
  • Finally it was unfair and an abuse of process in the second adjudication to require CSJV to respond to over 4000 pages (out of a total of 5000 pages) of facts, matters and documentation that were considered in the first adjudication.

His Honour Judge Richard Havery QC did not accept the four grounds submitted by CSJV. In the judgment he makes the following points:

The essence of CSJV's argument on ground one, was that under clause 11.7 CSJV could only grant one extension of time and therefore it followed there could only be one adjudication on the point. The Judge stated, "the argument involves a non sequitur and I reject it". 

One ground two he found that the second adjudicator had not trespassed on the decision of the first adjudicator: 

"It may well be true that Mr Hough did consider the facts and matters considered by Mr Miller in reaching his conclusion. That in itself in my judgment is not objectionable. In my judgment Mr Hough was not invited to trespass on Mr Miller's decision, nor did he do so." 

The third ground was rejected on the basis of the decisions above. In respect of the fourth ground the judge stated:

"The necessity to respond quickly to vast quantities of paperwork is one of the well-known hazards of the adjudication process. That cannot of itself be a ground for contending that there has been an abuse of process. In my judgment, the fact that the same documentation appears in two successive adjudications is a wholly insufficient ground for describing what happened as an abuse of process".

Accordingly, EDS was successful in enforcing the decision of the second adjudicator. Leave to appeal was refused by His Honour Judge Havery QC.

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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