Whiteways Contractors (Sussex) Ltd v Impresa Castelli Construction Ltd [2000] EWHC Technology 67

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Although the adjudicator under certain contracts has no power to determine his jurisdiction, the parties may decide between themselves to extend his jurisdiction. In applying sections 110 and 111 of the HGCRA, there is no distinction to be made between set-off and abatement.

HHJ Bowsher QC, Technology and Construction Court

9 August 2000

W was a plastering sub-contractor who was engaged by I in connection with a construction in London. The contract incorporated the terms of the standard form of contract for sub-contractors DOM/1. Article 3 and Clause 38 of those terms provide for disputes or differences between the parties to be referred to adjudication. W gave its notice to adjudicate by letter dated 13 January 2000. The adjudicator gave his decision on 25 April 2000, ordering that I pay W the sum of £81,177.45 plus VAT. I made no payment in response to that decision and so W made an application under CPR Part 24 for summary judgment against I.

I asserted that the adjudicator had acted in excess of jurisdiction and for that reason his order should not be enforced. In particular, I claimed that the adjudicator's jurisdiction is limited to the disputes indicated in the notice to adjudicate, and that the adjudicator should not have dealt with additional points which were made by W in their referral submission but which were not indicated in the notice to adjudicate. Furthermore, I claimed that it was entitled to rely on matters of abatement (though not set-off) in reduction of the amount ordered to be paid.

Having received the referral submission, the solicitors for I made their objection to the jurisdiction of the adjudicator on certain points by letter to the adjudicator dated 3 March 2000, stating: "We invite you to decide on this issue as a matter of urgency as our response to W's Notice of Referral will depend on your decision. Our client does not wish to incur costs on matters which, in our view, fall outside the jurisdiction of the Adjudication."

The adjudicator replied to this letter stating, after a detailed reasoned discussion of each of the disputed items: "I do have jurisdiction to consider this matter." In his final decision given on 26 April 2000, the adjudicator stated:

"Although I consider that an adjudicator has no power under Clause 38A of DOM/1 to determine his or her jurisdiction, I conclude from the parties' submissions, both from leading firms of Solicitors, that the parties had extended my jurisdiction to determine the matter."

The Court considered that I's solicitor had, in her letter of 3 March 2000, not enquired into the adjudicator's jurisdiction, as she contested, but had, in fact, made an invitation to decide it. The decision of the adjudicator, therefore, stood.

On the question of abatement, I's solicitors averred, after the adjudicator had given his decision, that W had been overpaid on previous applications. In considering the wording of sections 110 and 111 of The Housing Grants, Construction and Registration Act, the Court decided that there is no distinction between set-off and abatements and the relevant sections of the Act applies to one as much as it does to the other.

Although the adjudicator under certain contracts has no power to determine his jurisdiction, the parties may decide between themselves to extend his jurisdiction to enable him to determine it. In applying sections 110 and 111 of HGCRA, there is no distinction to be made between set-off and abatement.

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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