Try Construction Ltd v Eton Town House Group Ltd [2003] EWHC 60 (TCC)

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E argued that there had been a breach of natural justice because the adjudicator had used his own methodology without bringing significant issues to E's attention. However, the Judge held that an adjudicator is not limited to the material presented by the parties. He may take further information and apply his own knowledge and experience, having an absolute discretion to do what he considers necessary. The parties had also agreed to the adjudicator's appointment of a programming expert

HHJ David Wilcox, Technology and Construction Court

28 January 2003

E engaged T under a JCT 98 contract to do conversion work. Delays occurred and T submitted several claims. Two claims for extension of time were rejected and referred to adjudication. The adjudicator's decision in the first adjudication was not challenged. In the second adjudication, the adjudicator decided that T was entitled to an extension of time and awarded a sum of money.

At trial (as the matter could not be resolved by summary judgment), E's defence to the enforcement proceedings was that the adjudicator had used a programming expert to assist in reaching his decision, who had used his own methodology. The basis of the adjudicator's decision was not argued and thus E had not had the opportunity to make submissions on it. These matters were of such significance that this constituted a breach of natural justice. T argued that at no stage did E make any complaint and what appeared in the Referral Notice was not in dispute. E never reserved its position regarding the adjudicator's jurisdiction as to the expert's participation. The jurisdictional and natural justice complaints had not been raised at all until the defence to the enforcement proceedings was filed.

The Judge found that the parties had agreed to the appointment of the expert, who was to use his own expertise and do his own independent analysis if he felt it to be appropriate in the adjudication. The Judge rejected E's evidence that this was not the case, as this could not be reconciled with the other witnesses' accounts. On reading the decision, E had not written to the adjudicator to say that the scope of his jurisdiction was not agreed, and did not take the point until filing the defence. The adjudicator had recorded fully the scope of the agreement as to the use and role of the expert. E had fully appreciated the extent of the expert's authority. It knew that the expert would investigate the claim on his terms and there was no request for him to produce a preliminary or draft finding as a basis for further submissions.

E argued that there had been a breach of natural justice because the adjudicator had used his own methodology without bringing significant issues to E's attention. The decision was a nullity since the expert's methodology was not put into dispute. However, the Judge held that following Balfour Beatty v London Borough of Lambeth, an adjudicator is not limited to the material presented by the parties. He may take further information and apply his own knowledge and experience, having an absolute discretion to do what he considers necessary. In determining whether a party has been treated fairly or whether the adjudicator has acted impartially, it is necessary to consider whether the point of issue is decisive or of considerable potential importance to the outcome, or whether it is peripheral or irrelevant. In this matter, there was a vast amount of documents before the adjudicator, and the expert had approached the programming experts of both parties for information. His questions all related to information in the submissions, which had been exchanged. Neither party had provided a full as built analysis, however expected the expert to reach a conclusion. The adjudicator's decision was based on the evidence, was clearly the product of an agreed process and was transparent.

E argued that there had been a breach of natural justice because the adjudicator had used his own methodology without bringing significant issues to E's attention. However, the Judge held that an adjudicator is not limited to the material presented by the parties. He may take further information and apply his own knowledge and experience, having an absolute discretion to do what he considers necessary. The parties had also agreed to the adjudicator's appointment of a programming expert.

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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