Amber Construction Services Ltd v London Interspace HG Ltd [2007] EWHC 3042 (TCC)

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Where a party loses an adjudication and has no basis for resisting enforcement of that decision, it may be penalised on costs if that party fails to adhere to the decision and intimates that it intends to challenge the adjudicator’s decision or enforcement proceedings.

Mr. Justice Akenhead – Technology and Construction Court

Background

Amber obtained an adjudicator’s decision against London Interspace. London Interspace did not pay the sum that the adjudicator decided it owed to Amber. Amber’s lawyers wrote to London Interspace stating that if the sum was not paid without delay Amber would commence enforcement proceedings. London Interspace’s lawyers wrote back saying that they had a valid jurisdictional defence to such enforcement proceedings and would not therefore pay the sum. Amber therefore commenced enforcement proceedings seeking summary judgment against London Interspace for the sum decided by the adjudicator. London Interspace admitted Amber’s claim in the Acknowledgment of Service and then sought to argue that London Interspace was only obliged to pay £100, fixed costs, to Amber because the claim was admitted at this stage. 
 
Issue

The issue was whether Amber were only entitled to fixed costs, as the defendant admitted the sum claimed, or whether it was entitled to its costs on a basis to be assessed. 
  
Decision

Mr. Justice Akenhead found that:

  1. The court had discretion, under CPR Rules 45.1 and 45.3, to make an order other than fixed costs. 
  2. On the facts of this case the claimant was entitled to costs on an assessed, rather than fixed basis. In exercising its discretion the court considered it relevant that (i) four weeks had elapsed since the adjudicator’s decision (ii) the claimant’s solicitors gave very clear warning that, unless the sum due was paid promptly, proceedings would be commenced without further notice, and (iii) the defendant’s solicitors made it clear that they would not pay because they had a jurisdictional defence.

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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