Multiplex Constructions (UK) Ltd v West India Quay Development Co (Eastern) Ltd [2006] EWHC 1569 (TCC)

This summary was provided by CMS Cameron McKenna LLP.

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

Errors of fact or law made by the adjudicator will not render his decision invalid.  The only challenge made to his decision must be on the grounds of breach of natural justice or excess of jurisdiction.  Applying methods of analysis different to those adopted by the parties, failing to consider certain facts or to provide reasons for the decision do not, in the context of an adjudication, amount to a breach of natural justice nor excess of jurisdiction.

Mr Justice Ramsey – Queen’s Bench Division, Technology and Construction Court

Background

Multiplex successfully obtained several extensions of time in an adjudication, which reduced Multiplex’s overall liability for liquidated damages under the construction contract and resulted in a balancing payment becoming due by WIQ to Multiplex.  WIQ refused to pay the £1.1 million ordered by the adjudicator and Multiplex applied to the TCC for summary judgment enforcing the adjudication.

Present proceedings

WIQ argued that the adjudicator’s decision should be impeached on the basis that he had breached the rules of natural justice and had acted in excess of jurisdiction.  In particular, WIQ submitted that the adjudicator had:

i)  adopted a number of methods of analysis, several of which were unsound either because: a) the adjudicator had rejected that same analysis as unreliable in another context; b) the approach had resulted in the grant of an extension of time which went beyond the date upon which practical completion was achieved; or c) it was different to the method of analysis put forward by either party;

ii)  failed to take into account certain relevant considerations;

iii)  exceeded his jurisdiction by ordering an extension of time greater than that which had been claimed;

iv)  decided a case that was not put to him and adopted his own analysis without giving WIQ the opportunity to address it;

v)  failed to give reasons or adequate reasons for his decision.

Decision

Ramsey J rejected all of these arguments.  If the adjudicator had taken into account facts that were not relevant or adopted a method of analysis different to that submitted by the parties, this was not evidence that the process was unfair or had led to an excess of jurisdiction.  Even though it might have resulted in an error of fact or law, the court did not have the power to invalidate an adjudicator’s decision on those grounds.  
He did not agree that the adjudicator had decided a case that had not been put to him and found that the adjudicator’s approach to the case put forward by Multiplex was no more than an assessment of the evidence, analysis and submissions put before him. 

There was no obligation on the adjudicator to contact the parties and invite their comments on his conclusions.  Indeed, in the absence of any provision or request to provide reasons, the adjudicator was not under any obligation under statute to provide any reasons whatsoever for any decision reached.

A challenge could only succeed on the grounds of breach of natural justice or excess of jurisdiction.  Ramsey J could find no evidence of any unfairness in the process nor any excess of jurisdiction on the part of the adjudicator. 

Accordingly, summary judgment was granted and WIQ had to pay the balancing sum due to Multiplex as a consequence of the extensions of time awarded by the adjudicator which resulted in a reduction in the level of liquidated damages being payable under the contract for late completion of the project.

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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