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Win for Colman Coyle's Construction team in Technology and Construction Court

Colman Coyle’s construction team acted for the Claimant, YCMS Limited in its successful proceedings in the Technology and Construction Court to enforce an adjudication decision in its favour.

The judgment of Mr Justice Akenhead deals with a number of important issues which were raised in this case and which will also be of wider importance for adjudications generally.

The underlying dispute arose out of building works carried out by YCMS at the home of Mr and Mrs Grabiner.  The work was substantial and cost in excess of £1 million.

Whilst the Construction Act (HGCRA 1996) provides for adjudication to be implied into many constructions contracts one of the major exceptions is work undertaken for a residential occupier at their home.  However, these works were undertaken under a JCT Intermediate Form of contract which has a contractual provision introducing adjudication and largely mirroring the statutory scheme so adjudication was available.

An adjudicator was appointed to decide on monies YCMS claimed were due to them and he reached a decision but YMCS pointed out what it considered were mistakes in this. The adjudicator revised his decision awarding YMCS a greater sum.

Mr and Mrs Grabiner failed to pay the sum awarded and argued:-

1. The adjudicator did not have power to amend his award.
    
   
2.  If he did have power he acted in breach of natural justice by doing so without giving Mr and Mrs Grabiner an opportunity to address him on this. 
   
   
3. If he had power to make such amendment he had very limited time to do so and the 48 hours taken was too long.
   
   
4. Since the award they had started a separate adjudication against YCMS and had been awarded sums in that adjudication.  These sums would be due very shortly and therefore they wish to set off these sums against the original claim.
   
   
5. Mr and Mrs Grabiner challenged the right for the Court to award interest on the unpaid award.

The court held:-

1. An adjudicator in a contractual adjudication can amend his decision to correct obvious slips (e.g. naming the wrong party, or a clear arithmetical error) but not if he has had a change of mind.  This power is effectively an implied term of the contract and so could be excluded by the parties and may not apply to a purely statutory adjudication.  (This is something the Construction Act currently going through Parliament is likely to address).
   
   
2. Any correction must be within a reasonable time.  The court had no difficulty in deciding the 48 hours taken here was reasonable but indicated a period of 3 to 4 weeks in the context of a process that is meant to be concluded in 28 days would probably be too long.
   
   
3. Obviously there will be no need to seek the views of the parties as the adjudicator is simply correcting his obvious mistake and so it would be hard to show any prejudice even if there was a breach of natural justice.  This is all the more so given the speed in which the correction must be made.
   
   
4. Very importantly the court clearly rejected the notion that a subsequent award could be used as a set off or excuse for not honouring the first award. This is very much in line with the main trend of decisions which seek to uphold and enforce adjudication awards.
   
   
5. The court considered it did have power to award interest.

The case is particularly helpful in clarifying the circumstances in which an adjudicator can correct a slip and the time in which this must be done.  This is an issue that arises quite often, no doubt as a result of the speed at which adjudications are conducted, and the clarification will be welcomed by adjudicators as much as clients and their advisors.

The clear guidance that set-off for the later adjudication is not permissible is also likely to be of significance in many cases.

For more information on the above or any other advice please e-mail Howard Colman