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Legal insights & industry updates

| 1 minute read

Where's the the justice of Adjudication?

The success of adjudication, becoming established as the preferred dispute resolution procedure of the construction industry, has relied upon quick and consistent enforcement of adjudicator's decisions by the courts.

The nature of the procedure is often characterised as rough and ready with the emphasis on speed rather than deliberation. It is acknowledged that adjudicator's may make mistakes but provided these are fairly made and the adjudicator has restricted himself to the scope of the matter referred to him the courts will not interfere with their decisions.

It is always notable therefore when the courts decide that the decision of an adjudicator is not to be enforced either in whole or in part. 

That was the case in the recent case of CC Construction Ltd v Mincione [2021] EWHC 2502 (TCC), where the court held that an adjudicator's decision was only partly enforceable due to a material breach of the rules of natural justice.

Specifically the adjudicator did not consider a defence of set off put forward by the responding party to a claim for payment by a contractor. The responding party had argued that it had a liquidated and ascertained damages claim related to delay in completion of the works which should be set off against the final account payment due to the contractor. Rather than consider the defence the adjudicator decided that he did not have jurisdiction to consider the matter and expressly stated that he had not done so in his decision.

The court did not consider the merits of the responding party's set off defence but held that for any claim for payment natural justice demanded that such a defence be at least considered. The court gave effect to this by restricting enforcement of the adjudicator's decision by the amount of the set off defence which was significant. 

For parties in adjudication it may be tempting to argue that the adjudicator does not have jurisdiction to consider matters put forward and jurisdictional challenges are commonplace. However this case illustrates that care should be taken where an incorrect view affected the enforceability of the adjudicator's award. I am sure that the contractor's initial delight with the adjudicator's award has changed to frustration where it has been reduced by the amount put forward in a defence which was perhaps unlikely to be sustained if properly considered. 

There was a material breach of the rules of natural justice in the adjudicator's failure to consider the Employer's contention that he was entitled to set off his liquidated damages claim and, subject to submissions, the decision is only enforceable to the extent of the balance over the amount of that claim


construction and engineering, dispute resolution