High court backs contract adjudicator in building dispute

The courts are generally keen to support contract adjudicators whose task it is to resolve disputes speedily and at much lower cost than litigation. In one case which proved the point, a company was criticised for ‘scrabbling around’ in search of technical reasons why it should not have to abide by an adjudicator’s awards.

In a dispute concerning delayed completion of a design and build project, the adjudicator had awarded company A more than £230,000, and almost £30,000 in costs, against company B. Without success, the latter had twice challenged the adjudicator’s jurisdiction whilst he was considering the matter.

Before the High Court, company B argued that the adjudication clause in the contract was invalid in that it did not comply with the requirements of Section 108 of the Housing Grants, Construction and Regeneration Act 1996. On that basis, it was submitted that the adjudicator’s appointment was also invalidated and that his awards were nullities.

In rejecting those arguments, the Court described company B’s complaints as highly technical and wholly hypothetical. There had been a multiplicity of sub-issues and distractions raised since the adjudication and about £65,000 in legal costs had been spent on resolving jurisdictional issues. In the circumstances, the Court found that the adjudicator’s awards should be enforced in full.