Bouygues (UK) Ltd v Dahl-Jensen (UK) Ltd

An adjudicator's decision under section 108 of the Housing Grant, Construction and Regeneration Act 1996 is binding and ordinarily enforceable by summary judgment until the underlying dispute is finally resolved. An error of calculation or law does not defeat enforcement if the adjudicator answered the question referred. A decision is a nullity only where the adjudicator answered a different question from that submitted.

Where the successful party is in liquidation, insolvency set-off may provide a compelling reason not to grant summary judgment on a provisional adjudication award. The court should ordinarily allow mutual claims and cross-claims to be resolved in the liquidation. That point did not justify disturbing the discretionary order in this appeal, since it had not been raised below or in the notice of appeal and execution was stayed.

Bouygues (UK) Ltd, the main contractor, and Dahl-Jensen (UK) Ltd, its mechanical subcontractor, referred their reciprocal contractual claims to an adjudicator under the Construction Industry Model Procedure. The adjudicator awarded a net sum to Dahl-Jensen, but his calculation wrongly included retention monies that were not yet payable.

Dyson J granted Dahl-Jensen summary judgment to enforce the award. Bouygues appealed, contending that the error meant that the adjudicator had exceeded his jurisdiction. During the appeal, the court also considered the effect of Dahl-Jensen's liquidation and compulsory insolvency set-off on summary enforcement of a provisional adjudication award.

1. Appeal dismissed unanimously. Buxton LJ held that the adjudicator had answered the questions which the parties had referred. He had made an erroneous calculation by failing to deduct retention monies not then due, but this was an error in answering the right question. It was not an excess of jurisdiction and did not make the decision a nullity.

2. The governing distinction, drawn from Nikko Hotels (UK) Ltd v MERPC Plc [1991] 2 EGLR 103, is between answering the right question wrongly and answering a question not referred. Only the latter deprives an adjudicator's decision of binding force. The adjudicator's later refusal to correct an alleged clerical slip did not show that he had decided whether retention monies were payable; it showed only that he did not accept that his calculation contained such a slip.

3. Chadwick LJ explained that section 108 of the Housing Grant, Construction and Regeneration Act 1996 creates a speedy, provisional and enforceable means of resolving construction disputes. An adjudicator's binding decision will ordinarily be enforced summarily even though it may later be reopened in litigation or arbitration.

4. Chadwick LJ further observed that, where the award creditor is in liquidation, rule 4.90 of the Insolvency Rules 1986 requires an account and set-off of mutual claims. Since the adjudication award was provisional and the parties had unresolved cross-claims, that would ordinarily be a compelling reason to refuse summary judgment and leave the balance to be resolved in the liquidation. However, that issue was not raised before Dyson J or in the notice of appeal. In light of the stay of execution, the court would not set aside the judge's discretionary order.

5. The appeal was dismissed with costs summarily assessed at £20,000, and a stay of execution was granted.

• Court of Appeal (Civil Division): Appeal dismissed. The court upheld Dyson J's summary judgment enforcing the adjudicator's award, while granting a stay of execution.
• Queen's Bench Division (Dyson J): Granted summary judgment to enforce the adjudicator's award. No citation was stated in the judgment.