Thomas-Fredric's (Construction) Ltd v Wilson

An adjudicator’s ruling on a jurisdictional issue is temporarily binding if the objecting party agreed both to submit that issue for decision and to be bound by the ruling. Merely raising and arguing a jurisdictional objection does not establish such an agreement.

Without full submission, an award may still be summarily enforced where the adjudicator’s jurisdictional ruling was plainly right. A defendant may resist enforcement only by advancing a properly arguable jurisdictional objection with a realistic prospect of success. Where a construction contract must be evidenced in writing, the writing must evidence the whole contract, including the identity of the contracting parties.

The claimant obtained an adjudicator’s award against Mr Wilson under Part II of the Housing Grants, Construction and Regeneration Act 1996. Mr Wilson maintained that the relevant construction contract was with Gowersand Ltd and that the adjudicator therefore lacked jurisdiction.

His Honour Judge MacKay granted summary judgment enforcing the award. He held that the adjudicator’s ruling on his own jurisdiction should be followed and, alternatively, that the evidence established Mr Wilson as the contracting party.

The appeal concerned whether Mr Wilson had agreed to be bound by the adjudicator’s jurisdictional ruling and whether that ruling was plainly correct.

1. Appeal allowed unanimously. The order granting summary judgment was set aside and the respondent’s application was dismissed. Simon Brown LJ gave the leading judgment. Judge LJ agreed, particularly with its two essential principles, and Jonathan Parker LJ agreed with both judgments.

2. An adjudicator’s jurisdiction under Part II of the Housing Grants, Construction and Regeneration Act 1996 depends upon there being a construction contract in writing. Applying RJT Consulting Engineers Ltd v DM Engineering Ltd [2002] 1 WLR 2344, the whole contract must be evidenced in writing. The letter evidencing the agreement was expressly signed by Mr Wilson on behalf of Gowersand Ltd. It contained no evidence, still less clear evidence, that Mr Wilson contracted personally. The adjudicator’s jurisdictional ruling was therefore not plainly right and appeared plainly wrong.

3. An adjudicator’s decision is ordinarily binding only until final determination by litigation, arbitration or agreement. A party nevertheless becomes bound in the short term by a jurisdictional ruling where it agrees both that the adjudicator should decide the jurisdictional issue and that it will accept the ruling. Submission in this full sense is a question of fact.

4. A party does not make that agreement merely by raising a jurisdictional objection, participating in the adjudication or asking the adjudicator to rule upon the objection. Mr Wilson’s letter squarely challenged jurisdiction, and nothing he subsequently said amounted to an agreement to accept an adverse ruling. The case therefore fell within the reserved participation principle discussed in Westminster Chemicals & Produce Ltd v Eicholz & Loeser [1954] 1 LLR 99 and applied in The Project Consultancy Group v The Trustees of the Gray Trust [1999] BLR 377.

5. Where there has been no full submission, the award may still be summarily enforced if the adjudicator’s jurisdictional ruling was plainly right. Concern that jurisdictional objections might frustrate prompt payment is addressed by critical examination of the objection. Only a properly arguable objection with a realistic prospect of success can defeat summary enforcement.

• Court of Appeal (Civil Division): Allowed Mr Wilson’s appeal unanimously, set aside the summary judgment and substituted an order dismissing the claimant’s application. Costs were awarded to Mr Wilson here and below.
• High Court, Queen’s Bench Division, Liverpool Technology and Construction Court: His Honour Judge MacKay, sitting as a deputy High Court judge, granted the claimant summary judgment on 9 May 2003 to enforce the adjudicator’s award.