Midland Expressway Ltd & Ors v Carillion Construction Ltd & Ors (No. 3)

An adjudication challenge brought within the contractual time limit is ordinarily concerned with the adjudicator’s final decision, not an interim ruling made during the adjudication.

A dispute requires an identifiable claim to which the responding party can sensibly respond. A global, unquantified claim which does not attribute any specific sum to the relevant event may not constitute a dispute capable of adjudication, even though a dispute of principle exists.

Neither the Housing Grants, Construction and Regeneration Act 1996 nor the Scheme prohibits a referring party from withdrawing a claim during adjudication. Procedural questions should be approached with fairness and common sense.

The claimants challenged an adjudicator’s decision in the third set of proceedings arising from the M6 toll road construction project. The adjudication concerned whether CAMBBA’s claim for indirect or mitigation costs arising from department’s change 11 was within the adjudicator’s jurisdiction.

The adjudicator concluded that no capable dispute existed because CAMBBA had withdrawn its global claim and had not formulated a quantified claim specifically relating to department’s change 11. He therefore proceeded only with the direct-cost issues. The claimants argued that a dispute had arisen and that the adjudicator should have determined and dismissed the indirect-cost claim.

The court considered the contractual 60-day limitation period, the meaning of dispute in adjudication, and whether a claim could be withdrawn.

1. The action was in time. The reference in paragraph 9.2 of the dispute resolution provisions to the adjudicator’s determination meant the final decision completing the adjudicator’s functions. It did not refer to an earlier ruling made during the adjudication. The time-bar defence therefore failed.
2. No adjudicable dispute existed concerning the indirect costs. The parties disputed in principle whether CAMBBA could recover such costs. However, CAMBBA had not prepared a detailed quantified claim, and the November 2004 global claim attributed no specific sum to department’s change 11 and had no real prospect of success in its existing form. Under the principles in Hayter v Nelson and Home Insurance Co [1990] 2 Lloyd’s Law Reports 265 and AMEC Civil Engineering Ltd v Secretary of State for Transport [2005] EWCA Civ 291, a claim must be sufficiently defined to permit a sensible response.
3. The contractual joinder provisions did not enlarge the Dennys adjudication beyond the direct-cost dispute already referred. The attempts to introduce the indirect costs were ineffective.
4. Alternatively, CAMBBA could withdraw the claim. Neither the Housing Grants, Construction and Regeneration Act 1996, the Scheme, nor the relevant contractual provisions prohibited withdrawal. It would conflict with the informal and interim nature of adjudication to compel a party to pursue an unprepared claim. The court also approved the adjudicator’s approach as fair and sensible, having regard to the need to deal with substantial contractual issues sequentially.
5. The arguments concerning res judicata, issue estoppel, abuse of process, and retrospective revision of the adjudicator’s decision did not arise. The court stated obiter that it would be reluctant to transplant those doctrines into adjudication and would not bar a future articulated claim for indirect costs which had not yet been advanced.
6. Both claimants failed. The action was dismissed.