ROK Build Ltd v Harris Wharf Development Company Ltd

In adjudication enforcement proceedings, a court will not summarily enforce an award where it is reasonably arguable that the claimant was not a party entitled to refer the dispute. A contractual right to adjudicate belongs to the parties to the contract, or to an assignee where the contractual requirements for assignment have been satisfied.

A dispute may exist before the contractual final date for payment if, viewed objectively, the claim has not been admitted. The court should assess the circumstances in the round and apply robust common sense. Adjudicators’ errors within their jurisdiction ordinarily do not prevent enforcement, but jurisdictional excess and serious breaches of natural justice may do so.

A bare agreement to continue negotiations is unenforceable for uncertainty.

The claimant sought summary judgment under Part 24 to enforce an adjudication award of £940,927 arising from an interim payment application under a building contract. The contract named Walter Llewellyn & Sons Limited as contractor, but the adjudication and enforcement proceedings were brought by ROK Build Ltd, which had performed the works and received payments.

The defendant argued that ROK Build lacked standing because there had been no written assignment or consent under clause 18.1. It also challenged the existence of a dispute, the adjudicator’s treatment of withholding notices, and an alleged agreement not to enforce the award while final-account negotiations continued.

The central issues were whether the claimant’s contractual status raised a jurisdictional question unsuitable for summary enforcement, whether a dispute existed when the adjudication was commenced, and whether the alleged forbearance agreement was enforceable.

1. Standing and jurisdiction. Only parties to the contract, or an assignee where the contractual assignment requirements have been met, may exercise the contractual right to adjudication. Clause 18.1 required the written consent of the other party to an assignment. The evidence did not establish when or how ROK Build replaced the named contractor, or whether the defendant had consented. The adjudicator had proceeded on the implicit assumption that ROK Build was the proper contractor, without the defendant’s consent to determine that issue. The issue therefore went to jurisdiction.

2. On the evidence, it was reasonably arguable that ROK Build had no right to refer the dispute. The claimant declined an adjournment to adduce evidence concerning the contractual alterations, consent, agency or estoppel. Summary judgment was therefore unavailable on the present material.

3. Existence of a dispute. The court adopted the approach in Carillion Construction Ltd v Devonport Royal Dockyard [2005] 1 BLR 310. Adjudication awards should be enforced despite errors of fact, law or procedure where the adjudicator acted within jurisdiction. The court should scrutinise technical jurisdictional and natural-justice objections critically, consistently with the policy of the Housing Grants Reconstruction Act 1996.

4. Applying Collins Ltd v Baltic Quay Management [2005] 1 BLR 63, a dispute arises when it can reasonably be inferred that a claim is not admitted. The court should consider the circumstances in the round. Here, the defendant’s conduct and correspondence objectively demonstrated a dispute about the account, notwithstanding that the referral was framed by reference to the service of contractual notices.

5. The adjudicator erred by failing to take account of sums properly included in the defendant’s withholding notice. That was an error on matters within the adjudicator’s remit and did not justify resisting enforcement.

6. Alleged agreement not to enforce. The correspondence did not make payment on account inseparably conditional upon forbearance. In any event, a bare agreement to continue negotiations had no enforceable legal content because of uncertainty, applying Walford v Miles [1992] 2 AC 128.

7. The defendant’s remaining submission that the interim payment application was merely a draft had no merit. The claim was intended to operate as an application under clause 30.3.3.

8. The application for summary judgment was not granted because the claimant’s contractual identity and right to adjudicate remained reasonably arguable. The judgment records no final costs order.