Redwing Construction Ltd v Wishart

In adjudication enforcement proceedings, a party cannot refer a dispute to a second adjudicator where the same or substantially the same dispute was decided in an earlier adjudication. The scope of the earlier dispute depends on what had crystallised, what was referred, any validly raised defence, and what the first adjudicator actually decided. An adjudicator’s unnecessary opinion on a matter outside the referred dispute is obiter and does not bind the parties.

An adjudicator may correct a patent clerical or arithmetical error under an implied slip rule, provided the correction is made within a reasonable time. The rule cannot be used to change the decision because of second thoughts.

The claimant contractor sought enforcement of an adjudicator’s amended decision concerning the final account under a JCT Prime Cost Building Contract. A first adjudication concerned an extension of time and payment of the contractual fee at the stated weekly rate. The first adjudicator also purported to prevent any later adjustment of that rate under the contractual mechanism.

In a later adjudication, the second adjudicator decided that the weekly rate was adjustable by reference to the increase in Prime Cost. He subsequently corrected the calculation, treating the correction as an arithmetical slip. The defendant resisted enforcement on the grounds that the adjustment issue had already been decided and that the correction exceeded the slip rule.

1. The court applied the principles summarised in Benfield Construction Ltd v Trudson (Hatton) Ltd [2008] EWHC 2333 (TCC). The parties remain bound by an adjudicator’s decision until final determination or agreement. A second adjudication is barred only where the dispute is the same or substantially the same. That requires an analysis of the dispute referred and the adjudicator’s decision.

2. The first adjudication concerned only the further extension of time and the resulting entitlement to the Contract Fee at £3,500 per week. No dispute concerning adjustment of that weekly rate had crystallised before the first notice or referral. The wording seeking such other sum as the adjudicator might determine could not enlarge the crystallised dispute to include an unformulated claim for adjustment.

3. The first adjudicator was not given jurisdiction over the adjustment issue. His finding that the parties did not intend the Contract Fee to be adjusted twice, and his direction that payment for extended time would preclude payment based on adjustment, were unnecessary to the decision actually referred. They were tangential and, in court terms, obiter. They did not bind the parties or prevent the issue being referred in the second adjudication.

4. The court also applied the approach in YCM​S Ltd v Grabiner [2009] EWHC 127 (TCC). An implied contractual slip rule permits correction of patent errors, including simple arithmetical errors, but not a change of mind. The second adjudicator had plainly compared the actual Prime Cost with an estimated figure that wrongly included the Contract Fee. Correcting that error did not alter his reasoning or constitute second thoughts.

5. The correction was made within two days, after a limited exchange of views, and therefore within a reasonable time. The amended decision was enforceable. Judgment was entered for the claimant for the unpaid balance.