Supablast (Nationwide) Ltd. v Story Rail Ltd.

For summary enforcement of an adjudicator’s decision, the defendant must show a real prospect of successfully defending the claim or another compelling reason for trial. Where additional construction works are alleged to arise under a separate contract, the court must assess the parties’ agreement objectively, including their documents and conduct. A common contractual administration, single payment process and agreed treatment of the works may establish one contract or an estoppel by convention. Questions whether work was a variation may overlap jurisdiction and substance. An adjudicator appointed under the original contract will generally have jurisdiction to decide whether additional work was instructed as a variation, unless the contractual variation clause cannot encompass it. Summary judgment was granted to enforce the adjudicator’s decision.

Story Rail Ltd engaged Supablast (Nationwide) Ltd in connection with refurbishment works to a railway bridge. The parties initially agreed prices for grit blasting, painting, scaffolding and encapsulation. They later agreed a price for steelwork repairs. Their preliminary meeting minutes recorded all the works, prices, programme and payment arrangements under one subcontract.

After a final-account dispute, Supablast referred the dispute to a single adjudicator. Story challenged the adjudicator’s jurisdiction, arguing that the works were governed by two subcontracts and that the adjudicator could not determine disputes arising under both. The adjudicator rejected that challenge and awarded Supablast £262,366.09 plus VAT and fees. Story did not pay, and Supablast sought summary judgment to enforce the decision.

1. Summary judgment. Under Civil Procedure Rules 1998 CPR 24.2, the question was whether Story had a real prospect of successfully defending enforcement and whether any other compelling reason required a trial. The test was one of absence of reality, not probability.
2. One subcontract. The December 2007 letters created a contract for grit blasting, painting and scaffolding. However, the parties’ subsequent conduct and the minutes of the 16 January 2008 preliminary meeting objectively established that the steelwork repairs and the original works were to be carried out under one subcontract. The minutes referred to one subcontract, one subcontract price, one programme, one commencement date, one completion period and common payment arrangements.
3. Story’s uncommunicated belief that there were two contracts was immaterial. Alternatively, the parties’ conduct in ordering, administering and paying for the works on a unified basis created an estoppel by convention that there was one subcontract.
4. Jurisdiction and variations. It was unnecessary to decide whether the steelwork could have been instructed as a variation under the December subcontract because there was only one subcontract. Nevertheless, the issue illustrated the usual overlap between jurisdiction and substance. An adjudicator properly appointed under an original contract will generally have jurisdiction to determine whether additional work was instructed or treated as a variation, although the variation clause may not cover work wholly outside the original subcontract works.
5. The argument that there were two subcontracts had no real prospect of success. Summary judgment was therefore entered for Supablast to enforce the adjudicator’s decision. Story was ordered to pay the adjudicator’s fees and to indemnify Supablast against any claim by the adjudicator for those fees and expenses. Supablast’s costs were summarily assessed at £16,000 after a 20 per cent reduction for the variation issue.