Paice & Anor v Harding (t/a MJ Harding Contractors)

An adjudicator’s decision is enforceable where the parties objectively agreed an extension of time, even if one party maintained a jurisdictional reservation. Apparent bias is assessed objectively by reference to all relevant circumstances, including the decision-maker’s explanations. A fresh adjudication is not a review of an earlier adjudicator’s decision. An adjudicator’s jurisdiction depends on the contractual or statutory adjudication agreement, and a dispute arising under a separate agreement falls outside that jurisdiction. An excess-of-jurisdiction part of an award may nevertheless be severed where it is separately identified and valued.

The claimants applied under Part 24 of the Civil Procedure Rules to enforce a decision requiring the defendant to pay £296,006.44 following an adjudication concerning the value of works under a building contract. The defendant challenged enforcement on three grounds: that the decision was late, that the adjudicator was apparently biased, and that part of the decision exceeded his jurisdiction.

The court considered the parties’ communications concerning an extension of time, the adjudicator’s provision of a reference for an earlier adjudicator involved in related disciplinary proceedings, and the adjudicator’s determination of a design-fees dispute concerning a third house outside the contract.

1. Late decision. The Scheme for Construction Contracts required the adjudicator to decide within the prescribed or agreed period. Objectively construed against the background of the jurisdictional challenge, the defendant’s email agreed that the adjudicator could reach his decision by 27 April 2016. The reservation concerned the defendant’s contention that no valid adjudication existed. Once that contention fell away, the reservation did not prevent the agreed extension from taking effect. The decision was therefore timely and valid.
2. Apparent bias. The applicable test was whether an informed and fair-minded observer, knowing all relevant circumstances, would conclude that there was a real possibility of bias. The court considered the adjudicator’s general character reference for the earlier adjudicator, his failure to disclose it initially, his later explanations, and his intemperate correspondence. The fifth adjudication was a fresh determination, not a review of the earlier decision. The reference did not reasonably affect the adjudicator’s task, and the evidence did not establish assistance in the disciplinary complaint. A fair-minded and informed observer would not conclude that there was a real possibility of bias.
3. Jurisdiction and severance. The contractual adjudication agreement covered disputes arising under the contract. The design-fees dispute concerned House A, which was outside the contract, and arose, if at all, under a separate agreement. The adjudicator therefore lacked jurisdiction to decide it. However, the design-fees determination was separately identified and valued. It could be severed from the remainder of the decision.
4. The paragraphs of the adjudication decision dealing with the design fees were unenforceable. The award was reduced by £6,049.60. Summary judgment was entered for the claimants in the sum of £301,678.44, together with interest, adjudicator’s fees and costs.