Hutton Construction Lted v Wilson Properties (London) Ltd

An adjudicator’s decision within jurisdiction and reached in broad accordance with natural justice must ordinarily be enforced, despite errors of fact or law. The unsuccessful party must pay now and argue later.

Without consent, a merits challenge may be considered at the enforcement hearing only where a properly pleaded Part 8 claim raises a short, self-contained issue requiring no oral evidence, the error is so clear that it would be unconscionable to ignore, and its consequences are clear-cut. The procedure is exceptional and cannot be used to rerun the adjudication. An unsuccessful attempt may attract indemnity costs.

The claimant sought summary judgment enforcing an adjudicator’s award of £491,944.73. The defendant alleged neither want of jurisdiction nor breach of natural justice. It contended that the adjudicator had wrongly decided whether a document was an interim certificate or pay less notice and whether it was valid in timing and content.

The defendant issued a late and incomplete Part 8 claim. The claimant did not consent to determination of the underlying merits at the enforcement hearing. The central issue was whether the challenge fell within the narrow class of merits questions which the court may determine when enforcing an adjudicator’s decision.

1. Summary judgment was entered for the claimant for £491,944.73, payable within seven days. Where an adjudicator decides the referred issue within jurisdiction and acts broadly in accordance with natural justice, the court ordinarily enforces the decision even if it contains an error. The unsuccessful party must pay now and argue later: Macob Civil Engineering Ltd v Morrison Construction Ltd [1999] BLR 93, Bouygues (UK) Ltd v Dahl-Jensen (UK) Ltd [2000] BLR 522 and Carillion Construction Ltd v Devonport Royal Dockyard Ltd [2006] BLR 15 applied.

2. An admitted error may exceptionally be corrected where the court has jurisdiction finally to determine it. A separate narrow exception also permits determination of certain disputes concerning the timing, categorisation or description of payment applications, payment notices or pay less notices. These exceptions do not establish a general right to review an adjudicator’s merits.

3. Absent consent, a defendant seeking final determination of such a challenge must promptly issue a Part 8 claim identifying the declarations sought. At the least, it must state the declarations in a detailed defence and counterclaim. The defendant must demonstrate that the issue is short and self-contained, requires no oral evidence or elaboration beyond the enforcement hearing, and is one which it would be unconscionable to ignore. The consequences must also be clear-cut. Paragraph 9.4.3 of the TCC Guide was superseded by this guidance.

4. The defendant’s challenge failed those requirements. Its Part 8 claim was late, sought no specific declarations and omitted a material issue concerning the information supporting the nil valuation. The proposed challenge sought to rerun the adjudication and introduced factual matters which might be disputed. The adjudicator had carefully addressed the document’s character, timing and content, and there was nothing unconscionable in enforcing his decision.

5. Using an enforcement hearing to repeat a substantial adjudication without the claimant’s consent would undermine adjudication as a prompt, temporarily binding dispute-resolution process. Such challenges may constitute an abuse of process. An unsuccessful defendant will ordinarily risk indemnity costs. The defendant remained entitled to pursue its Part 8 claim separately after amendment and an appropriate exchange of pleadings.

• High Court (Technology and Construction Court): Enforced the adjudicator’s award by summary judgment. It declined to determine the defendant’s merits challenge at the enforcement hearing but permitted the separate Part 8 proceedings to continue.
• Adjudication: The adjudicator rejected the defendant’s arguments concerning the character, timing and content of its purported notice and awarded the claimant £491,944.73.