Rochford Construction Ltd v Kilhan Construction Ltd

Where an adjudicator has jurisdiction and has complied with natural justice, the decision should ordinarily be enforced under the pay now, argue later principle. A defendant’s assertion that the adjudicator was wrong is generally irrelevant to enforcement. Where enforcement proceedings and a Part 8 claim are brought together without consent, the Part 8 issue should only be heard with enforcement if it is short, self-contained, requires no oral evidence, and would be unconscionable to ignore on a summary judgment application. Realistic hearing estimates must allow for reading, substantive submissions, judgment and consequential matters. Enforcement should not be delayed merely to accommodate a longer Part 8 hearing.

Kilhan obtained an adjudicator’s decision for approximately £200,000 concerning an interim payment application. Kilhan issued enforcement proceedings. Rochford then issued a Part 8 claim alleging that the adjudicator had misinterpreted the subcontract’s payment provisions and that no payment had fallen due.

The enforcement hearing was listed for two hours. Rochford sought to have the Part 8 claim heard at the same time, or alternatively to adjourn both matters until a later date when a longer hearing could be listed. The central issues were whether the Part 8 claim could be accommodated with enforcement and whether enforcement should be postponed pending determination of that claim.

The court directed that the adjudication enforcement hearing remain listed for 13 February 2020 and that the Part 8 claim be heard separately on 12 March 2020, with a one-day estimate and half a day for reading.

1. Enforcement of adjudicators’ decisions. The adjudicator’s jurisdiction and compliance with natural justice were not challenged. The decision was therefore valid for enforcement purposes. Under the pay now, argue later principle, a valid adjudication decision ordering payment should be complied with, and the adjudication winner is entitled to hold the money pending resolution of the substantive dispute.
2. Concurrent Part 7 and Part 8 proceedings. Applying Hutton Construction Ltd v Wilson Properties (London) Ltd [2017] EWHC 517 (TCC), a Part 8 issue should only be dealt with alongside enforcement without consent where it is short and self-contained, requires no oral evidence, and is an issue which it would be unconscionable to ignore on a summary judgment application. Examples include a construction of a contract clause beyond any rational justification or an obviously incorrect calculation of time.
3. The alleged contractual error did not meet that threshold. The construction adopted by the adjudicator was not beyond rational justification, and the word relied upon in the Part 8 claim did not appear in the subcontract.
4. The proposed two-hour combined hearing was wholly unrealistic. A proper estimate must allow sufficient time for reading, substantive argument, an oral judgment if appropriate, and consequential matters. Delaying enforcement until a later date merely to accommodate a one-day Part 8 hearing would be wrong in principle and contrary to the approach in Hutton Construction Ltd v Wilson Properties (London) Ltd [2017] EWHC 517 (TCC).