Balfour Beatty Civil Engineering Ltd & Anor v Astec Projects Ltd

An insolvent company is not automatically barred from bringing adjudications merely because its claims and counterclaims arise under several contracts. Separate adjudications may proceed where, taken together, they can determine the parties’ mutual dealings and appropriate safeguards protect the responding party.

The court may permit the adjudications subject to security for costs, restrictions on enforcement, a stay while substantive proceedings are pursued, and procedural measures such as using the same adjudicator. The court should not restrain adjudication merely because the disputes may be complex or because litigation might ultimately be more convenient.

Astec Projects Ltd, a company in liquidation, sought to commence three adjudications concerning separate sub-contracts for works at Blackfriars Station. Balfour Beatty Civil Engineering Ltd and Balfour Beatty Group Ltd applied for an injunction to restrain them, relying on the insolvency set-off regime and the principles discussed in Bresco v Lonsdale [2019] EWCA Civ. 27 and Meadowside v 12-18 Hill Street Management [2019] EWHC 2651.

The central issues were whether multiple adjudications could collectively determine the parties’ net mutual dealings and whether adequate security and procedural protections could be imposed.

1. No jurisdictional bar. The court refused the injunction. Bresco v Lonsdale established that insolvency does not create an absolute jurisdictional bar to an adjudication. The fact that the disputes arose under three separate contracts did not itself make adjudication impermissible.
2. Multiple contracts. Although an adjudicator ordinarily deals with one dispute under one contract, three separate adjudications could, when considered together, determine the entirety of the parties’ mutual dealings. Any resulting awards could be netted off through a straightforward calculation. The reasoning in Enterprise v McFadden [2010] BLR 89, which treated adjudication across multiple contracts as jurisdictionally impossible or necessarily piecemeal, could not survive Bresco v Lonsdale.
3. Conditions and safeguards. The court applied the principles in Meadowside v 12-18 Hill Street Management. Security for costs was required in the sum of £750,000, reflecting the three contractual disputes, with liberty to seek further security. Any adjudication decision in Astec’s favour could not be enforced while Balfour Beatty pursued substantive proceedings commenced within six months. The sums recovered were also to be protected against repayment risk.
4. Procedural directions. The same adjudicator was to be appointed for all three adjudications. The adjudications were to be dealt with together, while preserving at least 28 days for each. The parties could agree to confer jurisdiction on one adjudicator to determine all three disputes in a single adjudication.
5. The court declined to restrain adjudication merely because litigation might be preferable or because the adjudications could be complicated. The adjudications were permitted subject to the stated conditions and amendments to the insurance arrangements.