Prater Ltd v John Sisk & Son (Holdings) Ltd

An adjudication decision remains binding and enforceable under the parties’ contractual scheme unless and until successfully challenged before the court or tribunal. A later adjudicator must treat the earlier decision as binding and must not reopen matters already decided. A jurisdictional challenge to the earlier adjudication does not, before determination of that challenge, invalidate a later decision which relies on the earlier decision.

Whether several issues comprise one dispute is a question of fact assessed commercially and without over-legalistic analysis. Distinct issues may form part of one larger dispute, and a party may refer only part of that dispute where the issues are linked and the whole dispute would be unsuitable for a single adjudication.

Prater sought summary judgment to enforce an adjudicator’s decision requiring Sisk to pay £1,757,821.35 plus VAT. The decision followed three earlier adjudications concerning, among other matters, the subcontract completion date, provisional sums and deductions for indirect losses.

Sisk argued that the second adjudicator lacked jurisdiction because several disputes had been referred together. It also argued that the fourth decision was unenforceable because it relied on the second decision, which Sisk said was itself a nullity. The central issues were whether an unresolved jurisdictional challenge to an earlier decision could affect enforcement of a later decision, and whether the second adjudication concerned more than one dispute.

1. Summary judgment. Summary judgment was entered for Prater. Decision 4 was enforceable.
2. Binding effect of Decision 2. Under clause W2.3(11) of the subcontract, Decision 2 remained binding unless and until revised by the court or tribunal. That reflected the usual position under section 108(3) of the Housing Grants, Construction and Regeneration Act 1996. Sisk had served a notice of dissatisfaction but had not referred the challenge to the court.
3. A later adjudicator cannot reopen matters decided in an earlier adjudication. If Mr Molloy had revisited Decision 2, that could have founded a challenge to Decision 4. His reliance on Decision 2 was proper. Any error concerning the effect of the earlier decision would have been an error of law within jurisdiction, rather than a jurisdictional error in Adjudication 4.
4. Single dispute. The guidance in Witney Town Council v Beam Construction (Cheltenham) Ltd [2011] EWHC 2332 (TCC) was applied. Whether there is one dispute is a fact-sensitive question requiring a common-sense and commercial assessment. A single dispute may contain several distinct issues. It is not necessary that one issue cannot be decided without deciding every other issue.
5. The matters referred in Adjudication 2 were linked aspects of the larger dispute concerning Sisk’s assessment and payment certificate. It would be arbitrary and potentially oppressive to require every issue in a complex final-account dispute to be referred in one adjudication, or to treat each issue as a separate dispute. The issues therefore comprised one dispute.
6. Contractual scheme. On proper construction, clause W2.1 contemplated referral of a single dispute at any one time. The wording, the scheme’s purpose, the statutory background and the commercial context supported that interpretation. The result did not affect the conclusion that the matters actually referred formed one dispute.