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Enforcement of an Adjudicator's Decision: YCMS Limited -v- Grabiner & another [2009 EWHC 127 (TCC)

Amendments of a Decision by the Adjudicator under the "slip rule" and off-setting the Award
This is a Judgement relating to an enforcement of an Adjudicator's Decision.

The background to the claim is that disputes arose between the parties in respect of valuation of the works. In all 3 adjudications were dealt with between the parties. This Judgement however related to enforcement of the 1st Decision. The delay in taking enforcement proceedings was apparently due to the fact that the parties were trying to see if they could resolve their differences by settlement but it proved not to be the case.

The issues before the Court related to whether the Adjudicator had authority to amend his 1st Decision under the "slip" rule and secondly whether the Defendants could set-off the sums awarded to them in the 3rd adjudication against the amounts that they had to pay in the 1st adjudication.

As far as revision of an Adjudicator's Decision is concerned the Judge, Mr Justice Akenhead, looked at the authorities that deal with revisions to an Adjudicator's Decision. The main case is the decision of HHJ Tolmin CMG QC in Bloor Construction (UK) Ltd -v- Bowmer & Kirkland (London) Ltd 2000 BLR 314. In this case the Adjudicator amended his Decision within 21/2 hours after he had been advised that he had failed to include payments on account already made. In that case the Judge decided that there should be an implied term in the contract which allowed the Adjudicator to correct an error arising from an accidental error of omission

In that case the Judge stated:

"It is clear that the error in this case falls into the category of the slip. The Adjudicator was giving effect to his first thoughts and intentions in his amended ruling. In my view, in the absence of any specific agreement to the contrary, a term can and should be implied into the contract referring the dispute to adjudication, that the Adjudicator on his initiative or on the application of a party, correct an error arising from an accidental error or omission. The purpose of the adjudication is to enable broad justice to be done between the parties. Parties acting in good faith will be bound to agree at the start of the adjudication that the Adjudicator could correct an obvious mistake of the sort which he made in this case.

Clearly there must be a time limited within such an amendment can be made but in this case the amendment was made within 3 hours of the communication of the original decision. This must in the circumstances of this case be within any acceptable time limited...

The primary reason for my decision is that, in the absence of a specific agreement by the parties to the contrary, there is to be implied into the agreement for adjudication the power of the adjudicator to correct any error arising from an accidental error or omission or to clarify or remove any ambiguity in the decision which he has reached provided this is done within a reasonable time and without prejudicing the other party..

Mr Justice Akenhead therefore came to the view that as far as the adjudication "slip" rule is concerned the following should apply:-

a) An adjudicator can only revise a Decision if it is an implied term of the contract, or if a statutory adjudication, such presumption arises out of statute;
b) If there is such an implied term it can and will only relate to "patent errors". A patent error can certainly include the wrong transposition of names or the failing to give credit for sums found to have been paid or simple arithmetical errors;
c) The "slip" rule cannot be used to enable an adjudicator who has had second thoughts and intentions to correct an award...;
d) The time for revising a decision by way of the "slip" rule will be what is reasonable in all the circumstances. In the Bloor case the Adjudicator revised his decision within several hours and before the time for issuing a decision had been given. It will be an exceptional and rare case in which the revision can be made more than a few days after the decision. The reason for this is that unlike a Court Judgement of arbitration award, the principle purpose of the 1996 Act is to facilitate cash flow. If an adjudicator was able to advise his decision say 21 or 28 days later that would necessarily slow down and interfere with the speedy enforcement of adjudicator's decisions. That would in broad terms be contrary to the policy of the Act

As far as setting off one decision against another is concerned, the Judge held that the decision of Jackson J in Interserve Industrial Services Ltd -v- Cleaveland Bridge UK Ltd in 2006 was still the correct law and which it was stated

"Where the parties to a construction contract engage in success of adjudications each focused on the parties' current rights and remedies, in my view the correct approach is as follows. At the end of each adjudication, absence special circumstances, the losing party must comply with the adjudicator's decision. He cannot withhold payment on the grounds of his anticipated recovery in a future adjudication based upon different issues..."

Accordingly it is not possible to off-set one decision against another.

This decision follows and enforced previous Judgements in that adjudicators have the authority to amend their decisions under the 'slip' rule provided they are carried out promptly, and do not prejudice the parties. What is considered a reasonable period will be for the Court to decide in all the circumstances. This judgement further emphasises the need to act promptly when reviewing and considering an adjudicator's decision.

Author / Commentator: Sarah Shemmings - Date: 01/02/2009 - To contact Click Here

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