6 January 2009 01:25

Enforcement of an Adjudicator's Decision

LEAD TECHNICAL SERVICES LIMITED - C M S MEDICAL LIMITED

A recent case in the Court of Appeal has given guidance as to when it is inappropriate for the parties to proceed by way of summary judgment to enforce an adjudicator’s decision.

At present that Technology and Construction Court Guidance states that all applications to enforce an adjudicator’s decision must be made by way of Summary Judgment.  However the Court of Appeal have stated that in some circumstances it is not appropriate to give judgment under the Summary Judgment procedure and that certain cases do need to be investigated fully before the Court will pronounce on whether that decision should be enforced.

In Lead Technical Services Limited - CM S Medical Limited the Court of Appeal held that the Judge in the Technology and Construction Court should not have given Judgment under the Summary Judgment procedure because the Defendant company were able to establish that there was a real prospect of a genuine defence.

CPR Rule 24.2 states that

the Court may hear Summary Judgement against a Claimant or a Defendant on the whole of the claim or on a particular issue if

a.it considers that -

i)the Claimant has no real prospect on succeeding on the claim or issue; or
ii)the Defendant has no real prospect of successfully defending the claim or issue; and

b.there is no other compelling reason why the case or issue should be disposed of at trial

The Court of Appeal held that the Defendant had shown that there were genuine reasons to successfully defend the claim and accordingly the Court held that the lower court had erred in giving Summary Judgment to the Claimant.  This did not however mean that the Claimant had lost, merely that the “short cut” had not worked.  The Court of Appeal held that full evidence needed to be considered to decide whether the decision of the Adjudicator should be enforced.

The dispute over the enforcement of the adjudication and its enforcement related to jurisdiction of the Adjudicator.  The Court of Appeal held that the adjudication had been started using not only the wrong contract but also the wrong appointing body, and secondly the Defendant had also produced evidence to show that there had been an oral agreement  as to part of the contractual terms.  The Court felt that this fell foul of the requirement under the Housing Grants Construction Regeneration Act 1996 in that the construction contract had to be in writing.

This case is a reminder to adjudicators to ensure that when they are appointed, there is and can be no dispute as to their appointment under the contract, which must be in writing, and that the correct appointing body has been used.

Sarah Shemmings

May 2007

 

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