The Court’s Commitment to Enforcing Adjudicator Decisions
Adjudication can provide parties involved in a construction dispute with a swift and decisive mechanism to resolve disputes. It is designed to provide interim relief, with decisions meant to be immediately binding and upheld by all parties involved. However, not all parties comply with these decisions, necessitating a robust enforcement process for adjudicator decisions.
In our recent article ‘Construction Adjudication in 2023’, our lawyers provide some valuable statistics into the prevalence and enforcement of adjudicator’s decisions over the past year. The need for enforcement is underscored by the fact that 79% of adjudicator decisions are actively enforced by courts.
Enforcement is not merely an option but is a fundamental aspect of adjudication, ensuring that decisions are respected and acted upon, thereby maintaining the integrity and effectiveness of the dispute resolution process in construction disputes.
Common Construction Disputes Referred to Adjudication
The construction industry faces a variety of disputes due to the complex nature of construction projects and contracts. The most common disputes referred to adjudications include:
- ‘Smash-and-Grab’ Claims (63% which was the most common dispute type referred to adjudication in 2023)
- ‘True Value’ Claims – Final Account (40%)
- Loss and Expense/Damages for Delay/Disruption (37%)
- ‘True Value’ Claims – Interim Payments (36%)
- Termination Disputes
- Negligence or Defective Workmanship
- Variation Disputes
- Extension of Time Claims
If you have a construction dispute or wish to enforce an adjudicator decision, please do not hesitate to contact our expert construction dispute lawyers for a Free Consultation on 0207 459 4037 today.
How to Enforce an Adjudicator’s Decisions in Construction Disputes?
The Technology and Construction Court (TCC) is the court where adjudicators’ decisions are enforced and any other business connected with adjudication is undertaken. The procedure for enforcing an adjudicator’s decision is contained in Section 9 of the Technology and Construction Court Guide (TCC Guide).
Enforcing an adjudicator’s decision in construction disputes involves a specific series of steps within the Technology and Construction Court which could take 6-8 weeks in total. Typically, the pre-action protocol for construction disputes does not apply to adjudication enforcement (J&B Hopkins Ltd v A&V Building Solution Ltd [2023] EWHC 301 (TCC)), allowing for quicker progression to court hearings.
Step 1: Determine the Correct Claim Type
There are two claim types and procedures to follow depending on the nature of the remedy awarded by the adjudicator decision namely:
- Part 7 Claim: This route is for money awards where you are seeking to recover a sum of money awarded by the adjudicator.
- Part 8 Claim: This is primarily about the legal interpretation of a point, typically for declaratory relief or where there is not a substantial dispute of fact.
The Court issue fee to enforce an adjudicator’s decision has now increased to £569.
Step 2: Prepare Court Documents
- Claim Form: Begin by filing a claim form (N1) in the Technology and Construction Court. This form initiates the legal process and must detail the adjudicator’s decision and the relief sought.
- Particulars of Claim: Accompanying the claim form, the particulars of claim should comprehensively outline the dispute, the adjudication proceedings, the decision made, and the basis for its enforcement.
- Witness Statement: This is a critical document where you lay out the facts of the case, the procedural history, and the reasons why the court should enforce the adjudicator’s decision. It must be factual, precise, and supported by evidence.
- Application Notice for Summary Judgment (CPR 24): If you are applying for a summary judgment, prepare an application notice under CPR Part 24 together with draft directions.
Step 3: File and Serve Documents
- Directions: The Court will usually provide the parties with directions for enforcement within 3 working days which will effectively act as a timeline for the claim.
- Lodge at the TCC: Issue all the prepared documents at the appropriate Technology and Construction Court registry or court centre.
- Serve the Defendant: Once the documents are filed and issued by the Court, serve them to the party against whom enforcement is sought. This must be done promptly and within the specified time frames, typically within 14 days of the claim form being issued.
- Opposition Defence: The Defendant will typically have 14 days to respond to the claim and provide any evidence in opposition.
- Reply to the Defence: The claimant will then have an opportunity to reply to the Defence typically within 14 days of service of the defence.
Step 4: Summary Judgment Application
Attend the Hearing: If you have applied for summary judgment under CPR 24, attend the hearing with all necessary documents and legal representation. Be prepared to argue why there is no need for a full trial and why the adjudicator’s decision should be enforced immediately.
Step 5: Obtain and Execute Court Judgment
- Receive Judgment: The court will provide a judgment following the hearing (typically 6-8 weeks after the start of the process). This will typically order the losing party to make a payment or take specific action in line with the adjudicator’s decision.
- Enforce Judgment: Should the party fail to comply with the court’s order, consider further enforcement steps such as applying for a charging order.
Our expert construction lawyers have extensive experience with construction adjudication and enforcement, if you wish to discuss your legal issue with one of our lawyers, please call us on 0207 459 4037 for a Free Consultation.
How can the Enforcement of Adjudicator’s Decision be challenged?
The TCC has a pronounced commitment to upholding the adjudicator’s decisions.
The decision in Macob Civil Engineering Ltd v Morrison Construction Ltd [1999] EWHC Technology 254 was the first case for enforcement of an adjudicator’s decisions. The court held that adjudicators’ decisions are intended to be interim binding, meaning they should be complied with until finally resolved in litigation, arbitration, or agreement. It established that minor procedural errors or misunderstandings by the adjudicator would not prevent enforcement unless they were so significant as to constitute a breach of natural justice or exceed the adjudicator’s jurisdiction.
In Speymill Contracts Ltd v Baskind [2010] EWCA Civ 120 the Court dealt with the enforceability of adjudicator’s decisions when one party alleges fraud. It was noted that even if there are allegations of fraud if the adjudicator has jurisdiction and the decision was reached following the principles of natural justice, the decision is enforceable.
The guiding principle supported by many cases since is that decisions are enforceable unless there is a glaring:
- Jurisdictional Error: One of the most critical aspects of enforcing an adjudicator’s decision is establishing that the adjudicator had the jurisdiction to make the decision. Jurisdictional challenges can include disputes over whether the adjudicator was appropriately appointed, whether the dispute was properly referred to, and whether it fell within the scope of the contract’s adjudication clause.
- Breaches of Natural Justice: The principles of natural justice require that each party has a fair opportunity to present their case and that the adjudicator is impartial. Breaches can lead to a decision being deemed unenforceable. This includes situations where an adjudicator has been shown to have bias or has denied a party the chance to present its case fully.
Therefore, if you have received an adjudication decision but it is not being complied with then there is a good chance that the Court will help you to enforce it.
Recent Decisions Challenging Enforcement of Adjudicator Awards
In 2023, TCC decisions have further reinforced the enforcement of adjudicator awards, underlining a commitment to the adjudication decisions and the “pay now, argue later” philosophy.
Exyte Hargreaves Ltd v NG Bailey Ltd [2023] EWHC 94 (TCC)
NG Bailey’s resistance to enforcement is based on prior Pay Less Notices and compliance with the Pre-Action Protocol. The court enforced the awards, ruling that non-compliance with the Pre-Action Protocol does not automatically warrant a stay in adjudication enforcement.
WRB (NI) Ltd v Henry Construction Projects Ltd [2023] EWHC 278 (TCC)
This construction dispute concerned the enforcement of an adjudicator’s decision, with the Defendant arguing for a stay of execution on the grounds of the Claimant’s dormant status and potential inability to repay in case of a successful counterclaim.
The court refused the stay of execution and enforced the adjudicator’s decision. It emphasised that a party’s financial status, such as being a dormant company, does not affect the enforceability of an adjudicated payment as that dormant company had been the contracting party.
J&B Hopkins Ltd v A&V Building Solution Ltd [2023] EWHC 301 (TCC)
J&B Hopkins Ltd pursued enforcement of an adjudicator’s decision against A&V Building Solution Ltd related to payment disputes under a subcontract for plumbing installation works.
The enforcement of the adjudicator’s decision was contested on grounds of procedural irregularities, including the failure to comply with the Pre-Action Protocol.
The court enforced the adjudicator’s decision. It again clarified that non-compliance with the Pre-Action Protocol is not a ground for resisting enforcement of an adjudication decision, emphasising the adjudication’s purpose in providing a speedy resolution to disputes.
Resolution of Construction Dispute – £1.2m Recovered for Sub-Contractor plus costs
Client A approached our expert construction dispute lawyers after receiving a contentious Pay Less Notice which the client assessed at zero.
Our dedicated construction dispute lawyers swiftly analysed the situation, and evidence (including an expert valuation report), identified key areas of contention, and helped Client A successfully challenge and mitigate the financial implications of the notice.
Our construction dispute lawyers were able to recover a significant multi-million-pound sum of over £1.2m for the subcontractor.
Winning Approach to Enforcing Adjudicator Decisions
Our lawyers’ extensive industry-specific knowledge and our commitment to justice make us the preferred choice for many businesses in the construction industry. Our construction dispute lawyers are passionate about this industry and are members of the Society of Construction Law and the Adjudication Society.
Our lawyers are recognised among the best lawyers in England & Wales, and have regularly been asked and featured to write authoritative articles in the Financial Times, the Law Society and LexisNexis and have been quoted in City AM, the New Law Journal, Law Society Gazette and Litigation Futures.
Our unique approach to the enforcement of adjudicator decisions means that we will:
- Arrange a Free Consultation with you & a qualified lawyer to discuss your construction dispute
- Free Asset Tracer & Due Diligence Report
- Arrange a WhatsApp group with you & your legal team in case you have any questions
- Investigate the merits of your issue & create a strategy for success
- Send us your case documents easily through our secure client portal, Go Transfer
- Advise on any judgments & tactics that have proved successful in construction disputes
- Consult with independent surveyors & experts to strengthen your position
- Free sign-up to our Insolvency Tracker & Claims Protection service (worth £1k pa)
- Fixed fees & “no win no fee” arrangements so that you have peace of mind throughout
- Work hard to achieve the best outcome in your construction dispute
Our construction lawyers offer regulated, independent & confidential legal advice and are also dedicated members of the Professional Negligence Lawyers Association, the London Solicitors’ Litigation Association, the Association of Cost Lawyers, the Insolvency Lawyers Association and the Commercial Litigation Association.
Free Consultation with Expert Construction Dispute Resolution Lawyers
Facing a construction dispute or need guidance on construction adjudication? Call our expert lawyers for a free consultation at 0207 459 4037. We are here to help.
We provide flexible funding options including fixed fees and ‘no win no fee’ arrangements for your construction dispute.
