Chairwoman's Notes - Susan Francombe

Editors' Notes - Douglas James, Benedict Morillo, Crown Office Chambers

Navigating the Waters of Multiple Simultaneous Adjudications in Construction Disputes: A Party Rep’s perspective - Rob Hubbard

When will indemnity basis costs be awarded in enforcement proceedings? - Joanne Chase and Robert Patterson, Clarion Solicitors

Termination, Insolvency, and their effect on Adjudication - Trevor Drury, Barrister

Adjudicator Spotlight - Patrick Waterhouse, Marion Smith KC, Lawrence Davies, and Trevor Pettigrew-Smith

Call for Mentors: Update - Morwenna Crichton

Mentoring Q&A with Len Bunton

Event Write-Up: ‘What do you really want from your adjudicator?’, 30 January 2024

Problem Question

Case Notes

Susan Francombe

Welcome to this edition of the Adjudication Society Newsletter. I’m pleased to see so many members contributing. If you have an idea for an article relevant to adjudication, please get in touch. 
 
In my section for this newsletter, I touch on the topic of jurisdiction. This often comes up in conversation, with many adjudicators and party representatives complaining about the number and complexity of jurisdictional challenges. However, what effect does this increasing emphasis on jurisdiction have on potential new adjudicators? Last month I spoke to several well-qualified and experienced professionals who had undergone mentoring with a view to becoming adjudicators. Unfortunately, two of them were quite insistent that they were no longer interested. This was in part due to the pressures and difficulties caused by the incessant jurisdictional challenges they had seen.
 
Now I know some of you will say that is just the job and they should be strong enough to deal with it. But are jurisdictional challenges getting out of hand? What about the cost and time taken by adjudicators in dealing with them? Or are the challenges justified given that responding parties are often under time pressures and on the back foot? What do you think?

This leads me onto my next question: What do adjudicators and Schrodinger’s cat have in common? Schrodinger’s cat is a thought experiment from the 1930’s that was used to point out a flaw in the then current thinking around quantum theory. (Don’t worry, we’re not going to get too physics heavy). The idea was that atoms exist in different states at the same time, a bit like being in two places at once. It is only when they are observed that they commit to a definite state, the observation influencing the outcome. Schrodinger explained it was like having a cat in a box with a radioactive atom and a vial of poison. At some stage the radioactive atom will decay, break the vial, release the poison, and kill the cat. According to quantum theory the cat will be both dead and alive until someone lifts the lid and looks in the box.
 
You might think a) that’s cruel and b) what has that got to do with adjudication? Well, the Adjudication Society Construction Law Update held on 13 March 2024 included an interesting review of the Lidl Great Britain Ltd v Closed Circuit Cooling Ltd (t/a 3CL) [2023] EWHC 3051 (TCC) judgment. Dr Franco Mastrandrea, the speaker at the event, was the adjudicator involved in the 3rd adjudication mentioned in the judgment. He highlighted the difficulties that adjudicator’s face in ensuring they have jurisdiction.
 
The general principle taken from S&T v Grove [2018] EWCA 2448 is that the loser in a smash and grab adjudication (I hate that phrase, but you all know what I mean) can’t commence a true value adjudication until they have handed over the sum they were directed to pay. In the 1st adjudication a smash and grab adjudication was won by Closed Circuit Cooling (CCL). Lidl didn’t pay so CCL headed off to enforcement.
 
Lidl quickly commenced their own adjudications. Both the 2nd and 3rd adjudications were commenced whilst payment of the 1st adjudication decision remained outstanding, but payment was made before both decisions were issued. The 2nd adjudication consisted of a claim for the cost of rectifying defects in the works. The 3rd adjudication dealt with the question of extension of time.
 
There were 4 key dates. 

• 25th May 2022 – contractual completion date.
• 18th June 2022 – previous ex gratia extension of time.
• 29th September 2022 – relevant payment application.
• 26th October 2022 – practical completion.

His Honour Judge Stephen Davies decided that Dr Mastrandrea did not have jurisdiction to determine extension of time over the period between 18th June 2022 and 29th September 2022. This was on the basis that the 1st adjudication (the smash and grab) dealt with a payment notice from Lidl for liquidated damages during this period. Considering the extension of time for the same period in the 3rd adjudication was effectively a true value assessment that couldn’t be commenced whilst payment of the 1st adjudication decision had not been made.
 
The adjudicator did however have jurisdiction to determine extension of time over the periods 25th May 2022 to 18th June 2022 and 29th September 2022 to 26th October 2022. So, an adjudicator can both have jurisdiction and not have jurisdiction at the same time. It all depends on when you open the box.
 
Before I sign off, I shall point out our new feature – What Would You Do? Each edition we will pose a practical question around adjudication and ask how you would deal with it. We will be covering some of the answers received in the next edition. So, what would you do? Click the link in the feature to submit your answer.

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Douglas James, Benedict Morillo, Crown Office Chambers

This quarter’s newsletter is our fullest for some time – the Society goes from strength to strength and we extend our thanks to all of our contributors and all of those on the Committee, and Edward Peters, the Society’s webmaster, who all make this newsletter possible. 

We start by drawing attention to the Society’s mentoring scheme which has thus far been a great success and has matched all of those seeking ad hoc mentorships with mentors - but more adjudicator mentors are needed that would be willing to offer pupillage mentoring. Please see Morwenna Crichton’s Call for Mentors and the Q&A with Len Bunton for further detail on what the scheme entails and how you can get involved – it really does seem like a rewarding experience for the mentors, and it is vital for helping the next generation of adjudicators to find their feet and develop their careers.

In terms of the Society’s activities, we have a report from Douglas James on the ‘What do you really want from your adjudicator’ event from January, which was a great success. The Society’s ‘Spotlighting Adjudicators’ scheme has also grown after being launched late last year. Patrick Waterhouse, Marion Smith KC, Lawrence Davies, and Trevor Pettigrew-Smith’s Q&As on their careers in and out of adjudication, and their advice to new adjudicators can now all be found on the Society’s website. We look forward to forthcoming events and draw attention to the ‘Use of Expert and Factual Witnesses in Adjudication Processes’ event later this month on 29 May 2024 and the ‘Case Law Updates’ which are taking place in June in Leeds and Edinburgh.

We have a good spread of articles on a range of topics. Rob Hubbard writes on the practicalities and strategies involved in navigating multiple simultaneous adjudications. Joanne Chase and Robert Patterson look at indemnity costs in enforcement proceedings and the decision in Sleaford Building Services Ltd v Isoplus Piping Systems Ltd [2023] EWHC 1643 (TCC). Trevor Drury provides an excellent and comprehensive article (for which we are very grateful) on the intersection between termination, insolvency, and adjudication.Thanks go to Nicholas Gould, Oliver Weisemann, Roma Patel and Taj Atwal of Fenwick Elliott as ever for generously providing an update on reported adjudication judgments from the last few months of 2023.

Please do get in touch with us (djames@crownofficechambers.com and bmorillo@crownofficechambers.com) or Bernadette Barker (bernadette@barkerconsultants.com) if you would like to contribute an article to the newsletter. All contributions are welcome and we are happy to discuss any ideas for articles you might have.

Douglas James
Benedict Morillo

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Rob Hubbard

In this article, Rob Hubbard provides a on overview of the challenges raised by and the strategies for managing multiple simultaneous adjudications. Rob very rightly points out the administrative and organisational burden it can involve having to fight multiple adjudications at the same time, and he suggests several strategies that can be used to make this more manageable

Read the full article

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Joanne Chase and Robert Patterson, Clarion Solicitors

Joanne Chase and Robert Patterson of Clarion Solicitors look at the law on indemnity costs in enforcement proceedings following Sleaford Building Services Ltd v Isoplus Piping Systems Ltd [2023] EWHC 1643 (TCC), examining whether and in what circumstances indemnity costs will be awarded against a party defending enforcement proceedings.

Read the full article

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Trevor Drury, Barrister

Trevor Drury, barrister, provides a comprehensive overview of grounds for termination at common law and under common standard form contracts (JCT and NEC), and he particularly looks at a party’s insolvency as a ground for termination and how insolvency interacts with the adjudication process.

Read the full article

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Please see the recent ‘Spotlighting the Adjudicator’ interviews with Patrick Waterhouse, Marion Smith KC, Lawrence Davies, and Trevor Pettigrew-Smith which are now on the Society’s website.

Read their responses here

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Morwenna Crichton

Women in Adjudication launched its mentoring scheme last November which is open to all members of the Adjudication Society. We run two schemes - the ad hoc scheme, which is aimed at developing skills and experience at all stages of the adjudication journey (whether as user, party representative, aspiring or practising adjudicator) and the pupillage scheme, where Adjudicators on our list approach us seeking a potential pupil at the point at which they receive a live adjudication.

We have successfully matched all candidates who have approached us seeking an ad hoc mentorship. We have also made pupillage matches but have a waiting list of candidates seeking pupillage mentorships.

We would encourage all practising adjudicators to consider joining our schemes as mentors in order to help develop the next generation of talent and keep adjudication at the cutting edge of dispute resolution.

In this issue, Len Bunton, one of our first sign ups as a mentor, has been kind enough to tell us about his experience with the programme to date and why he encourages others to join. In our next issue, we will hear from one of his mentees, Sue Kim.

Anyone interested in applying is invited to contact Morwenna Crichton
(mcrichton@yellandsavage.com) or any of the Adjudication Society committee.

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Len Bunton

Len Bunton, one of the Society’s most prolific mentors, answers some questions about his experience providing adjudication mentoring. Next issue, we will be hearing from Sue Kim, one of his mentees, about her experience of mentoring.

Read the full interview

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The Society held a successful and well-attended event on 30 January 2024 at Watson Farley & Williams LLP which looked at what parties and party representatives expect from their adjudicators. Thanks to Watson Farley for hosting and to our panellists: Michael Pogue (Secretariat), Nik Tait, (Laing O’Rourke), Stephanie Geesink (Watson Farley & Williams), and Matt Molloy (MCMS Limited).

Douglas provides a tongue-in-cheek summary of the key themes of the event as follows: (a) everyone loves Matt Molloy and wants to give him his 876th adjudication; (b) everyone loves the flexibility of adjudication, otherwise parties can always litigate and arbitrate; (c) no-one really wants joint expert meetings apart, sorry experts, from experts (and a select few adjudicators); (d) everyone thinks that adjudicator pupillage and mentoring open a “vault” of knowledge-sharing and experience and are generally very good things; (e) WFW are very good hosts, especially as they let you take booze into a panel discussion.

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Welcome to our new feature where we post a practical question around adjudication and ask how you would deal with it. In this edition you are asked to put yourself in the position of an Adjudicator. Will you allow the submission? What are the consequences either way? 
Let's see what you think!
 
Question:
You are appointed as Adjudicator. 
The Responding Party has declined to participate in the Adjudication. 
You write to the parties stating that you now intend to proceed to make your decision. 
The Referring Party then points out that you had given permission for a Reply in your directions, and states that it is still entitled to make a further submission to you.
WHAT WOULD YOU DO?
 
You can submit answers here
You can choose to be anonymous or leave your name if you would like a mention.

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Case Note Contributors: Nicholas Gould, Roma Patel, Oliver Weissmann and Taj Atwal, Fenwick Elliott

Level 1 Raised Flooring Limited v J M Construction (SW) Limited

Reference: [2023] EWHC 2841 (TCC)
Date: 12 September 2023
Judge: District Judge Baldwin
Keywords: Adjudication; Adjudicator’s decisions; Construction contracts; Enforcement; Summary judgments

Read the full case note

Bexhill Construction Ltd v Kingsmead Homes Ltd

Reference: [2023] EWHC 2344 (TCC)
Date: 3 October 2023
Judge: Honour Judge Kelly
Keywords: Summary enforcement; Breach of natural justice

Read the full case note

Van Elle Ltd v Keynvor Morlift Ltd

Reference: [2023] EWHC 3137
Date: 8 December 2023
Judge: Judge Stephen Davis, sitting as a High Court Judge
Keywords: Adjudicators' decisions; Construction contracts; Enforcement; England; Jurisdiction; Natural justice; Ordnance Survey; Statutory interpretation; Territorial waters; Tidal rivers

Read the full case note