| Date | 10 October 2001 |
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| Judgment | Farebrother Building Services Limited -v- Frogmore Investments Limited, TCC 28 April 2001 |
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| The Issue | Challenge to an adjudicator's decision on the grounds that the adjudicator has failed to consider all of the relevant material put before him. |
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| Implication |
The courts in England will generally refuse to dissect an adjudicator's decision, to remove parts where a successful challenge has been made. |
printThe Scottish and English courts have differed in their interpretation of the Housing Grants, Construction and Regeneration Act 1996 in a small number of areas. One example is whether, on hearing an application for enforcement of an adjudicator's decision, the court would be willing to enforce a part of the decision where it is considered to be sound, and refuse enforcement of the remaining part where a successful challenge has been made. In Barr -v- Law Mining, a case for enforcement of an adjudicator's decision heard in the Outer House of the Court of Session in Scotland, Lord Macfadyen was asked to consider such a question. He agreed with the defendant that the adjudicator did not have jurisdiction to make the decision he had made in respect of part of the dispute. He was content in such circumstances to separate the part of the decision affected by this question and order enforcement only of the remainder. This approach is in contrast to decisions south of the border. In KNS Industrial Services (Birmingham) -v- Sindall His Honour Judge Humphrey Lloyd said that the court should accept the award as it stands and not seek to vary it. "The parties have to accept the decision, warts and all. They cannot come to the court to have a decision revised to excise what was unwanted and to replace it with what was or is thought to be right, unless the court is the ultimate tribunal". Similar questions were examined in the Technology and Construction Court in the case of Farebrother Building Services -v- Frogmore Investments. Judge Gilliland QC agreed with Judge Lloyd, confirming that he took the view that it would not be right for the court to try to dismantle or reconstruct an adjudicator's decision. A dispute had arisen between the parties concerning whether Farebrother was entitled to a further extension of time and whether it was entitled to additional payment for loss and expense amounting to some £900,000. Frogmore countered that Farebrother was responsible for critical delay and that as a consequence it was entitled to set off an amount of approximately £300,000. Frogmore argued that these matters should be regarded as both a counterclaim and a defence to the claims being made by Farebrother. Submissions were made to the adjudicator on behalf of Farebrother that he could not deal with or give effect to Frogmore's counterclaims, because the appropriate notices had not been given. The adjudicator took legal advice and in his decision recorded that he did not have jurisdiction to deal with the counterclaim. He did not give further reasons for this decision, nor was he obliged to do so. In dealing with the substantive claims put forward by Farebrother, the adjudicator directed that there should be a full extension of time to correspond to the period claimed in the Referral Notice, and that Farebrother was entitled to a sum of approximately £600,000 plus VAT. Frogmore sought to resist summary enforcement of this decision, on the basis that the adjudicator had failed to deal with its claim for set-off of approximately £300,000. Frogmore argued that the adjudicator had simply not dealt with an essential and important part of the defendant's case and that accordingly the court should not enforce the decision. What exercised Frogmore was that it was one thing for the adjudicator to determine that he had no jurisdiction to deal with its claim for set-off in the sum of £300,000. It was quite another thing for the adjudicator to have entirely disregarded the evidence put forward in that submission which countered the other party's case. Judge Gilliland acknowledged that it was not clear on the face of the adjudicator's decision whether the adjudicator had entirely disregarded Frogmore's claims. It was possible that the adjudicator, in declaring that he had no jurisdiction to deal with Frogmore's counterclaim, had not only ignored the claims for £300,000 to be applied as a set-off, but had also disregarded the substance and merits of the case which had been put forward by Frogmore by way of a defence. Equally, there was nothing on the face of the decision to indicate that the adjudicator had not given consideration to these matters in determining that £600,000 was due to Farebrother. Frogmore's contention was that whilst it accepted that it could not challenge the adjudicator's award in the sum of £600,000, the court should deduct or set-off the £300,000 which it argued which was not in substance challenged by the other party. Judge Gilliland concluded that if it was the case that the adjudicator had ignored or failed to take account of an issue of substance put forward by the defendant, that would not be a matter which affected the adjudicator's jurisdiction. Judge Gilliland was reinforced in this view by noting that the adjudication had been conducted in accordance with the Technology and Construction Solicitors Association (TECSA) Adjudication Rules. Paragraphs 11 and 12 of these rules provide that, if the adjudicator decides that something is within his jurisdiction, that is binding. Accordingly, Judge Gilliland concluded that whether or not the adjudicator had taken into account all of the matters submitted by Frogmore, his decision could not be challenged on jurisdiction, and nor was it right for the court to dismantle the decision. The decision was to be enforced in the full amount determined by the adjudicator.
CJ-0140
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