| Date | 8 April 1999 |
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| Judgment | Outwing Construction Limited -v- H Randell & Son Ltd, TCC 15 March 1999 |
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| The Issue | Enforcement of adjudicator's decisions. |
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| Implication |
The courts will accelerate the normal time scales for enforcement of adjudicator's decisions and will award the successful party its costs in relation to the enforcement. |
printThe case of Outwing Construction-v-H. Randell & Son, heard in the Technology and Construction Court on 15 March 1999, is the second to appear before the court concerning the enforcement of the decision of an adjudicator acting under Section 108 of the Housing Grants Construction and Regeneration Act 1996. Outwing was a groundwork sub-contractor to Randell under a modified DOM/1 form of sub-contract for works at Borough Market Pavilions in Southwark. A dispute arose concerning the unpaid balance of the final account in the amount of £12,200. Randell argued that the moneys were not due as the work had not in fact been executed properly. The matter was referred to an adjudicator who decided that the sub-contract did not comply fully with the Act and accordingly the Scheme for Construction Contracts applied. Matters moved extremely quickly. On 12 February 1999 the adjudicator rejected Randell's case and decided that it should pay Outwing the amount claimed within seven days of the date of his decision, together with fees and expenses which brought the total to £16,000. He ordered that his decision was to be complied with peremptorily. Three days later Outwing issued an invoice corresponding to the amount of the adjudicator's decision. The monies still having been unpaid, on 26 February Outwing's solicitor sent a fax stating that unless payment was received by 2 March it intended to invoke paragraph 24 of the Scheme by obtaining summary judgment in accordance with the decision in Macob Civil Engineering-v-Morrison Construction. I reported that decision in Contract Journal on 3 March 1999. Interestingly in that case Macob did not apply for summary judgment for the amount contested and therefore did not obtain a monetary judgment in its favour. Instead the Honourable Mr Justice Dyson QC merely gave a declaration that the adjudicator's decision was binding until finally determined, and that by failing to pay Morrison was in default. Returning to the present case, on 2 March Randell replied saying that they were familiar with the Macob decision and its implications but that it had given notice of arbitration on the basis that the adjudicator had erred in a number of respects. Randell further contended that since the amount was in respect of a final payment it was not due until 30 days after the adjudicator's deadline. Outwing's solicitors pressed on undeterred. On 8 March they issued a writ claiming the sums due plus interest. Two days later they served a summons for an order that the time available to Randell to oppose to the claim should be abridged to seven days. The summons further requested an order that Outwing should have its legal costs paid. At about 11.00 a.m. on the 12 March, precisely one month from the date of the adjudicator's decision, Randell capitulated and sent a cheque for the amount claimed. Despite this, Outwing's claim for its legal costs could not be settled by agreement and it was heard on the afternoon of 12 March in front of His Honour Judge Humphrey Lloyd QC. Judge Lloyd was under no doubt that Outwing was entitled to the costs of its summons and therefore he ordered that the sum should be paid within 14 days. Curiously therefore we now have two cases concerning the enforcement of an adjudicator's decision, neither of which have arrived at a monetary judgment for the amount stated in the adjudicator's decision. Nevertheless the message from these two cases is extremely clear. The courts will support the overall intention of Parliament. Disputes are to go to adjudication and the decision of the adjudicator has to be complied with pending final determination. Furthermore, a defendant's argument of undue haste in enforcement proceedings will be heard with little sympathy. In the present case Judge Lloyd was satisfied that he could see no reason why the standard time limits for acknowledging service and for opposing an Order 14 application could not be abridged. He considered that an action to enforce an adjudicator's decision was not comparable to the ordinary process of recovering an apparently undisputed debt. In his view, the provisions in the Scheme for the enforcement of peremptory orders reinforced the conclusion that Parliament intended that adjudicator's decisions and orders, if not complied with, were to be enforced without delay. Accordingly, Judge Lloyd concluded that the court should not be hesitant to abridge the normal time limits such that an application for enforcement might be heard in under 2-3 weeks as opposed to the more normal 2-3 months.
CJ-9914
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