In LJR Interiors Ltd v Cooper Construction Ltd the TCC held that the Adjudicator was wrong to reject the responding party’s limitation defence such that his decision was void and unenforceable.

The Background to the Case

LJR Interiors and Cooper entered into a written contract pursuant to which LJR agreed to carry out dry lining, plastering and screed works at a property in Oxfordshire. Almost 8 years after completion of the works, LJR submitted an interim application no 4 to Cooper for payment for work done. Following Cooper’s failure to respond to AfP4 or pay and/or send a pay less notice in respect of the same, LJR commenced adjudication proceedings. The Adjudicator awarded LJR the sum claimed in its AfP4.

LJR started Part 7 enforcement proceedings and applied for summary judgment following Cooper’s failure to pay the adjudication award. Cooper responded to this by starting their own Part 8 proceedings for a declaration that the adjudicator had been wrong to dismiss its limitation defence; that LJR’s cause of action was in fact statute-barred; and the decision was therefore void and unenforceable.

What Did the Court Decide?  

The Adjudicator had been wrong to conclude that section 5 of the Limitation Act was not relevant to the question of whether interim application no 4 was valid. The Court also found that it would be unconscionable to ignore the Adjudicator’s error. The Adjudicator’s decision was void and unenforceable. Cooper had a complete defence to LJR’s claim for payment – i.e. LJR’s claim for payment was time-barred because the limitation period to bring such a claim had expired.

The Conclusion to the Case

This case is the first reported case where the court has refused to enforce an adjudicator’s decision due to limitation. Parties should take this case as an important reminder that failure to take prompt action against another party may prove costly where limitation may be relied upon as a defence.

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