In Construction Muzzy Ltd v Davis Construction (South East) Ltd, the TCC enforced two adjudication decisions made by the same adjudicator concerning disputes under different subcontracts on the same project.
What happened?
Davis engaged CML under two separate subcontracts for groundworks and drainage respectively at a site in Epping. Payment disputes arose when Davis failed to issue valid pay less notices for either sub-contract, leading to two separate adjudications with awards in CML’s favour. Davis failed to pay so CML issued enforcement proceedings, which Davis challenged on the grounds of natural justice, jurisdiction and alleged adjudicator bias.
What did the TCC decide?
- The two disputes were not “substantially the same” despite their involving the same parties and showing similarities in their subject matter, as they arose under separate sub-contracts with distinct factual matrices. The adjudicator had jurisdiction over both adjudications.
- The adjudicator did not breach natural justice by relying on a further submission ─ a ‘surrejoinder’ ─ sent by CML without permission, which was at best peripheral to the decision-making process.
- The adjudicator’s decision in the first adjudication (groundworks) did not taint his approach to the second adjudication (drainage), despite allegations of predetermination bias. Davis chose not to participate in the second adjudication, leaving the adjudicator with only CML’s evidence to consider in any event.
What can we learn from this?
This case reinforces the courts’ commitment to enforcing adjudication decisions, supporting the ‘pay now, argue later’ principle enshrined in the Construction Act 1996. It also affirms that separate contracts create separate disputes that can be separately adjudicated – a sensible decision which should reassure anyone managing multiple agreements.
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This article contains information of general interest about current legal issues, but does not provide legal advice. It is prepared for the general information of our clients and other interested parties. This article should not be relied upon in any specific situation without appropriate legal advice. If you require legal advice on any of the issues raised in this article, please contact one of our specialist construction lawyers.
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