As to stay, DDD contended that there was a real risk of future inability to repay if and when proceedings were commenced by them to finally determine what sum was due on the final account. The relevant guidelines were to be found in Wimbledon Construction Co (2000) v. Vago [13]. After considering the evidence the court concluded there was no evidence to demonstrate that WRW was in other than a relatively healthy financial position and, more importantly, there was no evidence to demonstrate any real risk that monies would not be repaid if and when a Court so ordered.
3) Payment Terms - Clarity of: Rochford Construction Ltd v Kilhan Construction Ltd [2020] EWHC 941 (TCC) Cockerill J Rochford brought a part 8 claim against Kilhan, in respect of Interim Payment Application 9, “IPA9”, which Rochford disputed was ever properly due and owing to Kilhan. The claim arose out of a bespoke subcontract under which Kilhan was engaged to construct a reinforced concrete frame for Richmond upon Thames College. Kilhan brought adjudication proceedings for payment of IPA9 for just shy of £1.4m covering the period ending 30 April 2019. Rochford responded with a payment notice for £1.2m. The following issues also arose: - Whether the payment provisions in the subcontract complied with the Act? - Was the application for IPA9, a valid application for payment, and / or a valid default payment notice? - Was Rochford's payment notice valid: i.e. was it issued in time and did it specify how the sum sought was calculated? The adjudicator concluded that the due date for payment of IPA9 was 20 May 2019, being the date on which the notice was served, and that the final date for payment was thirty days from that due date, being 19 June 2019. He concluded that Rochford had neither served a Payment Notice within five days of the due date nor a Pay Less Notice no less than seven days prior to the final date for payment. On that basis, the adjudicator found that the sum claimed was owing in default.
Comment
This is an important case. The consequences for the referring party were no doubt unexpected in terms of the valuation and the order for payment on enforcement. Would it be possible to prevent a similar result by careful drafting of the referral to limit the issues to be decided and/or the relief sought? Not in light of Bresco. A responding party can run any defence that is available to it including setting off a cross claim.
[13] [2005] EWHC 1086 at Paragraph 26; and see Broseley London v. Prime Asset Management [2020] EWHC 944 (TCC) at Paragraphs 23
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