Construction Adjudication Part 2 of 2021

determinations—such as where it was necessary to decide whether there was one contract which had been varied, or a series of contracts. The implication was that in such a case, the adjudicator’s decision on the preliminary matter may be binding. However, such determination was not always binding, just because it had been necessary to make it. The Court had to consider why and for what purpose the determination was made. In His Honour’s view, an adjudicator’s determination was only made within his/her jurisdiction (and therefore binding) if it had to be made, not just as part of the process of conducting the adjudication, but as a ‘necessary element’ in deciding the substantive dispute, once any questions of jurisdiction were resolved. That it had to be ‘integral’ to the substantive decision. In a case like the present, even where the dispute involved a question of whether works were carried out under an original contract or other contracts, a decision on that point would not always be a necessary element of resolving the dispute. The court would need to ‘look closely’, at what issues and why, the adjudicator was required to decide, in order to make the award. Just because there was a contract under which an adjudicator could be validly appointed, would not necessarily mean that the adjudicator could determine his/her own jurisdiction, where the particular challenge to its jurisdiction was that there were multiple disputes under multiple contracts. On the facts, it had not been necessary for the adjudicator to decide the ‘multiple contracts’ point, in order to determine the substantive dispute. The real issue between the parties on that dispute was whether there was a valid payless notice from MPS, and a potential valuation matter.

It was only necessary to consider the multiple contracts point as part of determining whether the adjudicator had jurisdiction. It was not an issue that the adjudicator could determine within his jurisdiction. The decision on it could not bind the parties. The remaining question then was whether MPS had a real prospect of demonstrating that there were in fact multiple contracts. The evidence persuaded the court that the parties had made a single contract, under which the works were called off. There was no real argument that the parties had concluded multiple contracts. Accordingly, the adjudicator had jurisdiction to decide the dispute, and his decision should be enforced. Had the court concluded otherwise, it would have been asked to sever the decision and enforce parts of it. While it was not necessary to decide this point, the court indicated it would not have considered severance appropriate. Among other difficulties, it would not have been clear which parts of the decision should be treated as valid or not.

Judgment for ENL

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