3) Stay – Wimbledon v Vago criteria – Quadro Services Ltd v FP McCann Ltd [2021] EWHC 1490 (TCC) 19 April 2021 (Veronique Buehrlen QC)
In the opinion of the court the adjudicator was entitled to find the letters in question were not privileged and were admissible. A court would be entitled to look at the documents to decide admissibility and so was the adjudicator.
He may or may not have been right to decide they were admissible.
Judgment not yet available.
The claimant Quadro applied to enforce the decision of the adjudicator in its favour. McCann the defendant did not oppose enforcement but applied for a stay of execution pursuant to CPR 83.7(4) and in doing so argued that the court should take into account the merits or lack of them in the underlying claim. The court began by restating the now well- established principles that the decision of an adjudicator would be enforced unless there had been either a jurisdictional error or a material breach of the rules of natural justice. Not even a manifest error of law could prevent enforcement. The criteria on which the court might in its discretion order a stay were set down in the leading case of Wimbledon v Vago [9]. The court was not prepared to consider the merits of the underlying claim as the basis for a stay. The court accepted that McCann’s financial position had deteriorated since January 2020 when the sub contract between the parties has been entered into, due to the Covid-19 pandemic. Although the full impact of that event was not yet known, it appeared that McCann was a still going concern and able to meet its liabilities and likely to be able to repay any judgment sum, after a trial of the substantive issues in 12 -18 months’ time. Although it was not necessary to decide the point, the court indicated that that Quadro was not responsible for McCann’s financial decline.
But even if he was wrong, that was an error of law which did not justify the court in refusing enforcement. The court looked at the law on privilege. The label used was not conclusive. The adjudicator had found that the few letters actually headed “without prejudice were not in fact privileged; and in the letters containing offers to carry out work “without prejudice”, the words were used to indicate that liability was not being admitted. In any case the adjudicator had placed little weight on such letters and instead had relied on the correspondence as a whole over a period of 23 months in deciding that the claim was not prescribed. It could not be said that the submission of the letters to the adjudicator, or the way in which he dealt with them, was in any way improper or involved any breach of natural justice or apparent bias.
Comment
This case is a reminder that heading a letter “without prejudice” does not of itself make it privileged. It is the content and substance which will determine that question. An adjudicator, just like a judge, is entitled to look at the materials to decide whether they are admissible.
The court refused to order a stay. An application for indemnity costs failed.
[9] Wimbledon Construction Co 2000 Ltd v Derek Vago [2005] EWHC 1086 (TCC) Coulson J
Made with FlippingBook Online newsletter maker