3. Did the adjudicator ask the wrong question?
Further the existence of a separate class was inconsistent with the observations of Coulson LJ in Bresco. Secondly, any jurisdictional objection here was on the basis of the undermining issue, and this would not have been ‘fundamental’ in the same way as there being no statutory power (i.e. to award costs) or a statutory exclusion. Had the court concluded (contrary to its actual findings) that, by deciding on the causation basis, the Adjudicator had undermined Award 1 and thus exceeded his jurisdiction, it would have found that Tecnicas did not have actual or constructive knowledge of the jurisdiction objection and thus its failure to raise such an objection prior to the Decision did not amount to a waiver of the objection.
At its most basic level the relevant question was this: “was [Tecnicas] entitled to levy the Contra Charge?”
The Adjudicator answered that question in the Decision, concluding that they were not so entitled. The Adjudicator’s error relied upon by Tecnicas was in his reasons for not accepting their arguments in support of their side of the dispute. That did not amount to answering the wrong question. More specifically, if there were two questions as suggested by Tecnicas, the Adjudicator answered both. He addressed the question of breach – finding in favour of the Tecnicas.
Then the question of loss flowing from breach – he addressed that too (albeit in less clear terms).
Judgment for Graham for the Contra Charges plus interest.
He concluded that the loss claimed in the Contra Charge did not flow from the breach of contract. The incurring of the costs of other contractor was caused by Tecnicas’ decision to abide by the terms of Adjudication 1 (as it was required to do at the time). That was a conclusion that the loss was caused by an intervening event. Whether it was right or wrong was immaterial; it was the Adjudicator’s answer to the correct question.
4. Waiver
In light of the conclusions at 1-3 above, the question of waiver did not fall for decision. However in case the court was wrong on those matters, the court addressed waiver.The court was not convinced there was a separate class of fundamental jurisdictional objection (that could not be waived). The discussion in Acqua Leisure [19] was obiter as the matter was not argued and the case decided on a different point.
[19] HH Judge Bird in Aqua Leisure International Limited v Benchmark Leisure Limited [2020] EWHC 3511 (TCC)
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