Second, the various declarations were staging posts on the way to the real issue which was whether Vital was entitled to £129,000 under the call-off contract.
Even if that finding was an error by the adjudicator it was within his jurisdiction and the court would not interfere.
(4) The Natural Justice Issue
Third, the terms of the framework were incorporated into the call-off contract.
LCC now accepted that if the award was to be challenged it could only be on the grounds of a breach of the rules of natural justice. It therefore now contended that not only was it not true that LCC had agreed that there was a typographical error in the SoR that should be amended to read “£2 per metre per day”, the point had never been raised or put to it and it had been deprived of the chance to raise the answer that if this was an error, it could not be simply corrected by reference to the rate in the BQ call-off contract; even if it could be corrected, it could only corrected by applying the NEC defined cost approach as provided for in the NEC3 contract. There was nothing in LCC’s response in the adjudication or in the compensation event notice that amounted to an admission that there was an error in the SoR. The difficulty the adjudicator faced was that Vital did not advance its case in the notice of adjudication or referral on the basis that there was a conflict between the SoR in the framework agreement and the BQ under the call-off contract, with the latter taking precedence. The adjudicator drew this to the parties’ attention and set out three possible ways forward in an email of 20 May including ‘start again’. In the event neither party agreed to any of the options. Unhelpfully Vital rejected the analysis and insisted the adjudicator proceed in accordance with the case advanced in the adjudication.
Linked with this was LCC’s submitted that the notice of adjudication had not been correctly served. The court was glad to find that on a proper construction of all the provisions of both contracts the notice of adjudication was to be given and sent in accordance with the provisions of the framework agreement, noting that it was actually received by LCC and promptly acted upon.
(3) The Nullity Issue
LCC’s complaint was that the adjudicator had failed to answer the questions put in the notice of adjudication or had answered the wrong question. Specifically, he failed to engage with the individual declarations sought and instead assessed the value of work by reference to rates in the Bills of Quantities (BQ) under the call off contract. On examination this narrow point was misconceived. The several issues comprised one dispute as to what sum LCC was obliged to pay. The basis of the decision was clearly set out. He decided there was a compensation event notice by reference to which the parties had agreed there was an error in the schedule of rates (SoR) in the framework agreement. The error was that a rate of “£2 per metre” should have been and meant “£2 per metre per day”. As a result there were then three different SoR rates by which the works might be valued. He opted for £2 per metre per day because he found that had been agreed.
The court clearly had some sympathy with the adjudicator who sought to overcome the difficulty
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