This meant that it was open to a responding party in adjudication to raise limitation as a substantive defence which the adjudicator had to consider. Alternatively, the court could consider any such issue at the enforcement stage (see Hutton v Wilson). The judge then sounded a note of caution; these were the judge’s views based on his own research and reasoning and had not been the subject of full legal argument before him. Next, the court looked at the timing of payment application number 4 and concluded it was out of time. Payment was not exclusively covered by the Scheme. LRJ’s terms provided for monthly billing and payment application number 4 was (save in relation to an administration charge of £750) seeking sums which were said to have fallen due on 28 November 2014, following completion of the works and the submission of payment application number 3. In this case, the right to the final payment under the contract (and applying the Scheme) arose in November 2014, following completion which on the undisputed evidence occurred on 19 October 2014. Deferring the date of the application after the right to payment had arisen could not extend the limitation period. The court found that the newly introduced claims for retention, administration charge and interest were each of them time barred. Finally, the court found that there had been no acknowledgement of the debt to start time running afresh, noting that s29(7) of the Limitation Act 1980 only revived a limitation period that had already expired and did not extend one that was yet current (as would have been the latter case here). The adjudicator’s decision was, in the court’s judgment, clearly wrong in disregarding (as not relevant) the limitation defence available to Cooper,
and that error was one which it would be unconscionable for the court to ignore in accordance with the guidance in Hutton v Wilson . Declaration granted accordingly.
C omment
It may seem an oddity that the question of the application of the Limitation Act 1980 to adjudication proceedings has not been more firmly settled, even some 24 years after the Act came into force. The problem has been that the outcome of the various cases in which limitation issues have arisen has often been based on unusual facts and situations, so that no universal answer could be found. For example, the right to payment might not arise until a payment certificate has been issued[9] as opposed to the making of a payment application. Still the lessons are clear. Payees should not delay in making a payment application following completion, or in commencing adjudication proceedings to enforce their rights. Payers should consider and raise any limitation defence in the adjudication (and if necessary in enforcement proceedings).
[9] Contrast Henry Boot Construction Ltd v Alstom Combined Cycles Ltd [2005] EWCA Civ 814; [2005] 1 WLR 3850
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