Natural justice The parties had recognised and in fact debated the question as to what sum remained due if the pay less notice was valid. Enough was raised by the adjudicator and debated between the parties to allow him justly to decide on a position that was somewhere in between the entire £1.5 million defects claim, or the £462,000 awarded by the second adjudicator, or the £12,000 awarded by Horner J. That is all he did and could do and he decided on the £462,000 option. He was not, consistently with the approach taken in a number of cases, obliged to go back to the parties at the very end and say that he was thinking of taking such a course. In the judgment of the court, natural justice did not oblige him to do so. It was already on the parties’ radar. The decision would be enforced. Comment This point of interest and debate emerges. The court seems to have steered a narrow path in accepting that the adjudicator had not carried out a true value adjudication (which would have been outside his jurisdiction), yet finding he was entitled to determine by reference to deductions by M&M for set off, what sum in excess of zero remained due. Some might find this a fine distinction. Until now the choice for a payee might have appeared to be between seeking payment in full in a technical adjudication (smash & grab) or commencing a true value adjudication. Of course one could seek both remedies in the alternative in the same adjudication. This case highlights a possible hybrid, middle course. A claim for payment based in the absence of pay less notice or there is an effective pay less notice, a claim for payment of a greater sum than the notified sum in the pay less notice by reason of a challenge to any deductions in the pay less notice. In such a case it is no doubt advisable to plead reliance on s. 111(8) of the Act. This middle course would not see, to be available where the pay less notice is simply a downward valuation of the sum applied for. To challenge that it is suggested would require a claim for a true valuation.
(a) The notice of adjudication provided for some other figure which could, by definition, only arise if the pay less notice was held to be valid. If it was not valid, the entire sum would fall due.
(b) There was power under section 111(8) of the Act which he referred to.
(c) By the end, and by reason of all the submissions for and against, including emails, the position had been reached where the adjudicator knew, because the parties told him, that £1.5 million had been attributed to the costs of the defects by M&M, and that had been the subject of a prior breakdown previously produced and was the subject of the second adjudication. In that second adjudication, the adjudicator had decided the appropriate amount to award was the £462,000. To date, however, M&M had spent only £247,000 though it said another 2,000 defects had to be attended to. The Northern Ireland High Court had prevented an enforcement of the whole of the £462,000 and allowed enforcement only of £12,000. (d) The adjudicator was, on any view, facing argument from Flexidig that all of M&M’s figures were of little or no significance or weight such that the pay less was still invalid because here was no proper or genuine breakdown. (e) Finally, and this was what the dispute was or had become, M&M in particular had engaged in the debate about the true extent of its defects claim. It was a short, if any, step from that debate to what figure should be put on M&M’s defects claim simply for the purpose of any allowance against the sums claimed by Flexidig in the exercise of the adjudicator’s powers.
This was not a case where the adjudicator had strayed off course.
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