Arcadis Uk Ltd V May And Baker Ltd
Technology and Construction Court
29th January 2013
The employer contended that the adjudicator went off on a frolic of his own and was therefore not in breach of the rules of natural justice by "splitting the difference" between the adjusted forecast figures of the contractor and the project manager. Akenhead J rejected this contention.
Whilst in one sense "splitting the difference" was Solomon-like in its simplicity, the adjudicator was effectively choosing between two figures, both of which had an evidential basis, not coming up with some basis of assessment which the parties had not had an opportunity to comment on and basing his assessment on the quantum approach specifically put forward by the contractor and actually addressed by the employer. The facts that the adjudicator was persuaded that the proper answer lay between the two adjusted forecast figures and that he happened to split it down the middle can not be considered to be a breach of the rules of natural justice. Whilst of course it is arguable that he was factually wrong, that does not impact on the enforceability of its decision.
In addition there was a fundamental difference in the approach of each party to quantum in that (i) The contractor argued that the proper approach to quantification (subject to liability) was to be based contractually on what it did (or what should or could reasonably have been) forecast and (ii) The employer argued that the value needed to be determined by reference to the work actually done and actual cost. Whilst both arguments were respectable and whilst the court should not form a view as to which, if either, was correct as a matter of contractual interpretation (i) The adjudicator formed the view, rightly or wrongly, that the forecast basis advanced by the contractor was the right one and (ii) Whether he was right so to find was immaterial when it came to considering the enforceability of the adjudicator's decision. Having decided that the forecast approach was right, the adjudicator looked at the possible forecast figures and was ultimately drawn to the contractor’s figure in its revised quotation and to the project manager's figure adjusted upwards to reflect the prolongation attributable to the prolongation (which the project manager had felt unable to accept but which the adjudicator found was established).