Beck Peppiat Limited V Norwest Holst Construction Limited
Technology and Construction Court
Thayne Forbes J
20 March 2003
The sub-contractor applied to the court for a declaration that the adjudicator did not have jurisdiction to determine the matters referred to adjudication by the contractor on the ground that there was no “dispute” between the parties at the time the contractor served its notice of referral.
Forbes J firstly considered the caselaw as to what constituted a “dispute” for the purposes of adjudication. He stated that the position was satisfactorily stated by Judge LLoyd in Sindall v Solland (2001) as being where it was clear that a point had emerged from the process of discussion or negotiation which had ended where there was something which needed to be decided. This was on the basis that that statement of principle was easily understood and was not in conflict with the approach of the majority of the Court of Appeal in Halki Shipping v Sopex Oils (1998) that there was a “dispute” for the purposes of arbitration where a claim were merely unadmitted (rather than positively rejected). The word “dispute” was an ordinary English word which should be given its ordinary English meaning.
Forbes J secondly concluded that there was a “dispute” in existence when the contractor made its referral to adjudication. The sub-contractor’s principal contention was that the contractor had served 11 lever arch files of documentation representing its version of the sub-contractor’s final account and that it had not had time to consider them before the service of the notice of referral. The judge pointed out that the factual context made it clear that the documentation was the contractor’s response to the sub-contractor’s asserted position in respect of the same matters. These matters had been the subject of correspondence between the parties over an extended period of time. There was therefore a dispute in existence even before the files were sent.
Forbes J rejected the assertion that there was a significant divergence of approach as to what constitutes a “dispute” for adjudication purposes between London TCC judges and other judges. This assertion was that London judges require evidence that the party against whom a claim is advanced has to have a reasonable opportunity to consider a claim before a dispute can be said to have arisen in respect of it whereas other judges merely require evidence that a claim has been advanced.