Cowlin Construction Limited V CFW Architects
Technology and Construction Court
Her Honour Judge Frances Kirkham
15 November 2002
The adjudication concerned the contractor’s claim for costs allegedly incurred by it due to the delays to the project caused by the architect. Before the contractor served its notice of intention to refer a dispute to adjudication in respect of this claim, there was correspondence between the parties and a meeting which took place between the contractor and the loss adjuster appointed by the architect’s insurer to deal with the claim. The contractor sent the loss adjuster a letter after the meeting stating that it would refer the dispute to adjudication at the end of two weeks if the architect had not by then made a satisfactory settlement offer. No such offer was forthcoming and the contractor referred the dispute to adjudication. The adjudicator decided that it should pay a specified sum to the contractor in respect of its claim. The architect refused to pay the award and the contractor began court enforcement proceedings. The architect contended that there was no dispute arising from the contractor’s claim that the architect was responsible for various delays to the project which could properly be referred to adjudication on the ground that the architect and its insurer had not had sufficient time to consider the claim.
Judge Kirkham rejected this contention on the basis that a dispute arose at the time when the period which the contractor gave to the architect to make a satisfactory settlement offer expired (before the contractor referred the dispute to adjudication) by reason of the architect (and its insurer) having given sufficient opportunity to indicate broadly its response to the contractor’s claim or of the architect not having accepted the claim. The contractor submitted a claim which was not admitted to be due and payable by the architect and notwithstanding that the architect had not expressly rejected the claim, there was a dispute on the expiry of the two weeks period given by the contractor for a satisfactory settlement offer to be made by the architect insofar as it had not accepted the claim.
Judge Kirkham took the view that the wide construction of the word “dispute” in Halki Shipping v Sopex Oils was to be preferred to a narrow one in the context of adjudications notwithstanding that that process involved short timescales with the attendant risk that a defendant might be ambushed.