Cubitt Building And Interiors Ltd V Richardson Roofing

Assuming that the sub-contract incorporated the arbitration agreement in DOM/1, the arbitration proceedings brought by the sub-contractor should not be stayed by the court to allow the contractor to adjudicate its claim for liquidated damages
 
CUBITT BUILDING AND INTERIORS LTD V RICHARDSON ROOFING (INDUSTRIAL) LTD

Technology and Construction Court
Akenhead J
9 May 2008
 
Two adjudications were brought by the sub-contractor in respect of its claim for certified sums. The first of the adjudications was abortive and the adjudicator made a decision in the second adjudication. The contractor announced its intention to deduct liquidated damages (long) after the sub-contractor had been completed (and the sub-contractor in turn applied for an extension of time). The sub-contractor began an arbitration in relation to the dispute in connection with the whether the contractor had the right to deduct liquidated damages. The contractor wished to adjudicate the dispute as to whether it had the right to deduct liquidated damages. The contractor applied for the arbitration proceedings brought by the sub-contractor to be stayed pursuant to the court's inherent jurisdiction to allow the contractor to adjudicate its claim for liquidated damages assuming that the sub-contract incorporated the DOM/1 conditions of sub-contract (in accordance with the judge's earlier decision in the judgment) and, in particular, the arbitration agreement in DOM/1. Article 3.1 of DOM/1 provided that if any dispute or difference arose under the sub-contract, either party could refer it to adjudication in accordance with clause 38A. Clause 38A.4.1 provided that when pursuant to Article 3 a party required a dispute or difference to be referred to adjudication, that party was to give notice to the other party of its intention to refer the dispute or difference to adjudication. Section 108(1) of the Construction Act provided that a party to a construction contract had the right to refer a dispute arising under the contract for adjudication.
 
Akenhead J refused the contractor's application. As a matter of construction both the DOM/1 conditions of sub-contract and the Construction Act did not contain any pre-condition or indeed obligation requiring either party to refer any disputes to adjudication before their (final) resolution in other proceedings. Instead there was simply a right on a party to proceed to adjudication at any time if it so wished. Whilst it was open to any party to apply for relief to the requisite tribunal to enable it to exercise its right to adjudicate, there did not have to be a stay of any arbitration or court proceedings where there was merely a discretionary right to adjudicate as opposed to a binding pre-conditional adjudication requirement.
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