The Project Consultancy Group -v- The Trustees of The Gray Trust
An adjudicator's decision could be challenged on the ground that the adjudicator was not empowered to make the decision by reason of the contract not being a 'construction contract' or of the contract not being subject to the Construction Act 1996
16 July, 1999
The adjudicator made an award in the consultant's favour. The consultant brought court proceedings to enforce the decision. The employer contended that the adjudicator had no jurisdiction because the contract of engagement did not constitute a ?construction contract? within the meaning of the Construction Act 1996 by reason of it having been entered into before the Act came into force. The consultant disputed that such a challenge could potentially be valid. Dyson J held that it was open to a defendant in proceedings to enforce an adjudicator's decision to challenge the decision on the ground that the adjudicator was not empowered by the Act to make the decision by reason, for example, of the contract not being a ?construction contract? within the meaning of the Act or of the contract being a construction contract but not being one that was entered into after the Act came into force. Whilst the (same) judge stated in Macob Civil Engineering v Morrison Construction (1999) that a decision whose validity was challenged on the ground of procedural error amounting to a breach of natural justice was nevertheless a decision within the meaning of the Act and the Scheme for Construction Contracts, different considerations applied where an adjudicator purported to make a decision he was not empowered by the Act to make. For example as a matter of straightforward statutory interpretation there was no right to refer a dispute arising out of a contract that was not a ?construction contract? under section 108(1) of the Act. The submission that if a defendant could resist enforcement proceedings on the ground that the adjudicator had no jurisdiction to make the award, Parliament's plain intention that adjudicators? decisions should be honoured pending disputes? final resolution would be frustrated should be rejected insofar as (1) It would only be in a comparatively few cases that it would be possible for a defendant to invent an argument along the lines advanced in the instant case and (2) When such arguments were advanced, the adjudicator and the court would be vigilant to examine the arguments critically. Advice Note Challenges to the adjudicator's jurisdiction to make a decision will be considered by the courts notwithstanding their willingness generally to enforce judgments by way of summary judgment.