Tim Butler Contractors Limited -v- Merewood Homes Limited
The contractor should be awarded summary judgement to enforce the adjudicator's decision in respect of interim payment applications on the basis that the dispute as to that entitlement was one as to the contract's terms
12 April, 2000
The contract incorporated the contractor's terms and conditions which included provision for interim payments. The contractor also sent a programme of works which showed a proposed duration of four weeks. The dispute referred to adjudication was whether the contractor was entitled to be paid on two payment applications where the employer failed to give any notice of intention to withhold payment under section 111 of the Construction Act 1996. The adjudicator decided that the contractor's programme was not a contract term insofar as the correspondence and documents which gave rise to the contract did not show any agreement as to the contract period or the duration of the works being established as being less than 45 days and awarded the contractor the amounts of the applications. If the programme had been a contract term, the contractor would not have been entitled to interim payments since section 109 provides that a party to a construction contract is entitled to interim payments unless the contractor specifies that the work's duration is to be less than 45 days or the parties agree that the work's duration is estimated to be less than 45 days. The contractor brought court proceedings to enforce the decision. Judge Gilliland held that the decision should be enforced by way of summary judgment. The adjudicator had had to decide what were the contractually agreed terms and, in particular, whether the contractor's programme was such a term. Whether the adjudicator's decision in relation to the contractor's programme was right or wrong was irrelevant in the sense that it was within his jurisdiction to make that decision. Also the employer accepted in the absence of any notice to withhold payment having been given by it that, even if the adjudicator had no jurisdiction, the effect of the contract term that there were to be interim payments and of paragraph 7 of the Scheme for Construction Contracts, which provided for when interim payments became due in the absence of express contractual provisions under section 110, was that the money became due within seven days in accordance with the decision. Advice Note An adjudicator has jurisdiction to decide whether a proposed contract term was so incorporated even if his decision in this connection affects the applicability of provisions of the Construction Act to the contract.