Ameycespa v Taimweser (TCC - 3.12.2014)

The adjudicator addressed the contractors defence by way of counterclaim that it was entitled to a release of retention and that that retention should be set-off against the sum awarded to the employer in respect of liquidated damages
 

AMEYCESPA v TAIMWESER

 

Technology and Construction Court
Edwards-Stuart J

 
 

There was a dispute about the date when work should have been completed and the employer’s consequent claim for liquidated damages which the employer referred to adjudication. The contractor in its response advanced its counterclaim for the release of retention, which was in the same sum as the employer’s claim for liquidated damages. The employer in its reply stated that it had already calculated the sums due to the contractor on the basis that retention should be treated as having been released.

 

The adjudicator awarded the employer the liquidated damages it claimed but made no award to the contractor in respect of its counterclaim for the release of retention. He stated in his decision that (i) Whilst there was no express reference to the counterclaim, the set-off by way of counterclaim was a legitimate defence to the claim for liquidated damages which could be expected to be encompassed within the notice of adjudication (ii) But there was no dispute (iii) It was clear from the correspondence referred to in the reply that the employer had already calculated the sums due to the contractor on the basis that the retention should be treated as having been released. The contractor refused to pay the award of liquidated damages and the contractor brought enforcement proceedings.

 

Edwards-Stuart J in enforcing the award stated that the adjudicator addressed the contractor’s defence and rejected it on the ground that the employer had already given credit for the amount of the retention in calculating payments due under the contract. The fact that the adjudicator addressed and decided upon the defence meant that the contractor could have no defence to the summary enforcement of the award of liquidated damages regardless of whether the adjudicator was in fact right or wrong in rejecting the defence. Whilst the adjudicator’s reference to there being no dispute was one usually used in the context of a claim about jurisdiction and whilst it was perhaps unfortunate that he used that expression, he clearly meant by that reference that (i) There could be no dispute about the fact that the retention had already been released and (ii) The retention had been released in the adjudicator's opinion because it had been taken into account in the accounts between the parties and, in particular, payment certificate 13 which was the subject of the correspondence to which he referred.

 

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