Barnes & Elliott Ltd v Taylor Woodrow Holdings Ltd
Technology and Construction Court
His Honour Judge Humphrey LLoyd QC
20 June 2003
The contract incorporated JCT 98, clause 39A.5.3 of which provides that the adjudicator is to reach his decision within 28 days and “forthwith” to send the decision to the parties. The adjudicator produced his decision in the claimant’s favour on the last day of the required period but failed to communicate it to the parties that day. Instead he posted it to them and they therefore did not (physically) receive the decision until two days later. The defendant refused to pay the sum awarded and contended in the court enforcement proceedings that the decision was a nullity and unenforceable by reason of the adjudicator’s failure to communicate the decision “forthwith.”
Judge LLoyd rejected this challenge on the basis that such an “error” on the part of the adjudicator was excusable, was within the tolerance and commercial practice that had to be afforded both to the adjudication provisions of the Construction Act 1996 and to the contractual provisions and did not mean that the decision had become unauthorised and invalid. The fundamental purpose of the adjudication provisions of the Construction Act was to establish a mechanism for the resolution of disputes arising during the course of the works (rather than after completion) to enable the parties in certain circumstances to have some idea of what the decision of the tribunal competent to resolve the dispute finally might be. Whilst the timing of when the decision was communicated to the parties was integral to this purpose, the completion of the decision came first as a matter of competing priorities. If the decision in the instant case were to be declared a nullity, this would have had the unpalatable consequences of having deprived the parties not just of knowing where they stood in the adjudicator’s eyes but also of having an enforceable decision upon which they might have rebuilt their relationship. Such consequences would not have been consistent with the primary purposes of the Construction Act.
Judge LLoyd reaffirmed the view taken by judges in previous cases that tolerance is to be shown in the application of the rules governing when an adjudicator must communicate his decision to the parties.