F W Cook Limited V Shimizu (UK) Limited (2000)

The correct interpretation of the sub-contractor's notice of adjudication and the decision was that they reflected the sub-contractor's wish to have certain disputed final account items decided to encourage the resolution of the others

Technology and Construction Court
His Honour Judge Humphrey LLoyd QC
4 February 2000
The disputes under the sub-contract arose out of discussions about the sub-contractor’s final account on the basis that payments on account had been made. The notice of intention to seek adjudication was a letter from the sub-contractor’s managing director which stated that (1) There were significant differences of opinion in relation to the sub-contractor’s provisional final account as to the value of variations, acceleration, delay, disruption and contra charges (2) The particular disputes to be referred to adjudication were (a) Reinstatement of the agreed sum for acceleration (b) Removal of negative variations not within the sub-contract scope (c) Removal of contra charges not relevant to the sub-contractor’s activities and (d) Release of half the retention monies.
The adjudicator’s decision (1) As to the acceleration agreement, was that this was a binding agreement and the sub-contractor was entitled to be paid a specified sum (2) As to the negative variations was that whilst the contractor was entitled to deduct a specified sum, it had wrongfully deducted a further specified sum and (3) As to the set-off items was that whilst the contractor was entitled to deduct a specified sum, it had wrongfully deducted a further specified sum and the sub-contractor was entitled to recover that further sum. The adjudicator did not add up the specified sums and concluded his decision merely by directing that all sums payable pursuant to his decision were to be paid by the contractor within seven days. The sub-contractor brought court enforcement proceedings in respect of the three specified sums on the basis that the adjudicator had stated at the end of the decisions that such sums were “payable”.
Judge Thornton held that the correct interpretation of the sub-contractor’s letter and of the adjudicator’s decision was that the sub-contractor wished to have certain of the disputed final account items decided upon so that other items might well be resolved once the decision was given. The decision merely set out how those items were to be treated in accordance with the letter.
Advice Note
It is vital in the notice of adjudication to make clear what is being claimed. If the adjudicator is merely asked to give his opinion about the claimant’s entitlements, his decision may well not be capable of enforcement.