Naylor Construction Services Ltd V Acoustafoam Ltd
The approach set out by Judge Grant to be adopted by an adjudicator when faced with a jurisdictional challenge that the contract was not in writing within the meaning of section 107 of the Construction Act
17 May, 2010
NAYLOR CONSTRUCTION SERVICES LTD V ACOUSTAFOAM LTD
His Honour Judge David Grant
18 December 2009
Judge Grant set out the approach to be adopted by an adjudicator when faced with a jurisdictional challenge that the contract was not in writing within the meaning of section 107 of the Construction Act.
What was required was that an adjudicator had to be able to find on the basis of the material placed before him that all the material terms of the construction contract in question were in writing. So long as the adjudicator was able to find that all the material terms of the construction contract were in writing there was certainty as to the terms of the contract which founded the adjudication process and the adjudicator would then be in a position to proceed with that process. However, an adjudicator had to be astute as to the realities of the case and remind himself that the adjudication process was essentially a summary process. Unless he was able to conclude that the position (namely that there was an agreement in writing) was clear cut, he should decline to continue with the adjudication. This was because otherwise he would be falling into the very trap identified by Judge Bowsher in Grovedeck v Capital Demolition (2000) and by Robert Walker LJ in RJT Consulting Engineers v DM Engineering (2002), namely determining a dispute which had arisen as to the terms of a contract which at least one party contended was made orally or partly in writing and partly orally. For the position to be clear cut, the adjudicator should be able to conclude from the material placed before him that there was no real prospect of the other party (who would invariably be the responding party) successfully establishing that the agreement was an oral agreement or an agreement made partly in writing and partly orally. There was a sound reason why this should be the approach of an adjudicator in such circumstances, namely the entire adjudication process was summary in nature and this test reflected the provisions of CPR Rule 24.2, which set out the grounds on which a court could grant summary judgment. A like approach should inform an adjudicator's function when faced with a point of this nature.