Sim Group Ltd v Jack

In Scotland whilst a challenge to an adjudicator's jurisdiction for continuing to act in contravention of paragraph 9(2) of the Scheme for Construction Contracts should be brought under Rule of Court 58, a similar challenge to an arbitrator's jurisdiction can be brought by seeking interdict
Scotland, Outer House, Court of Session
Lord Clarke
5 June 2002
This case concerned Scottish court procedure. The contract incorporated JCT 80. Disputes arose which were referred to arbitration by the contractor. The arbitrator made a final award. The employer then purported to refer another dispute to arbitration. The same arbitrator was appointed. At a preliminary meeting the contractor at which the contractor contended that the reference had been exhausted by the issue of the award with the result that the arbitrator was functus officio and had no jurisdiction to hear a fresh claim. The arbitrator rejected this contention and held that he did have jurisdiction. The contractor began court proceedings seeking interdict against the arbitrator from proceeding with the arbitration. The employer pleaded that the court proceedings were incompetent because they sought review of the actions of an arbitrator and any such review should be taken by way of judicial review proceedings under Rule of Court 58 (and not be way of ordinary action for interdict).
The employer relied on the decision of Lord Bonomy in Naylor v Greenacres Curling (2001) in support of its submission that any challenge to a person acting without jurisdiction should be made by way of judicial review petition. Lord Bonomy in that case had to consider the Scottish Scheme for Construction Contracts. The contractor had brought a petition for interim interdict against an adjudicator continuing to act on the ground that, in contravention of paragraph 9(2) of the Scheme, the dispute referred to him was (substantially) the same as one decided in a previous adjudication. Lord Bonomy held that the proceedings were incompetent as they should have been brought under Rule of Court 58.
Lord Clarke in rejecting the employer’s challenge stated that Lord Bonomy’s decision was distinguishable. In that case the adjudicator was in post until he resigned voluntarily or was compelled to do so by the court. He had a statutory duty to do so and it was his failure to carry out that duty which was challenged. In the instant case the arbitrator never had any power or function to determine disputes between the parties.
Advice Note
In Scotland the proper court procedures to be used for any challenges to the jurisdiction of arbitrators and adjudicators must be strictly adhered to or else such challenges will fail on purely procedural grounds.