Working Environments Ltd V Greencoat Construction Ltd

The adjudicator's declaratory relief in his decision as to the sum payable to the sub-contractor should be enforced by way of summary judgement
Working Environments Ltd V Greencoat Construction Ltd
Technology and Construction Court
Akenhead J
24 April 2012
The sub-contractor submitted a payment application. The contractor prepared a certificate in response to the application in which it stated the value of work done, the sums to be withheld in respect of various items and the net total. The sums to be withheld were set out in a separate table accompanying the certificate which was headed “notification of items being withheld from this valuation” and which set out ten items with values attributed to each item with the exception of liquidated damages. The contractor appended to its response in the adjudication a revised version of the table with what it described as it withholding notice which reiterated nine of the items in the table, albeit for no stated reason with three different values for three of the items and included for the first time a value against the liquidated damages item. At the time the response was served the final date for payment in respect of the payment application had still not been reached with the result that the contractor could properly give a withholding notice. The contractor contended that the withholding notice did not form part of the purported dispute referred because the notice of adjudication had not conferred jurisdiction on the adjudicator to consider the effect of the withholding notice.
Akenhead J rejected the contractor's contention. The ambit of the dispute referred included the first nine quantified items because the contractor was effectively arguing that the items and quantum then claimed could and should be deducted and the sub-contractor was arguing that they could and should not be deducted. The contractor could not in some way withdraw these nine items from the jurisdiction of the adjudicator as they were clearly part of the crystallised dispute referred to adjudication. The fact that some of them were re-quantified by the contractor in its formal withholding notice did not affect this conclusion because it had to be open to the parties within reason to adjust the quantum of disputed items and it would be extraordinary if a claiming or defending party could not, jurisdictionally, reduce its claim or cross claim within a referred dispute. The tenth item in relation to issues as to the scope of any liability on the sub-contractor’s part to liquidated damages was part of the crystallised dispute, was therefore within the adjudicator’s jurisdiction and could not have been withdrawn by the contractor despite the item not having been quantified in the certificate.