A D J U D I C AT I O N I N C ONST RU CT IO N L AW

CONSTRUCTION PRACTICE SERIES

Adjudication in Construction Law

Darryl Royce
(2016)

Chern on Dispute Boards: Practice and Procedure

Third Edition
Cyril Chern
(2015)

Construction Contract Variations

Michael Sergeant and
Max Wieliczko
Holman Fenwick Willan LLP
(2014)

Construction Law
Julian Bailey
(2011)

Remedies in Construction Law

Roger ter Haar QC and Camilla ter Haar
(2010)

The Law of Construction Disputes

Cyril Chern
(2010)

FIDIC Contracts: Law and Practice

Ellis Baker, Ben Mellors, Scott Chalmers and Anthony Lavers
(2009)

Construction Insurance and UK Construction Contracts

Marshall Levine and Roger ter Haar QC
(2008)

Construction Insurance
Marshall Levine and Roger ter Haar QC
(1991)
 ADJUDICATI ON I N
CO NS TRUCT I ON LAW

Darryl Royce

informa law
from Routledge
First published 2016
by Informa Law from Routledge
2 Park Square, Milton Park, Abingdon, Oxon OX14 4RN

And by Informa Law from Routledge

711 Third Avenue, New York, NY 10017

Informa Law from Routledge is an imprint of the Taylor & Francis Group, an Informa business

© 2016 Darryl Royce

The right of Darryl Royce to be identified as author of this work has been asserted by him/her in
accordance with sections 77 and 78 of the Copyright, Designs and Patents Act 1988.

All rights reserved. No part of this book may be reprinted or reproduced or utilised in any form or by
any electronic, mechanical, or other means, now known or hereafter invented, including photocopying
and recording, or in any information storage or retrieval system, without permission in writing from the
publishers.

Trademark notice: Product or corporate names may be trademarks or registered trademarks, and are
used only for identification and explanation without intent to infringe.

Lloyd’s is the registered trade mark of the Society incorporated by the Lloyd’s Act 1871 by the name of
Lloyd’s.

British Library Cataloguing in Publication Data

A catalogue record for this book is available from the British Library

Library of Congress Cataloguing in Publication Data

Royce, Darryl, author.
Adjudication in construction law / by Darryl Royce.
pages cm. -- (Construction practice series)
ISBN 978-1-138-91145-1 (hardback : alk. paper) -- ISBN 978-1-315-69267-8 (ebook) 1. Construction
contracts--England. 2. Civil procedure--England. 3. Dispute resolution (Law)--England. I. Title.
KD1641.R698 2015
343.4207’8624--dc23
2015008809

ISBN 978-1-138-91145-1
eISBN: 978-1-315-69267-8

Typeset in Plantin by
Servis Filmsetting Ltd, Stockport, Cheshire
 ACKN OW L E DGM ENTS

I must first acknowledge that the genesis of this venture lies in my declining facul-
ties, particularly my memory, so that necessity has obliged me to compile a series
of notes of judgments concerning adjudication as they have been handed down
over the years. Next I would like to thank Jackie Day, Abigail Pukaniuk, Alexia
Sutton, Joshua Wells and the rest of the team at Informa Law for their efficiency,
enthusiasm and forbearance in bringing this project to fruition. I also wish to pay
tribute to the Official Referees and their successors, the Judges of the Technology
and Construction Court, who have had to make sense of the Housing Grants,
Construction and Regeneration Act 1996 in both its original and now allegedly
improved form. I salute my colleagues in Atkin Chambers for their lack of overt
derision upon learning that I was writing a book. Lastly, I dedicate this work to my
wife Rosemary and my daughter Isobel, although painfully aware that such a gesture
falls considerably short of the compliment deserved by each of them.

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 TABL E OF C O NTENTS

Table of cases xxi

Table of statutes xxxv
Table of statutory instruments xxxix
General introduction xliii

Chapter 1 Statutory regulation of construction contracts 1

1.1 Definitions 1
1.2 Background to Part II of the 1996 Act 2
1.2.1 The Latham Report 2
1.2.2 Consultation 2
1.2.3 Pay now, argue later 2
1.3 Application of Act to United Kingdom and Northern Ireland, and
the Isle of Man 3
1.3.1 England and Wales and Scotland 3
1.3.2 Northern Ireland 4
1.3.3 Isle of Man 4
1.4 Purpose of adjudication 4
1.5 Construction contracts at common law and under statute 5
1.5.1 Introduction 5
1.5.2 Overlap between substance and jurisdiction 5
1.5.3 No construction contract 6
1.6 Categories of construction contracts regulated by statute 7
1.7 Carrying out or arranging for the carrying out of construction
operations 7
1.7.1 Construction operations 7
1.7.2 Different operations to a building or structure 9
1.7.3 Example of a structure 9
1.7.4 Part of the land 10
1.7.5 Plant hire 11
1.7.6 Collateral warranty 12
1.8 Exempted construction operations 12
1.8.1 Test for exemption 12
1.8.2 Competing constructions as to extent of exemption 13
1.8.3 Examples of narrow construction 14
1.8.4 Power generation 15

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1.8.5 Food and drink 16

1.8.6 Future work 16
1.9 Exempted construction operations relating to plant 17
1.9.1 Meaning of ‘construction operations’ 17
1.9.2 Meaning of ‘plant’ 18
1.10 Doing architectural, design, or surveying work, providing advice in
relation to construction operations 19
1.11 Unregulated contracts generally and residential occupiers 20
1.11.1 Unregulated contracts 20
1.11.2 Meaning of ‘residential occupier’ 20
1.11.3 Amendment of exclusions 22
1.12 Contracts and provisions not in writing 22
1.12.1 General position under the unamended Act 22
1.12.2 Whole contract previously required to be in writing 22
1.12.3 Incomplete or partially oral terms 23
1.12.4 Trivial matters 24
1.12.5 Implied terms 24
1.12.6 Recorded and undenied agreements 25
1.12.7 Reform of 1996 Act and meaning of ‘writing’ 26
1.13 Excluded construction contracts and disapplication of the Act 27
1.13.1 Agreements made under statutory provisions 27
1.13.2 PFI contracts 27
1.13.3 Finance agreements 28
1.13.4 Development agreements 29
1.13.5 Power to disapply provisions of Part II 29
1.14 Statutory requirements for adjudication 30
1.15 Effect of failure to comply with statutory requirements 31
1.15.1 Partial compliance 31
1.15.2 Non-compliant procedure void 31
1.15.3 Law of contract and relevant Statutory Scheme 32
1.16 Examples of non-compliance 33
1.16.1 Deferment of adjudication 33
1.16.2 Referring party to pay costs 33
1.16.3 Sum awarded to be paid into escrow account 33
1.17 Unfair terms in consumer contracts 34
1.17.1 Requirement of good faith 34
1.17.2 Significant imbalance 34
1.17.3 Imposition of term 35
1.17.4 Adjudication fair 36
1.18 Human Rights Act 1998 37
1.18.1 Introduction 37
1.18.2 Timetable not unfair 38
1.18.3 Adjudicator not a public authority 38
1.18.4 Requirements of Article 6 satisfied 38
1.18.5 Violation of Article 1 39
1.18.6 Failure to ask for a public hearing 39

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 CONTENTS

1.19 Insolvency Act 1986 and the Insolvency Rules 40

1.19.1 Administration 40
1.19.2 Winding-up and appointment of provisional liquidator 41
1.19.3 Claim for balance due not to be adjudicated 42
1.19.4 No piecemeal recovery 42
1.19.5 Temporary nature of adjudication 43
1.19.6 Company voluntary arrangements 43
1.20 Third parties 43

Chapter 2 Beginning adjudication 44

2.1 Introduction 44
2.2 Existence of a construction contract 44
2.2.1 Necessity for contract 44
2.2.2 Effect of repudiation 45
2.2.3 Third-party rights 45
2.3 Existence of a dispute: background 46
2.4 Current overview of dispute authorities 47
2.4.1 The Amec case 47
2.4.2 Distinction between arbitration and adjudication 48
2.5 Notification of a claim 49
2.6 Express rejection of a claim 49
2.7 Discussions between the parties 50
2.8 Prevarication and procrastination 50
2.9 Silence 50
2.10 Withdrawal of claim 51
2.11 A dispute 51
2.11.1 Meaning of ‘a dispute’ 51
2.11.2 Effect of Statutory Scheme 52
2.11.3 More than one dispute? 53
2.11.4 Concurrent adjudications 54
2.12 Arising under the contract 54
2.12.1 Conventional meaning of ‘arising under’ 54
2.12.2 The Fiona Trust case 55
2.13 Notice of intention to refer 56
2.13.1 The statutory requirements 56
2.13.2 Non-compliance 57
2.13.3 Construction of notice 57
2.13.4 Service of notice 58
2.14 ‘At any time’: ‘ambush’ and ‘kitchen sink’ adjudications 59
2.14.1 Meaning of ‘at any time’ 59
2.14.2 Abuse of process? 60
2.14.3 Commercial advantage and lever 61
2.14.4 Concurrent proceedings 61
2.14.5 ‘Ambush’ 62
2.14.6 ‘Kitchen sink’ adjudications 62
2.14.7 The position of the adjudicator and enforcement 63

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2.15 Notice of intention to refer and appointment of adjudicator 64

2.15.1 Before or after appointment of adjudicator? 64
2.15.2 Position under the Statutory Scheme 65
2.15.3 Time of giving notice 65

Chapter 3 Appointment and referral 67

3.1 Who may act as an adjudicator? 67
3.2 Appointment 67
3.2.1 Statutory requirements 67
3.2.2 Non-compliance 68
3.2.3 Procedure 68
3.2.4 Contacts between parties and adjudicators and
nominating bodies 69
3.2.5 Invalid appointments 69
3.3 Contract of appointment 70
3.3.1 Contractual relationship between adjudicator and parties 70
3.3.2 Unilateral appointments 70
3.3.3 Contract with neither party 71
3.3.4 Joint and several liability 71
3.3.5 Effect of jurisdictional challenge 72
3.4 Referral 73
3.4.1 Meaning of ‘referral’ 73
3.4.2 Method of referral 74
3.4.3 Late referral 74
3.4.4 When does referral take place? 76
3.5 Accompanying documents and contents of the referral notice 77
3.5.1 Non-compliance 77
3.5.2 Effect of referral notice on jurisdiction 78
3.5.3 Effect of notice of adjudication 78
3.5.4 Limitation of length of referral 79
3.6 Nominating bodies 80
3.7 Declarations of interest 80
3.7.1 Requirements of the Statutory Scheme 80
3.7.2 What type of interest? 80
3.7.3 The test for apparent bias 81
3.8 Consequences of declaration 82

Chapter 4 Procedure leading to the decision 84

4.1 Procedural requirements 84
4.2 Jurisdictional challenge 85
4.2.1 Available options 85
4.2.2 Investigation and grounds of challenge 85
4.3 Withdrawal of claim 86
4.4 More than one dispute 87
4.5 Dispute the same or substantially the same as one previously
referred to adjudication 88

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4.5.1 Adjudicator’s obligation to resign 88

4.5.2 No re-adjudication 88
4.5.3 Extensions of time and damages for delay 88
4.5.4 What did the first adjudicator decide? 89
4.5.5 Analogy with rule against successive litigation 90
4.6 Res judicata and issue estoppel 91
4.6.1 Res judicata 91
4.6.2 Contractual adjudication 91
4.6.3 Issue estoppel 92
4.6.4 Conclusion: factors to be deployed 93
4.7 Bias in summary 94
4.7.1 Declarations of interest and natural justice 94
4.7.2 Bias 95
4.7.3 Circumstances giving rise to bias 95
4.8 Impartiality in the conduct of the adjudication 96
4.9 Communication with the parties 97
4.10 ‘Without prejudice’ negotiations and communications 98
4.10.1 Adjudicator’s participation in ‘without prejudice’
negotiations 98
4.10.2 Receipt of evidence during negotiations 99
4.10.3 Risk of bias and consequences 99
4.10.4 Adjudicator’s participation in experts’ discussions 99
4.10.5 Submission of ‘without prejudice’ material to adjudicator 100
4.10.6 Conclusions on ‘without prejudice’ material 100
4.11 Taking the initiative in ascertaining the facts and law and breach
of natural justice 101
4.11.1 Basic procedural principles 101
4.11.2 Information from other sources 101
4.11.3 Adjudicator’s use of alternative approach 102
4.11.4 Adjudicator not obliged to accept submission of one
party or the other 103
4.11.5 New issues 103
4.11.6 Adjudicator’s own knowledge and experience 104
4.11.7 Adjudicator’s experience as an advocate 104
4.11.8 Summary 105
4.11.9 Necessity for material difference to outcome 105
4.11.10 ‘Splitting the difference’ 105
4.11.11 Constraints upon adjudicators 106
4.11.12 Approaches to two rules of natural justice 106
4.11.13 Adjudicator obtaining legal advice 107
4.12 Consideration of evidence and law 107
4.12.1 Declining to consider evidence 107
4.12.2 Summary of position on evidence 108
4.12.3 Declining to consider a late response 109
4.12.4 Failure to hold a meeting 109
4.12.5 Failure to have a site inspection 109

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4.12.6 Expressing a preliminary view 109

4.12.7 Having regard to a provision not relied upon by the
parties 110
4.12.8 Failure to consider an issue 110
4.12.9 Use of a witness statement not received by the other
party 111
4.13 Ambit of dispute 111
4.13.1 Role of notice of adjudication 111
4.13.2 Any ground open allowed for defence 112
4.13.3 Rejection of a defence not a jurisdictional decision 113
4.13.4 A summary 113
4.13.5 Defence not addressed by the parties 114
4.13.6 Part of claim wrongly ruled outside jurisdiction 114
4.14 Extensions of time 114

Chapter 5 The decision 116

5.1 Time limit for decision 116
5.2 Communication of decision 117
5.2.1 The principle 117
5.2.2 Means of communication 117
5.3 Decision outside time limit 118
5.3.1 Decision binding if adjudication agreement not
terminated? 118
5.3.2 Or is the time limit mandatory? 119
5.4 Communication outside time limit 119
5.4.1 Primary objective of a decision within time limit 119
5.4.2 Tolerance for a delay of a day or two 120
5.5 Form of decision 120
5.5.1 Formalities 120
5.5.2 Reasons not required 121
5.5.3 Reasons to make it clear that all essential issues decided 121
5.5.4 Reasons absent or unintelligible 122
5.5.5 A summary 122
5.5.6 Planning context of limited relevance 123
5.5.7 Time for payment need not be specified 123
5.6 Remuneration of adjudicator 124
5.6.1 Contractual entitlement between appointee and the
parties 124
5.6.2 Reasonableness of fees and expenses 124
5.6.3 Hourly rates, time spent and unnecessary work 125
5.6.4 Disputes as to fees 126
5.6.5 No lien on decision 126
5.6.6 Fees to be paid for a previous adjudication 127
5.6.7 Decision unenforceable 128
5.6.8 Adjudication under the Statutory Scheme 128
5.6.9 The bargained-for performance 129

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5.6.10 Referring party’s liability for fees in absence of

jurisdiction 130
5.7 Interest 130
5.7.1 The statutory provisions 130
5.7.2 Conferring jurisdiction 132
5.7.3 Implied power to award interest? 133
5.8 Costs of the parties 134
5.8.1 Contrasting views of the unamended legislation 134
5.8.2 Example of agreement to confer power under
unamended legislation 134
5.8.3 Costs not recoverable as damages 135
5.8.4 Provision that referring party to bear all costs 135
5.8.5 Costs under the amended legislation 135
5.8.6 Costs under the Late Payment of Commercial Debts
(Interest) Act 1998 136
5.9 Errors 136
5.9.1 The right question 136
5.9.2 Corrections under the unamended legislation 136
5.9.3 Jurisdiction and correction of errors 137
5.9.4 Express power under amended legislation 138

Chapter 6 Enforcement and court proceedings 140

6.1 Effect of decision 140
6.1.1 Statutory provisions 140
6.1.2 Nature of proceedings before an adjudicator 140
6.1.3 Nature of enforcement proceedings 141
6.2 Effect of challenge to validity of decision 142
6.2.1 Purpose and effect of the Housing Grants, Construction
and Regeneration Act 1996 142
6.2.2 Comparison with arbitration 142
6.2.3 A decision is a ‘decision’ 143
6.2.4 No stay for arbitration 144
6.3 Methods of enforcement 144
6.3.1 Summary judgment or mandatory injunction? 144
6.3.2 Order under section 42 of the Arbitration Act 1996 145
6.3.3 Statutory demand 145
6.4 Practice and procedure 147
6.4.1 Proceedings in the Technology and Construction Court 147
6.4.2 Issue of claims 147
6.4.3 No need to comply with pre-action protocol 148
6.4.4 TCC enforcement applications 148
6.4.5 Documents to be lodged 148
6.4.6 Procedural application dealt with on paper 148
6.4.7 Time 149
6.4.8 Preparation for hearing 149
6.4.9 Concurrent proceedings 150

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6.4.10 Insolvency proceedings 150

6.5 Service out of the jurisdiction 150
6.6 Abridgment of time 151
6.7 Summary judgment 153
6.7.1 Nature of summary judgment 153
6.7.2 Where summary judgment inappropriate 153
6.8 Defences: Generally and in relation to fraud 154
6.9 Defences: No construction contract or no construction operations 156
6.10 Defences: Wrong party 158
6.11 Defences: Insolvency Act 1986 158
6.11.1 Rule 4.90 of the Insolvency Rules 1986 158
6.11.2 Effect of insolvency set-off 158
6.11.3 Insolvency and summary judgment 159
6.11.4 Company Voluntary Arrangements 159
6.11.5 Administrative receivership 160
6.11.6 Administration 161
6.11.7 Winding-up petition 162
6.11.8 Adjudication begun without required leave 162
6.12 Defences: no pre-existing dispute 162
6.13 Defences: more than one dispute or contract 162
6.14 Defences: dispute not arising under the contract 163
6.15 Defences: adjudicator’s Interest 163
6.16 Defences: dispute previously referred 164
6.17 Defences: non-compliant notice of intention to refer 164
6.18 Defences: late service of referral 164
6.19 Defences: lack of impartiality in the conduct of the adjudication 164
6.20 Defences: late decision 165
6.21 Defences: late communication of decision 165
6.22 Defences: decision on dispute not referred or failure to deal with
part of dispute 166
6.22.1 Source of adjudicator’s jurisdiction 166
6.22.2 Summary of approach to jurisdictional errors 166
6.22.3 Examples 167
6.22.4 Erroneously restrictive view of jurisdiction 168
6.23 Ineffective defences: Failure to give reasons 170
6.24 Ineffective defences: Unfair contract terms in consumer contracts 170
6.25 Potential defences: Human Rights Act 1998 170
6.26 Set-off 170
6.26.1 The earlier authorities 170
6.26.2 Principles to be derived 172
6.26.3 The general rule 172
6.26.4 Setting off one decision against another 173
6.26.5 Contractual right preserved by decision 175
6.26.6 Conclusions 175
6.27 Waiver, agreement and reservation of position 176
6.27.1 Agreement to widen jurisdiction 176

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6.27.2 Participation in adjudication 176

6.27.3 Test for agreeing to be bound by decision 177
6.27.4 Types of reservation 178
6.27.5 The underlying issue 178
6.27.6 General reservations 179
6.27.7 Summary 180
6.28 Approbation and reprobation 181
6.28.1 The doctrine 181
6.28.2 Effect of seeking stay to arbitration 182
6.28.3 Inviting corrections, part payment and reservation 182
6.28.4 Effect of seeking further decision 183
6.28.5 Payment of adjudicator’s fees and full amount awarded 183
6.29 Severability of decision 184
6.29.1 Where only one dispute 184
6.29.2 Under TeCSA rules 184
6.29.3 Analysis of questions referred 184
6.29.4 Part of decision outside jurisdiction 185
6.29.5 Approach to severability 185
6.30 Interest 187
6.31 Stay of execution 188
6.31.1 Introduction 188
6.31.2 Company voluntary arrangement 189
6.31.3 Offer to provide bond 189
6.31.4 Successive adjudications 189
6.32 Costs 190
6.32.1 Indemnity costs 190
6.32.2 Examples 190
6.32.3 Fixed costs 191
6.32.4 Conditional fee agreements and after-the-event
insurance 194
6.32.5 Deployment of leading counsel 194
6.32.6 Claims consultants 194
6.32.7 Offers 195
6.32.8 Factors to be considered 195
6.33 Enforcement of judgment on decision 196
6.33.1 The law and practice 196
6.33.2 Charging orders 197
6.33.3 Orders for sale 197
6.34 Other proceedings 198
6.34.1 Types of dispute concerned 198
6.34.2 Ongoing adjudications 199
6.34.3 Practical difficulties 200
6.34.4 Restraining adjudication 200
6.34.5 Proceedings after decision 201
6.34.6 Unreasonable and oppressive behaviour 202
6.34.7 Judicial review 203

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6.34.8 Pre-action disclosure 203

6.34.9 Recovery of adjudicator’s fees as damages 204
6.35 Stay of proceedings pending adjudication 204
6.36 Effect of adjudicator’s decision on burden of proof in court
proceedings 206
6.36.1 Burden on party to show adjudicator wrong? 206
6.36.2 No effect on burden of proof? 206
6.36.3 Scottish approach 206
6.36.4 England and Wales 207
6.37 Enforcement in Europe 208
6.38 Recovery of sums paid and limitation 208
6.38.1 Repayment on final determination 208
6.38.2 Negative declaratory relief 209
6.38.3 Period of limitation 209

Chapter 7 Other jurisdictions 210

7.1 Republic of Ireland 210
7.2 Australia 212
7.2.1 Previous legislation 212
7.2.2 Recent legislation 212
7.2.3 East Coast Model 213
(a) Payment schedules 213
(b) Failure to pay an adjudication 214
7.2.4 West Coast Model 215
7.2.5 New South Wales 216
7.2.6 Summary of legislation 217
7.2.7 Relevant principles 219
7.2.8 Application of principles 221
(a) Limitations of principles 221
(b) Accommodation of the Scheme 222
(c) Supervisory jurisdiction of the court 223
(d) Issue estoppel and res judicata 224
(e) Void decisions 224
(f) Multiple adjudication applications 224
(g) Injunction to restrain filing of adjudication certificate 225
7.2.9 Victoria: Introduction 225
7.2.10 Payment claims and adjudication 226
7.2.11 Correction of mistakes and reviews 227
7.2.12 Enforcement 228
7.2.13 Queensland: introduction 230
(a) Summary of legislation 231
7.2.14 Effect of legislation 232
(a) The adjudication process 232
(b) Adjudicator’s function 233
(c) Risk of inability to refund moneys 233
7.2.15 Western Australia: Summary 234

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7.2.16 The process of adjudication 235

(a) Adjudicator’s reasons 235
(b) Response out of time 236
7.2.17 Review of decision 237
(a) Jurisdiction 237
(b) Judicial review generally 238
7.2.18 Northern Territory 238
(a) Overview 238
(b) Judicial review 239
7.2.19 Australian Capital Territory 240
(a) Introduction 240
(b) Similarity to New South Wales Legislation 240
(c) Summary of capital territory legislation 241
(d) Capacity to appeal 242
7.2.20 South Australia 243
(a) Introduction 243
(b) Adjudication 244
(c) Types of dispute 244
(d) Jurisdiction 245
(e) Bias 246
(f) Circumvention of the Act 246
7.2.21 Tasmania 247
(a) Existing procedure 247
(b) New legislation 247
7.3 New Zealand: overview 249
7.3.1 Summary of the scheme 250
7.3.2 Adjudication procedure and review 252
(a) Adjudication procedure 252
(b) Judicial review 253
(c) Enforcement 254
7.3.3 Weathertight homes schemes 254
7.3.4 Weathertight Homes appeals and enforcement 256
7.4 Singapore 256
7.4.1 Summary of adjudication procedure 257
(a) Adjudication application 257
(b) Respondent’s response 258
(c) Determination 258
(d) Costs 259
(e) Functions of adjudicator 259
7.4.2 Review of decisions 260
7.4.3 Effect of decisions and enforcement 260
(a) Determination binding 260
(b) Payment 261
(c) Failure to pay 261
7.5 Malaysia 262
7.5.1 Adjudication procedure 263

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7.5.2 Decision 264

7.5.3 Enforcement 266

Chapter 8 Review, proposals for reform and reform 267

8.1 2001 review 267
8.2 Enterprise Act 2002 270
8.3 2004 Review 270
8.4 2004 response 272
8.5 2005 Consultation and 2006 analysis 273
8.6 2007 proposals 274
8.7 2007 proposals: Contracts in writing 275
8.8 2007 Proposals: Jurisdiction concerning ‘conclusive’ interim
payments 276
8.9 2007 Proposals: Costs 276
8.10 Analysis of responses 278
8.11 Draft Construction Contracts Bill 2008 279
8.12 Contract provisions required to be in writing 279
8.13 Allocation of costs 280
8.14 Fees and expenses of adjudicator 281
8.15 Submissions on Draft Construction Contracts Bill 2008 282
8.16 Local Democracy, Economic Development and Construction Bill
2008 282
8.17 Local Democracy, Economic Development and Construction Act
2009 283
8.18 Amendment of Statutory Scheme 285

Chapter 9 Contractual adjudication 288

9.1 Introduction 288
9.2 JCT adjudication provisions 288
9.3 ICC (ICE) adjudication provisions 289
9.4 NEC 3 contracts 290
9.5 GC Works contracts 291
9.6 IChemE contracts 293
9.7 Institutional procedural rules 294
9.8 Dispute adjudication boards 297
9.9 FIDIC dispute adjudication boards 298
9.10 Contractual adjudication in the United States 300
9.11 Contractual adjudication in Hong Kong 302
9.12 Contractual adjudication in South Africa 305

Chapter 10 Payment under the UK statutory framework 308

10.1 Stage payments and dates for payment under the Act 308
10.1.1 Requirement for stage payments 308
10.1.2 Certificates 308
10.2 Payment notices under the Act 309
10.2.1 Payer or specified person to give notice to payee 309

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10.2.2 Requirements for notices 309

10.2.3 Effect of non-compliance 310
10.2.4 Payee’s notice where no payer’s or specified person’s
notice given 310
10.3 Payment of notified sum under the Act 311
10.3.1 Withholding notices and pay less notices 311
10.3.2 Payment of notified sum and pay less notices 311
10.3.3 Timing and effect of pay less notice 313
10.3.4 Adjudication where no pay less notice 313
10.3.5 Payment in accordance with adjudication decision 315
10.3.6 Effect of payee’s insolvency 315
10.4 Conditional payment provisions under the Act 316
10.5 Stage payments and dates for payment under the statutory
scheme 317
10.5.1 Amount of interim payment 317
10.5.2 When payment becomes due 318
10.6 Payment notices and notices of intention to pay less under the
Statutory Scheme 319
10.7 Conditional payment provisions under the Statutory Scheme 319
10.8 Right to suspend performance for non-payment 319
10.8.1 When right arises 319
10.8.2 Party in default to pay costs and expenses 320
10.8.3 Effect on time for completion 320
10.9 Adjudicator’s jurisdiction in relation to conditional payment 321
10.9.1 Certificate a condition precedent 321
10.9.2 Adjudicator’s jurisdiction in absence of certificate 321

Appendices 323
Appendix A 325
Appendix B 345
Appendix C 362
Appendix D 398

Index 427

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 TABL E OF CASES

AABB Ltd v Bam Nuttall Ltd [2013] EWHC 1983 (TCC) ............................................110
ABB Power Construction Ltd v Norwest Holst Engineering Ltd (2000) 77 Con LR 20 ...... 8, 13,
17, 18
ABB Zantingh Ltd v Zedal Building Services Ltd [2001] BLRBLR 66 ................................15
AC Yule & Son Ltd v Speedwell Roofing & Cladding Ltd [2007] EWHC 1360 (TCC),
[2007] BLRBLR 499 ............................................................................................115
AJ Lucas Operations Pty Ltd v Mac-Attack Equipment Hire Pty Ltd [2009] NTCA 4;
(2009) 25 NTLR 14 .............................................................................................240
AT Stannard Ltd v Tobutt & Anor [2014] EWHC 3491 (TCC).......................................153
AWG Construction Services v Rockingham Motor Speedway [2004] EWHC 888 (TCC),
[2004] TCLR 6 ....................................................................................................188
Absolute Rentals v Glencor Enterprises Ltd, [2001] C.I.L.L. 1637 .....................................189
Aceramais Holdings Ltd v Hadleigh Partnerships Ltd [2009] EWHC 1664 (TCC) .............199
Adelaide Linings Pty Ltd v Romaldi Construction Pty Ltd [2013] SASC 110 ......................246
Adonis Construction v O’Keefe Soil Remediation [2009] EWHC 2047 (TCC), [2009]
CILL 2784.............................................................................................................44
Aedifice Partnership Ltd v Ashwin Shah [2010] EWHC 2106 (TCC), 132 Con LR 100 ....181
Air Design (Kent) Ltd v Deerglen (Jersey) Ltd [2008] EWHC 3047 (TCC), [2009] CILL
2657 ......................................................................................................................56
Alexander & Law Ltd v Coveside (21BPR) Ltd [2013] EWHC 3949 (TCC)....................162
Allen Wilson Joinery Ltd v Privetgrange Construction Ltd [2008] EWHC 2802 (TCC) ........ 24,
25, 132
Allied P&L Ltd v Paradigm Housing Group Ltd [2009] EWHC 2890 (TCC); [2010]
BLR 59 ................................................................................................................178
Allied Vision Ltd v VPS Film Entertainment Gmbh [1991] 1 Lloyd’s Rep 392 ....................180
Alstom Signalling Ltd v Jarvis Facilities Ltd [2004] EWHC 1285 (TCC) ................. 154, 312
Altys Multi-Services Pty Ltd v Grandview Modular Building Systems P/L [2008] QSC
26 ................................................................................................................ 231, 232
Amber Construction Services Ltd v London Interspace HG Ltd [2007] EWHC 3042
(TCC), [2008] BLRBLR 74 .................................................................................192
AMEC Capital Projects Ltd v Whitefriars City Estates Ltd [2004] EWCA Civ 1418,
[2005] BLRBLR 1 ....................................................................................83, 95, 163
Amec Civil Engineering Ltd v Secretary of State for Transport [2004] EWHC Civ 2339
(TCC); affirmed [2005] EWCA Civ 291, [2005] BLR 227 ............. 46, 47, 49, 50, 112
Amec Group Ltd v Thames Water Utilities Ltd [2010] EWHC 419 (TCC) ................... 51, 169
Amsalem v Raivid [2008] EWHC 3226 (TCC) .............................................................196
Anglo Swiss Holdings Ltd v Pakman Lucas Ltd [2009] EWHC 3212 (TCC), [2010] BLR
109 ......................................................................................................................202

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Arcadis UK Ltd v May and Baker Ltd (t/a Sanofi) [2013] EWHC 87 (TCC) ..................106
Ashville Investments Ltd v Elmer Contractors Ltd 1989] 1 Q.B. 488 ....................................55
Aspect Contracts (Asbestos) Ltd v Higgins Construction Plc [2013] EWHC 1322 (TCC),
[2013] BLR 417; [2013] EWCA Civ 1541; [2015] UKSC 38; [2015] 1 WLR 2961 ..209
Associated Provincial Picture House Ltd v Wednesbury Corpn. [1948] 1 K.B. 223.................107
Atlantic Computers Plc, Re [1992] Ch 505 ........................................................................40
Austin Hall Building Ltd v Buckland Securities Ltd [2001] BLR 272 ......38, 39, 140, 141, 170
Austruc Constructions Ltd v ACA Developments Pty Ltd [2004] NSWSC 131 ....................220
Aveat Heating Ltd v Jerram Falkus Construction Ltd [2007] EWHC 131 (TCC), 113
Con LR 13, [2007] T.C.L.R. 3 ................................................ 31, 32, 65, 84, 116, 293
Avoncroft Construction Ltd v Sharba Homes (CN) Ltd [2008] EWHC 933 (TCC),
(2008) 119 Con LR 130, [2008] TCLR 7 ..............................................................190
Axis Plumbing NT Pty Ltd v Option Group (NT) Pty Ltd [2014] NTSC 22 ......................240
BM Alliance Coal Operations Pty Ltd v BGC Contracting Pty Ltd [2013] QCA 394 ...........233
Baldwin Industrial Services plc v Barr Ltd [2003] BLR 176 ...............................................11
Balfour Beatty Construction Ltd v Mayor & Burgesses of London Borough of Lambeth
[2002] EWHC 597 (TCC), [2002] BLR 288..........................................101, 165, 167
Balfour Beatty Construction v Serco Ltd [2004] EWHC 3336 (TCC) ...............................170
Balfour Beatty Engineering Services (HY) Ltd v Shepherd Construction Ltd [2009] EWHC
2218 (TCC).........................................................................................................122
Ballast Plc v The Burrell Company (Construction Management) Limited [2001] ScotCS
159, [2001] BLR 529 ................................................................................... 114, 168
Banner Holdings Ltd v Colchester B.C. [2010] EWHC 139 (TCC)...................................293
Barnes & Elliot Ltd v Taylor Woodrow Holdings Ltd [20003] EWHC 3100 (TCC), [2004]
BLR 111 ................................................................................ 116, 117, 118, 120, 165
Barr Ltd v Law Mining Co Ltd (2001) 80 Con LR 13 ......................................................52
Bearmans Ltd v Metroploitan Police District Receiver [1961] 1 WLRWLR 634 .....................80
Beck Interiors Ltd v Classic Decorative Finishing Ltd [2012] EWHC 1956 (TCC) .............176
Beck Interiors Ltd v UK Flooring Contractors Ltd [2012] EWHC 1808 (TCC), [2012]
BLR 417 ..............................................................................................................187
Beck Peppiatt Ltd v Norwest Holst Construction Ltd [2003] EWHC 822 (TCC), [2003]
BLR 316 .......................................................................................................... 47, 50
Benfield Construction Ltd v Trudson (Hatton) Ltd [2008] EWHC 2333 (TCC), [2008]
CILL 2633.............................................................................................................92
Bennett v FMK Construction Ltd , [2005] EWHC 1179 (TCC), 101 Con LR 92 ...............66
Bennett (Electrical) Services Ltd v Inviron Ltd [2007] EWHC 49 (TCC) ...........................23
Bill Biakh v Hyundai Corporation [1988] 1 Lloyd’s Rep. 187 ..........................................108
Bloor Construction (UK) Ltd v Bower & Kirkland (London) Ltd [2000] BLR 314 ............ 117,
137, 167, 280
Board & Trustees of National Museums & Galleries on Merseyside v AEW Architects &
Designers Ltd [2013] EWHC 2403 (TCC) .............................................................204
Bothma v Mayhaven Health Care Ltd [2006] EWHC 2601 (QB); [2007] EWCA Civ 527...53
Boutique Venues Pty Ltd v JACG Pty Ltd [2007] NTSC 5 ................................................238
Bouygues E & S Contracting UK Ltd v Vital Energi Utilities Ltd [2014] CSOH 115 ...........103
Bouygues (UK) Ltd v Dahl-Jensen Ltd [2000] BLR 522, 524, CA .........................4, 43, 108,
136, 142, 158, 159, 189
Bovis Lend Lease Ltd v Triangle Development Ltd [2003] BLR 31 .....................................171
Bovis Lend Lease Ltd v Trustees of the London Clinic [2009] 64 (TCC) ...............................62
BremerHandelsgesellschaft mbH v Raiffeisen Hauptgenossenschaft eG [1983] 1 Lloyd’s Rep.
434 ........................................................................................................................57

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Bridgeway Constructions Ltd v Tolent Construction Ltd [2000] C.I.L.L. 1662 ............. 135, 271
Bitannia Pty Ltd v Parkline Constructions Pty Ltd [2006] NSWCA 238 ............................219
Broadwell v k3D [2006] ADJ CS 04/21 ................................................................. 114, 169
Brodyn Pty Ltd t/a Time Cost and Quality v Davenport (2004) 61 NSWLR 421 ........219, 220,
222, 223, 224, 229, 233, 235
Brown (L.) & Sons Ltd v Crosby Homes (North West) Ltd [2005] EWHC 3503 (TCC).........5
Bryen & Langley v Boston [2005] EWCA Civ 973; [2005] BLR 508 .....................34, 35, 36
Built Environs Pty Ltd v Tali Engineering Pty Ltd [2013] SASC 84 ....................243, 245, 246
Buxton Building Contractors Ltd v Governors of Durand Primary School Buxton Building
Contractors Ltd v Governors of Durand Primary School [2004] EWHC 733 (TCC),
[2004] BLR 474 ...................................................................................................108
C & B Scene Concept Design Ltd v Isobars Ltd [2002] EWCA Civ 46,[2002] BLR
93 ................................................................................................................ 108, 167
CCD Group Pty Ltd v Premier Drywall Pty Ltd [2006] NSWSC 1012 ..............................239
CG Group Ltd v Breyer Group Plc (No. 1) [2013] EWHC 2722 (TCC) ...........................106
CG Group Ltd v Breyer Group Plc (No. 2) [2013] EWHC 2959 (TCC) ...........................195
CIB Properties Ltd v Birse Construction Ltd [2004] EWHC 514 (TCC); [2005] BLR 173 ...63
CJP Builders Ltd v William Verrey Ltd [2008] EWHC 2025 (TCC), [2008] BLR 545 .......109
CN Associates v Holbeton Ltd [2011] EWHC 43 (TCC), [2011] BLR 261 ......................181
CRJ Services Ltd v Lanstar Ltd (t/a CSG Lanstar) [2011] EWHC 972 (TCC) ................111
CSC Braehead Leisure Ltd v Laing O’Rourke Scotland Ltd [2008] CSOH 119, [2009]
BLR 49 ........................................................................................................ 121, 186
Camden, Mayor & Burgesses of London Borough of, v Makers UK Ltd [2009] EWHC 605
(TCC) ...................................................................................................................61
Cameron, A., Ltd v J. Mowlem & Co. plc (1990) 25 Con LR 11, CA ....................................1
Cantillon Ltd v Urvasco Ltd [2008] EWHC 282 (TCC), [2008] BLR 250... 78, 105, 112, 186
Cape Durasteel Ltd v Rosser and Russell Building Services Ltd [1995] 46 Con LR 75 ..........205
Capitol Avenue Development Sdn Bhd v Bauer (Malaysia) Sdn Bhd (Originating Summons
No: 25C-5-09/2014) .............................................................................................262
Captiva Estates Ltd v Rybarn Ltd [2005] EWHC 2744 (TCC); [2006] BLR 66 ................29
Carillion Construction Ltd v Devonport Royal Dockyard Ltd [2002] BLR79 ................... 23, 47
Carillion Construction Ltdv Devonport Royal Dockyard Ltd [2005] EWCA 1358, [2006]
B. L.R. 15 ......................................................... 78, 121, 131, 166, 170, 191, 253, 254
Carillion Construction Ltd v Stephen Andrew Smith [2011] EWHC 2910 (TCC) ................93
Carillion Utility Services Ltd v SP Power Systems Ltd [2011] ScotCS CSOH_139 .............104
Carter, R.G., Ltd v Edmund Nuttall Ltd, 21st June 2000, unreported ........................... 33, 59
Channel Tunnel Group Ltd v Balfour Beatty Construction Ltd [1993] AC 334 .....................297
Chartbrook Limited v Persimmon Homes Limited [2009] 1 A.C. 1101 ................................164
Chase Oyster Bar v Hamo Industries [2010] NSWCA 190 ....................................... 223, 237
Citex Professional Services Ltd v Kenmore Developments Ltd [2004] ScotCS 20 ..................207
City Inn Ltd v Shepherd Construction Ltd [2001] ScotCS 187 ..........................................206
Clarence Street Pty Ltd v Isis Projects Pty Ltd (2005) 64 NSWLR 448 ..............................220
Class Electrical Services v Go Electrical [2013] NSWSC 363 [33] (McDougall J)..............216
Cleveland Bridge (UK) Ltd v Whessoe-Volker Stevin Joint Venture [2010] EWHC 1076,
[2010] BLR 415 ............................................................................................. 14, 185
Coleraine Skip Hire v Ecomesh Ltd [2008] NIQB 141 .......................................................10
Collins (Contractors) Ltd v Baltic Quay Management (1994) Ltd [2004] EWCA Civ
1757, [2005] BLR 63 .................................................................... 46, 48, 49, 50, 112
Compania Maritima Zorroza SA v Sesostris SA,The Marques de Bolarque [1984] 1 Lloyd’s
Rep 652, 660........................................................................................................179

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Company (No 1299 of 2001), Re a [2001] CL 1745 .......................................................146

Comsite Projects Ltd v Andritz AG [2003] EWHC 958 (TCC); (2004) 20 Const. LJ
24 .................................................................................................................... 14, 18
Connex South Eastern LtdV MJ Building Services Group plc [2004] EWHC 1518 (TCC),
[2004] BLR 333, [2005] EWCA Civ 193, [2005] 1 WLRWLR 3323, [2005] BLR
201 ....................................................................................................... 24, 45, 59, 60
Conor Engineering Ltd v Les Constructions Industrielle de la Mediterranee [2004] BLR 212....16
Cook, (FW), Ltd v Shimzu (UK) Ltd [2000] BLR 199 .....................................................58
Co-ordinated Construction Co Pty Ltd v Climatech (Canberra) Pty Ltd [2005] NSWCA
229 ......................................................................................................................221
Coventry & Solihull Waste Disposal Co Ltd v Russell (Valuation Officer) [1999] 1 WLR
2093 ................................................................................................................ 28, 46
Cowlin Construction Ltd v CFW Architects (A firm) [2003] 1 BLR 241 ..............................47
Cruden Construction Ltd v Commission for the New Towns [1995] 2 Lloyd’s Rep. 387 ..... 47, 49
Cubitt Building & Interiors Ltd v Fleetglade Ltd [2006] EWHC 3413 (TCC), (2006) 110
Con LR 36 ................................................................76, 117, 119, 120, 127, 165, 166
Cubitt Building & Interiors Ltd v Richardson Roofing (Industrial) Ltd [2008] EWHC
1020 (TCC).........................................................................................................206
D & M, R (on the application of) v Secretary of State for Work & Pensions [2010] EWCA
Civ 18, [2010] 1 WLR 1782 .............................................................................. 28, 46
DGT Steel and Cladding Limited v Cubitt Building and Interiors Limited [2007] EWHC
1584 (TCC), [2007] BLR 371 ..............................................................................205
Dalkia Energy & Technical Services Ltd v Bell Group UK Ltd [2009] 73 (TCC) ................199
David McLean Contractors Limited v The Albany Building Limited [2005] EWHC 85
(TCC) ........................................................................................................... 88, 173
David McLean Housing Ltd v Swansea Housing Association Ltd [2002] BLR 125 ......... 52, 53,
163, 171
Dean and Dyball Construction Ltdv Kenneth Grubb Associates Ltd [2003] EWHC 2465
(TCC), (2003) 100 Con LR 92......................................................................... 79, 98
Demir Pty Ltd v Graf Plumbing Pty Ltd [2004] NSWSC 553 ..........................................239
Dewu Pty Ltd v Fabiano [2014] NSWSC 943 ................................................................223
Diamond v PJW Enterprises Ltd 2004 SC 430 ................................................................122
Director General of Fair Trading v First National Bank plc [2002] 1 A.C. 481, HL(E), 502 ...35
Discain Project Services Ltdl v Opecprime Developments Ltd [2001] BLR 285........98, 164, 167
Domsalla v Dyason [2007] EWHC 1174 (TCC); 112 Con LR95 ............................. 36, 170
Dorchester Hotel Ltd v Vivid Interiors Ltd [2009] EWHC 70 (TCC), [2009] BLR 135 ......199
Downer Construction (Australia) Pty Ltd v Energy Australia [2007] NSWCA 49 ...............219
Drake & Scull Engineering Ltd v McLaughlin and Harvey plc(1992) 60 BLR 102 .............145
Dualcorp Pty Ltd v Remo Constructions Pty Ltd [2009] NSWCA 69 ..................223, 224, 225
Dunlop & Ranken Ltd v Hendall Steel Structures Ltd [1957] 1 WLRWLR 1102 ................316
Durtnell (R) & Sons Ltd v Kaduna Ltd [2003] EWHC 517 (TCC); (2003) 95 Con LR
36 ................................................................................................................ 168, 181
EB Aaby’s Rederi A/S v Union of India, The (‘The Evje’) [1974] 2 Lloyd’s Rep. 57 (HL) .....50
Ealing London Borough Council v Jan [2000] Q.B. 451, C.A. ............................................96
Edenbooth Ltd v Cre8 Developments Ltd [2008] EWHC 570 (TCC) ..................................21
Edmund Nuttall Ltd v R. G. Carter Ltd [2002] EWHC 400 (TCC), [2002] BLR
312 ............................................................................................47, 50, 113, 167, 168
Elanay Contractors Ltd v The Vestry [2001] BLR 33...........................................................39
Elitestone Ltd v Morris [1997] UKHL 15, [1997] 1 WLR 687, [1997] 2 All ER 513 ..........10
Ellerine Bros. (Pty) Ltd v Klinger [1982] 1 WLR 1375 ..................................... 46, 47, 49, 50

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Ellis Building Contractors Ltd v Goldstein [2011] EWHC 269 (TCC) ...............................101
Emcor Drake & Skull Ltd v Costain Construction Ltd [2004] EWHC 2439 (TCC),
(2004) 97 Con L.R. 142 .........................................................................................88
England v Inglis [1920] 2 K.B. 636 .................................................................................80
Enterprise Managed Services Ltd v Tony McFadden Utilities Ltd [2009] EWHC 3222
(TCC) ........................................................................................................42, 43, 62
Epping Electrical Company Ltd v Briggs and Forrester (Plumbing Services) Ltd [2007]
EWHC 4 (TCC); [2007] BLR 126 .................................................. 31, 119, 165, 293
Essex C.C. v Essex Congregational Church Union [1963] A.C. 808, H.L.(E.) .....................176
Estor Ltd v Multifit (UK) Ltd [2009] EWHC 2108 (TCC), 126 Con LR 40 ...................128
Eurocom Ltd v Siemens Plc [2014] EWHC 3710 (TCC) ........................................... 70, 156
Evje, The, EB Aaby’s Rederi A/S v Union of India [1974] 2 Lloyd’s Rep. 57 (HL)................50
F. & G. Sykes (Wessex) Ltd v Fine Fare Ltd [1967] 1 Lloyd’s Rep. 53.................................46
FW Cook Ltd v Shimzu (UK) Ltd [2000] BLR 199 .........................................................58
Farebrother Building Services Ltd v Frogmore Investments Ltd [2001] CILL 1762 ...............184
Farrelly (M & E) Building Services Ltd v Byrne Brothers (Formwork) Ltd [2013] EWHC
1186 (TCC).........................................................................................................107
Fastrack Contractors Ltd v Morrison Construction Ltd [2000] 1 BLR 168 ........ 47, 51, 85, 162,
166, 176
Fence Gate Ltd v James R Knowles Ltd (2001) 84 Con LR 206...................................... 7, 19
Fenice Investments Inc. v Jerram Falkus Construction Ltd [2009] EWHC 3272 (TCC),
(2009) 128 Con LR 124 .......................................................................................201
Fenice Investments Inc. v Jerram Falkus Construction Ltd [2011] EWHC 1678 (TCC),
(2011) 141 Con LR 206 .................................................................. 67, 124, 125, 126
Ferson Contractors Ltd v Levolux AT Ltd [2003] EWCA Civ 11, [2003] BLR 118 ............171
Fileturn Ltd v Royal Garden Hotel Ltd [2010] EWHC 1736 (TCC), [2010] BLR 512 ........82
Filite (Runcorn) Ltd v Aqua-Lift (1989) 45 BLR 27, C.A .................................................55
‘Fiona Trust, The’: see Premium Nafta Products Ltd v Fili Shipping Co. Ltd
Fox v Star Newspaper Co. [1900] A.C. 19 ........................................................................86
GPS Marine Contractors Ltd v Ringway Infrastructure Services Ltd [2010] EWHC 283
(TCC), [2010] BLR 377 .............................................................................. 155, 179
Galliford Try Building Ltd v Estura Ltd [2015] EWHC 412 (TCC) ................... 314, 315, 321
Galliford Try Construction Ltd v Michael Heal Associates Ltd [2003] EWHC 2886 (TCC)....24
Galliford (UK) Ltd v Markel Capital Ltd [2003] EWHC 1216 (QB) ....................... 141, 153
Geoffrey Osbourne Ltd v Atkins Rail Ltd [2009] EWHC 2425 (TCC), [2010] BLR 363 ...202
George Park v The Fenton Partnership [2001] CILL 1712 ................................................146
Gibson Lea Interiors Ltd v Makro Shelf Service Ltd [2001] BLR 407 ............................ 10, 11
Gillies Ramsay Diamond v PJW Enterprises Ltd [2004] BLR 131 .......................................20
Gipping Construction Ltd v Eaves Ltd [2008] EWHC 3134 (TCC).............................. 3, 109
Glencot Development & Design Co. Ltd v Ben Barrett & Son (Contractors) Ltd [2001]
BLR 207 ...................................................................................................96, 99, 164
Glendalough Associated SA v Harris Calnan Construction Ltd [2013] EWHC 3142
(TCC) ............................................................................................................. 24, 26
Godwin v Swindon Borough Council [2001] EWCA Civ 1478, [2002] 1 WLR 997 ...........197
Graham Anstee-Brooke, ex p Karara Mining Ltd, Re [2013] WASC 59 ..............................236
Gray & Sons Builders (Bedford) Ltd v Essential Box Company Ltd [2006] EWHC 2520
(TCC), (2006) 108 Con LR 49.............................................................................190
Griffin & Anor t/a K & D Contractors v Midas Homes Ltd (2000) 78 Con LR 152 ............ 47,
50, 57, 130
Grindley Constructions Pty Ltd v Painting Masters Pty Ltd [2012] NSWSC 234 ................225

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Grocon Constructors v Planit Cocciardi Joint Venture [No.2] [2009] VSC 426 ....... 213, 229, 230
Group Connex South Eastern Ltd v MJ Building Services PLC [2004] BLR 333 ..................24
Grovedeck Ltd v Capital Demolition Ltd [2000] BLR 181 .....................................26, 51, 163
Guardi Shoes Ltd v Datum Contracts [2002] CILL 1934 .................................................146
H G Construction Ltd v Ashwell Homes (East Anglia) Ltd [2007] EWHC 144 (TCC),
[2007] BLR 175 .....................................................................................................91
H S Works Ltd v Enterprise Management Services Ltd [2009] EWHC 729 (TCC), [2009]
BLR 378 ...................................................................................................... 174, 201
Halki Shipping Corp. v Sopex Oils Ltd [1998] 1 WLR 726, CA ...........................47, 143, 144
Hansen Yuncken Pty Ltd v Ericson t/a Fleas Concreting [2011] QSC 327 ...........................234
Harding (t/a M.J. Harding Contractors) v Paice [2014] EWHC 3824 (TCC)................ 0, 313
Harlow & Milner Ltd v Teasdale [2006] EWHC 54 (TCC) ...............................................45
Harlow & Milner Ltd v Teasdale [2006] EWHC 1708 (TCC) ...........................................97
Harrington(PC) Contractors Ltd v Systech International Ltd [2012] EWCA 1371 ..............128
Harris Calnan Construction Co Ltd v Ridgewood (Kensington) Ltd [2007] EWHC 2738,
[2008] BLR 132 ....................................................................................151, 177, 190
Hart Investments Limited v Fidler [2006] EWHC 2857 (TCC); [2007] BLR 30 .......... 23, 44,
75, 117, 119, 164, 165
Harvey v Crawley Development Corporation [1956] 1 QB 485 ..........................................320
Hebburn Ltd, Ex parte; Re Kearsley Shire Council(1947) 47 SR (NSW) 416 ......................221
Henderson v Henderson (1843) 3 Hare 100 ......................................................................90
Henry Boot Construction Ltd v Alstom Combined Cycles Ltd [2005] EWCA Civ 814;
[2005] 1 WLR 3850, 3861 ....................................................................................321
Herbosh-Kiere Marine Contractors Ltd v Dover Harbour Board [2012] EWHC 84 (TCC) ...105
Herschel Engineering Ltd v Breen Property Ltd [2000] BLR 272 .........................................61
Herschel Engineering Ltd v Breen Property Ltd (No. 2), unreported, 28th July 2000 ...........189
Heyman v Darwins 1942] AC 356 ...................................................................................45
Hickory Developments Pty Ltd v Schiavello (Vic) Pty Ltd [2009] VSC 156 ................213, 229,
230
Highlands & Islands Airports Ltd v Shetland Islands Council [2012] ScotCS CSOH 12......107
Hillcrest Homes Ltd v Beresford and Curbishley Ltd [2014] EWHC 280 (TCC) .......... 56, 103,
130, 163
Homer Burgess Ltd v Chirex (Annan) Ltd [2000] BLR 124 ...............................................18
Horne v Magna Design Building Ltd [2014] EWHC 3380 (TCC) ...................................111
Hortimax v Hedon Salads Ltd (2004) 24 Const. LJ 47 .........................................16, 19, 177
How Engineering Services Ltd v Lindner Ceilings Floors Partitions plc (1999) 64 Con LR
66 ................................................................................................................ 100, 165
Humes Buildings Contractors Ltd v Charlotte Homes (Surrey) Ltd, 4 January 2007, Salford
TCC ....................................................................................................................114
Hurley Palmer Flatt Ltd v Barclays Bank Plc [2014] EWHC 3042 .....................................43
Hyder Consulting (UK) Ltd v Carillion Construction Ltd [2011] EWHC 1810 (TCC),
(2011) 138 Con LR 212 ............................................................................... 175, 202
IDE Contracting Ltd v R.G. Carter Cambridge Ltd [2004] EWHC 36 (TCC), [2004]
BLR 172 .......................................................................................................... 65, 68
ISG Construction Ltd v Seevic College [2014] EWHC 4007 (TCC) ..................313, 314, 315
ISG Retail Ltd v Castletech Construction Ltd [2015] EWHC 1443 (TCC) ..........................56
Imtech Inviron Ltd v Loppingdale Plant Ltd [2014] EWHC 4109 (TCC)..........................190
Integrated Building Services Engineering Consultants Ltd v PIHL UK Ltd [2010] CSOH
80, [2010] BLR 622 .............................................................................................161
Intero Hospitality Projects Pty Ltd v Empire Interior Pty Ltd [2007] QSC 220 ............ 231, 233

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Interserve Industrial Services Ltd v Cleveland Bridge (UK) Ltd [2006] EWHC 741 ........... 173,
190, 314, 315
Investors Compensation Scheme v West Bromwich Building Society [1998] 1 WLR 896 .........164
J.B. Leadbitter & Co. Ltd v Hygrove Holdings Ltd [2012] EWHC 1941 (TCC) ................317
JFC Builders Pte Ltd v Lion City Construction Co Pte Ltd [2012] SGHC 243 ....................257
J.R.L., In re, Ex parte CJ.L. (1986) 161 C.L.R. 342 .........................................................83
Jaques v Ensign Contractors Ltd [2009] EWHC 3383 (TCC) ..........................................108
Jim Ennis Construction Ltd v Premier Asphalt Ltd [2009] EWHC 1906 (2009) 125 Con
LR 141 (TCC) ............................................................................................. 141, 209
John Cothliff Ltd v Allenbuild (North West) Ltdl [1999] C.I.L.L 1530 ...............................134
John Goss Projects Pty Ltd v Leighton Contractors (2006) 66 NSWLR 707 ........................222
John Holland Pty Ltd v Roads & Traffic Authority of New South Wales [2007] NSWCA
19 ................................................................................................................ 220, 221
John Mowlem v Hydra-Tight Ltd (2002) 17 Const L.J 358.....................................31, 33, 59
John Roberts Architects Ltd v Park Care Homes Ltd [2006] EWCA Civ 64, [2006] BLR
106 ........................................................................................................................87
Johnson v Gore Wood & Co (a firm) [2002] 2 AC 1, H.L.(E.)............................................90
Joinery Plus Ltd v Laing Ltd [2003] EWHC 3513; [2003] BLR 184 ......................... 41, 166
K & J Burns Electrical Pty Ltd v GRD Group (NT) Pty Ltd [2011] NTCA 1, (2011) 29
NTLR 1...............................................................................................................240
KNN Coburn LLP v G.D. City Holdings Ltd [2013] EWHC 2879 (TCC) ..........77, 111, 115
KNS Industrial Services (Birmingham) Ltdv Sindall [2000] EWHC 75 (TCC), (2000)
75 Con LR 71 ...................................................................... 52, 78, 86, 112, 166, 184
Kariiti Ltd v Donovan Drainage & Earthmoving Ltd CIV-2010-488-000613, 15
November 2010....................................................................................................254
Ken Griffin & Anor t/a K & D Contractors v Midas Homes Ltd (2000) 78 Con LR 152...... 47,
50, 57, 130
Kirk v Industrial Relations Commission [2010] HCA 1 ............................................ 223, 237
Laker Vent Engineering Ltd v Jacobs E & C Ltd [2014] EWHC 1058 (TCC) .... 16, 32, 33, 70,
118, 164, 180, 183
Lanes Group Plc v Galliford Try Infrastructure Ltd [2011] EWHC 1035 (TCC), [2011]
BLR 438 ................................................................................................................75
Lanes Group Plc v Galliford Try Infrastructure Ltd (No. 2) [2011] EWHC 1679 (TCC) ......76
Lanes Group Plc v Galliford Try Infrastructure Ltd (No. 3) [2011] EWCA Civ 1617,
[2012] BLR 121 ........................................................................................75, 76, 110
Lansky Constructions Pty Ltd v Noxequin Pty Ltd (in liq) t/a Fyna Formwork [2005]
NSWSC 963 ........................................................................................................220
Leadbitter (J.B.) & Co. Ltd v Hygrove Holdings Ltd [2012] EWHC 1941 (TCC) .............317
Lead Technical Services Ltd v CMC Medical Ltd [2007] EWCA Civ 316, [2007] BLR
251 ................................................................................................................ 69, 158
Leander Construction Ltd v Mullaley & Co Ltd [2011] EWHC 3449 (TCC) ....................312
Lee v Chartered Pties. (Building) Ltd [2010] EWHC 1540 (TCC), [2010] BLR 500 .. 117, 120
Lee Wee Lick Terence (alias Li Weili Terence) v Chua Say Eng (formerly trading as Weng Fatt
Construction Engineering) [2012] SGCA 63, [2013] 1 SLR 401 ........ 257, 258, 259, 261
Lend Lease Building Contractors Pty Ltd t/a Sitzler Baulderstone Joint Venture v Honeywell
Ltd t/a Honeywell Building Solutions Ltd [2015] NTSC 10 .......................................240
Letchworth Roofing Co. Ltd v Sterling Building Co. Ltd [2009] EWHC 1119 (TCC) ..........115
Levolux AT Ltd v Ferson Contractors Ltd [2003] EWCA Civ 11, [2003] BLR 118 ............108
Lidl UK GmbH v R G Carter Colchester Ltd [2012] EWHC 3138 (TCC), (2012) 146
Con LR 133 .........................................................................................................186

xxvii
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Linnett v Halliwells LLP [2009] EWHC 319 (TCC) ....................................... 70, 71, 72, 73
Lissenden v CAV Bosch Ltd [1940] AC 412, HL .............................................................144
Locabail (U.K.) Ltd v Bayfield Properties Ltd [2000] Q.B. 451 .................................... 81, 96
London & Amsterdam Properties Ltd v Waterman Partnership Ltd [2003] EWHC 3059
(TCC), [2004] BLR 179 .........................................................................79, 104, 163
London Borough of Camden, Mayor Burgesses of, v Makers UK Ltd [2009] EWHC 605
(TCC) ...................................................................................................................61
Lovell Projects Ltd v Legg and Carver [2003] 1 BLR 452 ............................................. 34, 47
Lucas Stuart Pty Ltd v Council of the City of Sydney [2005] NSWSC 840 .........................232
MBE Electrical Contractors Ltd v Honeywell Control Systems Ltd[2010] EWHC 2244
(TCC), [2010] BLR 561 ......................................................................................144
M J Gleeson Group Plc v Devonshire Green Holding Ltd TCC Salford District Registry,
19 March 2004.....................................................................................................172
MRCN Pty Ltd t/a Westforce Constructions v ABB Australia Pty Ltd [2014] WASAT 59 ......237
MS Fashions v BCCI [1993] 1 Ch 425 ............................................................................43
Mw High Tech Projects UK Ltd v Haase Environmental Consulting GmbH [2015] EWHC
152 [35](TCC) ....................................................................................................202
McAlpine PPS Pipeline Systems Joint Venture. v Transco plc [2004] EWHC 2030 (TCC),
[2004] BLR 352 ...................................................................................................104
McConnell Dowell Construction (Aust) Pty Ltd v National Grid Gas plc [2006] EWHC
2551 (TCC), [2007] BLR, 92 ....................................................................5, 163, 189
Machkevitch v Andrew Building Constructions [2012] NSWC 546....................................216
Macob Civil Engineering Ltd v Morrison Construction Ltd [1999] BLR 93......................xxxiii,
4, 142, 143, 144, 145
Makers UK Ltd v London Borough of Camden [2008] EWHC 1836 (TCC), [2008] BLR
470 ........................................................................................................................97
Mayor & Burgesses of London Borough of Camden v Makers UK Ltd [2009] EWHC 605
(TCC) ...................................................................................................................61
Mead General Building Ltd v Dartmoor Properties Ltd [2009] EWHC 200 (TCC), [2009]
BLR 225 ..............................................................................................................188
Mecright Ltd v TA Morris Developments Ltd [2001] Adj LR 06/22 ......................................79
Medicaments and Related Classes of Goods (No 2), in re [2001] 1 WLR 701 para 37, C.A.....95
Melville Dundas Limited (in receivership) and others (Respondents) v George Wimpey UK
Limited and others (Appellants) (Scotland) [2007] UKHL 18, [2007] 1 WLR 136,
[2007] 3 All E.R. 889, [2007] BLR 257 ............................................................. 2, 316
Mentmore Towers Ltd & Ors. v Packman Lucas Ltd [2010] EWHC 457 (TCC).................203
Michael Ebbott t/a South Coast Scaffolding & Rigging Services v Hire Access Pty Ltd [2012]
WADC 66 ............................................................................................................238
Midland Expressway Ltd v Carillion Construction Ltd (No. 2) [2005] EWHC 2963
(TCC); (2005) 106 Con LR 154 ....................................................................... 33, 59
Midland Expressway Ltd v Carillion Construction Ltd (No.3) [2006] EWHC 1505
(TCC), [2006] BLR 325 ................................................................................xxxi, 49
Minister for Immigration and Ethnic Affairs v Wu Shan Liang (1996) 185 CLR 259 ...........222
Minister for Immigration and Multicultural Affairs, Re; ex parte Lam (2003) 214 CLR 1......222
Mitsui Babcock Energy Services Ltd, In the petition of [2001] Scot CS 150 ..........................15
Model v Steel (1841) 8 M & W 858 ..............................................................................xxxii
Modern Engineering (Bristol) Ltd v Gilbert-Ash (Northern) Ltd (1973) 71 L.G.R. 162,
C.A............................................................................................................ xxxvi, 191
Modern Engineering (Bristol) Ltd v Gilbert-Ash (Northern) Ltd [1974] A.C. 689, H.L
(E.) .................................................................................................................xxxii, 3

xxviii
 TABLE OF CASES

Mohammed v Bowles [2003] Adj. L.R. 03/14; [2002] 394 SD 2002 ................................146
Monmouthshire C.C. v Costelloe & Kemple Ltd (1965) 5 BLR 83 ............................46, 49, 50
Mott MacDonald Ltd v London & Regional Properties Ltd [2007] EWHC 1055 (TCC),
(2007) 113 Con LR 32 .................................................................... 26, 117, 120, 127
Multiplex Constructions Pty Ltd v Luikens [2003] NSWSC 1140 .....................................220
Musico v Davenport [2003] NSWSC 977 ......................................................................222
Nageh v Richard Giddings [2006] EWHC 3240 (TCC), [2007] CILL 2420 ......................66
NAP Anglia Ltd v Sun-Land Development Co Ltd (No. 2) [2012] EWHC 51 (TCC) ........195
Nefiko Pty Ltd v Statewide Form Pty Ltd (No 2) [2014] NSWSC 840 ..............................223
Nickelby FM Ltd v Somerfield Stores Ltd [2010] EWHC 1976 (TCC) .............................157
Nikko Hotels (UK) Ltd v MEPC plc [1991] 2 EGLR 103 ...............................................167
Nordot Engineering Services Ltd v Siemens Plc [2001] CILL 1778 ....................................178
North Midland Construction plc v A E & E Lentjes UK Ltd [2009] EWHC 1371 (TCC) .....14
Northern Developments (Cumbria) Ltd v J & J Nichol [2000] BLR 158 ............135, 168, 176
Nottingham Community Housing Association Ltd v Powerminster Ltd [2000] BLR 309 ............9
Nutton v Wilson (1889) 22 Q.B.D. 744 ............................................................................80
OSC Building Services Ltd v Interior Dimensions Contracts Ltd [2009] EWHC 248
(TCC), [2009] CILL 2688 .....................................................................................58
Oakley v Airclear Environmental [2002] C.I.L.L. 1824 ...................................................146
O’Donnell Developments Ltd v Build Ability Ltd [2009] EWHC 3388 (TCC) ...................138
O’Donnell Griffin Pty Ltd v John Holland Pty Ltd [2008] WASC 58 .................................238
Okaroo Pty Ltd v Vos Construction and Joinery Pty Ltd [2005] NSWSC 45 .......................216
Orange EBS Ltd v ABB Ltd [2003] 1 BLR 323 ...............................................................47
Outwing Construction Ltd v H. Randell & Son Ltd [1999] BLR 156 .................................152
PHD Modular Services Ltd v Seele GmbH [2011] EWHC 2210 (TCC) ...........................204
PT Building Services Ltd v ROK Build Ltd [2008] EWHC 3434 (TCC) ...............24, 77. 183
Paice v Harding Contractors (t/a M J Harding Contractors [2015] EWHC 661
(TCC) ...................................................................................................................69
Palmac Contracting Ltd v Park Lane Estates Ltd [2005] EWHC 919 (TCC), [2005] BLR
301 ........................................................................................................................64
Palmers Ltd v ABB Power Construction Ltd (1999) 68 Con LR 52........................................8
Paramount Airways, Re [1990] B.C.C. 130.......................................................................40
Parkwood Leisure Ltd v Laing O’Rourke Wales & West Ltd [2013] EWHC 2665 (TCC) .......12
Parsons Plastics (Research and Development) Ltd v Purac Ltd [2002] EWCA Civ 459,
[2002]BLR 334 ....................................................................................................171
Partner Projects Ltd v Corinthian Nominees Ltd [2011] EWHC 2989 (TCC), [2012]
BLR 97 ................................................................................................................131
Pegram Shopfitters Ltd v Tully Weijl (UK) Ltd [2003] EWCA Civ 1750, [2004] BLR 65 ... 3, 4,
34, 70, 142
Pepper v Hart [1993] AC 593 ................................................................................... 14, 59
Picardi v Cuniberti [2002] EWHC 2923 (TCC);[2003] 1 BLR 487 ..................................34
Pilon Ltd v Breyer Group Ltd [2010] EWHC 837 (TCC), [2010] BLR 452 ............. 110, 113
Pines Living Pty Ltd v O’Brien & Walter Construction Pty Ltd [2013] ACTSC 156 .... 241, 242
Pioneer Cladding Ltd v John Graham Construction Ltd [2013] EWHC 2954 (TCC)............34
Piper Double Glazing v DC Contracts [1994] 1 All ER 177 ..............................................195
Porter v Magill [2002] 2 A.C. 357 ...................................................................................81
Premium Nafta Products Ltd v Fili Shipping Co. Ltd (‘TheFiona Trust’) [2007] UKHL
40 .................................................................................................................. 55, 163
President of India v La Pintada Cia Navegacion SA [1985] A.C. 104 ................................133
Primus Build Ltd v Pompey Centre Ltd [2009] EWHC 1487 (TCC), [2009] BLR 437......103

xxix
 TABLE OF CASES

Pring & St. Hill Ltd v C.J. Hafner (t/a Southern Erectors) [2002] EWHC 1775 (TCC),
(2004) 20 Const. LJ 402 .........................................................................................53
Project Consultancy Group v Trustees of the Gray Trust [1999] BLR 337 ..............153, 157, 177
Quarmby Construction Co. Ltd v Larraby Land Ltd [2003] Adj. C.S. 04/14 ..........................5
Quartzelec Ltd v Honeywood Control Systems Ltd [2008] EWHC 3315 (TCC) ......... 113, 169
Quietfield Ltd v Vascroft Construction Ltd [2006] EWHC 174 (TCC), [2007] BLR
67 ...........................................................................................................88, 140, 164
R. (Factortame) v Secretary of State for Transport [2003] BLR 1 .......................................195
R. (Mount Cook Land Ltd) v Westminster City Council [2003] ECWA Civ 1346 ...............197
R & C Electrical Engineers Ltd v Shaylor Construction Ltd [2012] EWHC 1254 (TCC),
[2012] BLR 373 ...................................................................................................175
R & S Fire & Security Services Ltd v Fire Defence Plc [2012] EWHC 4222 (Ch), [2013]
BLR 500 ..............................................................................................................313
R. G. Carter Ltd v Edmund Nuttall Ltd, 21st June 2000, unreported ............................ 33, 59
R J Neller Building Pty Ltd v Ainsworth [2008] QCA 397, [2009] Qd LR 390..................232
RJT Consulting Engineers Ltd v DM Engineering (N.I.) Ltd [2002] EWCA Civ 270,
[2002] 1 WLR 2344 ............................................................... 3, 23, 45, 270, 271, 275
RSL (South West) Ltd v Stansell Ltd [2003] EWHC 1390 (TCC), [2003] CILL 2012 .....102
Rail Corporation NSW v Nebax Constructions [2012] NSWSC 6 .....................................225
Rainford House Ltd v Cadogan Ltd, [2001] BLR 416 .............................................. 160, 189
Redwing Construction Ltd v Wishart [2011] EWHC 19 (TCC) ........................................194
Redworth Construction Ltd v Brookdale Healthcare Ltd [2006] EWHC 1994 (TCC),
[2006] BLR 366 ...................................................................................................157
Reg. v Bow Street Metropolitan Stipendiary Magistrate, Ex parte Pinochet Ungarte (No. 2)
[2000] 1 A.C. 119 ..................................................................................................81
Re Graham Anstee-Brooke, ex parte Karara Mining Ltd [2013] WASC 59 .........................236
Reiby Street Apartments Pty Ltd v Winterton Constructions Pty Ltd [2006] NSWSC 375 .....220
Reid Minty v Taylor [2002] 1 WLR 2800, C.A................................................................190
Rhode (M) Construction v Markham-David [2006] EWHC 814 (TCC) ............................66
Rhode v Markham-David (No 2) [2007] EWHC 1408 (TCC) ................................... 58, 66
Ridgeway Constructions Ltd v Tolent Construction Ltd [2000] CILL 1662 ..........................271
Riley v the State of Western Australia [2005] WASCA 190 ................................................236
Ringway Infrastructure Services Ltd v Vauxhall Motors Ltd (N0. 2) [2007] EWHC 2507
(TCC) ......................................................................................................... 141, 187
Ritchie Brothers (PWC) Ltd v David Philp (Commercials) Ltd[ 2005] BLR 384 ................. 31,
75, 117, 165
River Plate Products NL BV v Etablissement Coargrain [1982] Lloyds LR 628 ..................122
Roadtek, Department of Main Roads v Davenport & Ors [2006] QSC 47 ..........................232
Roe Brickwork Ltd v Wates Construction Ltd [2013] EWHC 3417 (TCC) .........................154
Rodgers Contracts (Ballynahinch) Ltd v Merex Construction Limited [2012] NIQB 94 ........189
Rok Building Ltd v Bestwood Carpentry Ltd[2010] EWHC 1409 (TCC) ............................24
Rok Building Ltd v Celtic Composting Systems Ltd (No.1) [2009] EWHC 2664 (TCC),
130 Con LR 61 ....................................................................................................124
Rok Building Ltd v Celtic Composting Systems Ltd (No. 2) [2010] EWHC 66 (TCC), 130
Con LR 74 .............................................................................................................24
Rupert Morgan Building Services (LLC) Limited v Jervis [2003] EWCA Civ 1563,
[2004] 1 WLR 1867 ..............................................................................312, 314, 315
Ruttle Plant Hire Ltd v Secretary of State for Environment Food & Rural Affairs (No 3)
[2009] EWCA 97 Civ ...........................................................................................201
SGL Carbon Fibres Ltd v RBG Ltd [2011] Scot CSOH 62 (Lord Glennie) .....................104

xxx
 TABLE OF CASES

SG South Ltd v Kings Head Cirencester LLP [2009] EWHC 2645 (TCC), [2010] BLR
47 .................................................................................................................. 26, 155
SG South Ltd v Swan Yard (Cirencester) Ltd [2010] EWHC 376 (TCC) ............................26
St. Andrews Bay Development Ltd v HBG Management Ltd [2003] Scot CS 103 .............. 117,
120, 127, 165
Samuel Thomas Construction Ltd v Bick & Bick (t/a J & B Developments), unreported,
Exeter County Court, 28 January 2000 ...................................................................20
Saunders, In re, (A Bankrupt) [1997] Ch. 60..................................................................162
Savoye & Savoye Ltd v Spicers Ltd [2014] EWHC 4195 (TCC) ................................. 10, 11
Savoye & Savoye Ltd v Spicers Ltd (No 2) [2015] EWHC 33 (TCC) ..............................196
Seabreeze Manly v Toposu [2014] NSWC 1097 ..............................................................216
Secretary of State for Trade and Industry v Frid [2004] 2 AC 506 ........................................43
Shaw v Massey Foundation & Pilings Ltd [2009] EWHC 493 ................................... 21, 144
Shepherd Construction Ltd v Mecright Ltd [2000] BLR 489 ........................................... 5, 54
Shell Refining (Australia) Pty Ltd v AJ Mayr Engineering [2006] NSWSC 94...................232
Shimizu Europe Ltd v Automajor Ltd [2002] EWHC 1571 (TCC), [2002] BLR 122 ........167
185
Shin Khai Construction Pte Ltd v FL Wong Construction Pte Ltd [2013] SGHCR 4 ............258
Silent Vector Pty Ltd t/a Sizer Builders v Squarcini [2008] WASAR 39.................234, 235, 237
Simons Construction Ltd v Aardvark Developments Ltd [2003] EWHC 2474 (TCC),
[2004] BLR 117 ...................................................................................................118
Sindall Ltd v Solland & Ors (2001) 80 Con LR 152................................................... 47, 50
Skilltech Consulting Services Pty Ltd v Bold NVision Pty Ltd [2013] TASCC 3 ..................247
Solland International Ltd v Daraydan Holdings Ltd [2002] EWHC 220 (TCC); 83 Con
LR 109 ................................................................................................................171
Spark It Up Ltd v Dimac Contractors Ltd HC AK CIV-2008-485-1706 .................... 253, 254
Specialist Ceiling Services Ltd v ZVI Construction (UK) Ltd [2004] BLR, 403 ...................100
Speymill Contracts Ltd v Baskind [2010] EWCA Civ 120, [2010] BLR 257 .....................155
Sprunt Ltd v London Borough of Camden [2011] EWHC 3191 (TCC) ..............................68
Squibb Group Ltd v Vertase FLI Ltd [2012] EWHC 1958 (TCC), [2012] BLR 408 ..........175
Steffanutti Stocks (Pty) Ltd v SB (Pty) Ltd (2088/2013) [2013] ZAGPJHC 24 ................307
Stein v Blake [1996] A.C. 243 H.L. (E.) ............................................................42, 43, 159
Strathmore Building Services Ltd v Greig [2000] ScotsCS 133, 17 Const. LJ 72 ................312
Straume, A., (U.K.) Ltd v Bradlor Developments Ltd [2001] TCLR 409, [2000] B.C.C.
333 .................................................................................................................. 40, 41
Straw Realisations (No 1) Ltd (formerly known as Haymills (Contractors) Ltd (in
administration)) v Shaftsbury House (Developments) Ltd [2010] EWHC 2597 (TCC),
[2011] BLR 47.............................................................................................. 161, 189
Supablast (Nationwide) Ltd v Story Rail Ltd [2010] EWHC 56 (TCC), [2010] BLR 211 ....6
Sykes, (F. & G.), (Wessex) Ltd v Fine Fare Ltd [1967] 1 Lloyd’s Rep. 53 ............................46
Tayler v LaHatte HC AK CIV-404-6843 .......................................................................253
Testro Bros. Consolidated Ltd, In re. [1965] VR. 18 ...........................................................162
Thameside Construction Co. Ltd v Stevens [2013] EWHC 2071 (TCC) ............................175
Thermal Energy Construction Ltd v A E & E Lentjes UK Ltd [2009] EWHC 408
(TCC) ..................................................................................................114, 122, 169
Thiess Pty Ltd v MCC Mining (WA) Pty Ltd [2011] WASC 80........................................237
Thiess Pty Ltd v Warren Brothers Earthmoving Pty Ltd [2012] QCA 276 ...........................231
Thomas Vale Construction v Brookside Syston Ltd [2006] EWHC 3637..............................312
Thomas-Fredric’s (Construction) Ltd v Wilson [2003] EWCA Civ 1494, [2004] BLR 23.......3,
66, 158, 178

xxxi
 TABLE OF CASES

Three Rivers D.C. v Bank of England (no.3) [2003] 2 A.C. 1 ...........................................153

Tim Bultler Contractors Ltd v Merewood Homes Ltd (2002) 18 Const LJ 74 ......................308
Timwin Construction Pty Ltd v Façade Innovations Pty Ltd [2005] NSWSC 548 ...............220
Total M and E Services Ltd v .ABB Building Technologies Ltd [2002] EWHC 248 (TCC),
(2002) 87 Con LR 154 ................................................................................. 135, 168
Towsey v Highgrove Homes Ltd [2012] EWHC 2644 (Ch), [2013] BLR 45......................147
Transgrid v Siemens Ltd (2004) 61 NSWLR 521 .............................................219, 220, 235
Treasure & Son Ltd v Dawes [2007] EWHC 2420 (TCC), [2008] BLR 24 ............... 26, 121
Trustees of the Stratfield Saye Estate vv AHL Construction [2004] EWHC 3286 (TCC),
[2004] All ER (D) 77 .............................................................................................23
Trustor AB -v- Barclays Bank plc & Anr. Times Law Reports, November 22nd, 2000 ......151
Try Construction Ltd vv Eton Town House Group Ltd [2003] EWHC 60 (TCC), [2003]
BLR 286 ..............................................................................................................102
Trysams Pty Ltd v Club Constructions (NSW) Pty Ltd [2007] NSWSC 941 ..............217, 219,
221, 235, 236
TSG Building Services Plc. vv South Anglia Housing Ltd [2013] EWHC 1151 (TCC)........52,
162, 202
Tubular Holdings (Pty) Ltd vv DBT Technologies (Pty) Ltd (06757/2013) [2013]
ZAGPJHC 155.....................................................................................................307
Twintec Ltd vv Volkerfitzpatrick Ltd [2014] EWHC 10 (TCC) ..............................32, 70, 201
UDA Holdings Berhad v Bisraya Construction Sdn Bhd (Originating Summons No: 24C-
6-09/2014 ............................................................................................................262
University of Brighton vv Dovehouse Interiors Ltd [2014] EWHC 940 (TCC) ............... 58, 66
Vaultrise Ltd v Cook [2004] Adj CS 04/06 .....................................................................321
Venture Marine & Civil Bauer Joint and Leighton Kumagai Joint Venture [2005] WASAT
269 ......................................................................................................................237
Vertase FLI Ltd v Squibb Group Ltd [2012] EWHC 3194 (TCC) ......................................90
VGC Construction Ltd v Jackson Civil Engineering Ltd [2008] EWHC 2082 (TCC), 120
Con LR 178 ...........................................................................................................51
VHE Construction PLC v RBSTB Trust Co Ltd [2000] BLR 187 .....................................170
Veena SA v Cheong [2003] 1 EGLR 175 .......................................................................320
Viridis U.K. Ltd vv Mulalley & Co. Ltd [2014] EWHC 268 (TCC).....................................7
Vision Homes Ltd vv Lancsville Construction Ltd [2009] EWHC 2042 (TCC), [2009]
BLR 525 ........................................................................................................ 65, 122
Vitpol Building Service v Samen [2008] EWHC 2283 (TCC) .........................................199
Volker Stevin Ltd vv Holystone Contracts Ltd [2010] EWHC 2344 (TCC) ........................100
Wales And West Utilities Ltd v PPS Pipeline Systems GmbH [2014] EWHC 54 (TCC)........184
Walker Construction (U.K.) Limited v Quayside Homes Ltd [2014] EWCA Civ 93, [2014]
BLR 215 ...............................................................................................140, 207, 209
Watpac Constructions NSW Pty Ltd v Austin Corp Pty Ltd (No.1) [2010] NSWSC 168
.................................................................................................................... 222, 223
Watpac Constructions NSW Pty Ltd v Austin Corp Pty Ltd (No.2) [2010] NSWSC 347 .....224
Wates Construction Ltd v HGP Greentree Allchurch Evans Ltd [2005] EWHC 2174
(TCC), 2006 BLR 45 ...........................................................................................191
Wealands v CLC Contractors Ltd (1999) 74 Con LR 1 ....................................................133
West Country Renovations Ltd v McDowell [2012] EWHC 307 (TCC), [2012] BLR 255,
257 ......................................................................................................................147
Westfields Construction Ltd v Lewis [2013] EWHC 376 .....................................................21
Westminster Building Co. Ltd v Beckingham [2004] BLR 163 ......................................... 5, 35
Westminster Chemicals & Produce Ltd v Eischolz & Loeser [1954] 1 L.L.R. 99...................177

xxxii
 TABLE OF CASES

Westshield Ltd v Whitehouse [2013] EWHC 3576 (TCC), [2014] CILL 3457 ............ 43, 160
Whiteways Contractors (Sussex) Ltd v Impresa Castelli Construction UK Ltd (2000) 75
Con LR 92 ...........................................................................................................177
Whyte & Mackay Ltd vv Blyth & Blyth Consulting Engineers Ltd [2013] CSOH 54 .... 39, 122
William Hare Ltd v Shepherd Construction Ltd [2010] EWCA Civ 283, [2010] BLR
358 ......................................................................................................................270
William Verry (Glazing Systems) Ltd v Furlong Homes Ltd [2005] EWHC 138 (TCC) ........63
William Verry Ltd v The Mayor and Burgesses of the London Borough of Camden [2006]
EWHC 761 (TCC) ..............................................................................................172
William Verry Ltd v North West London Communal Mikvah [2004] EWHC 1300 (TCC),
[2004] BLR 308 .....................................................................................................76
Willis Trust Co Ltd v Green HC AK CIV-2006-404-809 [2006] NZHC 571 3 ..250, 252, 253
Willmott Dixon Housing Ltd v Newlon Housing Trust [2013] EWHC 798 (TCC), [2013]
BLR 325 ................................................................................................................53
Wimbledon Construction Co 2000 Ltd v Derek Vago [2005] EWHC 1086 (TCC), [2005]
BLR 374 ..............................................................................................................188
Windglass Windows Ltd v Capital Skyline Ltd [2009] EWHC 2022 (TCC).......................312
Witham v Raminea Pty Ltd [2012] WADC 1..................................................................238
Witney Town Council v Beam Construction (Cheltenham) Ltd [2011] EWHC 2332
(TCC), [2011] BLR 707 ........................................................................................53
Woods Hardwick Ltd v Chiltern Air-Conditioning Ltd [2001] BLR 23.......................... 98, 165
Working Environments Ltd v Greencoat Construction Ltd [2012] EWHC 1039 (TCC) .......194
WW Gear Construction Ltd V McGee Group Ltd [2012] 1509 (TCC), [2012] BLR 355 ....200
YCMS Ltd, v Grabiner [2009] EWHC 127 (TCC), [2009] BLR 211 .............................137
Yuanda (UK) Co. Ltd v WW Gear Construction Ltd [2010] EWHC 720 (TCC), [2010]
BLR 435 ...................................................................................32, 33, 133, 135, 271
Yule, A.C., & Son Ltd v Speedwell Roofing & Cladding Ltd [2007] EWHC 1360 (TCC),
[2007] BLR 499 ...................................................................................................115

xxxiii
This page has been left blank intentionally
 TABL E OF STATUTES
Arbitration Act 1996 .............. 46, 110, 133,
269, 279
s 7 ...................................................... 55
s 9 .............................................144, 152
s 14 .............................................. 56, 57
s 28(1) ............................................... 72
s 29 .................................................. 271
s 42 .................................xxxiii, 145, 287
s 57 .................................................. 136
s 68(2)(f) .......................................... 122
s 73 .................................................. 179
Banking and Financial Dealings Act 1971.. 62
Bankruptcy (Scotland) Act 1985
s 12 .................................................. 317
Construction Contracts Act 2004
(Isle of Man) ............................. 4, 210
Construction Contracts Act 2013
(Republic of Ireland)
s 1(1) ............................................... 210
s 1(2) ............................................... 210
s 2(1) ............................................... 210
s 2(3) ............................................... 210
s 3(3) ............................................... 210
s 3(4) ............................................... 211
s 3(5) ............................................... 211
s 6(1) ............................................... 211
s 6(11) ............................................. 211
s 6(3)–(4) ......................................... 211
s 6(8) ............................................... 211
s 7(1) ............................................... 211
s 8(2) ............................................... 211
s 8(3) ............................................... 211
s 12 .................................................. 210
Construction Contracts
(Amendment) Act (NI) 2011 .............4
s 9 ........................................................4
xxxv
Contracts (Rights of Third Parties)
Act 1999
s 1(4) ......................................43, 45, 46
s 8 ................................................ 43, 46
s 8(1) ................................................. 46
s 8(2) ................................................. 46
Education Act 1996
s 31 .................................................... 28
Employment Rights Act 1996 ................. 20
Enterprise Act 2002 ............................. 270
s 248(4)............................................ 317
s 277 ................................................ 317
Sch 16 .............................................. 317
Exchequer and Audit Departments
Act 1866 ......................................... 27
Highways Act 1980
s 278 .................................................. 27
s 38 .................................................... 27
Housing Grants, Construction and
Regeneration Act 1996 ................xxxi,
xxxii, 15, 20, 21, 24, 31, 32, 61,
63, 80, 110, 114, 118–121, 130,
134–137, 141, 144, 147, 151, 154,
159, 188, 190–191, 202–203, 210,
267–269, 272, 276–279, 283, 290–
291, 294, 315
Part II ..............1, 1–5, 11, 17, 20, 22, 25,
26, 27, 29, 30, 44, 45, 48, 54, 56,
62, 84, 86, 120, 127, 140, 157, 163,
275, 284, 288, 312
s 104 ..................................... 13, 44, 157
s 104(1)...................................5, 45, 156
s 104(1)(b) ......................................... 20
s 104(2)................................. 5, 7, 19, 45
s 104(2)(a) ................................... 19, 20
s 104(2)(b) ......................................... 19
 TABLE OF STATUTES
s 104(3) ................................................. 20
s 104(4)................................................7
s 104(5).......................................... 7, 17
s 104(6)............................................ 157
s 104(6)(a) ......................................... 20
s 104(6)(b) ..................................... 3, 20
s 104(7)................................................3
s 105 ................................. 14, 16, 18, 19
s 105(1)..................... 7, 8, 12, 13, 14, 17,
195
s 105(1)(a)–(c) ................................... 10
s 105(1)(a) .......................... 9, 10, 11, 16
s 105(1)(b) ................................... 10, 16
s 105(1)(c) ...........................................9
s 105(1)(d) ......................................... 10
s 105(1)(e) ......................................... 10
s 105(2)................ 5, 8, 12, 13, 14, 16, 17
s 105(2)(a)–(d) ................................... 13
s 105(2)(a) ......................................... 12
s 105(2)(b) ......................................... 12
s 105(2)(c) ..............................12, 14, 17
s 105(2)(c)(i) ...................................... 18
s 105(2)(c)(ii) ............................... 14, 18
s 105(2)(d) ................................... 12, 17
s 105(2)(e) ......................................... 12
s 105(3)................................................9
s 106 .......................................... 44, 157
s 106(1)(a) ...................... 5, 20, 270, 288
s 106(1)(b) ............................ 22, 27, 270
s 106(2).............................................. 20
s 106(3).............................................. 22
s 106(4).............................................. 22
s 106A ........................3, 29, 45, 157, 284
s 107 ............23, 24, 25, 26, 44, 270, 273,
275, 283, 284
s 107(1)......................5, 22, 23, 157, 275
s 107(2)........................................ 22, 26
s 107(2)(c) ......................................... 22
s 107(3)........................................ 22, 23
s 107(4).............................................. 25
s 107(5)...................................23, 25, 26
s 107(6).............................................. 25
s 108 ............1, 32, 40, 45, 54, 55, 56, 68,
70, 77, 79, 89, 127, 171, 204, 271,
283, 284, 288, 293
s 108(1)–(4) ....................................... 31
s 108(1)............. 1, 30, 44, 46, 48, 51, 53,
54, 56, 62, 156, 157, 162, 163,
166, 271, 288
s 108(1)(a)–(b) ................................... 64
xxxvi
s 108(2)................. 26, 30, 56, 60, 62, 67,
84, 96
s 108(2)(a) ......................................... 54
s 108(2)(b) ...................70, 74, 75, 76, 77
s 108(2)(c) ..................31, 62, 73, 75, 76,
116
s 108(2)(d) ................................... 31, 62
s 108(2)(e) ...................... 59, 62, 94, 142
s 108(2)(f) .................................. 97, 142
s 108(3)..........4, 30, 61, 88, 89, 140, 142,
143, 156, 157, 206, 207
s 108(3A) ............................ 30, 138, 285
s 108(4)...................................30, 74, 96
s 108(5)............30, 31, 52, 53, 57, 65, 68,
75, 138, 140, 280, 288, 293
s 108(6)............................................ 285
s 108A .......................................136, 285
s 108A(2) .......................... 284, 286, 287
s 109(1)............................................ 308
s 109(2)............................................ 308
s 109(3)............................................ 308
s 110(1)............................................ 308
s 110(2)............................................ 312
s 110(3)............................................ 309
s 110(6)............................................ 309
s 110A(1) ..................................309, 312
s 110A(2)(a) ..................................... 309
s 110A(2)(b)..................................... 310
s 110A(3) ......................................... 310
s 110A(4) ......................................... 310
s 110A(5) ......................................... 310
s 110B(1) ......................................... 310
s 110B(3) ......................................... 310
s 110B(4) ......................................... 311
s 111 ................................. 171, 312, 316
s 111(1)............................. 311, 312, 313
s 111(1A) ......................................... 316
s 111(1B) ......................................... 316
s 111(2)............................................ 312
s 111(2)(a) ....................................... 312
s 111(2)(b) ....................................... 312
s 111(2)(c) ....................................... 312
s 111(3)............................................ 312
s 111(4)............................................ 312
s 111(5)............................................ 313
s 111(6)............................................ 313
s 111(7)............................................ 313
s 111(9)............................................ 286
s 111(10) .......................................... 316
s 112(1)............................................ 320
 TABLE OF STATUTES
s 112(2)............................................ 320
s 112(3)............................................ 320
s 112(3A) ......................................... 320
s 112(4)............................................ 320
s 113 .......................................... 28, 270
s 113(1).....................................270, 316
s 113(2)............................................ 317
s 113(3)............................................ 317
s 113(4)............................................ 317
s 113(5)............................................ 317
s 113(6)............................................ 317
s 114 ................................................ 285
s 114(4).........................32, 77, 134, 176,
286
s 115 .......................................... 56, 312
s 115(1)...................................56, 58, 84
s 115(2).............................................. 58
s 115(2)–(4) ....................................... 84
s 115(3).............................................. 58
s 115(4).............................................. 58
s 115(5).............................................. 84
s 115(6)......................... 56, 84, 120, 312
s 146(1)...................................... 27, 285
s 146(2)............................................ 285
s 149 ....................................................4
Human Rights Act 1998 ....................... 170
s 1(1) ................................................. 37
s 2(1) ................................................. 37
s 3(1) ................................................. 37
s 3(2) ................................................. 37
s 4(2) ................................................. 37
s 4(6) ................................................. 37
s 6(1) ........................................... 37, 38
s 6(2) ........................................... 37, 38
s 7 ...................................................... 39
s 7(1) ........................................... 37, 38
Sch 1, art 6(1) .................................... 37
Insolvency Act 1986 ....................... 43, 150
Part II .............................................. 270
Part III, Chapters I-II........................ 316
Parts IV-V ........................................ 317
Parts VIII–XI .................................... 150
Part IX ............................................. 317
s 5 .................................................... 159
s 11(3)(c) ........................................... 40
s 11(3)(d) ........................................... 40
s 89 .................................................. 317
s 111 ................................................ 146
s 126(1).............................................. 41
xxxvii
s 130(2).............................................. 41
s 268 ................................................ 146
s 411(2)............................................ 158
s 420 ................................................ 317
Sch 8, para 12 ................................... 158
Sch B1 .............................. 270, 316, 317
Interpretation Act 1978 ...................... xxxiv
ss 5–6 ......................................... 52, 162
s 5 ...................................................... 27
Sch I .................................................. 27
Landlord and Tenant Act 1985
s 20 .................................................. 320
Late Payment of Commercial Debts
(Interest) Act 1998
s 1(1) ............................................... 133
s 1(2) ............................................... 133
s 2(1) ............................................... 133
s 3(1) ............................................... 133
s 5A(1) ............................................. 136
s 5A(2A) .......................................... 136
s 6(1) ............................................... 133
s 8(2) ............................................... 133
s 11 .................................................. 133
Law of Property Act 1925 ....................... 42
Legislative and Regulatory Reform
Act 2006 ....................................... 274
Local Democracy, Economic
Development and Construction
Act 2009 ................1, 28, 29, 135, 157,
289
Part 8 ........................................3, 4, 283
s 138 .........................................3, 29, 44
s 138(3)............................................ 284
s 139 ..........................22, 25, 26, 30, 157
s 139(1)............................................ 284
s 139(2)............................................ 284
s 140 ................................... 30, 138, 285
s 141 ................................. 136, 284, 285
s 142 ................................................ 309
s 142(2).....................................309, 316
s 143 ................................. 309, 310, 311
s 143(3)............................. 309, 310, 311
s 144 ................................ 311, 312, 313,
316
s 144(1)............................. 311, 312, 313
s 144(2)(a) ....................................... 320
s 144(2)(b) ....................................... 320
s 144(11) .......................................... 316
s 145 ................................................ 320
 TABLE OF STATUTES

s 145(2)............................................ 320 Senior Courts Act 1981

s 145(3)............................................ 320
s 145(4)............................................ 320
s 149(1)............................................ 284
s 149(2)............................................ 284
Misrepresentation Act 1967 .................... 55
s 2(1) ................................................. 56
National Audit Act 1983 ......................... 28
National Health Service (Private
Finance) Act 1997
s 1 ...................................................... 27
s 35A(1) ........................................... 187
s 37 .................................................. 145
Third Parties (Rights against
Insurers) Act 1930 ......................... 153
Town and Country Planning Act 1990
s 106 .................................................. 27
s 106A ................................................ 27
s 299A ................................................ 27
Water Industry Act 1991
s 104 .................................................. 27

xxxviii
 TABLE OF S TAT UTORY INSTRUM ENTS
Civil Procedure Rules 1998 (SI 1998
No 3132) ...............................194, 205
Part 1 ............................................... 154
r 1.1 ................................................. 198
Part 6
r 6.19(1)(b) ...................................... 150
Part 7 ............................................... 147
Part 8 ............................... 147, 150, 199,
201
Part 23
PD 23, para 6.5 .................................. 98
Part 24 ......................................148, 193
r 24.2 ........................................159, 178
Part 31
r 31.16 ............................................. 203
Part 44
r 44.4 ............................................... 195
r 44.4(3) ........................................... 195
Part 45 ......................................192, 193
r 45.1 ............................................... 192
r 45.2(b) ........................................... 192
r 45.3 ............................................... 192
Part 60
PD 60, para 2.1 ................................ 147
PD 60, para 3.2 ................................ 148
PD 60, para 3.3 ................................ 147
PD 60, para 3.4 ................................ 147
Part 70 ............................................. 196
Part 73
r 73.1(1) ........................................... 197
r 73.3(2) ........................................... 197
r 73.4(1) ........................................... 197
r 73.4(2) ........................................... 197
r 73.8(2) ........................................... 197
r 73.10(1) ......................................... 197
r 73.10(2) ......................................... 197
PD 73, para 4.2 ................................ 197
xxxix
Construction Contracts (2011 Act)
(Commencement) Order (Northern
Ireland) (SR 2012 No 367 (C 34))
para 2 ........................................... 4, 284
Construction Contracts Act 2013
(Code of Practice) (Adjudication)
Order 2014 (SI 2014 No XXX) ..... 211
Construction Contracts (England and
Wales) Exclusion Order 1998 (SI
1998 No 648)
art 3 ................................................... 27
art 4(1)............................................... 27
art 4(2)............................................... 27
art 4(2)(a) .......................................... 27
art 4(2)(b) .......................................... 27
art 4(2)(c) .......................................... 28
art 5(1)............................................... 28
art 5(2)............................................... 28
art 6(1)............................................... 29
art 6(2)............................................... 29
art 6(3)............................................... 29
para 4 ............................................... 270
Construction Contracts Exclusion
(England) Order 2011 (SI 2011
No 2332)
arts 3–4 ...................................... 28, 284
Construction Contracts Exclusion
Order (Northern Ireland) 1999
(SR 1999 No 33)...............................4
Construction Contracts Exclusion
Order (Northern Ireland) 2012
(SR 2012 No 366) .............................4
Construction Contracts (Northern
Ireland) Order 1997 (1997 No
274 (NI 1) ........................................4
Construction Contracts (Scotland)
Exclusion Order 1998 (SI 1998
No 686 (S33))...................................3
 TABLE OF STATUTORY INSTRUMENTS
Construction Contracts (Scotland)
Exclusion Order 2011 (SSI 2011
No 370) ............................................3
Enterprise Act 2002 (Insolvency)
Order 2003 (SI 2003 No 2096)...... 270
arts 4, 6 ............................................ 317
Insolvency Rules 1986 (SI 1986 No 1925)
r 4.90 .........................158, 159, 160, 161
Late Payment of Commercial Debts
Regulations 2002 (SI 2002 No 1674)
para 2(4) .......................................... 136
Late Payment of Commercial Debts
Regulations 2013 (SI 2013 No 395)
para 3 ............................................... 136
Local Democracy, Economic
Development and Construction
Act 2009 (Commencement No
2) (England) Order 2011 (SI
2011 No 1582)
para 2 ........................................... 3, 284
Local Democracy, Economic
Development and Construction
Act 2009 (Commencement No
2) (Scotland) Order 2011 (SI
2011 No 291)
para 2 ........................................... 3, 284
Local Democracy, Economic
Development and Construction Act 2009
(Commencement No 2) (Wales) Order
2011 (SI 2011 No 1597 (W 185))
para 3 ........................................... 3, 284
Rules of the Supreme Court (SI 1965
No 1776)
Order 46 .......................................... 196
r 1(1)(a) ........................................... 188
Scheme for Construction Contracts
(England and Wales) Regulations
1998 (SI 1998 No 649) ...........86, 154,
166, 176, 267, 275, 285, 308, 309,
Appendix B
Schedule, Part I
para 1 ............................................. 79
para 1(1) ................................. 65, 285
para 1(2) ......................................... 65
para 1(3) ................................. 57, 130
xl
para 2 ............................................. 67
para 2(1) ................................... 65, 68
para 2(1)(a)..................................... 67
para 2(3) ................................... 68, 80
para 3 ............................................. 68
para 4 ..................................67, 80, 94
para 5 ....................................... 68, 69
para 6 ............................................. 69
para 7 ..................................74, 77, 85
para 7(3) ................................268, 285
para 8 ............................................. 87
para 8(1) ......................................... 52
para 8(2) ......................................... 52
para 8(4) ....................................... 128
para 9 ....................................... 88, 89
para 9(1) ....................................... 128
para 9(2) ............................ 89, 90, 128
para 9(4 .......................... 89, 128, 286
para 10 ........................................... 82
para 11 ..................................128, 277
para 11(1) ........................ 83, 129, 286
para 11(2) ..................................... 129
para 1 ............................................ 96
para 12(a) ...............126, 127, 133, 142
para 12(b) ..................................... 124
para 13 .....................97, 142, 268, 269
para 13(h) ..................................... 134
para 15(b) ..................................... 286
para 17 ........................ 79, 94, 97, 268
para 19 .....................84, 116, 118, 126
para 19(1 ..................................... 286
para 19(1)(a) ................................. 119
para 19(2) ..................................... 119
para 19(3) ..............................120, 127
para 20 ................................... 97, 130
para 20(a) ..................................... 131
para 20(b) ..............................131, 286
para 20(c) ..............................131, 132
para 21 ..................................286, 287
para 22 ...................121, 122, 126, 269
para 22A ....................................... 287
para 22A(1) .................................. 138
para 22A(2) .................................. 138
para 22A(3) .................................. 139
para 22A(4) .................................. 139
paras 23–24................................... 145
para 23 ..................................... 88, 89
para 23(1) ..............................142, 143
para 23(2) ...............140, 142, 143, 208
para 24 ......................................... 287
 TABLE OF STATUTORY INSTRUMENTS
para 25 .................. 124, 125, 128, 278, 287
para 26 ......................................... 129
Schedule, Part II
para 2(2) ....................................... 318
para 2(3) ....................................... 318
para 2(4) ....................................... 318
para 4 ........................................... 318
para 5 ........................................... 318
para 6 ........................................... 318
para 7 ........................................... 318
para 8 ........................................... 318
para 9(1), (2) ................................ 319
para 9(4) ....................................... 319
para 10 ......................................... 319
para 11 ......................................... 319
para 12 ......................................... 318
Scheme for Construction Contracts
(England and Wales) Regulations
1998 (Amendment) (England)
Regulations 2011 (SI 2011 No
2333) .......... 76, 84, 116, 285, 318, 319
reg 1 ................................................. 285
reg 3(2) ............................................ 285
reg 3(3) ............................................ 285
reg 3(4) ............................................ 286
reg 3(5) ............................................ 286
reg 3(6) ............................................ 286
reg 3(7) ............................................ 286
reg 3(8) ............................................ 286
reg 3(9) ............................................ 286
reg 3(10) ...................................138, 287
reg 3(11) .......................................... 287
reg 3(12) .......................................... 287
xli
reg 3(13) .......................................... 287
Scheme for Construction Contracts
(England and Wales) Regulations
1998 (Amendment) (Wales)
Regulations 2011 (SI 2011 No
1715 (W 194)) .......................318, 319
Scheme for Construction Contracts in
Northern Ireland (Amendment)
Regulations (Northern Ireland)
2012 (SR 2012 No 365) ....................4
Scheme for Construction Contracts
in Northern Ireland Regulations
(Northern Ireland) 1999 (SR
1999 No 32) .....................................4
Scheme for Construction Contracts
(Scotland) Amendment
Regulations 2011 (SSI 2011 No
371) ..................................................3
Scheme for Construction Contracts
(Scotland) Regulations 1998 (SI
1998 687 (S34)) ................................3
Unfair Terms in Consumer Contracts
Regulations 1994 (SI 1994 No3159)
reg 4(1) .............................................. 35
reg 5(1) .............................................. 35
Sch 2 .................................................. 35
Unfair Terms in Consumer Contracts
Regulations 1999 (SI 1999 No
2083)
reg 5(1) ...................................34, 35, 36
reg 5(2) .............................................. 36
reg 6(1) .............................................. 34
This page has been left blank intentionally
 Introduction – the adjudication process

‘Adjudication should not become a game of chess in which the tactical skill of the players deter-
mines the outcome.’
Jackson J, Midland Expressway Ltd v Carillion Construction Ltd (No 3)1

About this book

This book is intended to provide guidance to all concerned with construction
adjudication by gathering together from various sources but, in particular, the case
law, information about that process. An attempt has been made to provide authority
for (nearly) every proposition, so that the reader will be able to find and assess the
strength of it by reference to the source.

About adjudication generally

Adjudication is a short form of dispute resolution introduced by statutory interven-
tion in the form of Part II of the Housing Grants, Construction and Regeneration
Act 1996, but the relevant legislation is merely part of the picture. In dealing with
the consequences of adjudication decisions, the courts have had to analyse the statu-
tory provisions, devise procedures and develop the law on a case-by-case basis. This
organic process has resulted in some unexpected developments and a number of
complications, which are set out in the main text. It may be helpful, however, to give
an overview of adjudication and its development by way of explanation of some of
the more involved points dealt with.

Where adjudication fits in

Payment under construction contracts

The key to understanding adjudication and the way in which the case law has
developed is to realise that it is intended to be a check or balance on a more radical
part of the statutory intervention, namely the abolition of the common law defence
of abatement or the equitable remedy of set-off except where a stringent notice
procedure is complied with. This in turn forms part of a payment regime imposed

1 [2006] EWHC 1505 (TCC), [2006] BLR 325 [105].

xliii
 INTRODUCTION

by the legislation. Under that regime, which is implied into contracts not containing
compliant provisions, the paying party is obliged to make periodic payment of sums
certified by a contract administrator or notified by the receiving party.

The position at common law

At common law, the paying party would be entitled to abate that part of the contract
price on the grounds of the receiving party’s breach (in addition to equitable rights
of set-off) in accordance with the rule in Model v Steel.2 The reason for this was that
although it would clearly be unfair if, for any inadequate reasons, the payments
were not made to the receiving party because its outpourings of money would be
continuing, equally it would be unfair if failure to adhere to contractual obligations
as to the work to be done should under no circumstances in any way affect its right
to receive interim payments.3 Bona fide claims to set off were very often disputed
by claimants. In such cases, the courts had no power to say to defendants: ‘Pay up
now and litigate or arbitrate the dispute later.’ This would have been to emasculate
the right of set-off. The dispute was resolved according to law in litigation or arbitra-
tion; in the meantime the status quo was preserved.4 So when one was concerned
with a construction contract one started with the presumption that each party was
to be entitled to all those remedies for its breach as would arise by operation of law,
including the remedy of setting up a breach of warranty in diminution or extinction
of the price of material supplied or work executed under the contract. To rebut that
presumption one had to be able to find in the contract clear unequivocal words in
which the parties had expressed their agreement that this remedy should not be
available in respect of breaches of that particular contract.5

The position under the 1996 Act

The effect of Part II of the 1996 Act was to rebut that presumption by the
imposition of a procedural device, namely a requirement for the paying party to
give notice of deductions to the receiving party before the relevant sum became
finally due. The right of set-off was not entirely emasculated, because the paying
party could make a deduction if it had given the appropriate notice. But how was
a dispute as to the deduction to be resolved so as not to allow the progress of the
works to be affected? The Act incorporated a solution used in standard forms of
subcontract, known as ‘adjudication’, whereby a third party decided the matter on
a temporary basis.

2 (1841) 8 M & W 858.

3 Modern Engineering (Bristol) Ltd v Gilbert-Ash (Northern) Ltd [1974] AC 689, 699F–G (Lord Morris
of Borth y Gest).
4 Modern Engineering (Bristol) Ltd v Gilbert-Ash (Northern) Ltd [1974] AC 689, 726D (Lord
Salmon).
5 Modern Engineering (Bristol) Ltd v Gilbert-Ash (Northern) Ltd [1974] AC 689, 718E (Lord Diplock).

xliv
 INTRODUCTION

The development of the Law

Gaps in the legislation

The statutory provisions, although providing for resolution of disputes on a temp-
orary basis, had little to say about the consequences of a decision by an adjudicator
other than to say that it would be binding on the parties unless and until revised in
arbitration or litigation. The subordinate legislation contained a provision that the
adjudicator could order any of the parties to comply peremptorily with the deci-
sion or any part of it, and the court could make an order under section 42 of the
Arbitration Act 1996 requiring a party to comply with a peremptory order made
by an adjudicator. There was some confusion initially as to the nature of adjudica-
tion and the appropriate method of its enforcement. It became clear that adjudi-
cation was sui generis and not a form of arbitration or expert determination in the
conventional sense of either of those procedures.

Enforcement and challenges

There were two strands in the development of the law, namely the enforcement of
and challenges to decisions. It was established early on as a result of the seminal
judgment of Dyson J in Macob Civil Engineering Ltd v Morrison Construction Ltd,6
that the appropriate method of enforcement was that of summary judgment in the
Technology and Construction Court (TCC) and not by way of mandatory injunc-
tion or use of the Arbitration Act provision. A special procedure was devised by the
TCC to permit the swift disposal of claims by successful parties in adjudications.
The law relating to challenges developed more slowly. A party who contended that
an adjudication should not proceed could obtain an injunction to prevent that hap-
pening, but it was not clear what options were open to an unsuccessful party once a
decision had been made.

Challenge procedures
The legislation conferred no right of appeal on an unsuccessful party to an adjudi-
cation. There would, however, inevitably be circumstances where the court would
need to intervene, most particularly in relation to jurisdiction and natural justice.
The question was whether this would be achieved by judicial review or in some
other way. Perhaps surprisingly, judicial review never seems to have been seriously
raised as an option and the courts have been content to proceed on the basis that
challenges can be raised by way of defence to summary judgment applications.
This was probably a pragmatic solution: unsuccessful parties would refuse to pay
as required by the decision and successful parties would then apply for summary
judgment, at which point the court could consider the merits of the challenge.

6 [1999] BLR 93.

xlv
 INTRODUCTION

Effect on development of law

The process whereby the courts had to deal with challenges as and when they arose
explains the superficially byzantine appearance of the law relating to adjudication.
To take one example, it was decided at an early stage that because the statute
referred to ‘a dispute’, an adjudicator could not deal with more than one dispute in
the same adjudication without the agreement of the parties. This led to attempts to
explain what constituted a dispute rather than the issues within the dispute and the
current tendency for the courts to take a ‘robust’ approach to such matters. It may
now be too late to point out that application of the provisions of the Interpretation
Act 1978 (whereby the singular is deemed to include the plural) might well have
avoided the definitional contortions involved in the first place. The courts were also
faced with a more fundamental problem which has perhaps not been satisfactorily
resolved, which is what to do about errors in decisions.

Errors
Everybody makes mistakes and adjudicators may well be in greater danger than
most of doing so because of the tight time limit of 28 days imposed on the adjudica-
tion process. At the same time, the courts have had to bear in mind the underly-
ing purpose of the legislation to emasculate the right of set-off. This has led to
an uncomfortable compromise, whereby adjudicators’ decisions are subject to the
same rule as expert determinations: that of the necessity of asking the right question
as opposed to the permission to give the wrong answer. This avoids the difficulties
posed by arbitration appeals where a distinction has to be made between questions
of law (right of appeal) and questions of fact (no right of appeal). It does, however,
lead to the enforcement of decisions that are wrong in either law or fact, or both.
This result has been slightly mitigated by judicial and then statutory intervention
permitting an adjudicator to correct clerical errors under the equivalent of the ‘slip
rule’ in arbitration.

Natural justice
The subordinate legislation provided that an adjudicator was obliged to act impar-
tially and a number of decisions established that the rules of natural justice applied
to adjudication. The underlying purpose of the legislation combined with the tight
timetable imposed has, however, meant that the courts have taken a robust approach
to challenges on the basis of alleged breaches of natural justice. Such breaches are
permissible if they are not ‘material’ and would have had no effect on the outcome.

Jurisdictional challenges
From the start, the courts recognised that an adjudicator could not make an effec-
tive decision if he or she had no jurisdiction to do so. Unsuccessful parties were
quick to seize the opportunity to avoid payment by employing such challenges and
were remarkably inventive in doing so. The courts have deployed various methods

xlvi
 INTRODUCTION

to keep such challenges within bounds, such as waiver or approbation of a decision,

as well as severance and enforcement of part of a decision. It is this area, above all,
that has led to the ‘chess board’ approach dealt with below.

The chess board of adjudication

Procedural pitfalls
Despite the stricture of Jackson LJ set out at the head of this introduction above,
there can be no escaping the fact that the adjudication process has many similarities
to chess, particularly clock chess. The parties must deploy their pieces in accord-
ance with prescribed moves within prescribed periods of time. This process begins
before the adjudication. The initial and most far-reaching move is the service of the
notice allowing a paying party to even be in the position of raising an entitlement
to a deduction from sums otherwise due. Experienced paying parties are also often
adept at avoiding a clear rejection of a claim in correspondence in order to argue
at a later stage that no dispute had arisen between the parties before service of the
notice of adjudication, thus depriving an appointed adjudicator of jurisdiction.
Then, if the notice of adjudication (provided that it has been served in accord-
ance with the statutory or contractual rules) refers to more than one dispute, the
responding party will again say that there can be no jurisdiction. Other traps for the
unwary referring party are applying for the appointment of an adjudicator before
service of the notice of adjudication or failing to serve the referral notice within the
prescribed period.

Reservation of position
As stated above, the worst excesses have been avoided by the courts’ adoption of a
sensible approach where the responding party has been inconsistent in its attitude
to the process. Thus a party that has waived a jurisdictional challenge or approbated
a decision will not be able to resist enforcement. The tactics developed to overcome
this difficulty were, first, the specific reservation of position and, subsequently, the
general reservation of position. By these means the responding party can have its
cake and eat it. The referring party may press on in the hope that there is no valid
challenge, but the courts have recognised a right to withdraw a claim, of which the
party may wish to avail itself.

Post-decision challenges
An unsuccessful party can wait to raise a challenge on jurisdictional or other grounds
in enforcement proceedings by the successful party. Another option is to seek a swift
decision in litigation. The TCC can deal with such applications at short notice and
is also willing to deal with substantive points of law ruled upon by an adjudicator
if they can be dealt with quickly. This often permits enforcement or revision of the
adjudicator’s decision to be dealt with at the same time.

xlvii
 INTRODUCTION

Conclusion
Nobody would argue with the proposition that cash flow in the construction industry
is, in the vivid phrase of Lord Denning MR, ‘the very lifeblood of the enterprise’.7
The adjudication experience has proved just how vital it is, to paying as well as
receiving parties: no procedural point, however small, has been ignored in the quest
to avoid payment for whatever reason. It is this that lies at the heart of the chal-
lenge to the process in the future. It is notable that other jurisdictions legislating
for prompt payment have incorporated appeal structures applicable to adjudication
decisions. This could go a long way towards removing the black and white squares
from adjudication.

7 Modern Engineering (Bristol) Ltd v Gilbert-Ash (Northern) Ltd 71 LGR 162, 167.

xlviii
 CHAPTER 1

Statutory regulation of construction contracts

1.1 Definitions
1.1 Adjudication is, conventionally, the process of judging, a court’s pronouncement
of a judgment or decree, or the judgment so given.1 It has been said that a judge or
an arbitrator adjudicates and in this sense adjudication is or should therefore be
synonymous with a judicial process.2 From 1976, standard forms of construction
subcontracts began to contain provisions for an ‘adjudicator’ to decide disputes
between the subcontractor and the main contractor as to the entitlement to payment
pending a final resolution by arbitration.3 The use of such provisions was adopted
in other forms during the 1980s and, by 1992, ‘adjudication’ could be defined as a
procedure where, by contract, a summary interim decision-making power in respect
of disputes was vested in a third-party individual (the adjudicator) who was usually
not involved in the day-to day performance or administration of the contract, and
was neither an arbitrator nor connected with the state.4 A party to a construction
contract regulated by Part II of the Housing Grants, Construction and Regeneration
Act 1996 now has the right5 to refer a dispute arising under the contract for adju-
dication under a procedure complying with the requirements of section 108 of that
Act. The word ‘adjudication’ is thus commonly used now to denote the process
whereby a decision is reached pursuant to the provisions of the Act. A fuller defini-
tion has been suggested as that of a process by which within a short and defined time,
and with a curtailed procedure left primarily to the adjudicator, all disputes under
most construction contracts have to be presented to and decided by a person who
will not be the arbitrator or the judge (unless of course the parties agree) where the
decision is binding (and is swiftly enforceable) until the dispute is considered on its
own merits by the ultimate tribunal, without regard to the decision of the adjudica-
tor, so that there is, in this sense, no appeal from the adjudicator but, until that time
arrives, there are very limited means of questioning the result of the adjudication.6

1 Garner’s Dictionary of Legal Usage (3rd edn, 2011).

2 LLoyd, ‘Adjudication’, ICLR [2001] 437, 438, but as the learned author pointed out, it is not.
3 For an example, see A Cameron Ltd v J Mowlem & Co plc (1990) 25 Con LR 11, CA. A useful
history is contained in McGaw, ‘Adjudicators, Experts and Keeping out of Court’ (1992) 8 Const. LJ
332, 334–9.
4 McGaw, ‘Adjudicators, Experts and Keeping out of Court’ (1992) 8 Const LJ 332.
5 Housing Grants, Construction and Regeneration Act 1996, s 108(1). The 1996 Act was amended
by the Local Democracy, Economic Development and Construction Act 2009.
6 LLoyd, ‘Adjudication’, ICLR [2001] 437, 438–9.

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 ADJUDICATION IN CONSTRUCTION LAW

1.2 Background to Part II of the 1996 Act

1.2.1 The Latham Report

1.2 Part II of the Housing Grants, Construction and Regeneration Act 1996
contains a package of measures relating to construction contracts which followed
upon the recommendations of Sir Michael Latham’s report Constructing the Team
(HMSO 1994). His report was jointly funded by the construction industry and the
Department of the Environment. In May 1995 the Department of the Environment
issued a consultation paper entitled Fair Construction Contracts. It was concerned
with the extent to which improved construction contracts could and should be
underpinned in law. It was noted that the Latham Report had confirmed what was
widely believed, that the existing arrangements militated against co-operation and
teamwork, and that the reform of current contractual relations was central to the
competitiveness of the industry in both the short and long term. Attention was
drawn to the list of principles that Constructing the Team had identified as those
which the most effective form of contract in modern conditions should include.
Among these principles, which were set out in Annex A to the consultation paper,
was the following:
‘Clearly setting out the period within which interim payments must be made to all par-
ticipants in the process, failing which they will have an automatic right to compensation,
involving payment of interest at a sufficiently heavy rate to deter slow payment.’7

1.2.2 Consultation
1.3 In the consultation paper it was noted that the proposals in Constructing the
Team had identified the following as essential terms in all construction contracts:
dispute resolution; right of set off; prompt payment; protection against insolvency. It
was also noted that legislation in this area could significantly restrict to some extent
the freedom of parties to contract on any terms they chose. The first point on which
the government wished to have views was whether the proposals for legislation set
out in Constructing the Team and elaborated in the consultation paper were likely to
improve contractual relations sufficiently to justify this regulatory intervention.8

1.2.3 Pay now, argue later

1.4 Following responses to the consultation paper and further consultation with
industry organizations, Part II was drafted. During the debate at Report Stage in the
House of Lords, Lord Ackner said:
‘What I have always understood to be required by the adjudication process was a
quick, enforceable interim decision which lasted until practical completion when, if not

7 Quoted in Melville Dundas Ltd (in receivership) v George Wimpey UK Ltd [2007] UKHL 18, [2007]
1 WLR 136, [2007] 3 All ER 889, [2007] BLR 257, [36] (Lord Hope).
8 Melville Dundas Limited (in receivership) and others (Respondents) v George Wimpey UK Limited and
others (Appellants) (Scotland) [2007] UKHL 18, [37] (Lord Hope).

2
 STATUTORY REGULATION OF CONSTRUCTION CONTRACTS

acceptable, it would be the subject matter of arbitration or litigation. That was a highly
satisfactory process It came under the rubric of “pay now argue later”, which was a
sensible way of dealing expeditiously and relatively inexpensively with disputes which
might hold up the completion of important contracts.’9

The phrase ‘pay now, argue later’ has frequently been adopted as shorthand to
describe the policy of the Act.10 The Technology and Construction Court and the
Court of Appeal have also said on many occasions that adjudication is a form
of rough justice, in the sense that within a very short period of time (28 days
usually) the adjudicator has to receive submissions and evidence from the parties
and produce his or her decision; inevitably the justice that is meted out is not always
as pure and as well prepared for as cases which proceed to a full trial in court or to
a substantive hearing before an arbitrator.11

1.3 Application of Act to United Kingdom and Northern Ireland, and the
Isle of Man

1.3.1 England and Wales and Scotland

1.5 Part II of the Housing Grants, Construction and Regeneration Act 1996 applies
to construction contracts which relate to the carrying out of construction opera-
tions in England and Wales and Scotland12 and whether or not the law of England
and Wales or Scotland is otherwise the applicable law in relation to the contract.13
There are separate statutory instruments relating to exclusions and the Scheme for
Scotland.14 Separate orders relating to the disapplication of Part II to certain con-
struction contracts can be made by the Secretary of State and the Welsh and Scottish
Ministers.15 The amendments to Part II 1996 Act made by Part 8 of the Local
Democracy, Economic Development and Construction Act 2009 came into force on
1 October 2011 in England16 and Wales17 and on 1 November 2011 in Scotland.18

9 Hansard, H.L. Vol 571, cols 989–90.

10 RJT Consulting Engineers Ltd v DM Engineering (N.I.) Ltd [2002] EWCA Civ 270 [2002] 1 WLR
2344, 2346, [1], (Ward LJ); Thomas-Frederic’s (Construction) Ltd v Wilson [2003] EWCA Civ 1494,
[2004] BLR 23, 28, [19] (Simon Brown LJ); Pegram Shopfitters Ltd v Tully Weijl (UK) Ltd [2003] EWCA
Civ 1750, [2004] BLR 65, 69, para 12 (May LJ). An earlier version was ‘pay up now and litigate or
arbitrate the dispute later’, used in Modern Engineering (Bristol) Ltd v Gilbert-Ash (Northern) Ltd [1974]
A.C. 689, 726D (Lord Salmon).
11 Gipping Construction Ltd v Eaves Ltd [2008] EWHC 3134 (TCC), [8] (Akenhead J).
12 Housing Grants, Construction and Regeneration Act 1996, s 104(6)(b).
13 Housing Grants, Construction and Regeneration Act 1996, s 104(7).
14 The Construction Contracts (Scotland) Exclusion Order 1998 (SI 1998 No 686 (S33)) as
amended by the Construction Contracts (Scotland) Exclusion Order 2011 (SSI 2011 No 370), the
Scheme for Construction Contracts (Scotland) Regulations 1998 (SI 1998 687 (S34)), as amended by
the Scheme for Construction Contracts (Scotland) Amendment Regulations 2011 (SSI 2011 No 371).
15 Housing Grants, Construction and Regeneration Act 1996, s 106A, as inserted by the Local
Democracy, Economic Development and Construction Act 2009, s 138.
16 The Local Democracy, Economic Development and Construction Act 2009 (Commencement
No 2) (England) Order 2011 (SI 2011 No 1582), para 2.
17 The Local Democracy, Economic Development and Construction Act 2009 (Commencement
No 2) (Wales) Order 2011 (SI 2011 No 1597 (W185)), para 3.
18 The Local Democracy, Economic Development and Construction Act 2009 (Commencement
No 2) (Scotland) Order 2011 (SI 2011 No 291), para 2.

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 ADJUDICATION IN CONSTRUCTION LAW

1.3.2 Northern Ireland

1.6 The provisions of the 1996 Act were made applicable to Northern Ireland19
with separate statutory instruments relating to exclusions and the Scheme.20 The
amendments to Part II of the 1996 Act made by Part 8 of the Local Democracy,
Economic Development and Construction Act 2009 came into force in Northern
Ireland on 14 November 2012.21

1.3.3 Isle of Man

1.7 The Construction Contracts Act 2004 (c 2), which closely follows the UK 1996
Act, applies in the Isle of Man.

1.4 Purpose of adjudication

1.8 It has been generally acknowledged that the intention of Parliament in enacting
the Housing Grants, Construction and Regeneration Act 1996 was to introduce a
speedy mechanism for settling disputes in construction contracts on a provisional
interim basis, and requiring the decisions of adjudicators to be enforced pending
the final determination of disputes by arbitration, litigation or agreement: see
section 108(3) of the Act. It is clear that Parliament intended that the adjudication
should be conducted in a manner which those familiar with the grinding detail of
the traditional approach to the resolution of construction disputes apparently find
difficult to accept. But Parliament has not abolished arbitration and litigation of
construction disputes, it has merely introduced an intervening provisional stage
in the dispute resolution process. Crucially, it has made it clear that decisions of
adjudicators are binding and are to be complied with until the dispute is finally
resolved.22

19 Housing Grants, Construction and Regeneration Act 1996, s 149, The Construction Contracts
(Northern Ireland) Order 1997 (1997 No 274 (NI 1). The amendments brought about by the Local
Democracy, Economic Development and Construction Act 2009 in England and Wales and Scotland
are reflected in the Construction Contracts (Amendment) Act (NI) 2011.
20 The Construction Contracts Exclusion Order (Northern Ireland) 1999 (SR 1999 No 33) as
amended by the Construction Contracts Exclusion Order (Northern Ireland) 2012 (SR 2012 No 366),
the Scheme for Construction Contracts in Northern Ireland Regulations (Northern Ireland) 1999 (SR
1999 No 32), as amended by the Scheme for Construction Contracts in Northern Ireland (Amendment)
Regulations (Northern Ireland) 2012 (SR 2012 No 365).
21 Construction Contracts (Amendment) Act (NI) 2011, s 9, The Construction Contracts (2011
Act) (Commencement) Order (Northern Ireland) (SR 2012 No 367 (C. 34), para 2.
22 Macob Civil Engineering Ltd v Morrison Construction Ltd [1999] BLR 93, 97 (Dyson J); approved in
Bouyges (UK) Ltd v Dahl-Jensen Ltd [2000] BLR 522, 524 [3], CA (Buxton LJ), and Pegram Shopfitters
Ltd v Tully Weijl (UK) Ltd [2003] EWCA Civ 1750, [2004] BLR 65, 68 [8] (May LJ).

4
 STATUTORY REGULATION OF CONSTRUCTION CONTRACTS

1.5 Construction contracts at common law and under statute

1.5.1 Introduction
1.9 At common law, a construction contract is a contract whereby one person, the
contractor, agrees to build or construct some work on behalf of some other person,
the employer, and can cover a wide range of work from minor repair for house owners
to large projects for commercial concerns or government agencies. The adjudication
provisions of Part II of the Housing Grants, Construction and Regeneration Act 1996
only apply to construction contracts as defined by that Part.23 The statutory defini-
tion includes contracts which would not normally be regarded as construction con-
tracts at common law, such as contracts of engagement for professional services to be
provided by architects or surveyors,24 and excludes contracts for construction works
to be performed at certain locations.25 Contracts with residential occupiers are also
excluded.26 The construction contract must also be in writing if governed by the una-
mended Act.27 Where parties to a construction contract have compromised a dispute
under that contract, the question of whether the compromise agreement is subject
to adjudication turns on the relationship between the construction contract and the
compromise agreement. An adjudicator will have jurisdiction where the compromise
agreement operated as a variation of the construction contract, and the compromise
agreement is not a ‘stand alone’ agreement, both agreements being subject to the
same adjudication provisions, and the adjudicator having jurisdiction to determine
the effect of the compromise agreement. On the other hand, where the compromise
agreement is a ‘stand alone’ agreement, which did not incorporate and was not
subject to any adjudication provision, the compromise agreement must be analysed in
order to determine whether there was a surviving dispute which can be adjudicated.28
Where there is no surviving dispute which can be adjudicated under the construction
contract, a dispute under the compromise agreement cannot be adjudicated because
that agreement is not a construction contract subject to Part II of the Act.29

1.5.2 Overlap between substance and jurisdiction

1.10 There may be cases where substance and jurisdiction overlap so that it is within
the adjudicator’s jurisdiction to decide as matters within his or her substantive
jurisdiction whether there have been, in effect, variations to the contract pursuant

23 Housing Grants, Construction and Regeneration Act 1996, s 104(1).

24 Housing Grants, Construction and Regeneration Act 1996, s 104(2). See Section 1.10, paras
1–36–8 below.
25 Housing Grants, Construction and Regeneration Act 1996, s 105(2). See Section 1.8, paras
1–21–30 below.
26 Housing Grants, Construction and Regeneration Act 1996, s 106(1)(a).
27 Housing Grants, Construction and Regeneration Act 1996, s 107(1). See Section 1.11, paras
1–9–44 below.
28 McConnell Dowell Construction (Aust) Pty Ltd v National Grid Gas plc [2006] EWHC 2551 (TCC),
[2007] BLR 92, 101 [42] (Jackson J). See also Quarmby Construction Co Ltd v Larraby Land Ltd [2003]
AdJ CS 04/14 (HHJ Grenfell); Westminster Building Co Ltd v Beckingham [2004] BLR 163 (HHJ Thornton
QC); L. Brown & Sons Ltd v Crosby Homes (North West) Ltd [2005] EWHC 3503 (TCC) (Ramsey J).
29 Shepherd Construction Ltd v Mecright Ltd [2000] BLR 489, 493 [14] (HHJ LLoyd QC).

5
 ADJUDICATION IN CONSTRUCTION LAW

to which he or she has properly been appointed adjudicator. It cannot then in those
circumstances be a valid challenge to his or her jurisdiction that upon analysis he or
she may be wrong as a matter of fact or law in determining that such variations were
made to the originating contract as opposed to a series of later legally unconnected
contracts.8 It must also be borne in mind that variations, that is additional, altered,
substituted or omitted works, are very common and almost invariably feature in
payment disputes between construction contract parties. Many of the adjudication
decisions which come to be considered by the Technology and Construction Court
involve rulings on whether particular work has been varied and, if so, what price
is to be put on it. Generally, an adjudicator properly appointed under the original
contract between the parties to the adjudication will have jurisdiction to determine
whether or not particular work was or was to be treated as a variation under or
pursuant to that original contract. Of course, it is open to either party to argue that,
although the particular work was extra to the scope of works covered by the original
contract, it was not a variation envisaged or permitted by that contract. That argu-
ment will or may in effect give rise both to a substantive defence under the original
contract (‘there is no entitlement to payment because there is no variation’) as well
as a jurisdictional challenge (‘the adjudicator has no jurisdiction to decide because
the extra work can not have been ordered under the original contract which gives
the adjudicator jurisdiction in the first place’). This is where there will often be an
overlap between jurisdiction and substance.30

1.5.3 No construction contract

1.11 Where there was never any initial concluded contract about which there was
no dispute, and that the claims made in the adjudication were all claims advanced
under a number of separate contracts, it follows that the adjudicator could not
properly have been appointed under any version of an initial concluded contract
as contended for by the referring party, because no such contract was ever formed,
in circumstances where there was a substantial dispute between the parties as to
whether or not there was such a contract, or a series of separate contracts covering
the same subject matter, and in circumstances where there were differences of sub-
stance in the adjudication procedures applicable to the differing contracts as well as
in the other terms of those contracts. It is difficult to construe this as a case where
the adjudicator is required, as part of the substantive dispute referred to him or her,
to decide whether or not the subsequent orders were variations of the original order.
If the claim as advanced was a simple final account claim under a contract, whereas
the question as to whether or not the claim advanced arose under one or more than
one contract was raised fairly and squarely as a question of jurisdiction, and the
adjudicator decided it accordingly, there can be no question of the court conclud-
ing that his or her answer on that question should, even if wrong, nonetheless be

30 Supablast (Nationwide) Ltd v Story Rail Ltd [2010] EWHC 56 (TCC), [2010] BLR 211 [29]
(Akenhead J).

6
 STATUTORY REGULATION OF CONSTRUCTION CONTRACTS

temporarily binding on the responding party, which never agreed to confer jurisdic-
tion upon him or her to decide that question.31

1.6 Categories of construction contracts regulated by statute

1.12 The first category of construction contract regulated by the Housing Grants,
Construction and Regeneration Act 1996 consists of agreements with a person for:
the carrying out of ‘construction operations’;32 arranging for the carrying out of
construction operations by others, whether under subcontract to him or otherwise;
or providing his own labour, or the labour of others, for the carrying out of con-
struction operations.33 The second is that of agreements to carry out architectural,
design, or surveying work, or to provide advice on building, engineering, interior
or exterior decoration or on the laying-out of landscape, in relation to ‘construc-
tion operations’.34 The Secretary of State has the power to add to, amend or repeal
these categories by statutory instrument after a draft order has been laid before and
approved by Parliament.35 Agreements that relate to construction operations and
other matters are subject to Part II of the Act only so far as they relate to construc-
tion operations.36 This provision is intended to make clear that where a contract
relates both to construction operations and to other activities, the contract is to be
treated as severable between those parts which relate to construction operations
and those parts which relate to other activities and that Part II and the provisions
for adjudication are to apply to the contract only in so far as the contract relates to
construction operations.37

1.7 Carrying out or arranging for the carrying out of construction

operations

1.7.1 Construction operations

1.13 By section 105(1) of the Housing Grants, Construction and Regeneration Act
1996, ‘construction operations’ means:38
(a) construction, alteration, repair, maintenance, extension, demolition or dis-
mantling of buildings, or structures forming, or to form, part of the land
(whether permanent or not);
(b) construction, alteration, repair, maintenance, extension, demolition or
dismantling of any works forming, or to form, part of the land, includ-
ing (without prejudice to the foregoing) walls, roadworks, power-lines,

31 Viridis UK Ltd v Mulalley & Co Ltd [2014] EWHC 268 (TCC) [81] (HHJ Stephen Davies).
32 ‘Construction operations’ are the subject of a specific definition: Housing Grants, Construction
and Regeneration Act 1996, s 105(1).
33 Housing Grants, Construction and Regeneration Act 1996, s 104(1).
34 Housing Grants, Construction and Regeneration Act 1996, s 104(2).
35 Housing Grants, Construction and Regeneration Act 1996, s 104(4).
36 Housing Grants, Construction and Regeneration Act 1996, s 104(5).
37 Fence Gate Ltd v James R Knowles Ltd (2001) 84 Con LR 206, 210 [7] (HHJ Gilliland QC).
38 Housing Grants, Construction and Regeneration Act 1996, s 105(1) as amended by
Communications Act 2003, s 406(1) & Sched 17, para 137.

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 ADJUDICATION IN CONSTRUCTION LAW

electronic communications apparatus, aircraft runways, docks and har-

bours, railways, inland waterways, pipe-lines, reservoirs, water-mains, wells,
sewers, industrial plant and installations for purposes of land drainage,
coast protection or defence;
(c) installation in any building or structure of fittings forming part of the land,
including (without prejudice to the foregoing) systems of heating, light-
ing, air-conditioning, ventilation, power supply, drainage, sanitation, water
supply or fire protection, or security or communications systems;
(d) external or internal cleaning of buildings and structures, so far as carried
out in the course of their construction, alteration, repair, extension or
restoration;
(e) operations which form an integral part of, or are preparatory to, or are for
rendering complete, such operations as are previously described in section
105(1) of the 1996 Act,39 including site clearance, earth-moving, excava-
tion, tunnelling and boring, laying of foundations, erection, maintenance or
dismantling of scaffolding, site restoration, landscaping and the provision of
roadways and other access works;
(f) painting or decorating the internal or external surfaces of any building or
structure.
By section 105(2) of the Act, ‘construction operations’ does not mean:40
(a) drilling for, or extraction of, oil or natural gas;
(b) extraction (whether by underground or surface working) of minerals; tun-
nelling or boring, or construction of underground works, for this purpose;
(c) assembly, installation or demolition of plant41 or machinery, or erection or
demolition of steelwork for the purposes of supporting or providing access
to plant or machinery, on a site where the primary activity is:42
(i) nuclear processing, power generation, or water or effluent treat-
ment, or
(ii) the production, transmission, processing or bulk storage (other than
warehousing) of chemicals, pharmaceuticals, oil, gas, steel or food
and drink;
(d) manufacture or delivery to site of:
(i) building or engineering components or equipment,
(ii) materials, plant or machinery, or
(iii) components for systems of heating, lighting, air-conditioning,
ventilation, power supply, drainage, sanitation, water supply or fire
protection, or for security or communications systems,

39 One view is that this expression is not wholly free from ambiguity: the more natural meaning is
that para (e) of s 105 (1) is not incorporating the exclusions provided by s 105(2): Palmers Ltd v ABB
Power Construction Ltd (1999) 68 Con LR 52, 62–3 [33] (HHJ Thornton QC).
40 Housing Grants, Construction and Regeneration Act 1996, s 105(2).
41 For the meaning of ‘plant’ see 1.9.2 below.
42 The use of the word ‘is’ in qualifying primary activity is not intended to produce a distinction
between a present use and a future use which would follow the completion of operations: ABB Power
Construction Ltd v Norwest Holst Engineering Ltd (2000) 77 Con LR 20, 30 (HHJ LLoyd QC).

8
 STATUTORY REGULATION OF CONSTRUCTION CONTRACTS

(e) except under a contract which also provides for their installation; the
making, installation and repair of artistic works, being sculptures, murals
and other works which are wholly artistic in nature.
The Secretary of State has the power to add to, amend or repeal these definitions
by statutory instrument after a draft order has been laid before and approved by
Parliament.43

1.7.2 Different operations to a building or structure

1.14 There is no warrant in paragraph (a) of section 105(1) for distinguishing
between different types of operations carried out in relation to a building or struc-
ture. Taking the construction of a building, paragraph (a) applies as much to the
installation of a demountable wall partition as it does to the installation of a central
heating, air-conditioning, sanitation system or any other of the fittings mentioned in
paragraph (c). There is no distinction in property law: once installed they all become
part of the land. Nor is there any other basis, whether technical or founded on the
ordinary use of words, for saying that the installation of a demountable wall par-
tition is, but the installation of heating systems, etc., is not part of the construction
of a building. Such systems are often complex, they are usually integrated into the
structure of the building; they may be very difficult to disconnect and remove from
the building. It may be far easier to remove and replace, say, a demountable wall
partition or cladding panels that have been fixed to the exterior of a building, than to
remove one of the systems described in paragraph (c). The same applies to the other
operations mentioned in paragraph (a). There is no justification for distinguishing
between the repair and maintenance of the roof or cladding panels of a building and
the repair and maintenance of the various systems described in paragraph (c). They
are all parts of a building. It is not a misuse of language to say that the maintenance
of a building includes the maintenance of the various items mentioned in paragraph
(c). It is worth emphasising the scope of those items. They include not only heating
and air-conditioning systems, but also lighting, power supply, drainage, sanitation
and water supply. These are all vital parts of a building, whose proper functioning is
required if a building is to be fit for habitation.44

1.7.3 Example of a structure

1.15 Where works involve the construction of a landfill cell, the securing of the
boundaries of the landfill, the capping of an existing area and the completion of a
treatment process, the landfill cell is clearly a ‘structure’ forming or to form part of
the land within section 105(1)(a), being formed in the ground from clay and stone
and meant to form a cell to receive landfill material. The capping layer does not con-
stitute a ‘structure’ and does not, therefore, fall under (a), being a synthetic cover of
an existing landfill area. It involves operations which form an integral part of, or are

43 Housing Grants, Construction and Regeneration Act 1996, s 105(3).

44 Nottingham Community Housing Association Ltd v Powerminster Ltd [2000] BLR 309, 312 [14]
(Dyson J).

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 ADJUDICATION IN CONSTRUCTION LAW

preparatory to, or are for rendering complete the operations relating to the landfill
cell and therefore falls under section 105(1)(e).45

1.7.4 Part of the land

1.16 Shopfitting does not amount to ‘construction operations’ unless it is ‘construc-
tion … of … structures forming, or to form, part of the land (whether permanent
or not)’ or ‘installation in any building or structure of fittings forming part of the
land’. What might be involved in a structure or fittings ‘forming part of the land’
is not something addressed by the Act. However, in the context of the law of real
property, the concept of a fixture is well-established, and the parts of the defini-
tion of ‘construction operations’ just set out are directed to whether the particular
structure or fittings will, when completed, amount to a fixture or fixtures.46 On the
other hand, whilst the law relating to fixtures casts useful light on the test, it is not
some sort of pre-condition that the test or threshold of ‘forming part of the land’ can
only be ‘passed’ if the item of work etc is a fixture as understood in the law of real
property. This is because it is not necessary to read the words used as requiring that
the word ‘fixture’ is not used and there are some hints in the wording that the full
fixture test is not required, not least of which are the words in section 105(1)(a) that
buildings and structures need not be ‘permanent, in section 105(1)(b) the words
‘industrial plant’ (not apparently limited only to large plant) and in section 105(2)
(d) the words ‘building or engineering components or equipment … materials, plant
or machinery’ (again without limitation). As can be seen by the cases dealing with
fixtures, the law relating to ‘fixtures’ is not particularly simple and, if Parliament had
intended to incorporate the law relating to fixtures, it could and would have done so
rather than use some sort of verbal code from which some, but not all, might infer
that the law relating to fixtures was to be applied.47
1.17 Whether something forms or is to form part of land is ultimately a question of
fact and this involves fact and degree. The factual test of whether something forms
or is to form part of the land is informed by but not circumscribed by principles to
be found in the law of real property and fixtures. Something which is already or is to
become a ‘fixture’ will, almost invariably, ‘form part of the land’ for the purposes of
the Act. There is some distinction to be drawn between fixtures, that is, things which
are attached to buildings or land, and the land itself. In Elitestone Ltd v Morris,48 a
distinction was recognised between the land and the building itself on the one hand
(effectively the same thing) and fixtures fixed to or within a building on the other.
To be a fixture or to be part of the land, an object must be annexed or affixed to the
land, actually or in effect. An object which rests on the land under its own weight
without mechanical or similar fixings can still be a fixture or form part of the land.
It is primarily a question of fact and degree. In relation to objects or installations
forming part of the land, one can and should have regard to the purpose of the
object or installation in question being in or on the land or building. Purpose is to be

45 Coleraine Skip Hire v Ecomesh Ltd [2008] NIQB 141 [14] (Weatherup J).
46 Gibson Lea Interiors Ltd v Makro Shelf Service Ltd [2001] BLR 407, 413 [15] (HHJ Seymour QC).
47 Savoye & Savoye Ltd v Spicers Ltd [2014] EWHC 4195 (TCC) [24] (Akenhead J).
48 [1997] UKHL 15, [1997] 1 WLR 687, [1997] 2 All ER 513 (Lords Lloyd & Cooke).

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 STATUTORY REGULATION OF CONSTRUCTION CONTRACTS

determined objectively and not by reference simply to what one or other party to the
contract, by which the object was brought to or installation brought about at the site,
thought or thinks. Primarily, one looks at the nature and type of object or installation
and considers how it would be or is intended to be installed and used. One needs
to consider the context, objectively established. If the object or system in question
was installed to enhance the value and utility of the premises to and in which it was
annexed, that is a strong pointer to it forming part of the land. Where machinery
or equipment is placed or installed on land or within buildings, particularly if it is
all part of one system, one should have regard to the installation as a whole, rather
than each individual element on its own. The fact that even some substantial and
heavy pieces are more readily removable than others is not in itself determinative
that the installation as a whole does not form part of the land. Machinery and plant
can be structures, works (including industrial plant) and fittings within the context
of section 105(1) paras (a) to (c) of the Act.49
1.18 Simply because something is installed in a building or structure does not
mean that it necessarily becomes a fixture or part of the land. A standing refrig-
erator or washing machine can be installed in a building but nobody, thinking
rationally, would suggest that they had become fixtures or part of the land. The
fixing with screws and bolts of an object to or within a building or structure is a
strong pointer to the object becoming a fixture and part of the land but it is not
absolutely determinative. Many of the old cases referred to above demonstrate that
such fixings did point towards the object so affixed being part of the land. However,
the Gibson Lea case50 produced a different answer, even though some items were
affixed by nails and screws. Ease of removability of the object or installation in
question is a factor which is a pointer to whether it is to be treated as not forming
part of the land. One can have regard, however, to the purpose which the object
or installation is serving, that purpose being determined objectively. The fact that
the fixing cannot be removed save by destroying or seriously damaging it or the
attachment is a pointer to what it is attaching being part of the land. A significant
degree of permanence of the object or installation can point to it being considered
as part of the land.51

1.7.5 Plant hire

1.19 A contract for mere plant hire is not a construction contract for the purposes
of Part II.52 However, a contract for the hire of a crane plus a driver is one for the
supply of plant and labour and is for construction operations which form part of, are
preparatory to or are for rendering complete construction operations as described
in s 105(1)(a).53

49 Savoye & Savoye Ltd v Spicers Ltd [2014] EWHC 4195 (TCC) [36] (c)–(h) (Akenhead J).
50 Gibson Lea Interiors Ltd v Makro Shelf Service Ltd [2001] BLR 407, 413 (HHJ Seymour QC).
51 Savoye & Savoye Ltd v Spicers Ltd [2014] EWHC 4195 (TCC) [36] (i)–(k) (Akenhead J).
52 Baldwins Industrial Services plc v Barr Ltd [2003] BLR 176, 178 [12] (HHJ Kirkham).
53 Baldwins Industrial Services plc v Barr Ltd [2003] BLR 176, 180 [21]–[23] (HHJ Kirkham).

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 ADJUDICATION IN CONSTRUCTION LAW

1.7.6 Collateral warranty

1.20 Although a particular collateral warranty was and is to be treated as a construc-
tion contract ‘for … the carrying out of construction operations’, it does not follow
that all collateral warranties given in connection with all construction developments
will be construction contracts under the Act. One needs primarily to determine in
the light of the wording and of the relevant factual background each such warranty
to see whether, properly construed, it is such a construction contract for the carry-
ing out of construction operations. A very strong pointer to that end will be whether
or not the relevant contractor is undertaking to the beneficiary of the warranty to
carry out such operations. A pointer against may be that all the works are completed
and that the contractor is simply warranting a past state of affairs as reaching a
certain level, quality or standard.54

1.8 Exempted construction operations

1.8.1 Test for exemption

1.21 Section 105(2) of the Housing Grants, Construction and Regeneration Act
1996, when compared with section 105(1), shows that it was the intention of
Parliament that exemption should be given by applying an additional and different
test: was the object of the ‘construction operation’ to further the activities described
in section 105(2)(c) (and in paragraphs (a) and (b) since in those industries or
commercial activities it was not thought necessary that at any level there need be a
right to adjudicate or to payment as provided by the Act. Section 105(1) provides
conventional descriptions of various kinds of work or services. Paragraph (d) of
subsection (2) does the same. In contrast, the remainder of the subsection, whilst
outlining an operation, qualifies it by reference to the ultimate purpose for which
the operation is required: the exploitation of oil or gas (paragraph (a)); the extrac-
tion of minerals, for example coal mining or quarrying (paragraph (b)); a wide
variety of disparate industries (paragraph (c)); or the creation of art (paragraph
(e)). In addition, paragraph (c) makes explicit the need to identify the site or loca-
tion of the activity and to ensure that it is the primary or dominant activity, since
the activities listed may be ancillary to the principal activity. The reason lies in the
purpose of the legislation. The two specific objectives – resolving disputes swiftly
but provisionally and regulating interim payments – are intended to correct two
common areas of friction between contracting parties. The overall objective was to
promote better relationships. There was no longer to be a lack of regulation which,
in certain instances, would lead to unfairness stemming from constraints that paying
parties might place on recipients either in deferring payments or by the arbitrary
withholding of money that was truly due. In addition, all classes of dispute were not
to be allowed to fester and their resolution postponed until they were resolved by
litigation or arbitration. Either party could get a decision swiftly which, as it would

54 Parkwood Leisure Ltd v Laing O’Rourke Wales & West Ltd [2013] EWHC 2665 (TCC) [27]–[28]
(Akenhead J).

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 STATUTORY REGULATION OF CONSTRUCTION CONTRACTS

be provisionally binding, would enable the parties to put the matter behind them
and get on with the work, leaving the final inquest until later, probably when the
work was completed. Relationships ought thus to be preserved or restored and the
concept of teamwork realised or saved from material damage. Adjudication could
be sought ‘at any time’ (i.e. early on) even though, as it has turned out, it is at times
not being used to resolve disputes contemporaneously but much later, even after the
time when they could have been the subject of a judgment or arbitral award. It is
clear from the wide language of sections 104 and 105(1) that Parliament wished to
ensure that these regimes would apply on every site and for every project.55

1.8.2 Competing constructions as to extent of exemption

1.22 The extent of the exemption provided for by section 105(2) is the subject of
conflicting authorities. The first approach (‘the narrow construction’) is that not all
processes involved in the construction or erection of, for example, power generation
plant are excluded from the ambit of section 105(1) by subsection (2). Clearly, the
erection of supporting steelwork is excluded. However, the construction of buildings
and concrete foundations for use with the plant in question do not come within the
exclusion provided by subsection (2) nor does any painting of the internal or exter-
nal surfaces of that plant. Thus, it is perfectly possible for a contractor’s operations
to fall outside the definition of a construction operation, yet for a sub-contractor
providing building, foundation or painting services, for that contractor’s work to
come within that definition. This would mean that some sub-contractors would be
able to seek an adjudication whereas the same contractor would not be able to seek
adjudication under the relevant main contract next up the contractual chain.56
1.23 The opposing view (‘the broad construction’) is that it was intended that, if the
regimes of the Act were not to apply, it would be invidious if they applied to some
but not all construction contracts on a site or for a project. Defining the exempt con-
struction operations by reference to the nature of the project or by reference to a site
should minimse the possibility that, for example, one contractor or sub-contractor
would think that it was better or worse off than another working alongside it, pre-
ceding or following it. That would not be conducive to the purpose of the legislation
and would be inimical to the establishment or maintenance of harmonious working
relationships and the concept of teamwork. Section 105(2) reflects the fact that the
majority of construction work done for the purposes set out in paragraphs (a) to (d)
is carried out by contractors responsible for design or performance and for owners
or employers, most of whom take an active interest in seeing that every aspect of the
project should be properly planned and co-ordinated. Such involvement minimises
the incidence of disputes at every level or tier. The object of this subsection is there-
fore that all the construction operations necessary to achieve the aims or purposes
of the owner or of the principal contractors (as described in it) would be exempt.

55 ABB Power Construction Ltd v Norwest Holst Engineering Ltd (2000) 77 Con LR. 20, 27–8, [13]
(HHJ LLoyd QC).
56 ABB Power Construction Ltd v Norwest Holst Engineering Ltd (2000) 77 Con LR 20, 28, [14] (HHJ
LLoyd QC).

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 ADJUDICATION IN CONSTRUCTION LAW

If these approaches are correct then an interpretation should be given to section

105(2) which would further and not thwart them.57

1.8.3 Examples of narrow construction

1.24 It has been held, applying the narrow construction referred to above, that
section 105 refers to the assembly and installation of plant and machinery, in the
context of a site where water treatment is the primary activity. In such a case, while
the primary activity within the building is water treatment, the plant (to which the
section applies) is a distinct element within the building. The fact that water treat-
ment is the primary activity within the building does not have the consequence that
all work within or related to the building housing the plant falls within the definition
of plant.4 This approach has also been adopted in holding that enabling and civil
engineering works to be carried out before flue gas desulphurisation units can be
installed at power stations are construction operations within section 105(1) and are
not excluded operations under section 105(2).58 That conclusion is supported by
the view that there is an ambiguity in the form of the difference between the broad
and narrow construction to section 105(2)(c) and, in this context, the reference to
steelwork in section 105(2)(c) is obscure, curious and odd. Applying Pepper v Hart
[1993] AC 593, statements in Hansard made by or on behalf of the Minster for
Construction, Planning and Energy Efficiency disclose the legislative intent under-
lying the wording of section 105(2)(c) and are clear. The intention was to exclude
steelwork which formed an integral part of the machinery and which was directly
and necessarily connected to the plant and that other steelwork would come within
construction operations to which the Bill applied. The reference to steelwork was,
therefore, intended to be a narrow exclusion and section 105(2)(c) was not intended
to exclude all structural steelwork or other building or civil engineering work on the
site. This supports the narrow construction.59
1.25 Where the work under the construction contract is carried out on a site where
the primary activity was the production, transmission, processing or bulk storage of
gas, the element of the work within the excluded operations is not all the work to the
‘steelwork for the purposes of supporting or providing access to plant or machinery’
including the prior activities of fabrication drawings, off-site fabrication or delivery
to site of the fabricated steelwork, but is limited to the ‘erection’ element of that
steelwork under section 105(2)(c)(ii).60

57 Comsite Projects Ltd v Andritz AG [2003] EWHC 958 (TCC); (2004) 20 Const. LJ 24 (HHJ
Kirkham), followed in North Midland Construction plc v A E & E Lentjes UK Ltd [2009] EWHC 1371
(TCC) [67] (Ramsey J).
58 North Midland Construction plc v A E & E Lentjes UK Ltd [2009] EWHC 1371 (TCC) [67]
(Ramsey J).
59 North Midland Construction plc v A E & E Lentjes UK Ltd [2009] EWHC 1371 (TCC) [62]–[63]
(Ramsey J).
60 Cleveland Bridge (UK) Ltd v Whessoe-Volker Stevin Joint Venture [2010] EWHC 1076 [37]–[61]
(Ramsey J).

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 STATUTORY REGULATION OF CONSTRUCTION CONTRACTS

1.8.4 Power generation

1.26 Although the Act makes exception in relation to sites where the primary activ-
ity is power generation, there is no exception in relation to sites where the secondary
or tertiary activity is power generation. Any construction of the Act that excludes
the possibility of secondary or tertiary activities would be contrary to the intention
of Parliament, so that where the whole areas occupied by the employer whose busi-
ness is printing colour magazines, power generation by a generator surrounded by a
security fence is not the primary activity of those sites, and can only be regarded as
ancillary to the primary activity of printing colour magazines whether or not excess
power might be sold to others.61
1.27 Where the scope of the contract works involves assembling on site the equip-
ment and piping into two mechanically complete boiler plants, namely a heat recov-
ery steam generating boiler and an additional boiler, located on land within a
petrochemical complex operated by a petrochemical company, to be constructed
on behalf of and operated by a company which leases the land, the installation is
to further the primary activity of the processing of chemicals and oil on the petro-
chemical complex.62
1.28 If plant has been constructed on land leased by a paper mill owner to an
operator to provide electricity and steam for the mill to replace a coal and gas fired
power plant which had been operating there for some 60 years and to export power
for payment principally to the national grid, the whole site including both the land
leased and the whole paper mill complex will to be considered as the relevant ‘site’
where:
• The power plant is being constructed at a site owned by the mill owner,
with whom the freehold of the whole site remains and at the end of the lease
the part leased would revert back to being part of the overall site.
• The plant is providing steam and electricity to serve the whole site.
• The plant occupies an area of some 10% of the total paper mill site, which
leads to it generally being described as being at the paper mill and its postal
address being by reference to its location at the paper mill.
• The definition of the ‘site’ depends not on the consequence of the plant
being increased in size so that it could export what is likely to be the major-
ity of its electricity to the national grid but on the location of the Plant. The
plant is located where it is because it is to provide a power and steam facility
for the paper mill.
• The matter has to be considered as one of overall impression rather than
detailed examination of particular documents or obligations which would
not have been known to the parties when they entered into the contract.
If, however, the lessee’s obligation under the lease is to construct and, on
termination, demolish the plant, that shows that the plant does not have a
continued existence after the limited period for which the mill owner has
leased the relevant land. This demonstrates that it is not an independent

61 ABB Zantingh Ltd v Zedal Building Services Ltd [2001] BLR 66, 72, [28] (HHJ Bowsher QC).
62 Mitsui Babcock Energy Services Ltd, In the Petition of [2001] Scot CS 150 (Lord Hardie).

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 ADJUDICATION IN CONSTRUCTION LAW

power station but one which depends on the relationship with the mill
owner.63

1.8.5 Food and drink

1.29 The exception where the primary activity is the production, transmission, pro-
cessing or bulk storage of food and drink applies where growing cucumbers is the
primary activity which is carried on at a site, even though the grower is not engaged
in any manufacturing or process treatment. The grower’s activities can, as a matter
of ordinary English, properly be said to consist of the production of cucumbers.
There is nothing in the term ‘production’ as normally understood which implies
that any kind of manufacturing or processing activity is being applied to what is
produced. There is no reason as a matter of construction to limit ‘production’ to the
production of processed food and drink or restrict production to production by the
means of the use of process plant.64

1.8.6 Future work

1.30 The use in section 105(2) of the word ‘is’ and not of ‘will be’ or ‘or will be’ does
not exempt work to be carried out in the future. All construction operations are, of
necessity, carried out in the future, viewed at the date of contract (or deemed start
when the notion of ‘relation back’ applies). An interpretation to the contrary would
mean that work done to improve an existing complex would be exempt whereas
work for a new project would not. If an undertaking were to wish to extend its
activities and could do so within the curtilage of its existing site but it had to cross
the road to build on vacant land then work done there would not be exempt even if
it might be physically connected with the main site (e.g. chemicals might be piped
across the road from the new site to be processed on the original site). It cannot
have been Parliament’s intention that there should be such an absurdity. The Act is
concerned with work which will be carried out. Section 105(1)(a) and (b) explicitly
refer to the construction of buildings or structures ‘forming, or to form, part of the
land …’. Even allowing for some of the exclusions and inclusions in section 105,
when taking into account the overt purposes of the Act, there is no logic in permit-
ting a major sub-contractor to require sub-sub-contractors to accept a ‘pay when
paid’ provision simply because the work is to do with an extension to an existing
production plant or factory whereas no such exemption applies if the work is for an
entirely new scheme.65

63 Laker Vent Engineering Ltd v Jacobs E & C Ltd [2014] EWHC 1058 (TCC) [66]–[70] (Ramsey J).
64 Hortimax v Hedon Salads Ltd (2004) 24 Const. LJ 47, 54 [20] (the decision did not turn on the
meaning of ‘plant’) (HHJ Gilliland QC).
65 ABB Power Construction Ltd v Norwest Holst Engineering Ltd (2000) 77 Con LR 20, 30–1 [17]-[18]
(HHJ LLoyd QC). See also Conor Engineering Ltd v Les Constructions Industrielle de la Mediterranee [2004]
BLR 212, 216 [18] (Mr Recorder Blunt QC).

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 STATUTORY REGULATION OF CONSTRUCTION CONTRACTS

1.9 Exempted construction operations relating to plant

1.9.1 Meaning of ‘construction operations’

1.31 Any work that would be a construction operation within section 105(1) which
is necessary for the full and proper assembly of plant so that it will fulfil the purpose
or purposes for which it is intended is exempt from the operation of Part II of the
Housing Grants, Construction and Regeneration Act 1996 by reason of section
105(2)(c) (assuming that the condition relating to the site is also satisfied). It would
not make sense if, for example, a sub-contractor providing paint systems or cathodic
protection systems necessary to protect plant against erosion or corrosion, to take
two instances, were not exempt whereas only the basic installation of the plant itself
were exempt. The Act has to be applied by people within the construction industry
and should be read and construed on the assumption that the answer is clear to a
layman. In addition, to make fine distinctions would be likely to inhibit the uniform
management of contractors working alongside each other on the same site or for the
same project and would not be consistent with the overall purpose of the exemp-
tions in section 105(2) which are defined by reference to the nature or aims of those
responsible for promoting or implementing the Scheme, project or activity, rather
than by reference to the many individual construction operations required for the
drilling or extraction of oil; for the extraction of minerals; for the assembly or instal-
lation of plant (e.g. tracks, foundations and other preparatory operations for assem-
bly or installation of plant or machinery, craneage, staging, control systems and
accommodation for controllers, testing and commissioning and the like). The Act
calls for distinctions which are based on operational or engineering considerations.
Plant and machinery can readily be distinguished from factory roads, administrative
offices, etc; steelwork is exempt only if required for the purposes of supporting or
providing access to plant or machinery.66
1.32 If a contract were either for the installation of insulation or cladding to pipe-
work, boilers and the like alone or were to include also prefabrication or delivery,
then its subject matter would be ‘assembly [or] installation … of plant’ for the pur-
poses of section 105(2)(c). If a sub-contract were for the provision or prefabrication
or if an addition by way of a variation or otherwise of the prefabrication and delivery
did not strictly form part of a contract for installation then section 105(2)(d) would
apply. If, however, the prefabrication and delivery formed part of a contract which
required their installation, then the effect of section 104(5) would be overridden
by the concluding words of section 105(2)(d) so as to pose the question: does the
installation constitute a construction operation to which section 105(2) applies or
is it an exempt operation under another part of section 105(2)? Where the provision
of insulation is an integral part of the construction of pipework, boilers and the like
which are required so that power may be generated, the installation of insulation
performs a plant-like function, because without it the paperwork, boilers, etc. would

66 ABB Power Construction Ltd v Norwest Holst Engineering Ltd (2000) 77 Con LR 20, 29–30 [15]
(HHJ LLoyd QC).

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 ADJUDICATION IN CONSTRUCTION LAW

not function as they are designed to perform, nor could the plant be operated safely
and efficiently.67

1.9.2 Meaning of ‘plant’

1.33 Pipework forming the links between various pieces of machinery or equip-
ment, by which ingredients and pharmaceuticals in the process of manufacture are
conveyed from one stage of the manufacturing process to another, is part of the
plant being assembled or installed on a site. Without such pipework, the individual
pieces of machinery or equipment would be unable to operate. The pipework is in a
real sense part of the apparatus, which, once it has been installed, is going to be used
in order to carry on the business of manufacturing pharmaceuticals, and its installa-
tion of the pipework is an operation which falls within the scope of the exception in
section 105 (2) (c) (ii), and is accordingly not a construction operation.68
1.34 On the other hand, lighting, emergency lighting, small power distribution,
power to roller doors, containment, fire and gas alarms and heating and ventilation
and building management systems, collectively described as ‘building services’, in a
building which houses a sludge dryer plant is not ‘plant’ at a site where the primary
activity is water or effluent treatment so as to be excluded from the definition of con-
struction operations by section 105(2)(c)(I). While the primary activity within the
building is water treatment, the plant is a distinct element within the building. The
fact that water treatment is the primary activity within the building does not have
the consequence that all work within or related to the building housing the plant
falls within the definition of ‘plant’. The building services are not necessary for the
full and proper assembly of the dryer. The dryer is capable of fulfilling the purpose
for which it was intended without the building services. None of the services was
connected to the plant or used to enable the plant to be physically operated. Their
purpose and function was simply related to the building which housed not only the
plant but also other areas of activity, including a workshop, compressor room, store
room, control room, bagging and polymer rooms. The building services have not
been integrated into the plant and so do not fall within the definition of ‘plant’ by
virtue of such integration. It cannot be said that in any ‘real sense’ the building ser-
vices are part of the plant. The fact that the occupier may not operate without some
of the services does not have the consequence that the building services are integral
to the plant so as to fall within the definition of ‘plant’ in section 105.69
1.35 Artificial lighting installed in greenhouses to extend the growing season for
cucumbers and enable them to be grown during the winter months when natural
light is deficient is plant. It is part of the apparatus used or to be used by the occupier
for carrying on its business of growing cucumbers. Likewise a system installed for
the irrigation and feeding of the cucumbers is an essential part of the apparatus used

67 ABB Power Construction Ltd v Norwest Holst Engineering Ltd (2000) 77 Con LR 20, 30 [16] (HHJ
LLoyd QC).
68 Homer Burgess Ltd v Chirex (Annan) Ltd [2000] BLR 124, 135 (Outer House, Scottish Court of
Session, Lord MacFadyen).
69 Comsite Projects Ltd v Andritz AG [2003] EWHC 958 (TCC); (2004) 20 Const. LJ 24 [38] (HHJ
Kirkham).

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 STATUTORY REGULATION OF CONSTRUCTION CONTRACTS

for the same purpose. Overhead and side screens to prevent light escaping from the
greenhouses and causing light pollution are to be regarded as part and parcel of the
lighting system. The cleaning out and enlargement of reservoirs and the provision of
pipework and other equipment to carry water from the reservoirs for use in water-
ing the cucumbers is all part of the provision or improvement of a system essential
to the carrying on of the business of growing cucumbers in the greenhouses. The
pipework storage tanks and pumping and filtering equipment is clearly plant as it is
apparatus used by the occupier in carrying on its business. The reservoirs are places
where water is collected and stored in order that it may subsequently be used in
the occupier’s business and as such it is part and parcel of the water supply system
for the cucumbers being grown in the greenhouses. The reservoirs cannot fairly
be described as places or settings in which the business is being carried on. They
are part of the means by which the business is carried on and they can properly be
regarded as part of the apparatus by which the occupier actually carries on its busi-
ness of growing cucumbers. They are ‘plant’ just as much as the pipework which
takes water to or from them for use in watering the plants in the greenhouses.70

1.10 Doing architectural, design, or surveying work, providing advice in

relation to construction operations
1.36 There are two limbs to section 104(2) of the Housing Grants, Construction
and Regeneration Act 1996. First, the contract must be a contract to do or perform
work of the character specified in subsection 2(a) or (b) and, second, that work must
be work ‘in relation to construction operations’. Thus, providing factual evidence at
an arbitration or assisting a party at an arbitration are not themselves construction
operations as defined by section 105, but it does not follow that those activities may
not have been carried out ‘in relation to construction operations’ for the purposes of
section 104(2). Unless, however, those activities fall within either subsection 2(a) or
(b) of section 104, the question of whether they were provided or done in relation to
construction operations does not arise.71
1.37 The giving of factual evidence by an architect, designer or surveyor at an arbi-
tration is not the ‘doing’ of architectural, designing or surveying work itself. Likewise
assisting at an arbitration is not the same thing as providing advice on building or
engineering. Both activities are provided not ‘in relation to construction operations’
as defined by section 105 but in relation to the arbitration. Disputes in relation to
the payment of fees properly payable for services rendered as a witness of fact or for
assisting at an arbitration or in litigation are not disputes ‘in relation to construction
operations’ even if the arbitration concerns such construction operations. They are
disputes in relation to litigation support work and they arise under a contract for the
provision of litigation support services and not under an agreement to do design or
surveying work or to provide advice on building or engineering matters in relation
to construction operations as defined by section 105.72

70 Hortimax v Hedon Salads Ltd (2004) 24 Const LJ 47, 52–3 [11]–[15] (HHJ Gilliland QC).
71 Fence Gate Ltd v James R Knowles Ltd (2001) 84 Con LR 206, 212 [11] (HHJ Gilliland QC).
72 Fence Gate Ltd v James R Knowles Ltd (2001) 84 Con LR 206, 212–13 [12] (HHJ Gilliland QC).

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 ADJUDICATION IN CONSTRUCTION LAW

1.38 A contract for the provision of professional services acting as contract admin-
istrators, including: the initial site survey, preparation of detailed scale plans for
use in applications for statutory consents and in budget costings and for tendering
purposes; preparation of draft scheme drawings and a draft specification; prepara-
tion of a pre-tender budget; issuing of tender documentation; appraisal of tenders;
monitoring and administration of the contract, including site visits and site meet-
ings; preparation of valuations and the issuing of certificates of payment; certifica-
tion of practical completion and agreement of final accounts; and supervision of the
contractor during the defects liability period, constitutes ‘arranging for the carrying
out of construction operations’ under section 104(1)(b) and is also ‘surveying work
… in relation to construction operations’ under section 104(2)(a) in carrying out a
site survey, preparing plans and making valuations.73

1.11 Unregulated contracts generally and residential occupiers

1.11.1 Unregulated contracts

1.39 A contract of employment within the meaning of the Employment Rights Act
1996 is not included within references to a construction contract in Part II of the
Hosing Grants, Construction and Regeneration Act 1996.74 Part II of the 1996 Act
applied only to construction contracts entered into after 1 April 199875 and, in its
amended form, applies only to construction contracts entered into after 1 October
2011 in England and Wales and 1 November 2011 in Scotland. It does not apply to
construction contracts which relate to the carrying out of construction operations
other than in England, Wales and Scotland.76
1.40 A construction contract with a residential occupier is not subject to Part II.77
Such a contract is one which principally relates to operations on a dwelling which
one of the parties to the contract occupies, or intends to occupy, as his residence.78
‘Dwelling’ means a dwelling-house or a flat: ‘dwelling-house’ does not include a
building containing a flat, and ‘flat’ means separate and self-contained premises
constructed or adapted for use for residential purposes and forming part of a build-
ing from some other part of which the premises are divided horizontally.79

1.11.2 Meaning of ‘residential occupier’

1.41 The authorities on this provision are very few, particularly on the issue as to
what may or may not be encompassed by the term ‘residential occupier’. In Samuel

73 Gillies Ramsay Diamond v PJW Enterprises Ltd [2004] BLR 131, 137 [15] (1) (Second Division,
Inner House, Scottish Court of Session, Lord Justice Clerk).
74 Housing Grants, Construction and Regeneration Act 1996, s 104(3).
75 Housing Grants, Construction and Regeneration Act 1996, s 104(6)(a).
76 Housing Grants, Construction and Regeneration Act 1996, s 104(6)(b).
77 Housing Grants, Construction and Regeneration Act 1996, s 106(1)(a). See also Britton
‘Adjudication and the “Residential Occupier Exeption”: Time for a Rethink?’ a paper presented at a
meeting of the Society of Construction Law in London on 12 May 2015.
78 Housing Grants, Construction and Regeneration Act 1996, s 106(2).
79 Housing Grants, Construction and Regeneration Act 1996, s 106(2).

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 STATUTORY REGULATION OF CONSTRUCTION CONTRACTS

Thomas Construction Ltd v Bick & Bick (t/a J & B Developments,80 the adjudica-
tor decided that the employer was not a residential occupier and was therefore
caught by the 1996 Act. The contract in question concerned the refurbishment of
a number of buildings, some of which were for the employer to live in, but others
were being refurbished for onward sale. The adjudicator decided that, where the
construction was for two dwellings, one of which was to be occupied, and one of
which was to be sold for commercial purposes, the contract in question could not
be said principally to relate to operations on a dwelling which one of the parties to
the contract intended to occupy, and he decided that he had the necessary juris-
diction to adjudicate. That decision was upheld in the TCC. The decision shows
that the burden is on the employers to demonstrate that the exclusion applies to
them.81
1.42 Where work is carried out to a lodge house which is a separate building, not
lived in or intended to be lived in by either of the employers, and the works are not
being carried out for development or commercial purposes, but at a date sometime
after the contract, an intention may be formed by one of the employers to live there,
possibly with a relative, it is the parties’ intentions at the time of the formation of
the contract which are relevant. In such a case, the lodge house is not the residence
of either of the employers, not occupied by either of the employers, not intended to
be occupied by either of the employers at the time when the contract was made, and
not the dwelling or the dwelling house of either of the employers. The definition in
section 106 of the Act is narrow. But by reference to that narrow definition, on the
basis of those facts the employers are not the residential occupiers of the building
that was the subject of the works.82
1.43 At what point should the court assess whether or not the employer occupies
the property as his residence? Is it the date of the formation of the contract? Or is it
important to regard occupation as a continuing operation, and not to overemphasise
the snapshot position at the date of the contract?83 Occupation is an ongoing process
and cannot be tested by reference to a single snapshot in time. The word ‘occupies’
must carry with it some reflection of the future: it indicates that the employer occu-
pies and will remain at (or intends to return to) the property. Thus the evidence
about the position at the date that the contract was made has to be considered in the
context of all of the evidence of occupation and intention, both before and after the
agreement of the contract.84
1.44 It is difficult to imagine how a company could ever be a residential occupier: a
company might occupy premises for commercial purposes, but the use of the word
‘residential’ conveys a requirement that, for the exemption to bite, a real person
must be living in – residing in – the house or flat in question.85

80 Unreported, Exeter County Court, 28 January 2000 (HHJ Overend).

81 As explained in Shaw v Massey Foundation & Pilings Ltd [2009] EWHC 493 [23] (Coulson J).
82 Shaw v Massey Foundation & Pilings Ltd [2009] EWHC 493 [24]–[25], [30]–]31] (Coulson J).
83 Westfields Construction Ltd v Lewis [2013] EWHC 376 [7] (Coulson J).
84 Westfields Construction Ltd v Lewis [2013] EWHC 376 [11(Coulson J).
85 Edenbooth Ltd v Cre8 Developments Ltd [2008] EWHC 570 (TCC) [9] (Coulson J).

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 ADJUDICATION IN CONSTRUCTION LAW

1.11.3 Amendment of exclusions

1.45 The definitions may be amended by statutory instrument after a draft order
has been laid before and approved by Parliament.86 The Secretary of State can also
exclude any other description of construction contract from the operation of Part
II of the Act by order.87 Construction contracts which are not in writing are not
regulated by the unamended provisions of Part II.88 This does not apply to contracts
governed by the amendments made to the 1996 Act by the Local Democracy,
Economic Development and Construction Act 2009.89

1.12 Contracts and provisions not in writing

1.12.1 General position under the unamended Act

1.46 By section 107(1) of the unamended Housing Grants, Construction and
Regeneration Act 1996 the provisions of Part II apply only where the construction
contract is in writing; any other agreement between the parties as to any matter is
effective for the purposes of that Part only if in writing.90 There is an agreement
in writing if the agreement is made in writing (whether or not it is signed by the
parties); made by exchange of communications in writing; or evidenced in writing.91
If the parties agree ‘otherwise than in writing’ by reference to written terms, that will
give rise to an agreement in writing.92

1.12.2 Whole contract previously required to be in writing

1.47 For an agreement to be in writing in accordance with section 107(2)(c) of
the unamended 1996 Act the whole contract has to be evidenced in writing, not
merely a part of it. Section 107(2) gives three categories where the agreement is to
be treated in writing. The first is where the agreement, whether or not it is signed by
the parties, is made in writing. That must mean where the agreement is contained
in a written document which stands as a record of the agreement and all that was
contained in the agreement. The second category, the exchange of communications
in writing, likewise is capable of containing all that needs to be known about the
agreement. What used to be known as the ejusdem generis rule leads to the belief that

86 Housing Grants, Construction and Regeneration Act 1996, ss 106(3), (4).

87 Housing Grants, Construction and Regeneration Act 1996, s 106 (1)(b). See Section 13 below.
88 Housing Grants, Construction and Regeneration Act 1996, s 107(1). See Section 12 below.
89 Local Democracy, Economic Development and Construction Act 2009, s 139, applicable to
contracts made on or after 1 October 2011 in England and Wales, 1 November 2011 in Scotland and 14
November 2012 in Northern Ireland. See Section 3 above. See Section 12 below.
90 Housing Grants, Construction and Regeneration Act 1996, s 107(1), repealed by Local
Democracy, Economic Development and Construction Act 2009, s 139 in relation to contracts made on
or after 1 October 2011 in England and Wales, 1 November 2011 in Scotland and 14 November 2012
in Northern Ireland. See Chapter 1, para 3, above.
91 Housing Grants, Construction and Regeneration Act 1996, s 107(2), subject to repeal by Local
Democracy, Economic Development and Construction Act 2009, s 139.
92 Housing Grants, Construction and Regeneration Act 1996, s 107(3), subject to repeal by Local
Democracy, Economic Development and Construction Act 2009, s 139.

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 STATUTORY REGULATION OF CONSTRUCTION CONTRACTS

the third category will be to the same effect, namely that the evidence in writing
is evidence of the whole agreement. Sub-section (3) is consistent with that view.
Where the parties agree by reference to terms which are in writing, the legislature is
envisaging that all of the material terms are in writing and that the oral agreement
refers to that written record. The written record of the agreement is the foundation
from which a dispute may spring, but the least the adjudicator has to be certain
about is the terms of the agreement which is giving rise to the dispute. On the point
of construction of section 107 what has to be evidenced in writing is, literally, the
agreement, which means all of it, not part of it. A record of the agreement also
suggests a complete agreement not a partial one. An exception to the generality of
that construction is the instance falling within sub-section (5) where the material or
relevant parts alleged and not denied in the written submissions in the adjudication
proceedings are sufficient.93

1.12.3 Incomplete or partially oral terms

1.48 It follows that section 107 will not engage when the written terms are incom-
plete in that they do not cover key obligations or where the written terms are
incomplete and additional contractual terms have been agreed orally; similarly, if
the written terms are complete, but the works have been subject to significant oral
variation.94 The Act, like the Arbitration Act 1996, uses the words ‘by reference
to terms that are in writing’, not ‘by reference to a previous agreement that is in
writing’ and does not provide for adjudication in relation to an alleged fundamental
variation of a construction contract made orally and without writing.95 Any con-
tention to the contrary is directly inconsistent with section 107(1) of the Act. The
existence of a construction contract usually requires agreement as to parties, work
scope, price and time. Where there is no agreement as to time, so that the best that
can be said is that there will be an implied term to the effect that the work will be
concluded within a reasonable time, the agreement as to price is limited to the costs
reasonably incurred, there is uncertainty over the identity of the parties, and the
work scope is based on subsequent orders, instructions and the like which might,
or might not, have been reduced to writing, it is not possible to say that all the
terms, or even all the material, are set out in writing.96 It is, of course, always open
to parties both in ordinary contractual terms and for the purposes of a construc-
tion contract in writing under the Act to have an agreement in which the contract
price is not expressly stated or agreed. It is open to the parties to agree a verbal or

93 RJT Consulting Engineers Ltd v DM Engineering (N.I.) Ltd [2002] EWCA Civ 270, [2002] 1 WLR
2344 [13]–[19] (Ward LJ). Because Auld LJ referred in his short judgment in that case to ‘the material
terms of the agreement’, it is sometimes suggested that it is only those material terms that must be in
writing and not all the terms of the contract. That is an incorrect reading of RJT. It was pointed out in
Trustees of the Stratfield Saye Estate v AHL Construction [2004] EWHC 3286 (TCC), [2004] All ER (D)
77 [46] (Jackson J) that the remarks of Auld LJ were not part of the ratio of the decision in RJT.
94 Bennett (Electrical) Services Ltd v Inviron Ltd [2007] EWHC 49 (TCC) [28] (HHJ Wilcox).
95 Carillion Construction Ltd v Devonport Royal Dockyard [2002] BLR 79, 84 [32] (HHJ Bowsher
QC).
96 Hart Investments Limited v Fidler [2006] EWHC 2857 (TCC), [2007] BLR 30 [60]–[61] (HHJ
Coulson QC).

23
 ADJUDICATION IN CONSTRUCTION LAW

mathematical formula by which the price can be determined. It may well be pos-
sible simply by way of construction in the light of the background factual matrix to
determine what the price is; such an exercise would not prevent the construction
contract being a construction contract in writing under the Act. A distinction needs
to be drawn between the construction or interpretation exercise which establishes
what the agreed price is and a written confirmation that something has been orally
agreed; the former can be a construction contract in writing under the Act whilst
the latter cannot.97

1.12.4 Trivial matters

1.49 Whilst adjudicators (and indeed judges) should be robust in determining
whether trivial matters said to have been agreed only orally between the parties
can prevent what would otherwise be a written contract for the purpose of section
107 being a written contract, the exercise of determining what is trivial must be an
objective one in relation to the particular contract and parties concerned. What may
be ‘trivial’ in one contract may not be in another. Thus, for example, an oral agree-
ment on a million pound project as to which of two mildly differing shades of light
blue paint might be used may be trivial on one development but not on another.
It is always necessary to determine whether a so-called agreement made orally
was in reality expected or intended to be binding as between the parties. Thus, the
parties having discussed and agreed something orally might later have reduced their
agreement into writing in such a way as to supersede the earlier oral agreement. A
later oral agreement may not be binding; for instance, it may lack consideration or
otherwise may not be intended to be binding.98

1.12.5 Implied terms

1.50 As to whether the existence of implied terms converts an otherwise written
construction contract into one that is no longer a written contract for the purposes
of section 107, it was manifestly not the intention of Parliament to exclude from the
jurisdiction of an adjudicator an agreement solely because it contains implied terms.99
This view is to be preferred to one that the mischief which Parliament was anxious to
avoid could arise in an acute form if it were suggested that a contract, not otherwise
complete, could be completed after it had been executed by the implication of terms
which were said to represent the actual, but unexpressed, intention of the parties.100
Terms are implied into contracts by operation of law. A number of different tests are
propounded for the implication of terms so some terms are, in effect, implied into

97 Rok Building Ltd v Bestwood Carpentry Ltd [2010] EWHC 1409 (TCC) [28] (Akenhead J). See also
Glendalough Associated SA v Harris Calnan Construction Ltd [2013] EWHC 3142 (TCC) [50] (Stewart-
Smith J), citing PT Building Services Ltd v ROK Build Ltd [2008] EWHC 3434 (TCC) (Ramsey J).
98 Allen Wilson Joinery Ltd v Privetgrange Construction Ltd [2008] EWHC 2802 (TCC) [27] (Akenhead
J).
99 Group Connex South Eastern Ltd v MJ Building Services PLC [2004] BLR 333 [24] (HHJ Havery
QC).
100 Galliford Try Construction Ltd v Michael Heal Associates Ltd [2003] EWHC 2886 (TCC) [29]
(HHJ Seymour QC).

24
 STATUTORY REGULATION OF CONSTRUCTION CONTRACTS

contracts by statute. Others are implied into contracts to give them ‘business efficacy’
or, in effect, to make the contracts work. There are other requirements said to exist
such as reasonableness of implied terms. Terms are implied into contracts as a matter
of law, albeit that some terms may be implied in the context of a factual relation-
ship or even a factual history which exists between the parties. There is no reason to
distinguish between different implied terms in the context of section 107. Thus, the
implication of any terms does not render what would otherwise be a written contract
under that section into something not covered by Part II of the Act.101

1.12.6 Recorded and undenied agreements

1.51 The remaining provisions of section 107 identify other routes by which agree-
ments can be made in writing for the purposes of Part II of the Act. The first is that
of the recording by any means102 of an agreement made otherwise than in writing,
either by one of the parties, or by a third party, with the authority of the parties to
the agreement.103 The second is that of one party alleging the existence of an agree-
ment otherwise than in writing in an exchange of written submissions in adjudica-
tion proceedings, or in arbitral or legal proceedings, which is not denied by the other
party in its response, resulting in an agreement in writing to the effect alleged.104
On one reading of sub-section 107(5), if one party to an adjudication alleges the
existence of an oral agreement and the other does not deny the existence of an oral
agreement, then there is an agreement in writing ‘to the effect alleged’, that is, in
the terms alleged by the claimant, even though the other party hotly denies that
the agreement was in the terms alleged, and Parliament cannot have intended such
an unjust result. It is permissible, following Pepper v Hart,105 to look at Hansard. It
appears from the Hansard Report of the proceedings of the House of Lords for 23
July 1996 that sub-section 107(5) originally contained no reference to adjudication
proceedings. The House of Lords accepted a Commons amendment that after the
word ‘submissions’ there should be inserted the words ‘in adjudication proceedings
or’. If sub-section 107(5) is read without the words ‘in adjudication proceedings
or’, it is clear that the intention of Parliament was that a contract should be treated
as a contract in writing if in arbitral or litigation proceedings before the adjudica-
tion proceedings in question an oral contract had been alleged and admitted. The
words ‘and not denied’ should also be read as meaning that the alleged terms of the
contract were not denied. By adding the words ‘in adjudication proceedings or’,
Parliament intended to add a reference to other preceding adjudication proceedings.
There was no intention by Parliament to provide that submissions made by a party
to an unauthorised adjudication should give to the supposed adjudicator a jurisdic-

101 Allen Wilson Joinery Ltd v Privetgrange Construction Ltd [2008] EWHC 2802 (TCC) [30]
(Akenhead J).
102 Housing Grants, Construction and Regeneration Act 1996, s 107(6), subject to repeal by Local
Democracy, Economic Development and Construction Act 2009, s 139.
103 Housing Grants, Construction and Regeneration Act 1996, s 107(4), subject to repeal by Local
Democracy, Economic Development and Construction Act 2009, s 139.
104 Housing Grants, Construction and Regeneration Act 1996, s 107(5), subject to repeal by Local
Democracy, Economic Development and Construction Act 2009, s 139.
105 [1993] AC 593.

25
 ADJUDICATION IN CONSTRUCTION LAW

tion which he did not have when he was appointed. Read in that way sub-section
107(5) has a sensible and practical intention and purpose. Disputes as to terms,
express and implied, of oral construction agreements are surprisingly common and
not readily susceptible to resolution by a summary procedure such as adjudication.
It is not surprising that Parliament should have intended that such disputes should
not be determined by adjudicators under the Act, but if in any case such room
for dispute has been removed by previous formal and binding legal submissions,
then the adjudicator has jurisdiction.106 A different view is that sub-section 107(5)
requires that a contract that does not fulfil the requirements of sub-section 107(2)
may nonetheless be subject to Part II of the Act if (1) there has been an exchange of
written submission in the adjudication; (2) in that exchange, the referring party has
alleged that there was an agreement otherwise than in writing; and (3) the respond-
ing party had not denied the existence of that agreement.107 It has also been pointed
out that the Pepper v Hart approach should primarily be adopted if there is some
ambiguity and there is no ambiguity in the wording: it can apply to any adjudication
proceedings before, after, concurrent with or the same as those under review by
the court. If there is no denial of an oral variation, the exchange of submission and
response constitutes for the purposes of the Act an agreement in writing.108 If the
referral notice does not refer to an agreement that is clearly in writing and is consist-
ent with the assertion of an agreement made otherwise than in writing, then sub-
section 107(5) is engaged – even if the words could also be construed as describing
a written agreement. This is because, on one reading, what is being alleged is an
agreement made otherwise than in writing.109

1.12.7 Reform of 1996 Act and meaning of ‘writing’

1.52 In the case of contracts subject to the Local Democracy, Economic
Development and Construction Act 2009, there is no requirement that construction
contracts regulated by the 1996 Act should be in writing.110 However, contractual
provisions relating to adjudication required to be included within construction
contracts in order to comply with the 1996 Act in order to prevent the Statutory
Scheme applying must be in writing.111 The definitions of ‘agreement in writing’ set
out above do not apply to this requirement.112

106 Grovedeck Ltd v Capital Demolition Ltd [2000] BLR 181, 185 [29]–[30] (HHJ Bowsher QC).
107 Mott MacDonald Ltd v London & Regional Properties Ltd [2007] EWHC 1055 (TCC), (2007)
Con LR 31 [54] (HHJ Thornton QC).
108 Treasure & Son Ltd v Dawes [2007] EWHC 2420 (TCC), [2008] BLR 24, 33 [44] (Akenhead J).
109 Glendalough Associated SA v Harris Calnan Construction Ltd [2013] EWHC 3142 (TCC) [24]
(Stewart-Smith J), in reliance on SG South Ltd v Swan Yard (Cirencester) Ltd [2010] EWHC 376 (TCC)
[10] (Coulson J).
110 Local Democracy, Economic Development and Construction Act 2009, s 139, repealing s 107 of
the Housing Grants, Construction and Regeneration Act 1996 in relation to contracts made on or after 1
October 2011 in England and Wales, 1 November 2011 in Scotland and 14 November 2012 in Northern
Ireland. See Chapter 1, para 3, above.
111 Local Democracy, Economic Development and Construction Act 2009, s 139, repealing s 107
and amending s 108(2) of the Housing Grants, Construction and Regeneration Act 1996.
112 Local Democracy, Economic Development and Construction Act 2009, s 139, repealing s 107
of the Housing Grants, Construction and Regeneration Act 1996.

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 STATUTORY REGULATION OF CONSTRUCTION CONTRACTS

‘Writing’ includes typing, printing, lithography, photography and other modes of

representing or reproducing words in a visible form, and expressions referring to
writing are to be construed accordingly.113

1.13 Excluded construction contracts and disapplication of the Act

1.13.1 Agreements made under statutory provisions

1.53 Certain construction contracts are excluded from the operation of Part II of
the Housing Grants, Construction and Regeneration Act 1996 by the Construction
Contracts (England and Wales) Exclusion Order 1998, made pursuant to the powers
conferred by sections 106(1)(b) and 146(1) of the Act. The first category is that of
agreements made under specified statutory provisions, namely: sections 38 and 278
of the Highways Act 1980 for the adoption of highways and the execution of works;
sections 106, 106A and 299A of the Town and Country Planning Act 1990 relating
to planning obligations, the modification or discharge of planning obligations and
Crown planning obligations; section 104 of the Water Industry Act 1991 for the
adoption of sewer, drain or sewage disposal works; and section 1 of the National
Health Service (Private Finance) Act 1997 relating to powers of NHS Trusts to
enter into agreements.114

1.13.2 PFI contracts

1.54 The second category is that of contracts entered into under the private finance
initiative (‘pfi’) as defined by the Order.115 The three conditions to be fulfilled in
order for a contract to qualify as having been entered into under the pfi are cumula-
tive.116 The first is that the contract contains a statement that it is entered into under
the pfi or under a project applying similar principles.117 The second is that the con-
sideration is determined at least in part by reference to one or more of three things
namely: the standards attained in the performance of a service which is provided as
the principal purpose or one of the principal purposes for the construction of the
building or structure; the extent, rate or intensity of use of all or part of the building
or structure; or the right to operate any facility in connection with the building or
structure.118 The final condition to be fulfilled in order for the contract to qualify is
that one of the parties falls within a list of people or bodies, which are a Minister of
the Crown, a department the appropriation accounts in respect of which are to be
prepared under the Exchequer and Audit Departments Act 1866; any other author-
ity or body subject to examination and certification by, or open to inspection by the
Comptroller and Auditor General; the authorities or bodies listed in Schedule 4 to

113 Interpretation Act 1978, s 5, Sched 1.

114 Construction Contracts (England and Wales) Exclusion Order 1998, SI 1998 No 648, art 3.
115 Construction Contracts (England and Wales) Exclusion Order 1998, SI 1998 No 648, art 4(1).
116 Construction Contracts (England and Wales) Exclusion Order 1998, SI 1998 No 648, art 4(2).
117 Construction Contracts (England and Wales) Exclusion Order 1998, SI 1998 No 648, art 4(2)
(a).
118 Construction Contracts (England and Wales) Exclusion Order 1998, SI 1998 No 648, art 4(2)
(b).

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 ADJUDICATION IN CONSTRUCTION LAW

the National Audit Act 1983 (nationalised industries and other public authorities);
bodies the accounts of which are subject to audit by auditors appointed by the
Audit Commission; the governing bodies or trustees of voluntary schools under
section 31 of the Education Act 1996 (county schools and voluntary schools); or
companies wholly owned by the foregoing bodies.119 Where the Local Democracy,
Economic Development and Construction Act 2009 applies, a sub-category of
construction contract is excluded from the operation of the provision in the 1996
Act as amended that the requirement that contracts provide an adequate mecha-
nism for establishing what payments become due and when under the contract is
not met, if payment is conditional on obligations being performed under another
contract. The sub-category comprises contracts pursuant to which a party to a pfi
contract has subcontracted to a third party some or all of its obligations under that
contract to carry out, or arrange that others carry out, construction operations.120
The type of contract excluded is what is known as a ‘first tier pfi sub-contract’. This
is a contract whereby the non-public body party to an agreement entered into under
the private finance initiative sub-contracts, to a third party, obligations under that
agreement relating to the carrying out of construction work. Provisions in first-tier
pfi sub-contracts which make payments in such contracts conditional upon obliga-
tions being performed in other contracts (obligations such as providing certificates)
will be effective. Obligations in other contracts in this context do not include obliga-
tions to pay money: a provision in a first-tier pfi sub-contract to the effect that the
party carrying out work will not be paid until the other party to the sub-contract has
under the other contact, will, generally speaking, continue to be ineffective by virtue
of section 113 of the 1996 Act.121

1.13.3 Finance agreements

1.55 Finance agreements constitute the third category.122 Such agreements can be
of five types, namely insurance contracts; contracts for the formation or dissolution
of companies, unincorporated associations or partnerships; contracts for the crea-
tion or transfer of securities or any right or interest in securities; money-lending
contracts; and contracts of surety, including fidelity bonds, advance payment bonds,
retention bonds or performance bonds.123 In cases other than contracts of insur-
ance, the description identified must be included in the principal obligations.124

119 Construction Contracts (England and Wales) Exclusion Order 1998, SI 1998 No 648, art 4 (2)
(c).
120 Construction Contracts Exclusion (England) Order 2011(SI 2011 No 2332) arts 3 & 4.
121 Explanatory Notes to Construction Contracts Exclusion (England) Order 2011(SI 2011 No
2332). An Explanatory Note may be referred to as an aid to construction where the legislation to which it
is attached is ambiguous: Coventry & Solihull Waste Disposal Co Ltd v Russell (Valuation Officer) [1999] 1
WLR 2093, 2103D (Lord Hope); D & M, R (on the application of) v Secretary of State for Work & Pensions
[2010] EWCA Civ 18, [2010] 1 WLR 1782, 1800H–1A [48] (Carnwath LJ).
122 Construction Contracts (England and Wales) Exclusion Order 1998, SI 1998 No 648, art 5(1).
123 Construction Contracts (England and Wales) Exclusion Order 1998, SI 1998 No 648, art 5(2).
124 Construction Contracts (England and Wales) Exclusion Order 1998, SI 1998 No 648, art 5(2).

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 STATUTORY REGULATION OF CONSTRUCTION CONTRACTS

1.13.4 Development agreements

1.56 Finally, construction contracts that are development agreements as defined are
excluded.125 These are agreements that include provision for the grant or disposal
of a relevant interest in the land on which the principal construction operations to
which the contract relates take place.126 A ‘relevant interest’ means a freehold or a
leasehold for a period expiring no earlier than 12 months after completion of the
construction operations under the contract.127
1.57 There are many ways in which parties may arrange for or provide for the dis-
position of an interest in land or the grant of such an interest. It might be at some
time in the future or subject to the fulfilment of some condition wholly within the
control of a third party, such as a planning authority, a parent company or a lender.
It might be subject to some condition within the control of one or both of the parties
being satisfied, such as timely or satisfactory completion of works by the contractor,
or the issue of a final certificate by an architect. Such provision or grant could be
subject to the willingness of a third party to enter into the transaction or pursuant
to a further document to be entered into by the parties. All such agreements would
make provision for the grant or disposal of a relevant interest within the Order, so
that an agreement granting an option to the contractor to take leases in respect of
some flats and parking bays on a development site was excluded from the operation
of Part II of the Act.128

1.13.5 Power to disapply provisions of Part II

1.58 In the case where the Local Democracy, Economic Development and
Construction Act 2009 applies, the Secretary of State may, by order, provide that
any or all of the provisions of Part II, so far as they extend to England and Wales,
shall not apply to any description of construction contract relating to the carrying
out of construction operations (not being operations in Wales) which is specified in
the order. The Welsh Ministers may, by order, provide that any or all of the provi-
sions of Part II, so far as extending to England and Wales, shall not apply to any
description of construction contract relating to the carrying out of construction
operations in Wales which is specified in the order. The Scottish Ministers may, by
order, provide that any or all of the provisions of Part II, so far as they extend to
Scotland, shall not apply to any description of construction contract which is speci-
fied in the order. An order under this provision should not be made unless a draft
of it has been laid before and approved by resolution of each House of Parliament,
the National Assembly for Wales or the Scottish Parliament as the case might be.129

125 Construction Contracts (England and Wales) Exclusion Order 1998, SI 1998 No 648, art 6(1).
126 Construction Contracts (England and Wales) Exclusion Order 1998, SI 1998 No 648, art 6(2).
127 Construction Contracts (England and Wales) Exclusion Order 1998, SI 1998 No 648, art 6(3).
128 Captiva Estates Ltd v Rybarn Ltd [2005] EWHC 2744 (TCC), [2006] BLR 66, 70–1 [14]–[15]
(HHJ Wilcox).
129 Housing Grants, Construction and Regeneration Act 1996, s 106A, as inserted by the Local
Democracy, Economic Development and Construction Act 2009, s 138.

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 ADJUDICATION IN CONSTRUCTION LAW

1.14 Statutory requirements for adjudication

1.59 Section 108(5) of the Housing Grants, Construction and Regeneration Act
1996 provides that if a construction contract regulated by Part II does not comply
with the requirements of subsections (1) to (4), the adjudication provisions of the
Scheme for Construction Contracts applies.130 The first requirement is that a party
to a construction contract has the right to refer a dispute arising under the contract
for adjudication under a procedure complying with this section, and for this purpose
‘dispute’ includes any difference.131 Second, the contract must:
(a) enable a party to give notice at any time of his intention to refer a dispute to
adjudication;
(b) provide a timetable with the object of securing the appointment of the
adjudicator and referral of the dispute to him within 7 days of such notice;
(c) require the adjudicator to reach a decision within 28 days of referral or such
longer period as is agreed by the parties after the dispute has been referred;
(d) allow the adjudicator to extend the period of 28 days by up to 14 days, with
the consent of the party by whom the dispute was referred;
(e) impose a duty on the adjudicator to act impartially; and
(f) enable the adjudicator to take the initiative in ascertaining the facts and the
law.132
The third requirement is that the contract should provide that the decision of the
adjudicator is binding until the dispute is finally determined by legal proceedings,
by arbitration (if the contract provides for arbitration or the parties otherwise agree
to arbitration) or by agreement, although the parties may agree to accept the deci-
sion of the adjudicator as finally determining the dispute.133 Finally, the contract
also needs to provide that the adjudicator is not liable for anything done or omitted
in the discharge or purported discharge of his functions as adjudicator unless the
act or omission is in bad faith, and that any employee or agent of the adjudicator is
similarly protected from liability.134
1.60 Further requirements arise where the Local Democracy, Economic
Development and Construction Act 2009 applies,135 namely that the contractual
provisions complying with the requirements referred to above should be in writing136
and that the contract should include provision in writing permitting the adjudicator
to correct his or her decision so as to remove a clerical or typographical error arising
by accident or omission.137

130 Housing Grants, Construction and Regeneration Act 1996, s 108(5).

131 Housing Grants, Construction and Regeneration Act 1996, s 108(1).
132 Housing Grants, Construction and Regeneration Act 1996, s 108(2).
133 Housing Grants, Construction and Regeneration Act 1996, s 108(3).
134 Housing Grants, Construction and Regeneration Act 1996, s 108(4).
135 In the case of contracts made on or after 1 October 2011 in England and Wales, 1 November
2011 in Scotland and 14 November 2012 in Northern Ireland. See Section 3, above.
136 Local Democracy, Economic Development and Construction Act 2009, s 139, amending 108
sub ss(2), (3) & (4) of Housing Grants, Construction and Regeneration Act 1996.
137 Local Democracy, Economic Development and Construction Act 2009, s 140, inserting 108
subs(3A) into Housing Grants, Construction and Regeneration Act 1996.

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 STATUTORY REGULATION OF CONSTRUCTION CONTRACTS

1.15 Effect of failure to comply with statutory requirements

1.15.1 Partial compliance

1.61 The provisions of sub-sections 108(2)(c) and (d) are mandatory rather than
directory, so that an adjudicator would have no jurisdiction to reach his decision out
of time. Thus, where those requirements have not been complied with, the Scheme
applies in place of the adjudication provisions of the contract. If it were otherwise,
two competing adjudication provisions would simultaneously apply to the contract
and many other contracts. This is a recipe for confusion and uncertainty and cannot
have been the intention of Parliament in passing section 108(5) of the Act, which
provides that if the contract does not comply with the requirements of sections
108(1) to (4), the adjudication provisions of the Scheme for Construction Contracts
(‘the Scheme’) shall apply.138 Even if some parts of the contract comply with the
Act, they cannot be retained and the Act cannot be used in substitution for or to fill
in those parts of the subcontract which are contrary to the Act. The words of the Act
are clear. Either a party complies in its own terms and conditions with the require-
ments of sections 108(1) to (4) of the Act or the provisions of the Scheme apply.139

1.15.2 Non-compliant procedure void

1.62 The argument that the Act does not render void a non-compliant procedure
and a party to such a contract could adjudicate under that contractual arrangement,
but is not bound by statute to do so, although that party could still insist on adju-
dication under the Scheme, is wrong. The conclusion that to have two competing
adjudication provisions in a contract would be a recipe for confusion and uncertainty
would not itself lead to uncertainty as to whether the contractual scheme survived,
nor would allowing the parties to follow the things they agreed to give certainty.
Even if, in general, the terms are imposed by the employer on the contractor and it
is the contractor, being the person to whom payment is or should be moving, who
initiates an adjudication, they will often be standard terms presumably designed to
secure compliance with the Act. If the parties had intended to have their own private
non-compliant adjudication system (necessarily in addition to an express or implied
compliant system), that would have been expressed. If no such intention appears
in the agreement, the Scheme and the contractual provisions cannot co-exist in the
contract unless provision is made in the contract how that is to work.140
1.63 It is true that the Act does not say that if the Scheme applies, the contractual
adjudication provisions are void. But if they are not void, then the contract contains
competing and, to some extent, mutually contradictory provisions. One could then
make sense of the contract only if, in the case of every pair of mutually contradictory

138 Epping Electrical Company Ltd v Briggs and Forrester (Plumbing Services) Ltd [2007] EWHC 4
(TCC); [2007} BLR 12 [19] (HHJ Havery QC): see also Ritchie Brothers (PWC) Ltd v David Philp
(Commercials) Ltd [2005] BLR 384 (Scotland, Inner House, Court of Session, Lord Eassie).
139 John Mowlem v Hydra-Tight Ltd (2002) 17 Const LJ 358, 363 (HHJ Toulmin CMG, QC).
140 Aveat Heating Ltd v Jerram Falkus Construction Ltd [2007] EWHC 131 (TCC), (113 Con LR 13,
16 [6] & 13–14 [8] (HHJ Havery QC).

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provisions, only one member of the pair were to be treated in any given case as pre-
vailing over the other. The conclusion that the two sets of adjudication provisions
– contractual and the Scheme – exist as alternative packages, only one of which (at
the option of the party initiating the adjudication) applies in any given case is not
the intention of the legislation. Although the notice of intention to refer a dispute
to adjudication could refer to the contractual adjudication provisions, this may not
always be so. Thus, there might well be confusion and uncertainty over which terms
apply.141
1.64 The position should now be regarded as settled: if there is any non-compliance
with section 108 of the Act, the adjudication provisions in Part 1 of the Scheme are
brought in – lock, stock and barrel.142

1.15.3 Law of contract and relevant Statutory Scheme

1.65 The Act applies both in England and Wales and also in Scotland but a different
Scheme applies in those jurisdictions. Indeed, when the Schemes were amended,
there were different amendments in England, Wales and Scotland, although the
differences between the amendments in England and Wales were insignificant. That
means that the Act and the England and Wales Scheme apply in Wales and in
England and that the Act and the Scotland Scheme apply in Scotland. The law
applied to a relevant construction contract made in those jurisdictions will, unless
a different proper law is chosen, be the law of that jurisdiction. However, where the
project is based in Scotland, but the parties to the construction contract expressly
agree that English Law is to govern that contract, both the Act and the England and
Wales Scheme, as amended, apply where English law is the applicable law. This is
most clearly shown by the fact that, under section 114(4) of the Act, the provisions
of the Scheme take effect as implied terms of the sub-contract. Matters related to
implied terms depend on the proper law which governs the relevant contract. It is,
therefore, the implied terms of the England and Wales Scheme, as amended, which
apply where English law governs the contract.143
1.66 If, however, the wrong adjudicator has been appointed under the wrong
Scheme and the wrong Scheme has been applied to the adjudication then, for the
reasons set out in Twintec Ltd v Volkerfitzpatrick Ltd,144 the adjudicator would not
have been properly appointed or the adjudication conducted under the correct
Scheme and this is a matter which would go to jurisdiction. However, where it
seems that both parties proceeded on the basis that the England and Wales Scheme
applied it would have to be considered whether this jurisdictional defence had been

141 Aveat Heating Ltd v Jerram Falkus Construction Ltd [2007] EWHC 131 (TCC), 113 Con LR 13,
16 [7] (HHJ Havery QC).
142 Yuanda (UK) Co Ltd v WW Gear Construction Ltd [2010] EWHC 720 (TCC) [61]–[62]
(Edwards-Stuart J).
143 Laker Vent Engineering Ltd v Jacobs E & C Ltd [2014] EWHC 1058 (TCC) [66]–[70] (Ramsey
J).
144 [2014] EWHC 10 (TCC) [58]: ‘the validity of the procedure by which the adjudicator was
nominated goes to the heart of his jurisdiction’ (Edwards-Stuart J).

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 STATUTORY REGULATION OF CONSTRUCTION CONTRACTS

waived by a party who expressly referred to the England and Wales Scheme in some
documents.145

1.16 Examples of non-compliance

1.16.1 Deferment of adjudication

1.67 A term stating that the parties agree that no matter shall be a dispute unless a
notice of dissatisfaction has been given and the matter has not been resolved within
four weeks is illegal because the parties would have no right to refer at any time
or give notice of an intention to refer a dispute to adjudication.146 This is so even
though the provision is a perfectly sensible one deferring for a modest period the
time at which the contractor could commence an adjudication.147
1.68 Where a variation under a construction contract has been ordered and is to
be paid for by a third party under another agreement between that party and the
employer, a provision in the construction contract that the contractor shall take no
steps to enforce any right, benefit or relief under that contract, pending the determi-
nation, agreement or resolution of any claim under the other agreement relating to
the same circumstances, cannot bar the contractor’s right to proceed immediately
to adjudication.148

1.16.2 Referring party to pay costs

1.69 A clause in a construction contract which imposes on the referring party
the entirety of the parties’ financial costs of the adjudication (i.e. its own and the
responding party’s legal and professional fees) would, in practice, limit that party’s
freedom to refer a dispute to adjudication at any time and, in some circumstances
– such as in a dispute involving a relatively small amount of money – deprive it of a
remedy altogether.149

1.16.3 Sum awarded to be paid into escrow account

1.70 A clause providing that a successful referring party in an adjudication should
not be entitled to be paid the sum claimed and instead the money is to be paid
into an escrow account with a bank is contrary to the Act and contrary to the
principle behind the entire adjudication process, which is ‘to pay now, argue later’;
where the need for the ‘right’ answer has been subordinated by the need to have an
answer quickly, because it would deprive a claiming party of the money they had

145 Laker Vent Engineering Ltd v Jacobs E & C Ltd [2014] EWHC 1058 (TCC) [112] (Ramsey J).
146 John Mowlem v Hydra-Tight Ltd (2002) 17 Const LJ 358, 363 (HHJ Toulmin CMG, QC). See
also R G Carter Ltd v Edmund Nuttall Ltd, 21st June 2000, unreported.
147 Midland Expressway Ltd v Carillion Construction Ltd (No 2) [2005] EWHC 2963 (TCC); (2005)
106 Con LR 154, 172, [65] (Jackson J).
148 Midland Expressway Ltd v Carillion Construction Ltd (No 2) [2005] EWHC 2963 (TCC); (2005)
106 Con LR 154, 172, [65] (Jackson J).
149 Yuanda (UK) Co Ltd v WW Gear Construction Ltd [2010] EWHC 720 (TCC) [51] (Edwards-
Stuart J).

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been awarded by the adjudicator, the clause is designed to discourage a party from
exercising its right to take disputes to adjudication.150

1.17 Unfair terms in consumer contracts

1.17.1 Requirement of good faith

1.71 There is an argument that the adjudication provisions in construction con-
tracts are unfair terms for the purposes of the Unfair Terms in Consumer Contracts
Regulations 1999151 (‘the Regulations’), but it has not found favour.
1.72 Two features of the JCT Forms have been argued152 to be, ‘contrary to the
requirement of good faith, [caused] a significant imbalance in the parties’ rights and
obligations arising under the contract, to the detriment of the consumer’ (Regulation
5(1)). They are those for the resolution of disputes by adjudication and, that unless
the employer issues a withholding notice specifying the amount that it intends to
withhold from an amount due under a certificate, that amount must be paid without
deduction. It was said that none of these provisions had been individually negoti-
ated, they were inherently unfair to consumers such as a residential owner occupier
and they were, therefore, not binding on such a party. At the heart of this argument
was the proposition that the purpose behind the introduction of such provisions into
building contracts was, if only temporarily, to assist the contractor’s cashflow at the
expense of the employer.153 It also placed reliance on the obiter conclusions in Picardi
v Cuniberti154 to the effect that clauses such as were in question were unfair and
caused a significant relevant imbalance. The tide on this question did not, however,
flow in only one direction. In Lovell Projects Ltd v Legg and Carver155 it was explained
why the adjudication provisions in the contract before the court were not regarded
as causing any significant relevant imbalance; and that, in any event, a term would
only be unfair for the purposes of Regulation 5(1) if the imbalance it caused was
‘contrary to the requirement of good faith’, which in that case it was not.156

1.17.2 Significant imbalance

1.73 A consideration of whether, on some sort of attempted objective assessment,
the particular provisions do or do not cause a ‘significant imbalance’ in the respec-
tive rights of contractor and employer to the detriment of the latter will be unnec-
essary because the performance of such an exercise will not, by itself, provide an
answer to the question raised by the argument. As Regulation 5(1) makes clear,
a term which has not been individually negotiated will only be relevantly ‘unfair’
if it causes the relevant imbalance ‘contrary to the requirements of good faith’.

150 Pioneer Cladding Ltd v John Graham Construction Ltd [2013] EWHC 2954 (TCC) [4]–[5]
(Coulson J).
151 SI 1999, No 2083.
152 Bryen & Langley v Boston [2005] EWCA Civ 973, [2005] BLR 508 (Rimer J).
153 Pegram Shopfitters Limited v Tally Weijl (UK) Limited [2004] 1 BLR 65, 67 [2] (May LJ).
154 [2003] 1 BLR 487, 503 [129]–[132] (HHJ Toulmin CMG, QC).
155 [2003] 1 BLR 452, 463 [29] (HHJ Moseley QC).
156 Bryen & Langley v Boston [2005] EWCA Civ 973, [2005] BLR 508 [43] (Rimer J).

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 STATUTORY REGULATION OF CONSTRUCTION CONTRACTS

Regulation 6(1) requires the assessment of the unfairness of a contractual term to

take account (inter alia) of ‘all the circumstances attending the conclusion of the
contract …’. It was explained in Director General of Fair Trading v First National Bank
plc157 that the object of the Regulations and the Directive is to protect consumers
against the inclusion of unfair and prejudicial terms in standard form contracts
into which they enter and further explained the requirement of ‘good faith’ in the
predecessor of Regulation 5(1) in the 1994 Regulations, which in this context, is
one of fair and open dealing. Openness requires that the terms should be expressed
fully, clearly and legibly, containing no concealed pitfalls or traps. Appropriate
prominence should be given to terms which might operate disadvantageously to
the customer. Fair dealing requires that a supplier should not, whether deliberately
or unconsciously, take advantage of the consumer’s necessity, indigence, lack of
experience, unfamiliarity with the subject matter of the contract, weak bargaining
position or any factor listed in or analogous to those listed in Schedule 2 to the
Regulations. Good faith in this context is not an artificial or technical concept; nor,
since Lord Mansfield was its champion, is it a concept wholly unfamiliar to British
lawyers. It looks to good standards of commercial morality and practice. Regulation
4(1) (whose terms were essentially the same as those of Regulation 5(1) of the
1999 Regulations) lays down a composite test, covering both the making and the
substance of the contract and must be applied bearing in mind the objective which
the Regulations are designed to promote.158

1.17.3 Imposition of term

1.74 It follows that in assessing whether a term that has not been individually nego-
tiated is ‘unfair’ for the purposes of Regulation 5(1) it is necessary to consider not
merely the commercial effects of the term on the relative rights of the parties but, in
particular, whether the term has been imposed on the consumer in circumstances
which justify a conclusion that the supplier has fallen short of the requirements of
fair dealing. The situation at which Regulation 5(1) is directed is one in which the
supplier, who will normally be presumed to be in the stronger bargaining position,
has imposed a standard-form contract on the consumer containing terms which are,
or might be said to be, loaded unfairly in favour of the supplier. The Picardi case was
one in which the terms had been imposed by the claimant architect (in that case,
the supplier). In the Lovell case, the terms had been imposed on the supplier by
the employers’ (i.e. the consumers’) architect, the judge finding not only that they
caused no significant imbalance to the employers, but also that in the circumstances
in which the contract came to be made was there any question of any lack of good
faith or fair dealing by the supplier contractor. A similar result, in like circumstances,
was arrived at in Westminster Building Company Limited v Beckingham.159
1.75 Where the relevant provisions were not imposed upon the consumer by the

157 [2002] 1 AC 481, 491 (Lord Bingham).

158 [2002] 1 AC 481, 494, (Lord Bingham), quoted in Bryen & Langley v Boston [2005] EWCA Civ
973 [44] (Rimer J).
159 [2004] BLR 163, as summarised in Bryen & Langley v Boston [2005] EWCA Civ 973 [45]
(Rimer J).

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supplier, rather it was the consumer, acting through his agent, who imposed them
on the supplier, as they were specified in the agent’s original invitation to tender,
assuming that, in practice, the consumer played no part in the preparation of that
invitation and that he did not receive any advice from the agent on the provisions
now in question. It is clear that there was no individual negotiation over them with
the supplier, however, in principle, the consumer had the opportunity to influence
the terms on which the contractors were being invited to tender, even though he
may not have taken it up. There is, therefore, at least an argument available to the
supplier under Regulation 5(2) to the effect that the terms of which he now com-
plains are not terms which fall within the first nine words of Regulation 5(1). Even
so, in light of the fact that it was the consumer, by his agent, who imposed the terms
on the supplier, the suggestion that there was any lack of good faith or fair dealing
by the supplier with regard to the ultimate incorporation of these terms into the
contract is repugnant to common sense. If it was to tender at all, the supplier were
being asked by the consumer to tender on (inter alia) the very terms of which the
consumer then complained. It was not for the supplier to take the matter up with
him and ensure that he knew what he was doing: they knew that he had the benefit
of the services of a professional, his agent, to advise him of the effects of the terms
on which he was inviting tenders. There was no lack of openness, fair dealing or
good faith in the manner in which the contract came to be made and in those cir-
cumstances the consumer’s case under the 1999 Regulations was not made out.160

1.17.4 Adjudication fair

1.76 Adjudication provisions, even if proffered by the contractor in circumstances
which would make it procedurally unfair for the contractor to rely on them vis-à-vis
a consumer, do not cause a significant imbalance in the parties’ rights and obliga-
tions. The procedure is, in essence, a rapid, cheap and temporary legal process
which determines the parties’ rights. It must be conducted pursuant to minimum
standards of fairness and impartiality and is one which is similar to the summary
judgment procedures available in court but capable of being undertaken more
speedily and economically. Although the adjudicator may not be a lawyer, he or she
will have had some professional training relevant to the determination of construc-
tion disputes and, as with arbitration, a legal background is not an essential prereq-
uisite of a fair and impartial procedure. Finally, any decision may be overturned in
a subsequent arbitration or piece of litigation. Although it is potentially unfair for a
contractor to rely on adjudication provisions, such reliance is not rendered unfair
by the Regulations because it does not substantially alter the balance of the parties’
rights and obligations.161

160 Bryen & Langley v Boston [2005] EWCA Civ 973 [46] (Rimer J).
161 Domsalla v Dyason [2007] EWHC 1174 (TCC); 112 Con LR 95 [92]–[93] HHJ Thornton QC:
the withholding provisions of the contract were held to be unfair.

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1.18 Human Rights Act 1998

1.18.1 Introduction
1.77 Under the Human Rights Act 1998, the Articles set out in Schedule 1 are to
have effect for the purposes of that Act subject to any designated derogation or res-
ervation.162 The Articles consist of articles of the European Convention on Human
Rights and subsequent protocols, known collectively as ‘Convention rights’.163
Article 6(1) of Schedule 1 provides that in the determination of his civil rights and
obligations, everyone is entitled to a fair and public hearing within a reasonable time
by an independent and impartial tribunal established by law, and that judgment
shall be pronounced publicly but the press and public may be excluded from all or
part of the trial in the interest of morals, public order or national security in a demo-
cratic society, where the interests of juveniles or the protection of the private life of
the parties so require, or to the extent strictly necessary in the opinion of the court
in special circumstances where publicity would prejudice the interests of justice.164
So far as it is possible to do so, primary legislation and subordinate legislation must
be read and given effect in a way which is compatible with the Convention rights.165
This applies to primary legislation and subordinate legislation whenever enacted,
but does not affect the validity, continuing operation or enforcement of any incom-
patible primary legislation.166
1.78 If the court is satisfied that the provision is incompatible with a Convention
right, it may make a declaration of that incompatibility,167 but a declaration of
incompatibility does not affect the validity, continuing operation or enforcement of
the provision in respect of which it is given and is not binding on the parties to the
proceedings in which it is made.168 It is unlawful for a public authority to act in a
way which is incompatible with a Convention right.169 However, this does not apply
to an act if as the result of one or more provisions of primary legislation, the author-
ity could not have acted differently; or in the case of one or more provisions of, or
made under, primary legislation which cannot be read or given effect in a way which
is compatible with the Convention rights, the authority was acting so as to give effect
to or enforce those provisions.170 A person who claims that a public authority has
acted (or proposes to act) in a way which is made unlawful by the Human Rights Act
1998 may bring proceedings against the authority under the Act in the appropriate
court or tribunal, or rely on the Convention right or rights concerned in any legal
proceedings, but only if he is (or would be) a victim of the unlawful act.171

162 Human Rights Act 1998, s 2(1).

163 Human Rights Act 1998, s 1(1).
164 Human Rights Act 1998, Sched, Part 1, art 6(1).
165 Human Rights Act 1998, s 3(1).
166 Human Rights Act 1998, s 3(2).
167 Human Rights Act 1998, s 4(2).
168 Human Rights Act 1998, s 4(6).
169 Human Rights Act 1998, s 6(1).
170 Human Rights Act 1998, s 6(2).
171 Human Rights Act 1998, s 7(1).

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 ADJUDICATION IN CONSTRUCTION LAW

1.18.2 Timetable not unfair

1.79 The argument, in reliance on section 6(1) of the Human Rights Act 1998,
that a timetable complying with the statutory requirement that the adjudicator shall
reach a decision is manifestly unfair and is particularly so when the only liberty
given to the adjudicator to extend the time is to do so by 14 days but only with the
consent of the referring party,172 can be met by the short answer that the adjudica-
tor could not have acted differently in imposing the time limits that he or she did.
As the adjudicator was acting in accordance with primary legislation, even if the
Convention should apply to his or her function, a party cannot pray in aid section
7(1) as a defence to an application to enforce the subsequent decision so far as time
limits are concerned.173

1.18.3 Adjudicator not a public authority

1.80 An adjudicator exercising functions of the sort required by the 1996 Act is not
a public authority and is not bound by the Human Rights Act 1998 not to act in a
way that is incompatible with a Convention right, subject to the limitation provided
by section 6(2) of the Act. Proceedings before an adjudicator are not legal proceed-
ings. They are a process designed to avoid the need for legal proceedings.174 Legal
proceedings result in a judgment or order that, in itself, can be enforced. If the
decision at the end of legal proceedings is that money should be paid, a judgment is
drawn up that can be put in the hand of the Sheriff or Bailiff and enforced. That is
not the case with an adjudicator. The language of the Housing Grants, Construction
and Regeneration Act 1996 throughout is that the adjudicator makes a decision.
He or she does not make a judgment. Nor does an adjudicator make an ‘award’ as
an arbitrator does though he or she can order that the decision be complied with.
Proceedings before an arbitrator are closer to court proceedings because an award
of an arbitrator can, in some circumstances, be registered and enforced without
a judgment of the court. But the decision of an adjudicator, like the decision of a
certifier, is not enforceable in and of itself. Those decisions, like the decisions of a
certifier, can be relied on as the basis for an application to the court for judgment,
but they are not in themselves enforceable.175

1.18.4 Requirements of Article 6 satisfied

1.81 Even if the adjudicator were a public authority, not just his or her decision
taken alone but also the whole process necessary to enforce his or her decision
should be considered. Considering the whole of that process, including the court
proceedings necessary to enforce the decision, there is necessarily a public hearing
before the decision is enforced (if enforcement be necessary) and all the other

172 Austin Hall Building Ltd v Buckland Securities Ltd [2001] BLR 272, 275–6 [12] (HHJ Bowsher
QC).
173 Austin Hall Building Ltd v Buckland Securities Ltd [2001] BLR 272, 277 [22] (HHJ Bowsher QC).
174 Austin Hall Building Ltd v Buckland Securities Ltd [2001] BLR 272, 280 [40] (HHJ Bowsher QC).
175 Austin Hall Building Ltd v Buckland Securities Ltd [2001] BLR 272, 279 [35] (HHJ Bowsher QC).

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requirements of Article 6 are satisfied. To illustrate the principle involved it is

unnecessary to look further than the long-standing process of the court granting an
interim injunction without notice (or ex parte as it used to be said). An injunction
granted without notice to the defendant, if viewed on its own, is made in breach
of the rules of natural justice and in breach of Article 6 of the Convention. To test
whether there is a breach of Article 6 or of the rules of natural justice, the process
as a whole must be looked at, including the urgency of the situation, the safeguards
ordered by the court including a cross-undertaking in damages and, more impor-
tantly, an order limiting the length of the injunction in time until an early public
hearing on notice to the defendant. Against those safeguards has to be balanced the
consideration that the rights of the citizen, such as a newspaper’s right to freedom of
expression, may be seriously limited and the short period of the limitation of those
rights may be very important. For example, publication of a news item of great
public interest and importance might be prevented in a Sunday newspaper on one
weekend and held over to the next weekend without that newspaper having been
given an opportunity to put its case.176

1.18.5 Violation of Article 1

1.82 Where there is no pressing need for a speedy provisional decision because the
dispute arose long after the completion of the works and is in respect of large claim
based upon professional negligence, the enforcement of an adjudicator’s decision can
constitute a violation of Article 1 of the First Protocol to the Convention,177 which pro-
vides that everyone is entitled to the peaceful enjoyment of his or her possessions.178
To enforce the decision would result in an unfair and excessive burden being placed
on the losing party and the interference would not be justified by any process which
could or even purported to identify the parties’ true legal rights and obligations.179

1.18.6 Failure to ask for a public hearing

1.83 A party who does not ask the adjudicator at the outset or at any time before
his or her decision for a public hearing and public pronouncement of the decision
is not a victim of an unlawful act for the purposes of section 7 of the Human Rights
Act 1998.180 In addition, it will have waived any right to a public hearing because
that right can be waived and such waiver can be inferred from a failure to ask for a
public hearing.181

176 Austin Hall Building Ltd v Buckland Securities Ltd [2001] BLR 272, 280–1 [45] (HHJ Bowsher
QC). See also Elanay Contractors Ltd v The Vestry [2001] BLR 33 (HHJ Havery QC) and Whyte &
Mackay Ltd v Blyth & Blyth Consulting Engineers Ltd [2013] CSOH 54 [63]–[64] (Lord Malcolm).
177 Human Rights Act 1998, Sched I, Pt II, Art. I.
178 Whyte & Mackay Ltd v Blyth & Blyth Consulting Engineers Ltd [2013] CSOH 54 [45] (Lord
Malcolm).
179 Whyte & Mackay Ltd v Blyth & Blyth Consulting Engineers Ltd [2013] CSOH 54 [46] (Lord
Malcolm).
180 Austin Hall Building Ltd v Buckland Securities Ltd [2001] BLR 272, 281 [51] (HHJ Bowsher QC).
181 Austin Hall Building Ltd v Buckland Securities Ltd [2001] BLR 272, 278 [31] 281–2 [53] (HHJ
Bowsher QC).

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 ADJUDICATION IN CONSTRUCTION LAW

1.19 Insolvency Act 1986 and the Insolvency Rules

1.19.1 Administration
1.84 During the period for which an Administration Order is in force no other
proceedings and no execution or other legal process may be commenced or con-
tinued and no distress may be levied against the company subject to the Order
or its property except with the consent of the administrator or the leave of the
court and subject, where the court gives leave, to such terms as aforesaid.182
‘Other proceedings’ means either legal proceedings or quasi-legal proceedings such
as arbitration.183 The adjudication procedure under section 108 of the Housing
Grants, Construction and Regeneration Act 1996 constitutes quasi-legal proceed-
ings such as arbitration within that classification and leave of the court is required
before an adjudication can be begun or continued against a company subject to an
Administration Order.184
1.85 The discretion as to whether or not to grant leave to commence or continue
should be exercised in accordance with the principles identified by the Court of
Appeal in Re Atlantic Computers Plc.185 Those guidelines are formulated for cases
where proprietary rights, including security rights, such as those held by landlords,
lessors or mortgagors, are sought to be exercised under the immediately preceding
section 11(3)(c) of the Insolvency Act 1986. However, with appropriate modifica-
tions, these guidelines are clearly helpful in considering whether a creditor should
be granted leave to enforce a trade debt under section 11(3)(d) of that Act. The
relevant guidelines are:
(1) It is in every case for the party who seeks leave to make out a case for it to
be given leave.
(2) The prohibition in section 11(3)(d) is intended to assist the company, under
the management of the administrators, to achieve the purpose for which the
administration order was made. If granting leave to a creditor to exercise his
contractual or restitutionary rights and sue for the payment of his debt is
unlikely to impede the achievement of that purpose, leave should normally
be given.
(3) In other cases the court has to carry out a balancing exercise, balancing the
legitimate interests of the creditor and the legitimate interests of the other
creditors of the company. This is to enable a balance to be struck between
the statutory objective of enforcing the prohibition to assist the company
to achieve the object for which the administration order was made and the
statutory power to relax the prohibition where it would be inequitable for
the prohibition to apply.
(4) Greater importance is given to those with proprietary interests than to

182 Insolvency Act 1986, s 11(3)(d).

183 Re Paramount Airways [1990] BCC 130, 153C (Sir Nicholas Browne-Wilkinson VC).
184 A. Straume (UK) Ltd v Bradlor Developments Ltd [2001] TCLR 409, [2000] BCC 333 (HHJ
Berhens).
185 Re Atlantic Computers Plc [1992] Ch 505.

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those who are mere unsecured creditors. The underlying principle is that an
administration for the benefit of unsecured creditors generally should not
be conducted at their expense or at the expense of secured or preferential
creditors save where this may be unavoidable and, even then, only to a
limited extent.
(5) It will normally be a sufficient ground for the grant of leave if significant loss
would be caused to the creditor by the refusal. However, that loss should
not prevail if substantially greater loss would be caused to others by the
grant of leave.
(6) In assessing these matters the court will have regard to matters such as: the
financial position of the company, its ability to pay the debt, the administra-
tors, proposals, the period for which the administration order has been in
force and is expected to remain in force, the effect on the administration if
leave were given, the effect on the applicant if leave were refused, the end
result sought to be obtained by the administration, the prospects of that
result being achieved, and the history of the administration so far.
(7) In considering these matters it will often be necessary to assess how prob-
able the suggested consequences are. Thus if loss to the applicant is virtu-
ally certain if leave is refused, and loss to others a remote possibility if leave
is granted, that will be a powerful factor in favour of granting leave.
(8) The conduct of the parties may also be a material consideration.
(9) The court will not decide a dispute as to whether the debt in question is due
unless it is a short point that must be decided.186
The court will not exercise its discretion to grant leave if the right of set off has been
excluded by the construction contract and the effect of allowing an adjudication to
be commenced or continued would permit its introduction by other means.187

1.19.2 Winding-up and appointment of provisional liquidator

1.86 When a winding-up order has been made or a provisional liquidator has
been appointed, no action or proceeding should be proceeded with or commenced
against the company or its property except by leave of the court, and subject to such
terms as the court may impose.188 It is submitted that ‘proceedings’ would be given
a similar interpretation to that set out above in relation to administration orders, and
the same would apply to the court’s power to restrain ‘any other action or proceed-
ing’ against the company after the presentation of a winding-up petition and before
the winding-up order has been made.189

186 Joinery Plus Ltd v Laing Ltd [2003] BLR 184, 204–5 [106]–[108] (HHJ Thornton QC).
187 A Straume (UK) Ltd v Bradlor Developments Ltd [2001] TCLR 409, [2000] BCC 333 (HHJ
Berhens). See also Joinery Plus Ltd v Laing Ltd [2003] BLR 184, 204–6 [102]–[120] (HHJ Thornton
QC).
188 Insolvency Act 1986, s 130(2).
189 Insolvency Act 1986, s 126(1).

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 ADJUDICATION IN CONSTRUCTION LAW

1.19.3 Claim for balance due not to be adjudicated

1.87 A claim by an assignee from a liquidator for an account and the payment of
what is alleged to be the net balance due under Rule 4.90 of the Insolvency Rules
cannot be pursued in adjudication but has to be pursued in court, because that
rule envisages that the account will be taken and the balance decided in one set of
proceedings where the result would be final and binding. That is the inescapable
effect of the words used, particularly in sub-rules 4.90(3) and (4). It is also what
Lord Hoffmann had in mind in Stein v Blake190 when he referred to the taking of the
‘single account’. That would rule out adjudication, because the results could only
be obtained piecemeal, contract by contract, and could only ever be temporarily
binding.191
1.88 In such a case, the claim for sums due under the construction contract has,
in the unequivocal words of Lord Hoffmann in Stein v Blake, ‘ceased to exist’.192
Following the liquidation of the assignor and the assignment of the right under
Rule 4.90, as he put it, ‘the only chose in action which continued to exist as an
assignable item of property was the claim to a net balance’.193 Thus the claim under
the construction contract could not be assigned to the assignee. Because it was no
longer extant, it was incapable of assignment under the Law of Property Act 1925.
The suggestion that the claim under the construction contract did continue to exist
because that was the way in which the balance could be ascertained under Rule
4.90 was roundly rejected by Lord Hoffmann in Stein v Blake where he said in
terms that such a claim was ‘merely part of the process of retrospective calculation’
and repeated that the only claim which could then exist was the claim to the net
balance.194 Accordingly, the only chose in action which the original party’s liquida-
tor could assign would be the claim to a net balance which arose out of the mutual
dealings.195

1.19.4 No piecemeal recovery

1.89 In the absence of any agreement between the parties, it would not be in
accordance with the Insolvency Rules for the calculation of the net balance under
Rule 4.90 to be performed in what might be described as a piecemeal or hobbled
fashion. Even if the original claim under the construction contract somehow contin-
ued to exist, it would only be as one part of the mechanism for the arriving at a net
balance arising from the mutual dealings. Absent agreement between the parties,
there is nothing in Rule 4.90 which would justify subjecting this mechanism to the
piecemeal, element-by-element approach encompassed in multiple adjudications,
particularly in circumstances where not all the relevant parties could be joined in

190 [1996] 1 AC 243, 258.

191 Enterprise Managed Services Ltd v Tony McFadden Utilities Ltd [2009] EWHC 3222 (TCC) [64]
(Coulson J).
192 [1996] 1 AC 243, 255.
193 [1996] 1 AC 243, 255.
194 [1996] 1 AC 243, 255.
195 Enterprise Managed Services Ltd v Tony McFadden Utilities Ltd [2009] EWHC 3222 (TCC) [68]
(Coulson J).

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 STATUTORY REGULATION OF CONSTRUCTION CONTRACTS

to the adjudication in any event. That conclusion, to the effect that Rule 4.90 envis-
ages a single and final ascertainment process, is consistent with the clear words of
the Rule; consistent with Lord Hoffmann’s reference to ‘a single account’ in Stein
v Blake; and consistent both with the earlier decision of the Court of Appeal in MS
Fashions v BCCI 196and the subsequent decision of the House of Lords in Secretary
of State for Trade and Industry v Frid.197 In none of those authorities is a piecemeal,
slice-by-slice approach suggested as being in any way appropriate for the taking of
the account under Rule 4.90.198

1.19.5 Temporary nature of adjudication

1.90 There is also a fundamental clash between the certainty and finality envisaged
by the full Rule 4.90 process and, to use the vernacular, the temporary, quick-fix
solution offered by construction adjudication under the Act. How can a decision
that, if challenged, is of a temporary nature only, and would relate just to an element
of the chose in action, have any role in or relevance to the taking of a final account
under the Insolvency Rules? This fundamental difference of approach was high-
lighted by the Court of Appeal in Bouygues (UK) Ltd v Dahl-Jensen (UK) Ltd.199

1.19.6 Company voluntary arrangements

1.91 As a matter of jurisdiction, the existence of a company voluntary arrangement
(‘CVA’) does not act as some sort of bar on adjudication which prevents a company
from pursuing adjudication for a pre-CVA debt. A CVA is not akin to a liquidation,
whereby it is the liquidator who must take proceedings and there are restrictions
even on that.200

1.20 Third parties

1.92 The rights of a third party enforceable under the Contracts (Rights of Third
Parties) Act 1999 cannot be determined by adjudication under an express term con-
tained within the agreement between the original contracting parties. Section 1(4)
of that Act alone would not be sufficient to permit a third party to refer its disputes
with a party to a construction contract to adjudication. Without an equivalent of
section 8 of the Act (which expressly refers to arbitration) so as to make the provi-
sion as to adjudication applicable to the relationship between the third party and
the party to the construction contract, the terms of an adjudication provision would
not be applicable.201

196 [1993] 1 Ch 425.

197 [2004] 2 AC 506.
198 Enterprise Managed Services Ltd v Tony McFadden Utilities Ltd [2009] EWHC 3222 (TCC) [69]
(Coulson J).
199 2000] BLR 522, as explained in Enterprise Managed Services Ltd v Tony McFadden Utilities Ltf
[2009] EWHC 3222 (TCC) [70]–[71] (Coulson J).
200 Westshield Ltd v Whitehouse [2013] EWHC 3576 (TCC) [23] (Akenhead J).
201 Hurley Palmer Flatt Ltd v Barclays Bank Plc [2014] EWHC 3042 [42] (Ramsey J). See Chapter
2, section 2 below.

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