Andrew Brown and Others v Complete Buildings Solutions Ltd
| Jurisdiction | England & Wales |
| Judge | Lord Justice Simon,Sir Robin Jacob,Lord Justice Beatson |
| Judgment Date | 13 January 2016 |
| Neutral Citation | [2016] EWCA Civ 1 |
| Docket Number | Case No: A2/2014/3610 |
| Court | Court of Appeal (Civil Division) |
| Date | 13 January 2016 |
[2016] EWCA Civ 1
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE TECHNOLOGY AND CONSTRUCTION COURT
MANCHESTER DISTRICT REGISTRY
HH Judge Raynor QC
Royal Courts of Justice
Strand, London, WC2A 2LL
Lord Justice Beatson
Lord Justice Simon
and
The Rt Hon. Sir Robin Jacob
Case No: A2/2014/3610
Mr Timothy Sampson (through the Public Access Scheme) for the Appellants
Mr Richard Bradley (instructed by C.E Law) for the Respondent
Hearing date: 16 December 2015
Introduction
This appeal from the judgment of HH Judge Raynor QC raises a short issue as to whether an adjudicator (appointed under the terms of a building contract) had jurisdiction to decide a dispute between the parties. The Appellants' contention is that he had no jurisdiction because he was being asked to adjudicate the same or substantially the same dispute as had been decided by another adjudicator in an earlier adjudication. The Respondent contends, as the Judge found, that he did have jurisdiction.
The facts
By the terms of a JCT Minor Works Building Contract (2011 Edition) dated 22 December 2011 ('the Contract') the Respondent agreed with the Appellants to demolish a dwelling house (at Ashtead in Surrey) and to build a new house for a price of £496,578, or such other sum as might become due under the contract.
The Architect certified practical completion on 9 April 2013, and issued a Certificate of Making Good Defects on 25 October 2013.
On 31 October the Architect issued a 'Final Certificate' under the contract and, on 20 December 2013, the Respondent sent a letter claiming that a final payment of £115,450.50 was due.
The sum was not paid and a Notice of Adjudication was sent on 7 February 2014 ('the First Adjudication Notice').
Section 7 of the Contract was headed 'Settlement of Disputes', and clause 7.2 provided:
If a dispute or difference arises under this Contract which either Party wishes to refer to adjudication the Scheme shall apply except that for the purposes of the Scheme the Adjudicator shall be the person (if any) and the nominating body shall be that stated in the Contract Particulars.
No Adjudicator was named in the Contract Particulars but on 10 February 2014 the nominating body appointed Mr CJ Calcroft as Adjudicator under the terms of clause 7.2.
The Respondent accepted that the Architect's 'Final Certificate' was uncontractual in that it was not issued in accordance with Clause 4.8.1 but relied on clause 4.8.4 of the Contract which provided:
If the final certificate is not issued in accordance with clause 4.8.1,
1. the Contractor may give a payment notice to the Employer with a copy to the Architect/Contract Administrator stating what the Contractor considers to be the amount of the final payment due to him under this Contract and the basis on which the sum has been calculated and, subject to any notice under clause 4.8.4.3, the final payment shall be the final amount.
…
3. If the Employer intends to pay less than the sum specified in the Contractor's payment notice, he shall not later than 5 days before the final date for payment give the Contractor notice of that intention … and the payment to be made on or before the final date for payment shall not be less than the amount stated as due in the Employer's notice.
Clause 4.8.5 established that where the Employer did not give a counter notice under clause 4.8.4.3 it was obliged to pay the Contractor the sum stated as due in the Contractor's notice.
On 1 April Mr Calcroft issued his Adjudication ('the First Adjudication'). He concluded (as was common ground) that the 'Final Certificate' issued on 30 October 2013 was ineffective; but also found that the Respondent's letter of 20 December 2013 was not a valid payment notice for the purposes of Clause 4.8.4.1. His reasons for reaching this conclusions were (a) it was based on the 'Final Certificate' being issued late, whereas it was in fact invalid (§§60–64), and (b) the terms of the 20 December letter did not comply with clause 4.8.4.1 in view of the way it was expressed: it did not make clear that it was (i) a notice (ii) issued pursuant to clause 4.8.4.1 (§72). He found that, since no payment notice had been served, no sum was payable.
On the same day, 1 April 2014, the Respondent sent a letter described as a 'notice pursuant to Clause 4.8.4.1 of the Contract' and, on 24 April, issued a Notice of Adjudication ('the Second Adjudication Notice').
Although Mr CJ Hough was appointed Adjudicator on 29 April, the Appellants disputed his jurisdiction, essentially on the basis advanced later before Judge Raynor QC and this Court: namely, that Mr Hough was being asked to decide the same, or substantially the same, dispute as had been decided by Mr Calcroft in the First Adjudication. On this basis they declined to participate in the adjudication and did not serve a notice under clause 4.8.4.3.
It is common ground that the Scheme referred to in clause 7.2 is the Scheme for Construction Contracts (England and Wales) Regulations 1998 (1998/SI/649) of which Regulation 9.2 provides:
An adjudicator must resign where the dispute is the same or substantially the same as one which has previously been referred to adjudication, and a decision has been taken in that adjudication.
Mr Hough issued his decision ('the Second Adjudication') on 27 May 2014. He found that the dispute he was being asked to decide was not the same or substantially the same dispute as had been referred to Mr Calcroft. He found that Mr Calcroft had decided that no certificate had been issued in accordance with Clause 4.8.1 and that this decision was binding on both the parties and him. However, he also decided that the 1 April 2014 notice was an effective notice under Clause 4.8.4.1 and the Appellant's refusal to make payment created a dispute which was not the same or substantially the same as the one previously referred to Mr Calcroft and decided by him.
On this basis, having noted that the Appellants had not given a counter notice under Clause 4.8.4.3, he decided that the Appellants were obliged by the terms of the Contract to pay £115,440.46 to the...
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