Lanes Group Plc v Galliford Try Infrastructure Ltd

JurisdictionEngland & Wales
CourtCourt of Appeal (Civil Division)
JudgeLord Justice Jackson,Lord Justice Stanley Burnton,Lord Justice Richards
Judgment Date21 Dec 2011
Neutral Citation[2011] EWCA Civ 1617
Docket NumberCase Nos: A1/2011/1288, A1/2011/1979, A1/2011/2002

[2011] EWCA Civ 1617





Royal Courts of Justice

Strand, London, WC2A 2LL


Lord Justice Richards

Lord Justice Stanley Burnton


Lord Justice Jackson

Case Nos: A1/2011/1288, A1/2011/1979, A1/2011/2002

HT-11-190 & 194

Lanes Group PLC
Appellant In First Two Appeals. Respondent In Third Appeal
Galliford Try Infrastructure Limited T/A
Galliford Try Rail
Respondent In First Two Appeals And Appellant In Third Appeal.

Mr. John Marrin QC (instructed by McGrigors LLP) for the Appellant

Mr. Richard Wilmot-Smith QC, Ms. Karen Gough and Ms. Rachael O'Hagan (instructed by Barton Legal) for the Respondent

Hearing dates : Thursday 8th December 2011

Lord Justice Jackson

This judgment is in seven parts namely,

Part 1 . Introduction,

Part 2 . The Facts,

Part 3 . The Proceedings in the Technology and Construction Court,

Part 4 . The Appeals to the Court of Appeal,

Part 5 . First Issue. Did Mr Atkinson have Jurisdiction as Adjudicator?

Part 6 . Second Issue. Is the Adjudicator's Decision Tainted by Apparent Bias?

Part 7. Conclusion.


These are conjoined appeals in three separate actions concerning an adjudication decision. The two essential questions are whether the adjudicator had jurisdiction to conduct the adjudication and whether his decision is a nullity by reason of apparent bias.


The claimant in the adjudication and appellant in two of the appeals is Lanes Group Plc, to which I shall refer as "Lanes". The respondent in the adjudication and appellant in the third appeal is Galliford Try Infrastructure Limited trading as Galliford Try Rail, to which I shall refer as "Galliford".


In this judgment I shall refer to the Institute of Civil Engineers as "ICE" I shall refer to the adjudication procedure published by the ICE in 1997 as "The ICE Adjudication Procedure".


I shall refer to the Housing Grants, Construction and Regeneration Act 1996 as "the 1996 Act". Section 108 of the 1996 Act provides:

"108–(1) 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.

For this purpose "dispute" includes any difference.

(2) The contract shall—

(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.

(3) The contract shall 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.

The parties may agree to accept the decision of the adjudicator as finally determining the dispute.

(4) …

(5) If the contract does not comply with the requirements of subsections (1) to (4), the adjudication provisions of the Scheme for Construction Contracts apply."


The Scheme referred to in Section 108(5) of the 1996 Act is the Scheme which is contained in the schedule to the Scheme for Construction Contracts Regulations 1998. I shall refer to this as "the Scheme".


Paragraph 1 of the Scheme provides:

"Notice of Intention to seek Adjudication

(1) Any party to a construction contract (the "referring party") may give written notice (the "notice of adjudication") of his intention to refer any dispute arising under the contract to adjudication.

(2) The notice of adjudication shall be given to every other party to the contract.

(3) The notice of adjudication shall set out briefly—

(a) the nature and a brief description of the dispute and of the parties involved,

(b) details of where and when the dispute has arisen,

(c) the nature of the redress which is sought, and

(d) the names and addresses of the parties to the contract (including, where appropriate, the addresses which the parties have specified for the giving of notices)."


Paragraph 7 of the Scheme provides:


(1) Where an adjudicator has been selected in accordance with paragraphs 2, 5 or 6, the referring party shall not later than seven days from the date of the notice of adjudication, refer the dispute in writing (the "referral notice") to the adjudicator.

(2) A referral notice shall be accompanied by copies of, or relevant extracts from, the construction contract and such other documents as the referring party intends to rely upon.

(3) The referring party shall, at the same time as he sends to the adjudicator the documents referred to in paragraphs (1) and (2), send copies of those documents to every other party to the dispute."


Paragraph 19 of the Scheme provides:


(1) The adjudicator shall reach his decision not later than—

(a) twenty eight days after the date of referral notice mentioned in paragraph 7(1), or

(b) forty two days after the date of the referral notice if the referring party so consents, or

(c) such period exceeding twenty eight days after the referral notice as the parties to the dispute may, after the giving of that notice, agree.

(2) Where the adjudicator fails, for any reason, to reach his decision in accordance with paragraph (1)

(a) any of the parties to the dispute may serve a fresh notice under paragraph 1 and shall request an adjudicator to act in accordance with paragraphs 2 to 7; and

(b) if requested by the new adjudicator and insofar as it is reasonably practicable, the parties shall supply him with copies of all documents which they had made available to the previous adjudicator.

(3) As soon as possible after he has reached a decision, the adjudicator shall deliver a copy of that decision to each of the parties to the contract."


In this judgment I shall refer to the initial notice of intention to refer a dispute to adjudication as an "adjudication notice".


After these introductory remarks I must now turn to the facts.


Lanes is a company which carries on business as a multi-disciplinary contractor in the railway industry. Galliford is a major contractor in the construction industry undertaking, inter alia, infrastructure projects in the public and related sectors. This dispute concerns works carried out under a sub-contract between Galliford and Lanes, whereby Lanes contracted to renew the roof at the traction maintenance depot ("TMD") in Inverness, Scotland.


The TMD is owned and run by Network Rail Infrastructure ("NRI"). Galliford were the main contractors to NRI. Under the sub-contract Lanes agreed to remove the existing roof and to carry out the re-roofing and glazing at the TMD. The original sub-contract sum was £819,367.00 plus VAT.


The sub-contract was evidenced by Galliford's sub-contract order dated 13 th May 2008 and it embodied the Civil Engineering Contractors Association's "Blue Form" of sub-contract terms and conditions, together with associated drawings, specifications and other documents mentioned in Galliford's sub-contract order of that date. There were subsequent variations to the sub-contract, but those are not material to the present proceedings.


The works were scheduled to commence on 3 rd June 2008, but in the event their commencement was put back by Galliford and as a result of further delays were not commenced until 13 th October 2008. On 28 th April 2009 Galliford determined Lanes' employment under the sub-contract. At that time, the sub-contract works were substantially incomplete and the only extensions of time which had been granted by Galliford were from 25 th November 2008 until 9 th December 2008 owing to the delayed start on site. Lanes claimed that the works were substantially varied and amended by Galliford, in particular in early March 2009, that it was entitled to substantial extensions of time and that accordingly the sub-contract was wrongfully terminated. Galliford alleged that Lanes had failed to proceed with the works with due diligence.


In November 2010 Lanes commenced an action against Galliford for wrongful termination of the sub-contract and claimed approximately 2 million pounds in damages. In response Galliford issued an application to stay those proceedings for arbitration. Independently, on 23 rd December 2010, Galliford sent Lanes a substantial claim in relation to delay and termination of the sub-contract under which it claimed some 2.7 million pounds in damages from Lanes.


By agreement, the parties compromised Galliford's application to stay the court proceedings for arbitration and agreed that the case should proceed in arbitration in the Technology and Construction Court before Mr Justice Ramsey sitting as arbitrator.


While the arbitration was proceeding, Galliford decided to seek the interim remedy of an adjudication award. Accordingly, Galliford duly served an adjudication notice on Lanes. On the 9 th March 2011 Galliford applied to the ICE to appoint an adjudicator.


On 10 th March 2010 the ICE appointed Mr Howard Klein as adjudicator. Mr Klein duly accepted the appointment. However, Galliford's solicitors failed to take the next step,...

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    • 4 April 2014 " unusual", " distinct from arbitration and sui generis" – see paragraph 40 of Lanes Group plc v Galliford Try Infrastructure Ltd t/a Galliford Try Rail [2012] BLR 121. One does not find the words " proceedings" or " commencement" in the Scheme. Th......
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    ...of the measures taken by the judge before the trial.’ 18 Those dicta are in line with the decision in Lanes Group plc v Galliford Try Infrastructure Ltd (trading as Galliford Try Rail) [2012] EWCA Civ 1617; [2012] Bus LR 1184. In that case, Jackson LJ addressed an allegation of apparent bi......
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    ...he failed to comply with the rules of natural justice. It is a species of bias, but rather different in concept: see Lanes Group PLC v Galliford Try Infrastructure Ltd [2011] EWCA Civ. 1617, and paragraph 44 onwards of the judgment of Jackson 160 As with the allegations of bias, the centra......
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2 firm's commentaries
  • 2011 Construction Case Law Summary
    • United Kingdom
    • Mondaq United Kingdom
    • 20 January 2012
    ...challenge in the Courts to the adjudicator's jurisdiction. Lanes Group Plc v Galliford Try Infrastructure Ltd (t/a Galliford Try Rail) [2011] EWCA Civ 1617 Forum shopping and bias: This Court of Appeal case concerned conjoined appeals in three separate actions from 2011 concerning an adjudi......
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    • Mondaq United Kingdom
    • 8 February 2012 Alstom of not getting the documents and the likelihood that Somi could not pay them. Justin Mort Galliford Try Infrastructure Ltd [2012] CILL 3116 Court of Lanes challenged the judge's finding at first instance that the adjudicator still had jurisdiction, even though the referring party ......

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