Petition Of Jack Paton And Another For Judicial Review
| Jurisdiction | Scotland |
| Judge | Lord Bannatyne |
| Neutral Citation | [2011] CSOH 40 |
| Year | 2011 |
| Published date | 01 March 2011 |
| Docket Number | P478/10 |
| Court | Court of Session |
| Date | 01 March 2011 |
| OUTER HOUSE, COURT OF SESSION [2011] CSOH 40 | |
| P478/10 | OPINION OF LORD BANNATYNE in the Petition of MR and MRS JACK PATON Petitioners; for Judicial review of a decision dated 17 April 2010 by Ian Strathdee, acting in the capacity of an adjudicator ________________ |
Petitioners: M. Hamilton; Maclay Murray & Spens LLP
First Respondent: S Smith; Wright Johnston & Mackenzie LLP
1 March 2011
Subject of the proceedings
[1] In this petition Mr and Mrs Paton ("the petitioners") seek judicial review of a decision of Ian Strathdee ("the adjudicator") dated 17 April 2010. The decision awarded an extension of time and prolongation costs totalling £27,414.83 with interest of £1,090.44 to Douglas Jamie ("the first respondent") who was the referring party in an adjudication which had taken place between the petitioners and first respondent.
The factual background to the adjudication
[2] The petitioners and the first respondent entered into a building contract on 10 September 2007 for the construction by the first respondent of a one and a half storey traditionally built private dwelling house ("the contract"). The contract is constituted by the conditions set out in the SBCC's Scottish Minor Works Contract 1986 Edition (January 2002 Revision) as amended by the parties.
[3] That the works were due to have been completed by 31 May 2008. They were not completed by that date.
[4] The works did not proceed according to programme and only achieved practical completion on 12 December 2008. Following a request by the first respondent on 8 September 2008 for an extension of time, the petitioners' architect granted an eight week extension of time by letter dated 27 August 2009. The extension of time awarded took the contractual completion date to 26 July 2008.
[5] That the first respondent was dissatisfied by the extension of time awarded. In addition, due to a number of difficulties experienced throughout the contract, the petitioners had withheld sums against an interim certificate and the final certificate. The first respondent was also dissatisfied that these sums had been withheld by the petitioners. By notice of adjudication dated 12 March 2010, the first respondent initiated an adjudication in accordance with Clause 10A of the Contract. In terms of the notice, the first respondent sought to challenge the extension of time awarded and the sums withheld by the petitioners. The adjudicator was nominated by the appropriate body. Before the adjudicator, the first respondent contended that he was entitled to an extension of time such that the contractual completion date coincided with the date of practical completion representing an extension of approximately 20 weeks. The first respondent also contended that the petitioners had wrongfully withheld sums due under the contract. In the decision, the adjudicator substantially agreed with the first respondent. He made awards as above set out.
The ground of challenge of the decision of the adjudicator
[6] The ground of challenge of the adjudicator's decision as developed in the petition was this: That in purporting to determine the dispute between the petitioners and the first respondent the adjudicator had acted in a manner which was in breach of the requirements of natural justice.
Evidence led in this judicial review
[7] The petitioners led evidence from two witnesses, namely: the adjudicator and Denis Shields. No evidence was led on behalf of the first respondent.
The adjudicator
[8] His evidence as regards what came to be the principal issues in the case was as follows: It was his position that based on the early site meeting minutes the first critical event was the supply of stonework by the petitioners to the site. When he spoke of an event or item as critical he was defining an event as being of such a nature that if it did not happen on the date in the contract programme when it was programmed to happen then other events in the programme would of necessity be delayed. It was in addition in his view the principal/dominant critical event in terms of this contract.
[9] As regards the first activity on the contract programme (6/26 of process) namely "site clear, drains, substructure" this was not broken up into its constituent parts in the programme. However, he gave evidence that he had come to the opinion that it would take one week to clear the site, drains would take two weeks and therefore the substructure could be commenced at the beginning of week four. That was his assessment and he came to his view by applying the experience that he had gained in the industry. In so far as when superstructure walling (event 2) could begin, he said that sufficient of the substructure had to be in place and that he had again used his knowledge and experience in coming to a view as to this. In reaching his view on what was sufficient, he had applied a rule of thumb. He described the contract programme as a simple one. It was no more than a bar chart.
[10] Turning to his approach to assessing the delay claim it was his position that he had not assessed this on the basis of a critical path analysis. He said that he had done no more than identify from the contract programme, and from the terms of the minutes of site meetings what events were critical, in this case principally supply of stonework. He stated that in a programme as simple as the one in this case that he was able to identify by eye the critical events. He said that he had only seen critical path analysis used in much more complex projects. He said that this type of bar chart programme did not lend itself to critical path analysis and that in particular there were no logic links.
[11] The adjudicator accepted when it was put to him that the second event on the contract programme, namely: "superstructure walling" was not divided in such a way as to identify what part of the period shown against that event related to breezeblock walling and what part related to stonework.
[12] When asked how he had reached his estimate that at the commencement of the third week of the second event namely 12 November 2007 stonework walling should have begun he advised that he had only been able to reach that figure with difficulty. He accepted that he had had to estimate when the stonework should have begun within the period allocated to that event. He said that he had come to his figure as a result of his own experience. It was what he described as an "informed guess". His opinion had been come to against a background that first, no delays were referred to in the site meeting minutes against the first event in the programme and secondly, the number of weeks given in the programme to that second event.
[13] In relation to the further relevant events he accepted that he had relied heavily on the architect's assessment.
Mr Denis Shields
[14] Mr Denis Shields, construction contract consultant, gave evidence as an expert on the petitioners' behalf. He spoke generally to his report 6/2 of process.
[15] In his evidence he accepted that for the purposes of assessing an extension of time claim it is possible to make an assessment without establishing a critical path and it would have been appropriate to make an assessment in this case without establishing a critical path by using minutes of meetings, photographs of work in progress and correspondence. However, it was his understanding from the documentation that the adjudicator was going to do a critical path analysis and use logic links. It was his position that a critical path could not be established without logic links.
[16] He had no difficulty with an adjudicator using his own knowledge and experience in arriving at an assessment.
[17] As regards the adjudicator's position that stonework was critical he advised under reference to 2.7.5 of his report that this was a critical matter. As to the adjudicators choice of date within the contract programme event 2 as to when stonework would have commenced he said that this was an estimate. It was his evidence that this was the critical date so far as the adjudicator was concerned in arriving at his figure for delay.
[18] He accepted that given that the superstructure bar was not divided between breezeblock and stonework the adjudicator would have had to make a judgment within the period shown against that event in the contract programme as to when the stonework could have been commenced.
[19] He accepted that when stonework would have commenced was a matter which on the basis of the submissions was before the adjudicator. He accepted that it was open to parties to make submissions on these issues. His position in cross-examination was that he had no difficulty with the adjudicator arriving at an assessment as to when stonework should have commenced and basing this on his own knowledge and experience. However, where he said the adjudicator had failed was in not giving parties an opportunity to comment on these matters.
Submissions for the petitioners
[20] Counsel's motion was that I should sustain the first and second pleas-in-law for the petitioners and repel the first respondent's pleas-in-law and thus reduce the adjudicator's decision and grant interdict as third and fourth sought.
[21] Counsel's broad position remained as set out in the petition that the adjudicator had breached natural justice in the manner in which he had reached his decision. The core of her position was as set out in paragraph 10 of the petition.
[22] She commenced her submissions by referring to Balfour Beatty Construction Limited v The Mayor & Burgesses of the London Borough of Lambeth 2002 BLR 288. The facts relevant to the issues before the court were:
"Balfour Beatty considered that they were entitled to extensions of time, and submitted certain information to the architect in respect of applications for this, relying upon 31 different relevant events .... Balfour Beatty did not submit a critical path, as Balfour Beatty maintained, this...
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