Shaw v Massey Foundations & Pilings Ltd
| Jurisdiction | England & Wales |
| Judge | Mr Justice Coulson |
| Judgment Date | 12 March 2009 |
| Neutral Citation | [2009] EWHC 493 (TCC) |
| Date | 12 March 2009 |
| Court | Queen's Bench Division (Technology and Construction Court) |
| Docket Number | Case No: 8LV26785 |
[2009] EWHC 493 (TCC)
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
ON APPEAL FROM LIVERPOOL COUNTY COURT
TECHNOLOGY AND CONSTRUCTION COURT LIST
Manchester Civil Justice Centre
Crown Square, Manchester
Before : Mr Justice Coulson
Case No: 8LV26785
Mrs Gabriele Shaw in person for the Appellants
Mr Richard Bradley (instructed by CE Law) for the Respondents
Hearing date: 12th March 2009
Mr Justice Coulson:
A. INTRODUCTION
These are two linked applications for permission to appeal. Although the appellants have had both solicitors and counsel acting for them in the past, they now appear in person through Mrs Shaw, a qualified barrister.
The first application for permission to appeal arises out of an order of 28 th November 2008 made by HHJ MacKay sitting in the Liverpool County Court (TCC List), in which he gave judgment in favour of the respondents in the sum of £88,000 odd by way of enforcement of an adjudicator's decision. He dismissed an application by the respondents to stay the claim for arbitration. Judge MacKay did however allow the appellants to apply to have that judgment set aside.
The second application for permission to appeal concerns the order of HHJ Platts, also sitting at Liverpool County Court. His judgment and order were dated 16 th December 2008. In that judgment Judge Platts refused to set aside the judgment on the ground that the appellants were residential occupiers. The appellants had argued that the adjudicator had no jurisdiction because residential occupiers were excluded from the ambit of adjudication by operation of Section 106 of The Housing Grants (Construction and Regeneration) Act 1996 (“The 1996 Act”).
As I have indicated, both appeals arise out of decisions in the County Court. The decision of Judge MacKay is rightly described in the grounds of appeal to be a decision against the grant of interim relief. On behalf of the respondents today, Mr Bradley accepts that, and agrees that I have the jurisdiction to consider the first application.
The decision of Judge Platts was in respect of an application to set aside judgment. If the application had been granted the proceedings would not have been determined. It was not therefore a final order within the definition of Part 2A.2 of the Practice Direction supplementing CPR Part 52. Again, Mr Bradley accepts this, and agrees that I also have the jurisdiction to deal with the second application for permission to appeal. I therefore turn to address one preliminary matter, before going on to deal with each application for permission to appeal.
B. THE APPLICATION TO AMEND
The appellants seek to make an application to amend their notice of appeal to raise an issue ostensibly concerned with natural justice, which has not been raised before. Given the fact that it is entirely new, and was not taken before either judge below, it seems to me that it is inappropriate to allow the matter to be raised on an application for permission to appeal.
In any event, on analysis, the matters raised in the amendment application are irrelevant to the only issue that now remains, which is whether or not the appellants are liable to pay the sums found due by the adjudicator. The new matters are not in fact concerned with natural justice at all; instead, they seek to raise a point that the appellants were 'consumers' when they entered into the construction contract. As I explained to Mrs Shaw during the course of the argument, the notion of 'consumers' is not something that is expressly recognised by the 1996 Act. Neither are the Unfair Terms in Consumer Contracts Regulations of any relevance; in my judgment, the cases have clearly decided that 'a consumer' has no grounds for complaining about the adjudication process per se under those Regulations: see Lovell Projects Ltd v Legg & Carver [2003] BLR 452, and Steve Domsalla (t/a Domsalla Building Services) v Kenneth Dyason [2007] EWHC 1174 (TCC).
What matters for the purposes of the 1996 Act is the definition of 'residential occupiers' under section 106. On the facts of this case, if the appellants are residential occupiers under that provision, then the adjudicator had no jurisdiction to reach his decision and judgment must be set aside. If they are not residential occupiers, the adjudicator did have the necessary jurisdiction and the decision must be enforced. Everything else in the new file of material relating to the application to amend consists either of revamped arguments which are already in play, or an apparent attack on the appellants' former Contracts Advisor, which as I pointed out during the argument is irrelevant to the issues between the parties today.
I therefore decline permission to amend the notice of appeal to raise matters that are entirely new, although I make clear, even if I had allowed the amendment, for the reasons that I have given, it makes no difference at all to the substantive result.
C. APPLICATION 1
In 2007 the appellants engaged the respondents to carry out building works at their property in Cheshire. The appellants live at Great Moreton Hall, a very large country house, in Cheshire. The works were carried out to a building known as the East Lodge, which was a separate building some distance away from the main house. Mr Bradley put it at a 1/4 mile away down the drive. The contract was in the old Minor Works Form, and did not therefore include any express provision for adjudication.
Disputes arose between the parties, and those were referred to adjudication. The respondents, who were the referring party in the adjudication, relied on the terms of the contract implied therein by operation of Part II of the 1996 Act, and the Scheme for Construction Contracts, which contain detailed provisions concerning adjudication. The appellants argued that the adjudication provisions in the 1996 Act were not implied at all, because they were residential occupiers. The adjudicator rejected that argument.
By a decision dated 25 th September 2008, the adjudicator awarded the respondents the sum of £80,000 odd together with interest and sums for his fees. The total sum due was £86,000 odd. That sum was not paid by the appellants. On 10 th October 2008 the respondents commenced proceedings in the Liverpool County Court to enforce the decision of the adjudicator. On 17 th November 2008, the appellant sought to stay those proceedings pursuant to section 9 of the Arbitration Act 1996.
On 28 th November, HHJ MacKay dismissed the application for a stay under s.9 of the Arbitration Act, and gave judgment in favour of the respondents in the sum of £88,199.66 inclusive of interest.
The appellants now seek permission to appeal against that decision. The grounds of appeal, drafted by counsel, are in these terms:
“The learned judge was wrong to refuse the mandatory stay to arbitration (S.9 Arbitration Act) in circumstances where the contract provides that disputes will be resolved by a valid arbitration clause and the respondents had commenced a Part 7 claim to enforce the decision of the adjudicator, but had failed to make an application to enforce the decision of an adjudicator by way of Summary Judgment, and to have the timetables abridged in accordance with the TCC procedure either at the time of issuing the claim or prior to the application for a stay”
The law in this area is clear and can be condensed into a few simple propositions:
a) Absent a want of jurisdiction or a failure to comply with the rules of natural justice, the court will enforce the decision of an adjudicator. The position was summarised by Chadwick LJ in Carillion Construction Ltd v Devonport Royal Dockyard Limited [2005] EWCA Civ 1358 in these terms:
“85. The objective which underlies the Act and the statutory scheme requires the courts to respect and enforce the adjudicator's decision unless it is plain that the question which he has decided was not the question referred to him or the manner in which he has gone about his task is obviously unfair. It should be only in rare circumstances that the courts will interfere with the decision of an adjudicator….
It is only too easy in a complex case for a party who is dissatisfied with a decision of an adjudicator to comb through the adjudicator's reasons and identify points upon which to present the challenge under the labels 'excess of jurisdiction' or 'breach of natural justice'…. The task of the adjudicator is to find an interim solution which meets the needs of the case. Parliament may be taken to have recognised that, in the absence of an interim solution, the contractor or sub-contractor or his sub-contractors will be driven into insolvency through a wrongful withholding of payments properly due. The statutory scheme provides a means of meeting the legitimate cash flow requirements of contractors and their sub-contractors. The need to have the right answer has been subordinated to the need to have an answer quickly…
In short, in the overwhelming majority of cases the proper course of the party who is unsuccessful in an adjudication under this scheme must be to pay the amount that he has been ordered to pay by the adjudicator. If he does not accept the adjudicator's decision is correct (whether on the facts or in law), he can take legal or arbitration proceedings in order to establish the true position….”
b) The paying party can, as Chadwick LJ indicated, issue a claim form or an arbitration notice in order to obtain a substantive decision on the merits, and that may lead to some or all of the money, originally ordered to be paid by the adjudicator, being repaid to the paying party. But that does not affect the temporary finality of the adjudicator's decision, or the imperative that that decision must be...
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