University of Brighton v Dovehouse Interiors Ltd
| Jurisdiction | England & Wales |
| Judge | Mrs Justice Carr |
| Judgment Date | 04 April 2014 |
| Neutral Citation | [2014] EWHC 940 (TCC) |
| Docket Number | Case No: HT-14-62 |
| Court | Queen's Bench Division (Technology and Construction Court) |
| Date | 04 April 2014 |
[2014] EWHC 940 (TCC)
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
TECHNOLOGY AND CONSTRUCTION COURT
Royal Courts of Justice
Strand, London, WC2A 2LL
The Hon Mrs Justice Carr DBE
Case No: HT-14-62
Ms Lucy Garrett (instructed by Berwin Leighton Paisner LLP) for the Claimant
Miss Serena Cheng (instructed by Thomas Eggar LLP) for the Defendant
Hearing date: 14 March 2014
Introduction
This is a claim issued by the claimant university ("the University") under Part 8 of the Civil Procedure Rules for declaratory relief against the defendant contractor ("Dovehouse"). The University challenges the validity of a notice of adjudication served by Dovehouse pursuant to Part 1 of the Schedule to the Scheme for Construction Contracts (England and Wales) Regulations 1998 ("the Scheme"). It contends that the notice was ineffective to commence proceedings for the purpose of a "conclusive evidence" clause in a construction contract between the parties.
The relevant facts
By a contract dated 26 th March 2012, executed as a deed and incorporating the terms of the Intermediate Building Contract with Contractor's Design 2005 Edition, Revision 2 (2009), as amended by a Schedule of Further Modifications ("the Contract"), the University engaged Dovehouse to carry out the fit out of University Centre, Priory Square, Hastings for a Contract Sum of £2,553,031.29. By clause 9.2 of the Contract the Scheme was to apply in the event of a dispute or difference arising under the Contract which either party wished to refer to adjudication. The date for completion of the works was stated as 29 th July 2012.
Practical completion was not certified until 30 th October 2012. The parties fell into dispute broadly on the following issues :
a) Dovehouse's entitlement to extensions of time to the date for completion;
b) the proper valuation of adjustments to the Contract Sum in respect of instructed variations to the works;
c) Dovehouse's liability for the University's costs to address incomplete and defective works;
d) Dovehouse's entitlement to recover loss and expense in respect of delay and/or disruption to the works.
On 9 th December 2013 the Contract Administrator issued her Final Certificate pursuant to clause 4.14.1 of the Contract ("the Final Certificate"). A gross valuation of the works in the sum of £2,099,629.23 was certified. On 12 th December 2013 the University served a Payment Notice on Dovehouse pursuant to clause 4.14.2 of the Contract and/or under paragraph 9 of Part II of the Scheme and section 11A of the Housing Grants, Construction and Regeneration Act 1996 (as amended) ("the Payment Notice") ("the Act"). Dovehouse disagreed with the sum stated as due in the Final Certificate and in the Payment Notice. So as to allow time for negotiation and settlement, on 23 rd December 2013 the University and Dovehouse agreed in writing to amend clause 1.9.2 of the Contract by replacing the period of 28 days there provided for with a period of 66 days. Accordingly, " for the purposes of clause 1.9.2 [of the Contract] the Final Certificate shall not be conclusive evidence of the matters set out in clauses 1.9.1 [of the Contract] until Friday 14 February 2014". Settlement was not reached in that period.
On 13 th February 2014 Dovehouse, acting at that stage by Knowles Limited ("Knowles"), served a Notice of Adjudication ("the First Notice"). It is the validity of that notice which is in dispute. It referred a full final account dispute. It is common ground that the First Notice was received by the University on 13 th February 2014.
The First Notice was headed "IN THE MATTER OF AN ADJUDICATION CONDUCTED IN ACCORDANCE WITH THE SCHEME…". It was entitled "NOTICE OF ADJUDICATION".
At section 1.0 the parties' names and addresses were set out. The First Notice gave the name and address of the University as :
" University of Brighton
Estate and Facilities Management
Exion 27
Crowhurst Road
Hollingbury
Brighton
BN1 8AF" ("the Exion address")
The next section (2.0 to 2.4) proceeded under the heading " Introduction and Nature of Dispute". The background to and circumstances of the dispute were set out. At paragraph 2.4 it was stated :
" 2.4 Article 7 has not been deleted and therefore Clause 9.2 of the Conditions applies. The Adjudicator is not named and the nominator of the Adjudicator is not stated. The Referring Party therefore selects from the list included in the Contract the Royal Institution of Chartered Surveyors to nominate an Adjudicator."
The following section (3.0 to 3.3) set out the nature of redress sought :
" 3.0 Nature of Redress
The Referring Party seeks a decision from the adjudicator that
3.1 The Final Certificate is to be corrected to certify that the gross sum of £3,670,692.19 and a net sum after deducting previous payments of £1,702,266.47 plus VAT as applicable and that sum is not to be reduced by the notice to pay less nor for any other reason or in all matters such other sum as the Adjudicator may decide and such sum shall be paid forthwith by the Responding Party to the Referring Party.
3.2 The Date for Completion is to be extended to the 30 October 2012 or such other period or date as the Adjudicator may decide.
3.3 The Responding Party shall forthwith pay interest to the Referring Party on the sum decided at 3.1 above at such rates and on such sum or sums as the Adjudicator may determine.
3.3 (sic) The Responding Party shall pay the Adjudicator's fees and expenses."
On 14 th February 2014 Dovehouse requested the Royal Institution of Chartered Surveyors ("the RICS") to select a person to act as adjudicator. On 19 th February 2014 the RICS confirmed nomination of Mr Philip Eyre as the adjudicator ("the First Adjudicator"). On the same day the First Adjudicator confirmed to the parties that he had received notice of his nomination. Under the Scheme he anticipated receipt of the referral of the dispute by 20 th February 2014. He received notice of referral with supporting materials by 5.30pm on 20 th February 2014.
On 21 st February 2014 the First Adjudicator resigned pursuant to paragraph 9(1) of the Scheme on the basis that he had no jurisdiction, the Contract requiring nomination by the President or Vice-President of the Chartered Institute of Arbitrators ("the CIArb"), not the RICS. He treated his nomination as a nullity.
Dovehouse issued a re-served Notice of Adjudication on 24 th February 2014 ("the Second Notice"). It corrected the error in the First Notice by recording that the nominator of the Adjudicator was stated in the Contract to be the President or a Vice-President of the CIArb.
These proceedings
By a claim form issued on 25 th February 2014 ("the declaration application"), the University applied for a declaration that the Final Certificate has become conclusive evidence of the matters stated in clause 1.9.1 of the Contract, namely that :
a) necessary effect has been given to all the terms of the Contract that require additions to, adjustments or deductions from the Contract Sum, save in regard to any accidental inclusion or exclusion of any item or any arithmetical error in any computation;
b) all and only such extensions of time, if any, as are due under clause 2.19 of the Contract have been given; and
c) that the reimbursement of direct loss and/or expense, if any, to Dovehouse pursuant to clause 4.17 of the Contract is in final settlement of all and any claims which Dovehouse has or may have arising out of the occurrence of any of the Relevant Matters, whether such claim be for breach of contract, duty of care, statutory care or otherwise.
The University also sought an injunction prohibiting Dovehouse from taking any further step in the adjudication until determination of that application. On 27 th February 2014, and without prejudice to their position on costs, the parties agreed to stay the adjudication proceedings pending the outcome of the declaration application.
The issues and evidence
The central issue in the declaration application is whether or not Dovehouse " commenced" " adjudication" " proceedings" within the meaning of clause 1.9.2 of the Contract by 14 th February 2014.
The University contends that the First Notice was ineffective to commence adjudication proceedings within the meaning of clause 1.9.2. It advances four main grounds :
a) that under the Scheme an adjudication is not commenced until a Referral Notice is served on a properly appointed adjudicator pursuant to paragraph 7(1) of the Scheme;
b) the First Notice was invalid because it did not comply with the requirements of paragraph 1(3) of the Scheme. It did not identify the contractually required address and was not served at the contractually required address;
c) no adjudication proceedings were in fact commenced. Dovehouse sought to appoint the adjudicator via the wrong nominating body. The appointed adjudicator correctly resigned;
d) the defects in the First Notice and the resignation of the First Adjudicator cannot now be cured.
Dovehouse contends that the First Notice was effective. Proceedings were commenced upon service of the First Notice and such defect as there may have been on the face of the First Notice were not such as to invalidate it. There was proper service. Despite the resignation of the First Adjudicator, since proceedings were commenced by 14 th February 2014, the saving proviso in clause 1.9.2 has been triggered and survives any error of incorrect identification of the nominating body.
For the purpose of the hearing the parties adduced evidence as follows :
a) for the University : two statements from the University's solicitor, Mr James Clarke;
b) for Dovehouse : a statement from Mr Rodney...
To continue reading
Request your trial
-
Ecovision Systems Ltd v Vinci Construction UK Ltd
...may need to be made here between the formal validity of the notice of adjudication and its substantive validity. In University of Brighton v Dovehouse Interiors Ltd [2014] EWHC 940 (TCC) Carr J held (at paras. 77–78) that a notice of adjudication identifying the wrong ANB was still an effec......
-
Grove Developments Ltd v S&T(UK) Ltd
...law that the notice of adjudication is the starting point for any consideration of the scope of the adjudication: see University of Brighton v Dovehouse Interiors Limited [2014] EWHC 940 (TCC). Although the notice has to be looked at in its factual context, the definition of the dispute in ......
-
South Coast Construction Ltd v Iverson Road Ltd
...is the notice of intention to refer a dispute to adjudication, commonly known as the notice of adjudication: see University of Brighton v Dovehouse Interiors Limited [2014] EWHC 940 (TCC). When undertaking that exercise the court, and indeed the adjudicator, should not adopt an overly legal......
-
The Trustees of The Marc Gilbard 2009 Settlement Trust v OD Developments and Projects Ltd
...and to provide clarity as to the parties' obligations once a project is complete": see the recent judgment of Carr J in University of Brighton v Dovehouse Interiors [2014] BLR 432, which concerned the same clause of the JCT Contract as the present case. (iii) Final Certificates and Adjudica......
-
Statutory adjudication
...notice of adjudication be invalid because it identiies an incorrect nominating body: University of Brighton v Dovehouse Interiors Ltd [2014] EWHC 940 (TCC) at [75]–[98], per Carr J; Ecovision Systems Ltd v Vinci Construction UK Ltd [2015] EWHC 587 (TCC) at [78]–[80], per HHJ Havelock-Allan ......
-
Contract terms
...the High Court: [2010] HCA 32); Ener-G Holdings Plc v Hormell [2012] EWCA Civ 1059; University of Brighton v Dovehouse Interiors Ltd [2014] EWHC 940 (TCC) at [73], per Carr J (considering clause 1.7.3 of the JCT Intermediate Building Contract with Contractor’s Design, 2005 edition); Obrasco......
-
Contract administration
...466 See Pertamina Energy Trading Ltd v Credit Suisse [2006] SGCA 27 at [63]; University of Brighton v Dovehouse Interiors Ltd [2014] EWHC 940 (TCC) at [26]–[28], per Carr J; Trustees of the Marc Gilbard 2009 Settlement Trust v OD Developments and Projects Ltd [2015] EWHC 70 (TCC) at [9], pe......
-
Table of cases
...II.10.65, II.14.17, II.14.20, II.14.29, II.14.70, III.15.19, III.15.22, III.15.35 University of Brighton v Dovehouse Interiors Ltd [2014] EWHC 940 (TCC) I.3.90, I.5.144, I.5.157, III.24.18, III.24.20, III.24.50 University of Reading v Miller Construction Ltd (1994) 75 BLR 91 III.23.46 Unive......