This is the final decision in this long running dispute between the parties. Following four adjudications, Treasure commenced an arbitration for final determination of the matters in dispute. A settlement was reached before the hearing and this application was specifically to determine the costs of the arbitration. Both parties considered themselves the winner so that the other party should pay their costs.

Treasure submitted that it was the claimant in the arbitration, and the settlement was for approximately 30% of the amount claimed, therefore it had succeeded. However, Dawes argued that because the settlement was less favourable to Treasure than the earlier adjudication decision, and this meant an overall balancing payment by Treasure to Dawes, then Dawes was the winning party for the purposes of costs.

The arbitrator decided, and the court agreed, that where an arbitration is commenced in final determination of disputes that have been the subject of earlier adjudications, the overriding burden of proof rests upon the claimant in the arbitration. The tribunal, whether that is court or arbitration, must consider the dispute as if no adjudications have taken place between the parties.

If the claimant party is successful in recovering monies against its starting position in the arbitration, costs should generally be awarded to that party, rather than on the basis of the final outcome against any adjudication recovery.

(Thanks to Peter Chapman for supplying this case)