The Outer House of the Court of Sessions enforced an adjudication decision rejecting arguments that the adjudicator had breached the rules of natural justice.

The defendant, Arnold Clark had engaged the claimant, Bell, to design and build a new car showroom in Glasgow, but the contract was terminated. In the first adjudication, Ms Lindy Patterson QC, the first adjudicator, decided that Arnold Clark had been in repudiatory breach. In the second adjudication, Bell sought damages from Arnold Clark. The second adjudicator, Mr Len Bunton decided that Bell was entitled to payment of just over £1 million. Arnold Clark didn’t pay and so Bell commenced enforcement proceedings.

The defendant argued that Mr Bunton’s decision should not be enforced on the grounds that it was arrived at in breach of the rules of natural justice, in particular the manner in which he had dealt with Bell’s loss and expense claim and Arnold Clark’s contra-charges for the rectification of defects. Also, the defendant argued that it was unfair of the adjudicator to leave his request for evidence of sub-contractor payments until the day before his decision was due.

Lord Tyre held that the adjudicator was not obliged to request the evidence of sub-contractor costs for the rectification works as it was the responsibility of Arnold Clark, when submitting its claim, to include the necessary proof. However, Lord Tyre rejected the defendant’s argument that it had not been given a fair opportunity to present its case to the claimant and held that no injustice had arisen.

The Judge said that the defendant had been provided with material from the claimant late in the process and had been asked for further evidence by the adjudicator the day before the decision was due. Lord Tyne held that the defendant’s refusal to participate in the visit to the claimant’s offices was a major contributing factor in the evidence having to be considered over the weekend prior to the adjudicator’s decision. Also, Mr Bunton had offered an extension to give the defendant more time to submit its further evidence, which it did not agree to. Arnold Clark had failed to engage in the process and it could not now complain of unfairness.

This case served a useful reminder for practitioners that natural justice challenges are difficult. While evidence was being requested by the adjudicator late in the day, as Lord Tyre highlighted, Mr Bunton had sensibly suggested a further extension to the timetable in order to allow the defendant sufficient time to deal with the issues raised.