Sheer employed Berry as a subcontractor to carry out piling and related works. The works fell into delay and water began to leak through the piles during the course of the works. Sheer therefore had an allegation of loss against Berry for water seeping into the excavations. The dispute in relation to the delay and the defect was referred to adjudication.

The Adjudicator awarded £20,459.89 (excluding VAT) to Berry. Sheer refused to pay on the basis that:

1. 1 The Adjudicator reached the conclusion in respect of Sheer’s counterclaim based upon an argument that was raised for the first time by the Adjudicator in his Decision;
2. 2 The enforcement should be stayed because of the financial position of Berry, and its potential inability to repay if Sheer was successful in an subsequent arbitration.

The Adjudicator’s decision stated that he could see no reason why water could not have been directed to a storage tank and then pumped away from the excavations in order to avoid flooding. Sheer considered that this was part of the reason for the Adjudicator’s decision, but that it had not been argued during the course of the adjudication. The Judge rejected entirely this argument. He said that it was clear that Sheer’s claim for delay failed because the Adjudicator came to the conclusion that the failure to properly analyse the delays meant that no delay had been proved.

In respect of the stay, Sheer was claiming in excess of £150,000. The decision ordered payment of around £20,000. Sheer had referred their dispute to arbitration. A review of Berry’s published accounts showed that they had suffered a loss and were in a high risk category. However, after a more detailed examination the Judge was satisfied that Berry would continue to trade for a year or two with or without the injection of a further £20,000. He therefore refused to stay the execution of the judgment.