1. There were effectively two contracts, and the second of those was not in writing within the HGCRA. Alternatively, it was an oral variation to the first contract;
2. The Adjudicator had applied an incorrect analysis of the contractual relationship between the parties, which went the core of his jurisdiction;
3. They were entitled to set-off sums as they did not have an obligation to provide a withholding notice;
4. There was a breach of natural justice because the Adjudicator had not considered MSD's cross-claims;
5. There was a serious cross-claim to be tried, and so for the purposes of summary judgment, MSD had a realistic prospect of succeeding; and
6. A stay should be granted because there was a serious doubt as to whether ALE could repay any sums that might become due.

His Honour held that the contract had been agreed between the parties by exchange of letters. ALE's conditions for the hiring of plant were included. Those terms were binding on the parties and section 111 of the HGCRA applied. Clause 35 provided that the nominating body was the Construction Plant Hire Association. The parties' exchanges at the time of entering into the contract made no reference to a suggestion that there might be two contracts.

The Court of Appeal case of Rupert Morgan Building Services Limited v Jervis required that where a certificate identifying an amount to be paid had been issued under a contract, the paying party must give a notice in due time under section 111 in order to withhold any amount. Any set-off raised by MSD was raised out of time, so the Adjudicator did not need to consider it. As a result, there was no breach of natural justice.

The decision should, therefore, be enforced. While, ALE's accounts gave some cause for concern, they were in no more financial difficulty than when the contract commenced in August 2005. A stay would, therefore, not be ordered.

[Many thanks to Casetrack for kindly providing their permission to reproduce this transcript on our website.]