Birmingham City Council v Paddison Construction Limited
Case reference:
[2008] EWHC 2254 (TCC)
Thursday, 25 September 2008
Key terms: Jurisdiction - substantially similar dispute - declarations - same dispute - serial adjudications
Birmingham engaged the Paddison to undertake construction work for a new community and training centre. The completion date provided by the building contract was 24 February 2006, which was revised to 17 April 2006, however practical completion was 23 June 2006. Paddison alleged that Birmingham were responsible for the delay in completion and sought a full extension of time and loss and/or expense. The matter was referred to adjudication in February 2008 where it was decided that Paddison were entitled to a full extension of time for the full period and that Birmingham should repay the LADs withheld totalling £26,800 and £25,363.39 for the respective variations.
As regards Paddison’s claim for loss and expense, the adjudicator branded this as "extravagant and exaggerated," however he suggested that some further monies may be credibly claimed, and that Paddison should pursue a further adjudication on this point alone.
The construction of that section of the decision became an issue between the parties, with Paddison claiming that no decision had been made in relation to their claim for loss and/or expense. However, Birmingham considered that the adjudicator had addressed this issue fully. When Paddison served a second notice of adjudication, Birmingham commenced Part 8 proceedings seeking declarations that a decision had been made regarding the dispute and would have a binding effect; that the dispute referred to the second adjudicator was substantially the same as had been referred to the first adjudicator; and lastly, as a consequence the second adjudicator would have no jurisdiction to act and must therefore resign.
The Judge addressed each of these issues in turn, and held that the first adjudicator did indeed make a decision regarding Paddison’s loss and/or expense claim. This was plainly that the claim was "extravagant and exaggerated" and that he was "not prepared to grant further monies relating to [Paddison’s] loss and/or expense claimed". The Judge commented that it was unfortunate that the adjudicator commented in his decision that Paddison should pursue a separate adjudication on this point, and made the point that his intention was probably to "sweeten the pill of his refusal to grant Paddison more money".
With regard to the second issue, the Judge analysed the respective claims, and found them to be coextensive, save that the second claim included a claim for damages for breach of contract and an expert report. Having considered the report and the surrounding case law carefully, the Judge concluded that the two claims were essentially the same dispute, and she stated that Paddison "sought to make good in the second adjudication the shortcomings in their claim in the first adjudication," and therefore had no jurisdiction for this adjudication. Birmingham were awarded their declarations accordingly.
As regards Paddison’s claim for loss and expense, the adjudicator branded this as "extravagant and exaggerated," however he suggested that some further monies may be credibly claimed, and that Paddison should pursue a further adjudication on this point alone.
The construction of that section of the decision became an issue between the parties, with Paddison claiming that no decision had been made in relation to their claim for loss and/or expense. However, Birmingham considered that the adjudicator had addressed this issue fully. When Paddison served a second notice of adjudication, Birmingham commenced Part 8 proceedings seeking declarations that a decision had been made regarding the dispute and would have a binding effect; that the dispute referred to the second adjudicator was substantially the same as had been referred to the first adjudicator; and lastly, as a consequence the second adjudicator would have no jurisdiction to act and must therefore resign.
The Judge addressed each of these issues in turn, and held that the first adjudicator did indeed make a decision regarding Paddison’s loss and/or expense claim. This was plainly that the claim was "extravagant and exaggerated" and that he was "not prepared to grant further monies relating to [Paddison’s] loss and/or expense claimed". The Judge commented that it was unfortunate that the adjudicator commented in his decision that Paddison should pursue a separate adjudication on this point, and made the point that his intention was probably to "sweeten the pill of his refusal to grant Paddison more money".
With regard to the second issue, the Judge analysed the respective claims, and found them to be coextensive, save that the second claim included a claim for damages for breach of contract and an expert report. Having considered the report and the surrounding case law carefully, the Judge concluded that the two claims were essentially the same dispute, and she stated that Paddison "sought to make good in the second adjudication the shortcomings in their claim in the first adjudication," and therefore had no jurisdiction for this adjudication. Birmingham were awarded their declarations accordingly.