Adjudication Update

In Sindall v Solland, Solland sought to resist enforcement of an adjudicator's decision on the grounds that the decision on that part of the claim which was for a further extension of time had been made in the absence of jurisdiction.

HHJ LLoyd QC held that, in the absence of any substantive response from the contract administrator to the application for a further extension of time there could be no dispute about this.

"For there to be a dispute for the purposes of exercising the statutory right to adjudication it must be clear that a point has emerged from the process of discussion or negotiation and that there is something which needs to be decided".

However, the dispute which had been referred was not primarily about the claim for a further extension of time, it had been about whether or not Sindall's employment had been wrongfully terminated. Thus the judge was prepared to uphold the adjudicator's award of an additional 13 weeks. It was upheld in the context of the adjudicator's decision on the termination. An integral part of the termination dispute included consideration of whether or not the contract administrator was correct to decide that Sindall were not proceeding regularly and diligently and consequently whether Sindall were entitled to a further extension of time. The adjudicator had vindicated Sindall and HHJ Lloyd QC agreed that the adjudicator had acted within his jurisdiction:

"Accordingly, comprehended within a dispute about the determination and as to whether or not Solland was right to act upon MEA's opinion was the underlying question: was one of the premises upon which that opinion was based correct or were there not events which entitled Sindall to a further extension of time?.at the heart of the dispute was at least the amount of the extension of time to which Sindall was entitled. it was clear that the determination was disputed and, with it, the basis upon which it had been arrived at."

Cases From The TCC

In Durabella Ltd v J Jarvis & Sons Ltd Jarvis tried to rely upon the "pay when paid" clause contained in the subcontract to prove that it need not pay Durabella. There had been proceedings between Jarvis and the ultimate employer following the termination of Jarvis' contract. In those proceedings, Jarvis had maintained that Durabella's work was not defective. In the latest proceedings, Jarvis maintained a contrary position.

HHJ LLoyd QC found that the settlement in the first proceedings had no evidential value in showing whether Jarvis had been paid in full for the work carried out by Durabella. The Judge also held that Jarvis could not rely upon the pay when paid clause if the reason for the non-payment was in fact, its own breach of contract or default. Further Jarvis could not rely on the pay when paid clause when its employment came to an end under its own default and/or it had failed to pursue its remedies promptly and effectively.

In Pillar and Sons v Edwards, HHJ Thornton QC agreed that the court had jurisdiction to extend the time for making an application to remit an award back to the arbitrator for reconsideration under s68 of the 1996 Arbitration Act. The problem here was that the claim for arbitration was approximately £100k. In his first award, the Arbitrator had awarded £75k plus interest.

However, following a series of corrections, this sum was reduced to £9k. This had particularly adverse cost consequences because of a series of sealed offers, which had been made. Apparently, the total amount incurred by both parties in costs amounted to nearly £400k. However, the corrections made by the Arbitrator to the first award had been made out of time. The Judge concluded that the just course was to grant the application to remit the award and also to allow the application to extend time for the making of an application that the first award be corrected.

The Judge made obiter comments about the costs of the arbitration. In particular the fees charged, (and all the parties' representatives were non-lawyers) were, the Judge felt, substantially in excess of those that would have been charged by solicitors. The Judge suggested that the arbitrator might wish to consider ordering that the court undertake a detailed cost assessment.

Other Cases of Interest

In Sage v Maidstone Borough Council, the CA considered the question of when a building was substantially complete. Sage claimed that Section 171b of the Town and Country Planning Act 1990 prevented a valid enforcement notice being issued when a building has been substantially completed four years before the issue of the notice.

The CA agreed that to be substantially complete under this clause, the test to be applied was whether all the operations required by the planning provisions had been completed. Therefore, works which affected only the interior of the building and which did not materially affect its external appearance would not be taken into account.

In Sutton Smith v Stephens, HHJ Nicholls considered the court's inherent jurisdiction in relation to jointly instructed experts. This was a personal injury case. Seven expert witnesses had been jointly instructed. It was suggested by the claimant's counsel that the claimant (and his representatives) should meet with the single joint experts. However, the defendant would be absent.

The court held that those single joint experts who had agreed to attend the consultation had failed to comply with paragraph 19.8 of the code of guidance for expert witnesses. They had not informed the defendant of the consultation and had not sought the consent of the defendant.

The court had directed the parties to instruct joint experts. It was wrong for one side to attempt to ascertain the strength of that evidence through a meeting. CPR 35 was designed to ensure that all the parties knew what an expert would say at trial so as to encourage an early settlement.

In Williams Corporate Finance v Holland and Others, the CA agreed that a Judge's order as to costs should be overturned.

The claimant was seeking damages of over £30,000. The main body of the claim was dismissed, and after allowing parts of a counterclaim raised by the defendant, the claimant recovered approximately £1,200. The Judge made an order requiring the first defendant to pay the claimant's costs of the action.

The CA disagreed saying that since the claimant recovered a sum, which was too small to have attracted an award of costs in the small claims court, it would be unjust that the defendant should have to pay the claimant's costs. The appropriate order was that there be no order for costs.

In Smith and Anr v Peter North Partners, the CA confirmed that the general rule for damages in valuation cases was to place the claimant as far as possible in the position he would have been in if the contract had not been breached and the report had not been negligent.

Thus if there was no difference in value between the actual value of the property and the value according to the conditions stated in the defendant's reports then the recoverable damages for breach of contract would be nil. This was despite the fact that the joint expert found that whilst the diminution in value was nil the costs of the repairs to the main timber frame superstructure, which had not been highlighted in the report, would amount to around £130,000.

Health & Safety

An amendment to the Control of Asbestos at Work Regulations is scheduled to be made in June of next year. It is likely to come into force 18 months after that. The regulations will require owners and occupiers of workplace buildings to determine the presence of asbestos in their buildings and assess and control any risk from the material.

Mayer Parry (Recycling) Ltd was fined £200,000 plus costs of £4,794 after being prosecuted under s2 (1) of the HSWA, for failing to ensure the safety of a worker who was killed when one of the legs of a two-leg chain sling struck him on the head.

Carillion Construction was fined £15,000 plus costs for failing to ensure the safety of people carrying out engineering works. This was simply a case of work being carried out to a footpath too close to a train track.

Other News

The minimum wages levels went up on 1 October 2001. The adult rate goes up from £3.70 to £4.10 while for 18 to 21-year-olds, the minimum hourly wage rises from £3.20 to £3.50.

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