Barry M Cosmetics Ltd v Merit Holdings Ltd

[2019] EWHC 136 (TCC)

This was an adjudication enforcement case. Merit presented its final account on 20 December 2017 some nine months after practical completion. Barry commenced adjudication proceedings on 27 July 2018. Merit said that there was no dispute because there was not yet any entitlement to payment. The Judge disagreed. There was nothing in the language of the Scheme to suggest that a dispute may only be referred to adjudication once an entitlement to payment has arisen. Here, there was a clear dispute between the parties as to the correct value of the final account and it was entirely appropriate to refer the matter to adjudication. 

Merit also raised a natural justice point. Merit had served a delay analysis as part of their Response. Barry said that this was the first time they had had any real explanation of Merit’s EOT claims. Barry served their own report by way of Reply. Barry said that Merit’s report had: “ignored what actually happened on site at the time” and was based on “theoretical events”. Barry had conducted a: “retrospective analysis, looking back at what actually happened and what actually delayed the completion of the works”. The adjudicator allowed Merit to serve a Rejoinder but limited it to 12 pages and to dealing with issues they felt that Barry had tried to “fudge”. Merit objected to the direction that the Rejoinder be limited, complaining that there was too much ground to cover. Merit duly served a Rejoinder which went beyond the adjudicator’s direction and a brief Surrejoinder was allowed. The Decision noted that the adjudicator had considered all the submissions and he had a preference for Barry’s delay report. The Judge noted that the need to give each party an opportunity to meet the case made against him is not an unlimited right. Taken literally it might be understood to afford a right to endless rounds of pleadings. The adjudicator’s direction that the Rejoinder be limited was perfectly fair and proper, and any award based on a limited rejoinder would have been in accordance with the principles of natural justice. As it was, Merit had ignored the direction; but the adjudicator had taken Merit’s Rejoinder into account in arriving at his decision. 

Back to the previous page

Click to download PDF