HT-2024-LDS-000009 - [2024] EWHC 2188 (TCC)

By subcontract made on 20 September 2022, the Claimant agreed to undertake various works on a project at Poverty Lane, Maghull (“the subcontract”). The subcontract itself did not comply with the requirements concerning adjudication set out in section 108 the Housing Grants, Construction and Regeneration Act 1996 (as amended) (the “Act”). The Scheme for Construction Contracts (England and Wales) Regulations 1998 (as amended) (the “Scheme”) therefore applied. The parties have taken part in three adjudications, two of which have relevance to this application for enforcement.

The first adjudication was dealt with by Mr Latham who gave a decision on 5 March 2024. The dispute referred concerned the Claimant’s interim application for payment issued by email on 30 December 2023. The Defendant had not issued a payment notice nor a pay less notice in response to the application. The interim payment application was exhibited to the notice of adjudication and set out the following works:

“Phase 1, 1a and 1b

Earthworks – Plots and External Areas £367,774.47

Phases 2 & 3

Earthworks – Plots and External Areas £119,462.45

Roads & Footpaths – All Phases

See schedule for breakdown £173,031.28

Piling Mats – All Phases

See schedule for breakdown £30,732.14

Variations

Refer to Variations tab for breakdown £668,842.09”

The subtotal of the amounts claimed was £1,359,842.44. From that sum was deducted previous payments made to the Claimant to give the sum claimed of £253,425.56. Mr Latham decided that the amount stated in the application by the Claimant of £253,425.56 was due plus interest of £2,679.88 and a daily rate of interest at £92.00. In addition, the Defendant had to pay the adjudicator’s fees of £8,190.00 plus VAT.

The Defendant did not pay the sums decided by Mr Latham. Instead, on 15 March 2024, it referred a further dispute to a second adjudication seeking the “proper valuation of the final account” and repayments of any sums found to have been overpaid to the Claimant. The second adjudication was dealt with by Mr Lord.

The dispute referred by the Defendant in the second adjudication referred to an interim payment application made by the Claimant in September 2023 which claimed a gross cumulative sum of £1,359,842.22 with the various works done in different phases claimed as set out above. In the second adjudication referral, the Defendant referred to the gross cumulative sum claimed by the Claimant in respect of phases 1, 1a and 1b as being £367,774.47, that is the same sum for the same work as was considered by Mr Latham in the first adjudication. The Defendant valued that phase in the gross cumulative sum of £319,659.88. The Defendant referred to the respective valuations of phases 2 and 3. The Claimant claimed £119,462.45 and the Defendant asserted that the phase was only worth £98,758.65. It is not necessary to set out in detail the remaining matters referred to in the second adjudication referral save to note that the Defendant asked for a valuation to be made in respect of the same items considered in the first adjudication.

The Claimant challenged Mr Lord’s jurisdiction to deal with the second adjudication referral on the basis that the dispute related to the same, or substantially the same, subject matter. The Claimant provided Mr Latham’s decision to Mr Lord and asserted that the interim payment application in September 2023 and the interim payment application in December 2023 were for the same works.

Mr Lord decided that he did have jurisdiction to deal with the matter. On 14 April 2024, Mr Lord issued his decision that the Defendant pay the Claimant £89,480.94 plus VAT within seven days. On 18 April 2024, the Defendant paid the Claimant £63,695.38. That sum was paid because the Defendant asserted that it was entitled to withhold the Defendant’s statutory CIS contributions from the payment.

On 15 March 2023, a third adjudication was started by the Claimant in relation to the interim payment notice of September 2023 and claimed payments of £300,456.25 or such other sum as the adjudicator (again Mr Latham) decided proper.

I have had the benefit of reading the witness statement of Cathal Kenny, director of the Claimant, dated 21 March 2024 and the witness statement of Daniel Hall, solicitor for the Defendant, dated 19 April 2024, together with the various documents contained within the bundles to which I was taken to during the course of the hearing and directed to in skeleton arguments.

I do not propose to rehearse all of the arguments raised, nor all of the evidence referred to during the course of the hearing. However, I record that I read and considered the evidence as a whole, as well as various documents within the hearing bundle to which my attention was drawn, in addition to all those arguments before coming to my decision.