HT-2025-LDS-000006 - [2025] EWHC 2173 (TCC)

Carillion Construction Ltd v Devonport Royal Dockyard Ltd [2005] EWCA Civ 1358 ;

Carillion Construction Ltd v Devonport Royal Dockyard Ltd [2005] EWHC 778 (TCC) ;

Cantillon Ltd v Urvasco Ltd [2008] EWHC 282 (TCC) ;

Primus Build Limited v Pompey Centre Limited [2009] EWHC 1487;

Roe Brickwork Ltd v Wates Construction Ltd [2013] EWHC 3417 (TCC);

Van Oord UK Ltd v Dragados UK Ltd [2022] CSOH 30;

Corebuild Limited v Cleaver [2019] EWHC 2170 (TCC);

Herbosch-Kiere Marine Contractors Ltd v Dover Harbour Board [2012] EWHC 84 (TCC);

Balfour Beatty Construction Ltd v Lambeth LBC [2002] EWHC 597 (TCC);

Willow Corp Sarl v MTD Contractors Ltd [2019] EWHC 1591 (TCC);

Givaudan & Co Ltd v Minister of Housing and Local Government [1967] 1 WLR 250;

Gillies Ramsay Diamond & Others v PJW Enterprises Ltd [2004] BLR 131;

Amec Capital Projects Ltd v Whitefriars City Estates Ltd [2004]EWCA Civ 1418;

Multiplex Constructions (UK) Ltd v West India Quay Development Company (Eastern) Ltd [2006] EWHC 1569 (TCC);

Harris Calnan Construction Co. Ltd v Ridgewood (Kensington) Ltd [2007] EWHC 2738 (TCC);

Arcadis UK Ltd v May and Baker Ltd (t/a Sanofi) [2013] EWHC 87 (TCC);

ABB Ltd v BAM Nuttall Ltd [2013] EWHC 1983 (TCC);

Broughton Brickwork Ltd v F Parkinson Ltd [2014] EWHC 4525 (TCC);

AECOM Design Build Ltd v Staptina Engineering Services Ltd [2017] EWHC 723 (TCC); and

Keating on Construction Contracts, 12^th edition, Chapter 18.

The court will refuse a summary judgment application to enforce an adjudicator’s decision if there is a realistic prospect of establishing that there was a breach of natural justice or an excess of jurisdiction by the adjudicator.

The court will not refuse to enforce an adjudicator’s decision merely because of an error of fact or law.

The test for breach of natural justice is whether there has been a breach of the principles of natural justice and, if so, whether any such breach was material. In Cantillon Ltd v Urvasco Ltd, Akenhead J set out the test as follows:

“(a)

It must first be established that the Adjudicator failed to apply the rules of natural justice;

(b)

Any breach of the rules must be more than peripheral; they must be material breaches;

(c)

Breaches of the rules will be material in cases where the adjudicator has failed to bring to the attention of the parties a point or issue which they ought to be given the opportunity to comment upon if it is one which is either decisive or of considerable potential importance to the outcome of the resolution of the dispute and is not peripheral or irrelevant.

(d)

Whether the issue is decisive or of considerable potential importance or is peripheral or irrelevant obviously involves a question of degree which must be assessed by any judge in a case such as this.

(e)

It is only if the adjudicator goes off on a frolic of his own, that is wishing to decide a case upon a factual or legal basis which has not been argued or put forward by either side, without giving the parties an opportunity to comment or, where relevant put in further evidence, that the type of breach of the rules of natural justice with which the case of Balfour Beatty Construction Company Ltd -v- The Camden Borough of Lambeth was concerned comes into play. It follows that, if either party has argued a particular point and the other party does not come back on the point, there is no breach of the rules of natural justice in relation thereto.”

In respect of breach, Coulson J (as he then was) in Primus Build Limited v Pompey Centre Limited stated in respect of the failure of an adjudicator to go back to the parties:

“39.

… It is a fine line for an adjudicator between wanting to help the parties on the one hand, and making one side’s case for them, on the other. But if an adjudicator believes that, in the interests of justice, there is a legitimate alternative course which has not been considered or put forward by the referring party, but which may, on its face, meet the objections of the responding party, he should immediately ask himself the question: do I need to give notice of, and obtain submissions about, that alternative approach?

40.

As I have said, these things are always a matter of fact and degree. An adjudicator cannot, and is not required to, consult the parties on every element of his thinking leading up to a decision, even if some elements of his reasoning may be derived from, rather than expressly set out in, the parties’ submissions. But where, as here, an adjudicator considers that the referring party’s claims as made cannot be sustained, yet he himself identifies a possible alternative way in which a claim of some sort could be advanced, he will normally be obliged to raise that point with the parties in advance of his decision.”

Whether or not there has been a breach of natural justice is exquisitely fact sensitive in the majority of cases. If an adjudicator intends to determine a point on the basis of material which has not been put before him by the parties, he must give them an opportunity to make submissions. However, he can reach a decision on the material before him on a basis for which neither party has contended if the parties are aware of the relevant material and the issues have been fairly canvassed before the adjudicator.

If issues have been fairly canvassed before an adjudicator, or if the adjudicator has simply adopted an intermediate position, fairness does not require the parties to be given an opportunity to make further submissions. An adjudicator is obliged to make a decision and come to conclusions based on the evidence of each party, his analysis of it and of the submissions put to him. He is not under an obligation to invite comments on his conclusions reached after that process.

Any breach of natural justice must be “serious” or “of considerable potential importance to the outcome” before an adjudicator’s decision is compromised.

In Carillion v Devonport, the Court of Appeal quoted and approved the principle set out by Jackson J (as he then was) about the need for an adjudicator to seek further submissions:

“it is often not practicable for an adjudicator to put to the parties his provisional calculations for comment. Very often those provisional conclusions will represent some intermediate position, for which neither party was contending. It will only be in an exceptional case such as Balfour Beatty v London Borough of Lambeth that an adjudicator’s failure to put his provisional conclusions to the parties will constitute such a serious breach of the rules of natural justice that the court will decline to enforce his decision.”

An adjudicator can decide to crudely split the difference without further consultation with the parties. In Arcadis, Akenhead J held at paragraph 37:

“…The fact that he was persuaded that the proper answer lay between the two adjusted forecast figures and that he happened to split it down the middle can not be considered to be a breach of the rules of natural justice. Whilst of course it is arguable that he was factually wrong, that does not impact on the enforceability of its decision.”

In respect of summary judgment, in Corebuild Limited v Cleaver, Mr Adam Constable QC sitting as a Deputy High Court Judge set out at paragraph 26:

“There may be circumstances in which it is possible to demonstrate on

summary judgment that the answer the adjudicator arrived at was so obviously

correct, that the failure to have allowed the point to be properly ventilated is not

material: permitting a party to make submissions could not have changed the outcome. However, generally, it is sufficient for a party to show that the substance of the point with which they were deprived of the opportunity to engage with was properly arguable i.e. it had reasonable prospects of success. Beyond that, the Court should not determine the merits of the point itself on the summary judgment application.”