Introduction

Mr. Justice Edwards-Stuart dealt with the claim brought under Part 8 of the CPR for a declaration that the building contract does not entitle the Defendant to refer a dispute to adjudication.

The Claimants, Simon and Susan Gotch, contracted the Defendant, Enelco Ltd, to construct two residential properties. A dispute arose over the works between the parties where the Defendant threatened to take the case to adjudication. Upon Claimants’ contest, Defendant agreed to postpone any reference to adjudication. However, Claimants sought a declaration from the court that the defendant had no right to refer a dispute to adjudication because they fell within the residential occupier exception in section 106 of the Housing Grants, Construction and Regeneration Act 1996. Further, the Claimants held that the provision for adjudication in the contract articles was deleted.

Defendants held that the Claimants repudiated the contract in May 2014 as part of the contracted works were withdrawn and instructed to be carried out by others. In addition, the Defendant argued that s106 does not apply as one of the claimant’s properties was being marketed as a holiday let which is not a property intended for residential occupation.

The court advised on the correct course of litigation in the Technology and Construction Court. It focused its guidance over how to conduct litigations in a manner so as to keep the costs down. Mr Justice Edwards-Stuart decided that the Claimants' application for a declaration in relation to the right of adjudication under the contract would not be useful. Further, he added that

Defendant has maintained the position that it has no current intention to refer any dispute to adjudication. So long as that remains the position and the parties are engaging in some alternative means of dispute resolution, the question of whether or not the contract confers a right to adjudicate any dispute is academic. The time and costs of resolving that question would therefore achieve nothing.

In these circumstances I considered that the Claimants' application should be stayed and that the present proceedings should continue as if they had been started under Part 7, pursuant to CPR 8.1(3) . To that end the Defendant would be able to pursue the determination issue and its claim for damages by way of Counterclaim.