Lanes Group plc v Galliford Try Infrastructure Limited t/a Galliford Try Rail

Case reference: 
[2011] EWCA Civ 1617
Wednesday, 21 December 2011

Key terms: 
Jurisdiction – Bias – Appointment of Adjudicator – s108

This was an appeal from two judgments that have been reported previously. In summary, Galliford commenced adjudication and applied to the ICE, the nominating body under the subcontract, to appoint an Adjudicator. The ICE nominated Mr Klein and he accepted the appointment. Galliford’s solicitors did not send the referral document as they believed Mr Klein was, or appeared to be, biased, because of their previous dealings with Mr Klein in an earlier case. Galliford’s solicitors then served a fresh notice of adjudication and again applied to the ICE to nominate an Adjudicator. The ICE nominated Mr Atkinson who accepted the appointment. Lane unsuccessfully brought Part 8 proceedings seeking an injunction to restrain Galliford from continuing or making further applications to adjudicate the dispute. The adjudication continued and Mr Atkinson issued a preliminary views document. Mr Atkinson then issued his decision. Lanes brought Part 8 proceedings challenging the decision on the basis that: (i) Mr Atkinson did not have jurisdiction where Mr Klein had been validly appointed and (ii) insofar as the decision repeated many of the points in the preliminary views document, Mr Atkinson had shown apparent bias. The Judge found that the decision was a nullity on the grounds of apparent bias as it appeared that, by issuing the preliminary views document, Mr Atkinson had already made up his mind. Galliford appealed the Judge’s order on apparent bias and Lanes appealed the Judge’s orders on jurisdiction. Lanes argued that s108 and the subcontract only allowed a party to refer a dispute once or, alternatively, there was an implied term that the right to adjudicate would only be lost if the Referring Party deliberately failed to serve the Referral. Whilst the Court was initially attracted to Lanes’ argument regarding s108, the Court did not find in their favour. There are times that adjudication is not pursued further after preliminary steps have been taken and there is no authority to suggest that as a consequence the Referring Party loses its right to adjudicate that dispute for all time. Further, the Blue Form subcontract, the ICE adjudication Procedure and the Scheme recognise a right to restart an adjudication in a variety of circumstances. It is impossible to imply a term, either into the present contract, the Act or the Scheme, that a claimant loses the right to adjudicate if he deliberately and without good reason failed to serve referral documents by the due date. The Adjudicator therefore had jurisdiction. There was no apparent bias. The fair minded observer would have no difficulty in deciding the case. He would characterise the preliminary views document as a provisional view, disclosed for the assistance of the parties, not as a final determination reached before Mr Atkinson had consider Lanes’ submissions and evidence.

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