Multiplex Constructions (UK) Limited -v- West India Quay Development Company (Eastern) Limited

Case reference: 
[2006] EWHC 1569 (TCC)
Thursday, 8 June 2006

Key terms: 
Natural Justice - Failure to Consider Defence - Adoption of Own Case - Application for Stay - Assessment of evidence - Selection of delay analysis method - Failure to give reasons

West India Quay ("WIQ") engaged Multiples as main contractor for the construction of a hotel and apartment block on the north bank of the Thames at West India Quay. The agreement was 1998 JCT contract with contractor's design and the works were divided into six sections. The adjudicator decided that Multiplex were entitled to an extension of time of 41 days for the section 1 works on the basis of two variations and an extension of time of 220 days for the section 2a works. As WIQ had deducted liquidated damages the consequence of the adjudicator's decision was that WIQ had to repay the balance of the liquidated damages.

WIQ initially relied on a witness statement that found matters that they considered to be errors by the adjudicator and characterised them as matters of unfairness, apparent bias or lack of jurisdiction. This was later accepted by WIQ as irrelevant.

WIQ then resisted enforcement on the basis that in respect of section 1, the adjudicator decided a case that was not put before him and adopted his own analysis without giving WIQ the opportunity to address it. In doing so, he both exceeded his jurisdiction and acted unfairly. Secondly, in respect of section 2a, the adjudicator arrived at his decision in breach of the principles of natural justice.

His Honour Judge Ramsey rejected WIQ's arguments regarding section 1. The adjudicator had made his own assessment of the evidence and did not adopt his own method as was the case in Balfour Beatty v Lambeth. There was no breach of natural justice. If the adjudicator was wrong in fact or in law that does not give rise to a right of challenge. At most WIQ's challenge that the adjudicator failed to consider the extent to which the two events for which Multiplex were entitled to an extension of time overlapped was an error of fact or law.

In relation to other complaints regarding section 1, WIQ stated that the adjudicator awarded a greater extension of time than was claimed and adopted a different method of analysis than that put forward by either party.

His Honour Justice Ramsay stated:
"As a result I do not consider that, when properly analysed, it can be said that the extension of time departs from the case put forward by Multiplex or that the adjudicator has adopted a different method of analysis. On that basis there is no question of the adjudicator exceeding his jurisdiction or acting unfairly. Further, looking at the matter more broadly, the adjudicator had to decide the question of an extension of time. WIQ contended that the date should remain at 29 March 2004. Multiplex contended that it should be extended to 11 June 2004, and the adjudicator held, based on claims raised by Multiplex, that the date should be 9 May 2004. It is difficult to see how he exceeded his jurisdiction on this basis. In relation to acting unfairly the adjudicator is obliged to make his decision and in doing so he has to assess the case put forward by each party. He did this in relation to this claim. He did not, as in Balfour Beatty v. Lambeth, create his own as-built programme and then derive his own critical path, thereby adopting his own methodology. Rather, he came to conclusions on the basis of the evidence, analysis and submissions put before him. In doing so I do not consider that there was an obligation on the adjudicator to contact the parties and invite their comments on that conclusion. Such an approach would be unrealistic and impracticable in the context of this or any similar adjudication. As a result I do not consider that WIQ has raised any matters of excess of jurisdiction or breach of natural justice which can impeach the adjudicator's decision on the extension of time for bar counters in section 1."

In relation to Section 2a, WIQ complained that the adjudicator had decided a case that was not put to him and adopted his own analysis without giving WIQ the opportunity to address it. At the hearing, WIQ also criticise the adjudicator for failing to give reasons. Judge Ramsay stated that a criticism of a failure to give reasons or adequate reasons is not a breach of the rules of natural justice in the context of an adjudication. Further, there was no breach of the rules of natural justice on the basis of the other WIQ challenges

WIQ had also applied for a stay. WIQ's evidence to support this application was produced very late and the Judge was minded not to allow the evidence to be admitted. However, having considered the evidence, Judge Ramsay did not consider the evidence sufficient to justify a stay in any event as it did not amount to special circumstances under RSC Order 47 as the evidence did not establish that Multiplex would not probably be unable to repay the sum.

Key contact

Tel: +44 (0)20 7421 1986
Tel: +44 (0)20 7421 1986