Orange EBS Limited -v- ABB Limited
Case reference:
[2003] EWHC 1187 (TCC)
Thursday, 22 May 2003
Key terms: Adjudicator's Jurisdiction - DOM/1 1980 Edition - Repudiation - Final Account - Dispute
Bovis (who were carrying out the building of the trauma centre at the John Radcliffe Hospital) sub-contracted works to the Defendant, ABB. ABB then sub-contracted mechanical services work to Orange based on an amended DOM/1 1980 Edition. Orange submitted, in March 2002, their penultimate application for the gross sum of £81,399.05 at a time when approximately 75% of their work had been completed. On 28 May 2002 Orange withdrew from site. ABB issued a Notice in June 2002 stating that Orange had failed to complete their work. ABB refused to give Orange further access to the site. On 5 July 2002 ABB sent a fax to Orange stating that they would pay them no further sums until a Final Account had been submitted and ABB had adjusted it to take account of defective and incomplete work. On 10 July Orange replied stating that a dispute existed between the companies. A Final Account was not provided until 2 December 2002 seeking a gross valuation of £270,417.00. Enclosed with the letter was a formal Notice of Intention to Refer to Adjudication.
A first Adjudicator was appointed on 9 December 2002, but resigned on 11 December as the dispute was not referred to him. A second Notice to Refer was issues on 6 January 2003 and the Adjudicator decided that ABB's conduct in refusing Orange access to the site amounted to a repudiatory breach of contract. He concluded that the total value of Orange's claims were £155,011.22.
ABB contended that the Adjudicator did not have jurisdiction to decide how much Orange should be paid in respect of the Final Account as no dispute existed at the time of the Referral.
HHJ Kirkham referred to the recent decision of Forbes J Beck Peppiatt Ltd -v- Norwest Holst Construction Ltd [2003] EWHC H22 (TCC). In that case Forbes J held that the decision in Halki binds judges in the context of adjudication and the word "dispute" should not be given some special meaning. For a dispute to have arisen it must be clear that the process of negotiation has ended and there is something that needs to be decided.
Orange argued that a dispute had arisen on or before 8 July at the latest, or alternatively on or about 2 December when the Final Account was delivered.
HHJ Kirkham held that a dispute arose on receipt of ABB's letter of 6 July at the latest, but that at that point Orange had not provided ABB with the detail of the amount claimed. For example, a large proportion of the variations had not been claimed until 2 December 2002 when the Final Account was submitted. She therefore concluded that there was no dispute for the purposes of adjudication in July 2002 as to the amount payable to Orange. On the other hand, by the time Orange issued its Notice to Adjudicate on 6 January 2003, a dispute had arisen as sufficient time had elapsed for evaluation and discussion or negotiation of Orange's claim. Therefore, the second Adjudicator had jurisdiction and Orange was entitled to judgment.
A first Adjudicator was appointed on 9 December 2002, but resigned on 11 December as the dispute was not referred to him. A second Notice to Refer was issues on 6 January 2003 and the Adjudicator decided that ABB's conduct in refusing Orange access to the site amounted to a repudiatory breach of contract. He concluded that the total value of Orange's claims were £155,011.22.
ABB contended that the Adjudicator did not have jurisdiction to decide how much Orange should be paid in respect of the Final Account as no dispute existed at the time of the Referral.
HHJ Kirkham referred to the recent decision of Forbes J Beck Peppiatt Ltd -v- Norwest Holst Construction Ltd [2003] EWHC H22 (TCC). In that case Forbes J held that the decision in Halki binds judges in the context of adjudication and the word "dispute" should not be given some special meaning. For a dispute to have arisen it must be clear that the process of negotiation has ended and there is something that needs to be decided.
Orange argued that a dispute had arisen on or before 8 July at the latest, or alternatively on or about 2 December when the Final Account was delivered.
HHJ Kirkham held that a dispute arose on receipt of ABB's letter of 6 July at the latest, but that at that point Orange had not provided ABB with the detail of the amount claimed. For example, a large proportion of the variations had not been claimed until 2 December 2002 when the Final Account was submitted. She therefore concluded that there was no dispute for the purposes of adjudication in July 2002 as to the amount payable to Orange. On the other hand, by the time Orange issued its Notice to Adjudicate on 6 January 2003, a dispute had arisen as sufficient time had elapsed for evaluation and discussion or negotiation of Orange's claim. Therefore, the second Adjudicator had jurisdiction and Orange was entitled to judgment.