Century and Eclipse engaged Urang on separate developments using JCT 2005 standard form of building contracts. Disputes arose and Urang referred them to adjudication. Both referrals claimed amounts under interim certificates, against which Urang claimed no valid withholding notices were served as well as other contractual claims. The same Adjudicator was appointed for each adjudication.
Urang was successful in the adjudications. In both adjudications, the Adjudicator ordered the employer would be liable for his fees but that these should be paid by Urang who should then seek those amounts from the employers.

Urang commenced enforcement proceedings. Century and Eclipse respectively defended on the basis that (1) the Adjudicator breached the principles of natural justice in failing to consider valid counterclaims put forward; (2) the Adjudicator’s decision that there were no valid withholding notices was not a decision on the counterclaim’s merits but an erroneous and unfair ruling that did not fall within the Adjudicator’s remit; and (3) the Adjudicator failed to take into account a material valid withholding notice and in doing so breached the principles of natural justice. These jurisdictional arguments were not raised in either adjudication.

The Judge held that the Adjudicator’s decisions should be enforced. Century and Eclipse had claimed that Urang should not have been entitled to the sums stated in the interim certificates without showing any further entitlement, however the Judge ruled this was an incorrect interpretation. Where a contract has a certification regime by an independent third party, a contractor is entitled to claim for the amount stated on a certificate. This differs from the position where there is no certification regime. The Judge concluded that the Adjudicator had made a mistake when he decided that he could not consider the counterclaim as there was no valid withholding notice. This only applied to interim payments. Whereas in relation to the contractual claims, that were made outside of the payment regime, then the counterclaim should have been taken into account as no withholding notice is necessary. However, whilst the Adjudicator was wrong in the answer, he had answered the right question, namely could the employers’ counterclaims be used as a defence to Urang’s claims. Therefore, the decisions were enforced.

The Judge further noted that as the employers had been held liable for the Adjudicator’s fees, but Urang had been ordered to pay them in the first instance and had not, then the payment of the fees from the employers to Urang could only be made 14 days following payment of the fees by Urang to the Adjudicator.