Watkin Jones & Son Ltd -v- Lidl UK GmbH
Case reference:
[2001] EWHC 453 (TCC)
Thursday, 27 December 2001
Key terms: CPR Part 8 procedure - Jurisdiction of adjudicator - Acting ultra vires - Withholding notice according to contractual terms
The contract between claimant Watkin Jones (contractor) and defendant Lidl (employer) was for a new retail store in Bangor. Watkin made an application for payment. Lidl treated the application as a valuation for a final account. The contract required at clause 30.3.3 that an employer should give notice stating the respects in which the amount applied for was not due to the contractor. No such notice was issued. Nevertheless, Lidl did not pay. A first adjudicator awarded Watkin Jones the sum they had applied for.
Subsequently, Lidl launched a second adjudication seeking a revision of the sum applied for by Watkin Jones, as well as a repayment in case of overpayment. A second adjudicator resigned on the grounds of lack of jurisdiction.
Lidl then commenced a third adjudication. The third adjudicator formed the view that he had jurisdiction to decide the dispute. By its CPR Part 8 claim, Watkin Jones sought both a declaration that the third adjudicator was not entitled to do so and an injunction to restrain Lidl from continuing with the adjudication.
HHJ LLoyd held that the third adjudication did not have any jurisdiction on the strength that the subject of the third adjudication had already been dealt with in the first adjudication. He found it was not open to Lidl to avoid the consequences under the contract where no notice had been given by then asserting that the dispute was justiciable as it concerned prior questions namely what ought to have been applied for, what the valuation was, etc., since they were the rationale for clause 30.3.3.
Accordingly, HHJ LLoyd held that the notice of adjudication as well as the appointment of the second and third adjudicator were invalid. However, the court did not grant an injunction because it expected that an undertaking would be given by Lidl in the terms sought in lieu of an injunction.
Subsequently, Lidl launched a second adjudication seeking a revision of the sum applied for by Watkin Jones, as well as a repayment in case of overpayment. A second adjudicator resigned on the grounds of lack of jurisdiction.
Lidl then commenced a third adjudication. The third adjudicator formed the view that he had jurisdiction to decide the dispute. By its CPR Part 8 claim, Watkin Jones sought both a declaration that the third adjudicator was not entitled to do so and an injunction to restrain Lidl from continuing with the adjudication.
HHJ LLoyd held that the third adjudication did not have any jurisdiction on the strength that the subject of the third adjudication had already been dealt with in the first adjudication. He found it was not open to Lidl to avoid the consequences under the contract where no notice had been given by then asserting that the dispute was justiciable as it concerned prior questions namely what ought to have been applied for, what the valuation was, etc., since they were the rationale for clause 30.3.3.
Accordingly, HHJ LLoyd held that the notice of adjudication as well as the appointment of the second and third adjudicator were invalid. However, the court did not grant an injunction because it expected that an undertaking would be given by Lidl in the terms sought in lieu of an injunction.