WH Malcolm Limited, Re Judicial Review
Case reference:
[2010] Scot CSOH 152
Wednesday, 10 November 2010
Key terms: Judicial review – Jurisdiction – Same dispute – Subsequent decision
Amec engaged WH Malcolm as subcontractor on works carried out at Calderglen High School in East Kilbride. WH Malcolm had previously commenced adjudication, receiving a decision in its favour (“Adjudication 1”). Adjudication 1 was concerned with the valuation of 14 items. Part of the Adjudicator’s decision included reasoning that SMM7 did not apply to the subcontract.
A second adjudication was commenced by WH Malcolm, claiming payment for three items (“Adjudication 2”). As part of its response, Amec submitted that SMM7 was the correct method of measurement for the three items. WH Malcolm asserted that the issue of SMM7 had already been determined in Adjudication 1, and it was not open for Amec to raise the issue again. After receiving further submissions from the parties, the second Adjudicator stated that he was not bound by the first Adjudicator’s comments in respect of SMM7. Prior to the end of Adjudication 2, WH Malcolm applied for judicial review of that decision. Clause 38 of the TeCSA Adjudication Rules, which were incorporated into the subcontract, stated:
“No party shall, save in case of bad faith on the part of the adjudicator make any application to the courts whatsoever in relation to the conduct of the adjudication or the decision of the adjudicator until such time as the adjudicator has made his decision or refused to make a decision and until the party making the application has complied with any such decisions.”
There were three issues to be decided:
- Was WH Malcolm entitled to commence judicial review proceedings prior to the determination of Adjudication 2? If so:
- What was the dispute that was referred to Adjudication 1? and
- What was decided in Adjudication 1?
The Judge determined that WH Malcolm was not entitled to commence judicial review proceedings prior to the determination of Adjudication 2. Clause 38 was written in clear terms, and to commence proceedings whilst the adjudication was ongoing was a breach of the subcontract.
The judge went on to comment that, in any event, the issue of SMM7 was not part of the dispute or the decision in Adjudication 1. It was part of the reasoning used to make the Adjudicator’s decision, and the distinction was an important one. The judge’s decision did not prevent WH Malcolm from arguing that SMM7 did not apply. The Adjudicator in Adjudication 2 had only stated that he did not believe he was bound by the first Adjudicator’s comments, not necessarily that he disagreed with them. Therefore, WH Malcolm had not been prejudiced by the decision.