TSG Building Services Plc v South Anglia Housing Ltd

Case reference: 
[2013] EWHC 1151 (TCC)
Wednesday, 8 May 2013

Key terms: 
Multiple dispute – jurisdiction of the adjudicator if multiple disputes are referred

On 1 July 2009 South Anglia Housing Ltd (“South Anglia”) entered into a contract with TSG Building Services PLC (“TSG”) in respect of gas servicing and associated works that South Anglia required to be carried out on a number of housing properties it was responsible for.

During the next 13 months TSG became concerned about the amount of payment it was receiving and wrote to South Anglia on 20 July 2010 in respect of a number of issues. On 23 August 2010, South Anglia responded with two letters to TSG. The second letter gave TSG three months notice of South Anglia’s intention to terminate the contract.

On 15 October 2012, TSG wrote to South Anglia sending a “Position Statement” and sought further payment of £1,190,971.56 in respect of four heads of claim.

When no satisfactory response was received from South Anglia, TSG served on South Anglia a Notice of Adjudication on 23 January 2013. The Notice referred three issues to adjudication: (i) additional costs TSG incurred due to poor maintenance, service or installation works, (ii) revenue TSG lost due to South Anglia awarding contract works to other contractors and (iii) the costs resulting from South Anglia’s termination of the contract.

South Anglia raised three jurisdictional points, one being that the Referral Notice referred to three distinct disputes. The adjudicator considered he did have jurisdiction and found in favour of TSG, awarding £383,778.91 plus interest be paid by South Anglia.

On 18 March 2013, TSG commenced proceedings for the enforcement of the adjudicator’s proceedings. On 20 March 2013, South Anglia issued Part 8 proceedings seeking a declaration that the South Anglia was entitled to terminate the contract and that adjudicator was wrong to award TSG the sums in the adjudication.

In respect of the enforcement proceedings, South Anglia pursued its jurisdiction argument maintaining that more than one dispute had been adjudicated. In referring to the observations of the Court in Witney Town Council v Beam Construction (Cheltenham) Ltd [2011] EWHC 2322 (TCC), the Judge determined that there was only one dispute, which was TSG’s compensation claim flowing from its termination, and this comprised of three primary strands or issues.

The Judge also considered TSG’s argument that multiple disputes could be referred to a single adjudication, relying on the comments made in obiter by Mr Justice Ramsey in Willmott Dixon Ltd v Newlon Housing Trust [2013] EWHC 798 (TCC). Mr Justice Ramsey had said at paragraphs 75-77 of the judgment that the reference to “a dispute” in Section 108 and the Scheme “was a generic and not intended to limit the number of disputes which could be referred to adjudication by Notice”). On this point, the Judge confirmed that “absent specific agreement…authorities are sufficiently well established now to suggest that only one dispute can be referred to adjudication, albeit that the courts adopt a sensible and commercial approach in determining the relative width of any given dispute.”

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Tel: +44 (0)20 7421 1986