MW High Tech Projects Limited v Balfour Beatty Kilpatrick Limited [2020] 1413 (TCC)

Serving a delay report, the crystallisation of a dispute, the adjudicator’s jurisdiction and the reimbursement of the adjudicator’s fees?
 
The Court recently rejected a Part 8 claim from the claimant, seeking a declaration that the adjudicator’s decision was not legally binding, due to the submittal of a late delay report and the adjudicator’s lack of jurisdiction.

Facts
 
This case concerned the construction of a new laboratory, worth over £23,000,000. MW High Tech Projects Limited (“the claimant”) and Balfour Beatty Kilpatrick Limited (“the defendant”) entered into a Design and Build 2011 Subcontract, requiring the defendant to carry out mechanical and electrical works.
 
Delays occurred and the defendant served notices for an extension of time on five occasions. However, the claimant failed to respond to these notices, and led to the defendant referring this dispute to an adjudicator in August 2019, seeking an extension of time. The adjudicator, in his decision dated 10 October 2019, granted the defendant the full extension of time requested (282 days) and required the claimant to pay his fees.
 
The claimant submitted a Part 8 claim, arguing that eight days was not enough time to respond to the extension of time requests under the new delay report, and the dispute had not crystallised. Therefore, the adjudicator lacked jurisdiction and his decision was not legally binding.
 
Issues considered
 
In determining the judgment, the Court considered whether the dispute had crystallised and if the Defendant was entitled to a reimbursement of the adjudicator’s fees.
 
Judgment
 
The Court held that the adjudicator had jurisdiction and therefore his decision is legally binding. The claimant was ordered to reimburse the cost incurred by the defendant, including the adjudicator’s fees, which were assessed at £37,251.66.
 
The reasoning behind the Court’s judgment was that the new report was not materially different to previous notices for delay and was not an entirely new notice. The claimant had to respond to any notices within 16 weeks of receipt under clause 2.18.2 of the sub-contract. However, the claimant failed to respond to any of the notices under their contractual obligations and this silence inferred that the delay notices were not accepted.
 
Therefore, the dispute had crystallised on receipt of the last notice and the adjudicator had jurisdiction to determine this matter. The adjudicator’s decision was valid and legally binding.
 
Top tip
 
Before challenging an adjudicator’s decision, check whether the latest notice for an extension of time is materially different to previous notices, and constitutes a “new notice”.
 
If you would like further assistance, please contact Barton Legal on 0113 202 9550, or use the contact us page on our website.