Adjudication
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KEYWORDS: |
Adjudication, the Housing Grants Construction and Regeneration Act 1996, enforcement, adjudicator's decision, stay to arbitration, limited company, residential occupier, financial standing, construction, Judge David Wilcox. |
In Absolute Rentals Ltd v Gencor Enterprises Ltd (2000) TCC Absolute Rentals sought summary judgment for £19,723.33 awarded by an Adjudicator in respect of building works carried out by Gencor at Fulham London. Gencor sought an order that Absolute Rental's claim in the proceedings be stayed or alternatively the judgment which Absolute Rentals might obtain be stayed pending the determination of Gencor's claim against Absolute rentals referred to arbitration. Gencor asserted that Absolute Rentals would not be in a position to pay such sum ordered to be paid in respect of Gencor's claim and that Gencor would not be able to recover any sum which was required to be paid to Absolute Rentals.
One issue which was not pursued was that the work was done on a residential dwelling and therefore fell within the exception contained in Section 106 of the Housing Grants, Construction Regeneration Act 1996. His Honour judge David Wilcox stated obiter that a limited company cannot be a residential occupier of a dwelling house.
It was argued that Gencor was entitled to a stay under Section 9 of the Arbitration Act 1996 since a valid notice had been given to arbitration, relying on Halki Shipping Corporation v Sopex Oils Limited 1998. It was held that the determination by an Adjudicator was entirely without prejudice to the final merits and determination by the Arbitrator, and that Gencor had no defence. Summary judgment was granted in the sum of £19,723.
On the matter of Absolute Rental's financial viability it was held that it was not desirable to judge the financial standing on an application for summary judgment of an adjudicator's decision. The purpose of adjudication (under the Scheme in this case) was to provide a speedy mechanism for settling disputes on a provisional basis and by requiring decisions of an Adjudicator to be enforced pending final determination of disputes by arbitration, litigation or agreement, whether those decisions are wrong in point of law or fact, if within the terms of reference. It was held that adjudication was a robust and summary procedure and that there may be casualties although the determinations are provisional and not final Bouygues UK Ltd v Dahl-Jensen UK Ltd.