黑洞社区

The Institute of Civil Engineers (ICE) seems, and always has seemed, to want to push people into 鈥渄isputomania鈥�. Its adjudication procedure includes a leftover from the days of dinosaurs.

It is the same pushy notion that used to apply to what used to be in the ICE documents called 鈥淭he Engineers Decision鈥�. All and every dispute was supposed to be decided by the project engineer. Hardly could the engineer be called unbiased. Come to think of it, that scoundrel engineer Brunel liked to decide all the disputes himself. I bet he never lost once!

Hardly could the engineer be called unbiased. Come to think of it, That scoundrel engineer Brunel liked to decide all the disputes himself. I bet he never lost once!

Unless the disgruntled contractor shouted 鈥渓et鈥檚 arbitrate鈥� within three months, the engineers鈥� partisan and biased decision became final and binding. And, yes, that did happen, mostly because the contractor was busy constructing instead of reading the small print. The recent humdinger of a row between Buckingham Group Contracting Limited and Westshield Civil Engineering Limited (or Westshield Limited), had all these same deadline time games.

The adjudication procedure pushed out by the ICE has a clause, which says: 鈥淪hould either party be dissatisfied with the decision of the adjudicator that party may within 28 days of the adjudicator鈥檚 decision refer the dispute to either legal proceedings or arbitration in accordance with clause 15 of this subcontract. If no such proceedings are commenced within the said 28 days then the adjudicator鈥檚 decision shall be final and binding on the parties.鈥�

Buckingham Group Contracting was the main contractor for a studio for the TV soap Coronation Street. Westshield became their subcontractor for supply and laying of drains.

There were two quarrels:

• Was it Westshield Limited or was it Westshield Civil Engineering Limited that contracted with Buckingham? (Oh, dear - this sort of mess is not uncommon)
• The subcontractor valued the final account at 拢550k, but Buckingham said 拢364k.

Buckingham started the adjudication and had second thoughts as to the final account- it became 拢295K in the referral and wanted a repayment. The subcontractor also had second thoughts and came in at 拢641k in its response to the referral. It argued that Westshield Limited rather than Westshield Civil Engineering Limited was the subcontractor. If that was true it was unfortunate for Buckingham, because Westshield Limited had just been placed into a creditors voluntary liquidation.

Mr Philip Doherty was appointed adjudicator. He decided the correct company on drainage was Westshield Civil Engineering Limited and decided the final account was 拢505k.

Buckingham 鈥榮 lawyers popped into the high court in Manchester and took out a claim form against the two westfield companies, then kept the form up its sleeve for four months

Now comes the fun. Do you recall that clause giving 28 days to refer an adjudicator鈥檚 decision to either litigation or arbitration? Well, Buckingham made a canny move. Its lawyers popped into the High Court in Manchester and took out a claim form against the two Westshield companies, then kept the form up its sleeve for four months. By now the 28 days in the clause looked to be well past. Buckingham told Westshield it could sling its hook for the cash.

Unsurprisingly, Westshield sought to enforce the adjudicator鈥檚 decision. Buckingham said it was unenforceable but if it was enforceable they told the court that it had commenced court proceedings on the true value of the final account. Westshield argued that Buckingham was out of the 28-day time frame and was therefore permanently stuck with the decision of the adjudicator.

The High Court had to decide what is meant by 鈥減roceedings are (to be) commenced within 28-days of the adjudicator鈥檚 decision鈥�. Buckingham said it had done so but kept mum! Foul, shouted Westshield. The builder and subcontractor have themselves become stars in a soap - a sort of courthouse in Coronation Street. When Buckingham popped into court and completed a claim form, paid its fee and didn鈥檛 tell Westshield, had proceedings 鈥渃ommenced鈥�? That鈥檚 all it takes. Then the claimant has four months to hold on before letting the High Court鈥檚 cat out of the bag.

Buckingham may well have no appetite to go on into expensive litigation and may prefer to wait and negotiate a settlement.

Come on ICE - drop this clause, it pushes people into disputomania.

Tony Bingham is a barrister and arbitrator at 3 Paper 黑洞社区s, Temple