Readers may recall the case of Linnett v Halliwells where Mr Linnett the adjudicator claimed his fees from Halliwells even though Halliwells objected to the adjudicator’s jurisdiction and did not take part in the adjudication.
Mr Linnett’s decision was enforceable, and by conducting the adjudication provided “consideration” to Halliwells. The Court therefore allowed Mr Linnett’s claim and Halliwells had to pay up.
But what if the adjudicator’s decision had been unenforceable?
The answer is (to an extent) provided in the case of Systech International v PC Harrington.
PC Harrington had adjudicated against Tyroddy Construction and then sought to enforce the adjudicator’s award.
The Court held that there had been a breach of Natural Justice and the adjudicator’s decision was therefore unenforceable.
Systech (the adjudicator’s employer) in any event sought payment of its fees from PC Harrington, who refused to pay on the basis that the unenforceable decision meant there had been a total failure of consideration by the adjudicator.
The Court dismissed PC Harrington’s argument and said that the “consideration” provided was not just the decision itself, but the adjudicator’s overall conduct of the adjudication.
COMMENT: Does this mean that adjudicators will be entitled to their fees come what may? Unlikely. Each case will be decided on its own facts, and here the Court noted that the adjudicator had acted honestly but had unwittingly fallen below the standard required of him. Perhaps if the adjudicator mad been in blatant breach of the rules of natural justice or acted in bad faith, the decision would have been different.
Author: James Coppinger, Head of Construction and Engineering.
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