The case of The Trustees of the Marc Gilbard 2009 Settlement Trust v OD Developments & Projects Limited concerned clause 1.9.3 of the JCT 2009 Standard Building Contract without Quantities (Rev 2) which provides:
"If any adjudication, arbitration or other proceedings are commenced by either Party within 28 days after the Final Certificate has been issued, the Final Certificate shall have effect as conclusive evidence as provided in clause 1.9.1 save only in respect of the matters to which those proceedings relate."
Following the issue of the final certificate by the Contract Administrator, which provided for a payment by ODD (the contractor) to the Trustees (the employer), ODD issued Court proceedings to protect its position.
ODD later commenced adjudication proceedings. This was challenged by the Trustees as it was more than 28 days after the final certificate had been issued. ODD argued that the Court proceedings preserved its right to adjudicate those issues being the subject matter of the Court proceedings and that clause 1.9.3 was contrary to the Construction Act as it prevented it from commencing adjudication proceedings "at any time".
The Court held that clause 1.9.3:
- Allowed ODD to commence proceedings (whether Court proceedings or adjudication proceedings) to protect its position providing such proceedings were commenced within 28 days of issue of the final certificate;
- Envisaged that only one set of proceedings were necessary; and
- Did not fetter ODD's right to refer a dispute to adjudication "at any time", but the practical effect was that if adjudication proceedings were commenced after the expiry of the 28 day period, the Trustees could rely on the final certificate as "conclusive evidence" and so defeat ODD's claim.
The clear message is to ensure that the right to challenge a final certificate within the 28 day period is not lost. Claimants should choose their forum carefully and decide whether Court or adjudication proceedings would be most appropriate. In this regard, whilst adjudication proceedings are likely to provide a quicker and cheaper outcome, if the disgruntled party is not happy with the adjudicator's decision, the right to challenge the decision by way of Court proceedings is likely to have been lost.
