Morgan Sindall Construction and Infrastructure Ltd v Westcrowns Contracting Services Ltd

Case reference: 
[2017] CSOH 145
Thursday, 30 November 2017

Key terms: 
Adjudication - HGCRA 1996 - Adjudicator's jurisdiction - procedural fairness

Morgan Sindall Construction and Infrastructure Ltd, the pursuer, sought to enforce the decision of an adjudicator against Westcrowns, the defender. This case is a prime example where a party resisting adjudication proceedings should make its objections clear from the outset as it cannot raise multiple points of objection to resist enforcement proceedings without a particular focus.

Morgan Sindall entered into a contract with Westcrowns under which Westcrowns agreed to carry out works involving the installation of soft flooring to classrooms, corridors and ancillary spaces in a school. After installation of the vinyl floor covering, the parties became aware of what were described as "bubbling and blistering" in the flooring. Morgan Sindall sent a schedule of defects to Westcrowns and contended  the defects were caused by three failures on the part of Westcrowns; namely, use of an incorrect primer, inadequate application of the primer and a failure properly to test for the presence of moisture in the anhydrite screed prior to laying the flooring. Westcrowns rejected Morgan Sindall’s claims. The matter was referred to adjudication by Morgan Sindall. The adjudicator’s decision was held in favour of Morgan Sindall and ordered Westcrowns to pay the sum of £430,654.44 plus VAT.

Westcrowns challenged the adjudicator’s decision on five grounds. The first was that the adjudicator had acted outside of his jurisdiction by deciding matters which went beyond the scope of the dispute which had been referred to him. Lord Clark rejected this submission on the basis that Westcrowns did not sustain its jurisdictional objection. Although it had raised a specific jurisdictional objection before the adjudicator, the adjudicator held that such objection was unfounded and Westcrowns continued with the adjudication without further jurisdictional objection.

Westcrowns’ second objection was that the adjudicator had sought to decide two disputes. This was rejected by Lord Clark as the factual basis for each of the alleged disputes was held to be "exactly the same, namely the cause of the bubbling and blistering". The third objection was that the adjudicator had left out of account a relevant consideration. This submission was rejected on the ground that the alleged omissions were not material and did not have a significant impact on the outcome of the adjudication. The fourth objection was that the adjudicator had acted in a way that was procedurally unfair. This objection was substantially overlapping with the third ground of challenge and was dismissed for the same reason. The final objection by Westcrowns was that the adjudicator had failed to deal with its specific point raised as part of its defence. This objection was also rejected by Lord Clark, who held that the adjudicator's failure to deal with the point was immaterial and it had not caused substantial prejudice to Westcrowns.

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