Adjudication is not the Wild West of dispute resolution.
24th October 2016 by Rob Kelly
The title of this article comes from Fraser J’s judgment in Beumer Group UK Ltd v Vinci Construction UK Ltd  EWHC 2283 (TCC). He was referring to adjudication being a “formal dispute resolution forum with certain basic requirements of fairness” which arise from the rules of natural justice and are central to the court’s judgment.
Gatwick Airport Ltd (the employer) employed Vinci Construction UK Ltd (the contractor) to install a £30 million airport baggage handling system at the airport’s south terminal. The contractor engaged Beumer Group UK Ltd as a sub-contractor. Beumer sub-contracted work to Daifuku Logan Ltd.
Disputes arose between Vinci and Beumer and between Beumer and Daifuku. Beumer referred both disputes to the same adjudicator but neither Beumer nor the adjudicator told Vinci of the adjudicator’s involvement in both adjudications.
Vinci complained that they had not been told of the adjudicator’s involvement with the other adjudication and argued there had been a breach of natural justice. The court held that the existence of the other adjudication should have been revealed to Vinci and that the adjudicator should have disclosed that he was acting in both adjudications. Had Vinci known about the other adjudication it would have been entitled to seek disclosure of documents relating to it. This was particularly important because Beumer was advancing factually inconsistent cases in both adjudications.
The court noted that the adjudicator had dealt with both disputes with care but held there had been a breach of natural justice and so declined to enforce his award.
Comment: Adjudication is a serious method of dispute resolution and is not a poor relation to traditional court proceedings; basic requirements of fairness and natural justice apply.
If you would like further information please contact Rob Kelly on 01202 755217.
This article provides information and comments on legal issues and developments of interest. The contents of this article do not constitute legal advice, is not a comprehensive treatment of the subject matter covered, and should not be relied on as such. Legal advice should be sought about your specific circumstances before taking any action with respect to the matters discussed.