A & D Maintenance and Construction Ltd v Pagehurst Construction Services Ltd (CIP) [2000]

A & D Maintenance and Construction Ltd v Pagehurst Construction Services Ltd (CIP) [2000]

A & D were appointed by Pagehurst as subcontractors in respect of extension works being undertaken at a school. Part of the works being undertaken by A & D included the installation of a boiler and flue. Disputes arose as to whether or not A & D’s and therefore Pagehurst’s works were complete, which eventually resulted in the school terminating Pagehurst’s contract on 19 November 1998. On the same day, Pagehurst terminated A & D’s contract.

On 27 November 1998 the school prepared a schedule of outstanding works.

On 28 November 1998 a fire occurred at the school causing considerable damage to the extension and the main building. The loss adjusters for the school reported on 28 December 1998 that the cause of the fire was the negligent installation of the boiler.

A & D commenced adjudication proceedings against Pagehurst in respect of invoices that had not been paid, and obtained a decision from the adjudicator on 8 March 1999 that Pagehurst should pay them the sum of £103,665.80. These proceedings arose as a result of A & D seeking to enforce the decision of the adjudicator.

Pagehurst defended the enforcement proceedings on the following grounds:

  1. They argued that termination of the contract resulted in a termination of the implied terms including the right to adjudicate.
  2. They argued that some of the invoices that the adjudicator had ordered should be paid had not become payable under the timetable laid down in the Scheme.
  3. They argued that as there were other ongoing proceedings to recover the losses sustained by reason of the fire, the application for summary judgment to enforce the adjudicator’s decision should be dismissed.

With regard to point (1), the court concluded that disputes referred to the adjudicator remain disputes under the contract notwithstanding termination of that contract. Where there is a contract to which the Act applies, as in this case, and there are disputes arising out of the contract to be adjudicated, the adjudication provision clearly remains operative just as much as an arbitration clause would remain operative.

With regard to point (2), the court concluded that the adjudicator had jurisdiction to consider the issues raised as to the payment of the invoices and that the correctness of his decision is not a matter that falls to be considered by the court when considering the limited issue of the enforceability of the adjudicator’s decision.

With regard to point (3), the court concluded that it would not have been disposed to give leave to defend the enforcement proceedings in the absence of other proceedings. Further, that adjudication is a remarkable and possibly unique intervention whereby the ordinary freedom of contract between commercial parties to regulate their relationships has been overridden and that the intention of parliament is clear – that disputes are to go to adjudication and the decision of the adjudicator has to be complied with, pending final determination.

Therefore the court gave summary judgment for the claimant against the defendant.

One response to “A & D Maintenance and Construction Ltd v Pagehurst Construction Services Ltd (CIP) [2000]

  1. Pingback: International Judgments – Malaysian Construction and Contract Law | Malaysian Construction and Contract Law

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