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Mek Mesfin considers the case of ICCT v Pinto [2019] 4 WLUK 289

ICCT v Pinto [2019] 4 WLUK 289

  1. Pursuant to an oral contract Mr Pinto engaged ICCT to perform works to seal leaks in his basement. ICCT performed the works. Mr Pinto alleged that the works were defective and refused payment. ICCT alleged that Mr Pinto, by his actions, had terminated the contract. The parties fell into a dispute and ICCT referred the dispute to adjudication. Neither Mr Pinto nor ICCT had had any previous experience of adjudication. Neither Mr Pinto nor ICCT was represented during the adjudication. Both parties engaged fully in the adjudication without making any jurisdictional reservations.
  2. The adjudicator awarded ICCT the sums it had sought (the invoices it had submitted in relation to the performance of the works). ICCT sought to enforce the adjudicator’s decision by way of the TCC’s well known bespoke summary judgment procedure. Mr Pinto raised three objections to the enforcement proceedings.

Jurisdiction

  1. The first, and most interesting, objection raised by Mr Pinto (which was raised the working day before the enforcement hearing) was that Mr Pinto had been a residential occupier and, therefore, pursuant to s.106 of the Construction Act, adjudication could not apply to him, in circumstances where the parties had not agreed a contractual adjudication.
  2. Waksman J rejected this argument. He accepted ICCT’s argument that although s.106 of the Construction Act precluded the automatic implication of adjudication into a construction contract with a residential occupier, s.106 did not make adjudication in relation to contracts with residential occupiers unlawful per se. Residential occupiers are free to agree to adjudication. Many standard form contracts intended for works for residential occupiers include adjudication clauses.
  3. The Court held that even where there was no formal jurisdiction, an ad hoc jurisdiction could, depending on the circumstances, arise to give the adjudicator jurisdiction. The Court referred to Promet Technology Ltd v Imperial Cash and Carry Ltd [2015] 7 WLUK 596 and the authorities therein. In the instant case Mr Pinto (and ICCT) had fully engaged with the adjudication process and, accordingly, an ad hoc adjudication had come into being. Further, Mr Pinto had made no reservation of rights, and thereby he had waived any jurisdictional objections. The fact that Mr Pinto was unaware of s.106 of the Construction Act did not matter, ignorance of the law not being a defence.
  4. Mr Pinto had also argued that he had been coerced into taking part in the adjudication by the adjudicator’s timetabling; but, on the facts, the Court found that Mr Pinto had been given an extension whenever he had asked for one and there was no basis for criticising the adjudicator. Mr Pinto had been given every opportunity to make his case.
  5. Finally, the Court stated that the adjudicator had been under no duty to tell Mr Pinto about any jurisdictional issue. An adjudicator was entitled, when receiving a referral, to accept it, and had no obligation to enquire any further, especially when there had been no reservation of rights.

Natural Justice

  1. Mr Pinto’s second objection was an allegation of a breach of natural justice. Mr Pinto alleged that ICCT and the adjudicator knew each other. This was based on (a) ICCT’s addressing of the adjudicator by his first name during the adjudication and (b) an email sent by ICCT after the adjudication had concluded in which ICCT had stated that the adjudicator had come “highly recommended”. Mr Pinto said these amounted to apparent bias.
  2. This allegation – that the parties had known each other – had been raised by Mr Pinto during the adjudication (in response to ICCT referring to the adjudicator by his first name). ICCT and the adjudicator stated that they had not had any past association with each other.
  3. The application, which was made to the Chartered Institute of Building, seeking the nomination of an adjudicator had not requested a specific adjudicator. The reference made by ICCT after the adjudication to the adjudicator having been “highly recommended” was explained to the Court, on instructions, as having been a reference to the adjudication process having been highly recommended.
  4. The Court found that Mr Pinto’s allegation of apparent bias had no merit. Even if the adjudicator had come highly recommended, in the sense of being portrayed as a good adjudicator, that fact alone could not have impugned his impartiality. Parties very frequently request recommendations for, and seek the nomination of, adjudicators and/or arbitrators, that have come highly recommended in that sense of the word. However, the key facts were that (a) the adjudicator had not been specifically nominated and (b) the adjudicator and ICCT were not aware of each other prior to the adjudication. Therefore, the allegation of a breach of natural justice could not stand.

Merits

  1. Mr Pinto’s third objection was that the adjudicator’s decision had been wrong on the merits. Waksman J reiterated the trite position at law that it was not for the Court on an application for the enforcement of an adjudicator’s decision to investigate such matters. It could not be said that the matter had been dealt with by the adjudicator incoherently or with a real misunderstanding of what the dispute was about.
  2. Upon all three objections failing, ICCT’s summary judgment application was granted.

Mek Mesfin appeared for the successful applicant, ICCT, Instructed by Silver Shemmings Ash LLP.



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