In a judgment of strategic importance for the construction sector, the TCC has provided the first direct authority on whether an assignee of a construction contract can refer a dispute to adjudication. In Paragon Group Limited v FK Facades Limited [2026] EWHC 78 (TCC), the Court granted summary judgment in favour of the assignee, Paragon, and confirmed that the statutory right to adjudicate is a remedy that transfers to an assignee along with the other benefits of the contract, unless expressly excluded.

Factual Background

The original contract was entered into on 17 October 2018 between Office Depot International (UK) Limited (‘the Employer’) and FK Facades Limited (‘the Contractor’). The agreement, in the form of a JCT Minor Works Building Contract 2016 edition, covered remedial roof installation works at a commercial property in Ashton-Under-Lyne, Greater Manchester.

The contract provided that either Party could refer a dispute to adjudication and confirmed that the Scheme for Construction Contracts would apply and the contract was specific in defining a ‘Party’ as “either the Employer or the Contractor.” Clause 3.1 restricting assignment was deleted and was replaced with an amendment stating that “the Employer may assign or charge the benefit of this Contract at any time without the Contractor’s consent.”

In the years following the original agreement, the benefit of the contract was assigned twice: ODI to OT Group Ltd and OT Group Ltd to Paragon.

A dispute arose in 2025 when Paragon, asserting that FK was in culpable delay, terminated the contract and levied a claim for liquidated damages. Paragon commenced an adjudication and FK challenged the adjudicator’s jurisdiction, arguing that Paragon, as an assignee, possessed no right to adjudicate. The adjudicator issued a non-binding decision affirming his jurisdiction, proceeded with the referral, and awarded Paragon £80,500 plus his fees.

Can an Assignee Adjudicate?

HHJ Stephen Davies found in favour of Paragon with his reasoning built on a pragmatic and commercially sensible interpretation of the law and the contract:

Interpretation of ‘Party’: The judge decisively cut through the ‘literalist’ argument, concluding that the term ‘party’ in the contract and the Scheme could be interpreted to include a legal assignee “without doing violence to the wording.” He noted that the “indiscriminate approach to the use of the word ‘party’ in the Scheme” supported this flexible and commercially sensible interpretation, especially where the contract itself expressly permitted assignment.

Overriding Effect of Statutory Assignment: The judge placed significant weight on S.136 of the Law of Property Act 1925 and drew heavily on the enduring principle of statutory assignment, citing Lord Esher in Read v Brown [1888] that an assignment transfers the legal rights and remedies to the assignee “as though it had been his from the beginning.” This logic, the judge found, necessarily includes the right to adjudicate unless expressly carved out.

Deconstruction of Practical Complications: The judge noted that any immediate injustice was mitigated and the contractor could still rely on its claims as a defence, either as an equity or through the principle of conditional benefit. Crucially, since adjudication is only temporarily binding, any potential for inconsistent findings between different forums could be rectified in subsequent litigation.

Weight of Commercial Common Sense: Ultimately, the judge reasoned it would be highly unlikely for commercial parties to intend for an assignee, who holds all other contractual benefits, to be denied the primary, swift, and cost-effective dispute resolution mechanism specifically designed for the construction industry.

Conclusion

Following this judgment, there is a new premium on foresight and precision during contract negotiation and drafting. Parties who wish to prevent an assignee from having the right to adjudicate must now include explicit and unambiguous wording to that effect. The default position is clear: the right to adjudicate is assigned. The judge put the matter beyond doubt, observing that any party could explicitly contract for a “‘no adjudication by an assignee’ clause” if they wished to avoid this outcome.