This article summarises the High Court judgment of Home Group Ltd v MPS Housing Ltd [2023] EWHC 1946 (TCC) handed down by Mr Justice Constable on 25 July 2023. The case concerned Home Group’s application for summary enforcement of an adjudicator’s decision in their favour. MPS opposed enforcement, primarily arguing a breach of natural justice due to the volume of material in the referral and the limited time provided to respond. The judge ultimately dismissed these challenges and enforced summarily the adjudicator’s decision.

Background to Dispute

Home Group engaged MPS under a JCT Measured Term Contract for maintenance and repair works. MPS purported to terminate the contract in May 2022, which Home Group did not accept, asserting it was a repudiatory breach they accepted on 16 May 2022. In a first adjudication it was determined that MPS’ purported termination was invalid and constituted a repudiation of the contract.

This second adjudication was commenced by Home Group to recover termination losses, claiming £9,348,087.81. The referral, served on 17 March 2023, comprised a substantial amount of documentation including a quantum expert report amounting to 338 megabytes of data and a further 2,325 files and five factual witness statements. The adjudicator issued a decision on 28 April 2023, ordering MPS to pay Home Group £6,565,831.94 plus interest and 85% of his fees.

Complexity Argument

MPS opposed the enforcement of the adjudicator’s decision, primarily arguing that the process was unfair and in breach of natural justice. MPS explicitly stated they were not arguing that the dispute was incapable of adjudication per se. Instead, MPS argued that it was unable to properly digest and respond to the material served with the referral which has led to a material difference in the outcome.

The judge reviewed several key cases regarding challenges to adjudication enforcement based on time constraints and complexity, including HS Works, Amec Group, Edenbooth, The Dorchester Hotel, and CSK Electrical Contractors. These cases consistently highlight the inherent time pressures in adjudication and the reluctance of the courts to overturn decisions on these grounds unless there is a clear and material breach of natural justice that has led to a significant difference in the outcome. The Scottish case of Whyte & Mackay, involving a professional negligence claim brought significantly late, was distinguished based on its specific and unusual circumstances.

The judge stated that the sheer volume of information, in itself, does not constitute a valid basis for challenging enforcement, especially in the context of electronic data. The judge said at [52]:

“Irrespective of whether the correct number is 7 boxes or 32 boxes, as set out above, the quantity of information of itself does not present a valid basis for challenging enforcement. I would add that in the modern day, conceptualising the extent of electronic data by what it would look like printed will rarely be particularly persuasive or helpful, particularly so where a large quantity of the ‘documentation’ is in spreadsheets which are not designed to be printed.”

The crucial question is whether the responding party had a fair opportunity to understand the claim and present their response, considering the timing of the provision of material. The judge highlighted that Home Group had provided a draft of their expert report almost two months before MPS was required to serve their responsive evidence. Revised appendices were also provided five weeks before the referral. This significantly undermined MPS’s argument of being ambushed with information at the last minute.

The judge suggested at [55] that MPS’s reluctance to engage with Home Group’s offers of access to underlying data and their insistence on needing detailed information on every line item appeared to be strategically driven, potentially aimed at creating a jurisdictional challenge.

Despite claiming insufficient time, MPS did serve a comprehensive response with witness statements and their own expert report. They were able to identify areas of dispute and advance arguments, achieving some success in reducing Home Group’s initial claim. At [57] the judge stated: “Of course the response was less comprehensive than would be expected in litigation or arbitration, but that is plainly not the test.”

Conclusion

This judgment reinforces the courts’ robust approach to enforcing adjudication decisions and highlights the high bar for successfully challenging enforcement based on arguments of insufficient time and voluminous documentation. The adjudicator considered the issue of his jurisdiction and his ability to do “broad justice”, and the court would be “extremely reticent” to interfere with that conclusion.

The judge reiterated the principles from Carillion v Devonport and other cases, emphasizing that adjudication is a speedy, interim process aimed at providing a quick answer, not necessarily the definitive ‘right’ answer. To successfully challenge enforcement based on a breach of natural justice, the responding party must demonstrate that the alleged breach was material and led to a real difference in the outcome of the adjudication.