A fundamental principle in adjudication enforcement proceedings is that an unfair decision is not necessarily a ground for resisting enforcement. The concept of fairness is limited to procedural matters only and does not extend to substantive matters. With that in mind this chapter will attempt to identify the salient rules of procedural fairness in adjudication.

Procedural unfairness is defined as a failure of a party to hear the case against it and respond. In the adjudication arena whereby, the adjudicator has some inquisitorial scope, the author suggests the definition might be expanded to a failure of a party to hear the case against it – including any alternative view taken by the adjudicator – and respond.

In accordance with the rules of natural justice, the court has determined that adjudicators have a duty to comply with the requirements of procedural fairness. The duty is qualified due to the constraints inherent in the tight timescales imposed by the Construction Act under which the adjudicator is to conduct the adjudication. As Dyson J stated in Macob v Morrison [1999]: “So far as procedure is concerned, the adjudicator is given a fairly free hand.”

Categories of procedural unfairness

On review of the literature, the domain of procedural unfairness related to adjudication falls into three categories: (i) responding; (ii) canvassing; and (iii) exhausting. These are discussed below.

Responding – A failure to allow a party to hear the case against it and respond

1. Failure to permit further submissions

Although, there is no inherent entitlement for parties to serve any submissions beyond the referral, it is accepted that, to comply with natural justice, both parties must be allowed the opportunity to be heard. The best course of action for the adjudicator is to set out a clear timetable at the outset of the adjudication, with the condition that any material sent thereafter will not be considered unless the parties consent to an extension of time.

In Balfour Beatty Construction Northern v Modus Corovest [2008], Modus was not permitted leave to submit a rejoinder. The adjudicator’s timetable made no allowance for the rejoinder and Modus did not challenge this. The decision was enforced because Modus failed to identify any new points it would have made in the rejoinder and therefore no grounds for a breach of natural justice.

2. Failure to follow the agreed procedure

The RICS guidance note states that, unless there are specific requirements within the applicable adjudication rules, the adjudicator has complete discretion as to the procedure that is to be adopted in reaching her decision. The adjudicator should write to the parties on receipt of the referral setting out the procedure and should it be necessary to make any changes to that procedure, invite comment from the parties.

3. Unfair timetable

The adjudicator must bear in mind she has to reach a decision within the twenty-eight days permitted by the Construction Act, or such extended time that may be agreed by the parties. Whilst in transit the adjudicator must ensure parties are afforded the luxury of a fair hearing. If that is not possible and the parties refuse to extend the timetable, she must resign or otherwise risk a breach of the rules of natural justice.

4. Late submissions

Natural justice affords both the opposing party and the adjudicator sufficient time to deal with submissions. If a party sends a late and unsolicited submission, the adjudicator should consider it as time permits.

Coulson J said in Amec v Thames Water [2010] that, “an adjudicator is not obliged to consider in detail a second-round submission or pleading, served very late in the adjudication process’. He went on to state that, ‘the adjudicator was not acting in breach of natural justice if he simply glanced at the material that it contained, to see its general nature and to see if it contained anything of real significance“[64].

In GPS Marine v Ringway Infrastructure, Ramsey J held that an adjudicator could decline to consider the responding party’s rejoinder, served two days before the adjudicator’s decision was due and after the adjudicator had advised the party that it did not have permission to serve it.

Canvassing – A failure to invite comments on her alternative view

1. Failure to consult on approach / preliminary view

Where the adjudicator wishes to adopt an approach or methodology to determine a material issue which neither party has advanced, she must ensure that this approach or methodology has been communicated to the parties, and that they have time to consider it (Roe Brickwork v Wates Construction [2013]). However, the adjudicator’s decision to use an approach which both sides have told her to ignore will likely amount to a breach of natural justice (Primus Build v Pompey Centre [2009], Liverpool CC v Vital Infrastructure [2022]).

In Lanes v Galliford Try [2011] EWCA, Lanes argued that the adjudicator had ‘predetermined’ the dispute as his decision was the same as the preliminary views he had shared with the Parties. The Judge found that there is nothing objectionable with an adjudicator setting out a provisional view at an early stage so that the parties have an opportunity to correct any errors in the adjudicator’s thinking. Furthermore, if the adjudicator forms a view that is different from any of the views that the parties hold and one which they could not have reasonably anticipated, that view must be communicated early and the parties must be afforded the opportunity to make submissions on it (Shimizu Europe v LBJ Fabrications [2003]).

2. Failing to share advice from experts

The adjudicator may take advice on legal or technical matters that are outside their own competence. The Scheme provides at subparagraph 13(f) that the adjudicator may ‘obtain and consider such representations and submissions as he requires, and, provided he has notified the parties of his intention, appoint experts, assessors, or legal advisers’. However, where the adjudicator seeks advice from a third party and fails to notify the parties and permit the parties the opportunity to comment on any material or opinion, the decision is likely to be unenforceable.

The case of Balfour Beatty v The Mayor of Lambeth [2002] involved the adjudicator electing not to canvass the parties on a self-commissioned report. Even though HHJ LLoyd QC stressed that the purpose of adjudication is not to be derailed ‘by an overly sensitive concern for procedural niceties’, the Judge refused to enforce as the parties hadn’t been consulted on the findings sought from a programming expert. That could have been cured by disclosure to the parties and inviting comments on the report.

Exhausting – A failure to consider the case in full

1. Failing to consider / address matters in issue

If the adjudicator takes an erroneously restrictive view of her jurisdiction and fails to address the question referred to her, that could make the decision unenforceable. However, it is not incumbent upon the adjudicator to include in the decision a commentary upon every issue, save to the extent that it is necessary to provide reasons for what is decided. That would include expressly rejecting any cross-claims.

As Lord Briggs stated in Bresco Electrical Services v Michael J Lonsdale [2020] UKSC, “However narrowly the referring party chooses to confine the reference, a claim submitted to adjudication will nonetheless confer jurisdiction to determine everything which may be advanced against it by way of defence, and this will necessarily include every cross-claim which amounts to a set-off.”

In CC Construction v Raffaele Mincione [2021], Judge Eyre QC distinguished between considering a defence and finding it was not tenable and declining to consider an asserted defence at all. She stated that the former is within an adjudicator’s jurisdiction and this approach, even if expressed in short terms, is unlikely to breach natural justice.

By way of example, in CG v Breyer [2013], Akenhead J said that should a party raises a set-off defence for defects against a payment claim against it, the adjudicator ‘needs to address and rule upon it, even if it is simply a rejection on the basis factually that it was never raised before or legally that there was no timeous withholding notice’.

2. Failing to consider / address submission or evidence

If the adjudicator is found not to have addressed a party’s case in full, prejudicial to the innocent party, that is likely to amount to a breach of natural justice. However, where it is important for the adjudicator to consider and address substantive defences, it is less important to address all aspects of the evidence that went to support that defence.

Akenhead J’s judgment in Jacques v Ensign Contractors [2009] confirmed that the adjudicator’s discretion extends to making decisions on material she considers inadmissible, as well as material to which little or no weight will be attached.

Adjudicators’ decisions often express pro-forma wording along the lines of: “Having considered all submissions and evidence in reaching my decision, I have only referenced those considered essential.” In JJ Rhatigan v Rosemary Lodge [2019] Jefford J expressed her opinion on the treatment of such formalities. Although a party ought to take it at face value, the door is open to demonstrating that the adjudicator had not considered all matters.

3. Wrongly interpreting jurisdiction due to previous adjudications

The adjudicator must be careful not to adjudicate on matters already decided or will be acting in excess of jurisdiction. The difficulty arises in determining what has been decided. The mere fact that a point has arisen in an earlier adjudication does not automatically exclude it from matters to be decided. If the adjudicator takes a restrictive view on jurisdiction she would risk infringing on the rules of natural justice.

A reference point on this issue can be found in Sudlows v Global Switch Estates [2023] EWCA, where the adjudicator dealt with the difficulty by offering an alternative decision – effectively producing two decisions in one – giving the Courts carte blanche to enforce. This issue is dealt with more comprehensively in ‘S is for Substantially the Same’.

Conclusion

To canvass or not to canvass? There is often a fine line to be drawn between the adjudicator employing her own expertise and going on a frolic of her own, but it may not be clear where that line is. It is not possible nor desirable to canvass the parties on a multitude of points and it is the adjudicator’s discretion when to do so. An omission of such an action which leads to weakening a party’s case will likely be a material breach of natural justice. For example, should a party demonstrate it had a viable argument in court but had not been given the opportunity to respond, that will likely be found to be a breach of natural justice. There is another school of thought that the adjudicator should not interfere with the cases advanced by the parties.

Then there is the serial adjudication dilemma. It appears that, like a surgeon, where there is an overlap between disputes referred, the adjudicator is required to meticulously dissect what formed part of a previous decision – including any ‘essential components’ in reaching that decision – and then determine what remains to be decided. Even following the Court of Appeal’s decision in Sudlows, what exactly constitutes an essential component of a decision remains a somewhat moot point.