WRW Construction Limited V Datblygau Davies Developments Limited
Thursday, 23 July, 2020
 EWHC 1965 (TCC)
Recorder Andrew Singer QC
Adjudicators’ decisions; Enforcement; Jurisdiction; Payment; Merger; Stay of execution
This was an application for summary judgment to enforce an adjudicator’s decision. WRW Construction Limited (the “Claimant”) alleged that, as a result of the adjudication, a payment of £568,597.32 was due from Datblygau Davies Developments Limited (the “Defendant”). The issue was whether the adjudicator had jurisdiction to order payment and/or whether payment is due to the Claimant as a result of the adjudication.
The parties entered into a contract incorporating the JCT 2011 Design and Build Conditions. The Claimant was appointed to design and build nine dwellings on a site in London for a contract sum of £2.2 million. The adjudication between the parties related to the final account valuation. The parties agreed that the adjudicator had jurisdiction to conduct the final account valuation. However, the Defendant alleged that the adjudicator did not have jurisdiction to order a payment to be made to the Claimant. The Defendant alleged that the Claimant would need to commence a further adjudication in order to obtain a valid order for payment.
The Judge accepted that the adjudicator did not have jurisdiction to award payment to the Claimant, however, he did not consider that this was the relevant issue in this case. He considered that the relevant issue was whether the Court could order payment of the sum due to the Claimant following the valid, binding valuation carried out by the adjudicator. The Judge did not consider that the authorities cited to him prevented him from making such an order. Furthermore, he considered that it would be contrary to principle and established authority for the Court to effectively force the Claimant, who has the benefit of an award in its favour in terms of a balance being due, to commence a further adjudication in order to obtain valid payment of that balance.
The Defendant also relied on the doctrine of merger when resisting enforcement, alleging that, by ordering payment, the Court would essentially make a final determination on the merits of the final account valuation, which would prevent any attempt to reclaim overpayments in subsequent litigation. The Judge dismissed this argument, holding that an order for payment in this instance would not amount to the Court making a final determination of the final account valuation. The Judge reinforced the point that the adjudicator’s decision is temporarily binding and an order for payment in this instance would be on a similarly temporary basis. As such, the Defendant would not be prevented from reclaiming overpayments in subsequent litigation, such an application would follow a separate cause of action. The Claimant’s application for summary judgment succeeded.
The Judge considered whether a stay of execution should be granted. The Judge did not consider that there was any evidence which demonstrated that the Claimant was in anything other than a relatively healthy financial position and did not consider that there was a very real risk that the Claimant would be unable to repay the sum of £568,597.32 if ordered to do so in the future. The application for a stay was dismissed. The Judge noted that, even if there was a real risk of non-payment, a stay would still not have been granted. The fact that the Defendant had not commenced any proceedings to re-open the adjudication valuation exercise would have been fatal to its application in that event.