Cases - Amec Capital Projects Ltd v Whitefriars City Estates Ltd

Record details

Name
Amec Capital Projects Ltd v Whitefriars City Estates Ltd
Date
(2004); [2005]
Citation
96 Con LR 142; BLR 1 CA
Legislation
Keywords
Construction contracts - adjudication - appointment of adjudicator - bias - natural justice - re-determination - JCT standard form with contractor's design - whether correct to seek appointment of alternative adjudicator - housing grants, Construction and Regeneration Act 1996 - Scheme for Construction Contracts (England and Wales) Regulations 1998, clause 2
Summary

The responding party challenged the decision of the adjudicator on the basis of apparent bias. The test applied by the Court of Appeal was whether a fair-minded and informed observer, having considered all the circumstances that have a bearing on the suggestion that the decision-maker was biased, would conclude that there was a real possibility that he was biased: Porter v Magill at paragraph 103.

The adjudicator in this case was initially appointed and made his decision in favour of the referring party. However, that decision was found to be unenforceable because the adjudicator had not been properly appointed.

The same adjudicator was subsequently reappointed in a second adjudication concerning the same matters.

The judge at first instance held that there was a real possibility of bias in the present case by reason of the combined effect of the facts that:

(a) on AMEC's case, the issues were the same in the two adjudications;

(b) on the basis of the adjudicator's findings, the issues that he had to decide were the same in both adjudications;

(c) the legal advice obtained in the first adjudication may have been 'carried forward' into the second adjudication and influenced the second decision;

(d) the adjudicator did not give the parties an opportunity to comment on the legal advice obtained on the jurisdiction issue in the second adjudication; and

(e) the adjudicator had a private conversation with the solicitor representing the referring party, which was limited to an explanation of why he was being re-appointed.

The Court of Appeal overturned the decision of the first instance judge on the following grounds:

(a), (b) The mere fact that the tribunal has previously decided the issue is not of itself sufficient to justify a conclusion of apparent bias. Something more is required. The vice that the law must guard against is that the tribunal may approach the rehearing with a closed mind.

(c) This was a new point that had not previously been raised and which was too late to raise now.

(d) Natural justice requires no more than that a party should have an effective opportunity to make representations before a decision is made. In the court's view, Whitefriars had such an opportunity in the present case and took advantage of it. In any event, the common law right to prior notice and an effective opportunity to make representations is to protect parties from the risk of decisions being reached unfairly. But it is only directed at decisions that can affect parties' rights. In this case the legal advice related to the adjudicator's own jurisdiction, which was not binding on the parties.

(e) Conversations between one party and the tribunal in the absence of the other party should be avoided. Communications should ordinarily be in writing with copies to all parties. But the Court of Appeal saw nothing in the circumstances of this conversation, which arose out of an innocuous telephone call to the adjudicator's office, which would lead the fair-minded and informed observer to conclude that what was said would give rise to a real possibility of bias.