Cases - Woods Hardwick Ltd v Chiltern Air Conditioning Ltd
Record details
- Name
- Woods Hardwick Ltd v Chiltern Air Conditioning Ltd
- Date
- (2000)
- Citation
- BLR23
- Legislation
- Keywords
- Construction contracts - adjudication - adjudicator - bias - impartiality - natural justice - telephone conversations - procedural errors - whether the adjudicator's decision-making process was so tainted by procedural errors that it meant he had not acted impartially - whether the adjudicator's decision had been reached within the statutory scheme - Housing Grants, Constructions and Regeneration Act 1996, s. 111
- Summary
-
Woods Hardwick were an architect and engineer, Chiltern an air conditioning specialist. Chiltern appointed Woods Hardwick on two projects. Disputes arose in connection with liability for fees, which Woods Hardwick referred to two separate adjudications.
In the first adjudication, Chiltern did not dispute the sum that the adjudicator decided was payable (circa £6,000) but claimed a stay of execution pending the outcome of an action that Chiltern was pursuing against Woods Hardwick in relation to an unrelated third project.
In the second adjudication, but involving the same adjudicator, Chiltern purported to set-off damages that it said that it had incurred by reason of Woods Hardwick's failure to provide an accurate survey drawing, as a result of which the works were set out incorrectly. The total additional fee claim was in the order of £45,000. The adjudicator dismissed Chiltern's abatement and decided that Woods Hardwick should be paid a substantial part of their claim.
In relation to the second adjudication, Chiltern complained that the adjudicator lacked impartiality and had conducted the adjudication in breach of the rules of natural justice in that:
- he prevented Chiltern from fairly presenting its case at the meetings;
- he took evidence from Woods Hardwick and a third-party that he failed to afford Chiltern an opportunity to comment on; and
- he provided a detailed witness statement to Woods Hardwick for use in the enforcement proceedings, which contained partisan views adverse to Chiltern.
With regard to point (1), the judge concluded that Chiltern's representatives had every opportunity to present their case and to answer Woods Hardwick's case.
With regard to point (2), the judge concluded that the adjudicator's reasons for not disclosing this information to Chiltern - namely that he felt that it would not serve any useful purpose to seek Chiltern's view on the additional information as he had witness statements provided by Chiltern and in his view there was no likelihood that these witnesses would have any answer to the additional information he had obtained - were not satisfactory.
The judge concluded that in the context of this adjudication in which so much additional information relied on by the adjudicator had been obtained by the process of telephone interviews with representatives of Woods Hardwick and other subcontractors, there was a clear breach of the statutory requirements.
With regard to point (3) on the provision of a witness statement for these enforcement proceedings in support of one party's case against the other party, the judge concluded that there is no rule to prevent such a course but that if the adjudicator is to retain the confidence of the parties he must scrupulously ensure that his evidence is confined to a neutral, factual account of what transpired in the adjudication. In taking the course that he did, the adjudicator exceeded the requirement of neutrality in two material respects. Firstly, he revealed that he had taken strongly against Chiltern and had decided at an early stage in the adjudication process that Chiltern's case should be dismissed. Secondly, he sought in the witness statement to argue the case of Woods Hardwick and to explain and expand upon the reasons for his decision.
Following the above, the judge dismissed the summary judgment application.