O’Donnell Developments Ltd v Build Ability Ltd [2009] EWHC 3388 (TCC)

The question which arose before Mr Justice Ramsey was whether the adjudicator was entitled to correct his decision. Following the issuing of his decision, O’D wrote to the adjudicator noting two errors:

  1. the adjudicator had included in his calculations a sum paid for loss and expense which was made after the date of valuation; and
  2. the retention was calculated at 3% of the gross value of the Works including and not excluding loss and expense. BAL objected, but the adjudicator proceeded to correct his decision. It is well known that generally an adjudicator’s decision will be enforced even if it contains an error of law or fact. The key is whether an adjudicator had jurisdiction or not.

That general rule is subject to the slip rule which provides that an adjudicator can correct an accidental error or omission providing that the correction is made within a reasonable time.

The issue here raised what the Judge termed a threshold question, namely as to how far the court can interfere with an adjudicator’s exercise of his power under the slip rule. Or to put the question another way, if an adjudicator has jurisdiction under the slip rule, to what extent can the court review the exercise of that jurisdiction by the adjudicator? BAL submitted that the court needs to be satisfied that a slip, properly so defined, has occurred. If there is no slip then the adjudicator does not have jurisdiction. BAL further suggested that it was only if the parties, in effect, agreed on the slip that the slip rule could be applied. The Judge did not consider that this was correct.

Mr Justice Ramsey noted that if the adjudicator were to exercise a slip rule when there was no express or implied slip rule, that would clearly be a decision which was outside his jurisdiction. However, if the adjudicator is asked by one party to correct a slip and he accepts that an error has been made within the slip rule then if the adjudicator makes an error of fact or law in so doing, the Judge considered that such an error would not take the exercise of the slip rule outside his jurisdiction. Although, if the adjudicator is asked by one party to correct a slip which the other party agrees is a slip within the slip rule but in operating the slip rule he makes an error of fact or law, then the Judge did not consider that the court can interfere in that decision.

Here, it was accepted by BAL that the slip rule was an implied term of the Sub-Contract. The adjudicator was asked to correct a slip and accepted that he had made an error within the slip rule. Accordingly, the Judge did not consider that the court could or should interfere with the exercise of the adjudicator’s powers within his jurisdiction. To do so would be to seek to interfere in a case where he has answered the right question. The decision, as corrected, was therefore enforced.