Breaches of natural justice Cantillon Ltd v Urvasco: Part 1

This case is important for two reasons. First Mr Justice Akenhead set out the following propositions which should be followed if a breach of natural justice was being alleged:

  1. It must be first established that the adjudicator failed to apply the rules of natural justice; 
  1. Any breach of the rules must be more than peripheral. It must be a material one; 
  1. Breaches of the rules will be material in cases where the adjudicator has failed to bring to the attention of the parties a point or issue which they ought to be given the opportunity to comment upon if it is one which is either decisive or of considerable potential importance to the outcome of the resolution of the dispute and is not peripheral or irrelevant; 
  1. Whether the issue is decisive or of considerable potential importance or is peripheral or irrelevant obviously involves a question of degree which must be assessed by any judge in a case such as this; 
  1. It is only if the adjudicator goes off on a frolic of his own, that is wishing to decide a case upon a factual or legal basis which has not been argued or put forward by either side, without giving parties the opportunity to comment, or where relevant put in further evidence, that the type of breach of the rules of natural justice with which the case of Balfour Beatty Construction v The London Borough of Lambeth1 was concerned comes into play.

It follows that, if either party has argued a particular point and the other party does not come back on the point, there is no breach of the rules of natural justice in relation to that point.


Cantillon Ltd v Urvasco: Part 2

Although it is clear that a decision that is wrong on the facts will be enforced, provided the adjudicator had jurisdiction to decide the matter and provided he answered the question referred to him, what is the position with a decision that might be good in part and impeachable in others? This time, Mr Justice Akenhead having reviewed the authorities suggested that a decision could be severable if two or more disputes have been determined and the challenge only goes to one of those disputes. In doing so, he listed the following propositions:

  1.  The first step must be to ascertain what dispute or disputes has or have been referred to adjudication. One needs to see whether in fact or in effect there is in substance only one dispute or two and what any such dispute comprises.
  1. It is open to a party to an adjudication agreement as here to seek to refer more than one dispute or difference to an adjudicator. If there is no objection to that by the other party or if the contract permits it, the adjudicator will have to resolve all referred disputes and differences. If there is objection, the adjudicator can only proceed with resolving more than one dispute or difference if the contract permits him to do so. 
  1. If the decision properly addresses more than one dispute or difference, a successful jurisdictional challenge on that part of the decision which deals with one such dispute or difference will not undermine the validity and enforceability of that part of the decision which deals with the other(s). 
  1. The same in logic must apply to the case where there is non-compliance with the rules of natural justice which only affects the disposal of one dispute or difference.
  1. There is a proviso to (c) and (d) above which is that, if the decision as drafted is simply not severable in practice, for instance on the wording, or if the breach of the rules of natural justice is so severe or all pervading that the remainder of the decision is tainted, the decision will not be enforced. 
  1. In all cases where there is a decision on one dispute or difference, and the adjudicator acts, materially, in excess of jurisdiction or in breach of the rules of natural justice, the decision will not be enforced by the Court.