This unreported case concerned an application to set aside default judgment that had been entered in respect of the enforcement of an adjudicator’s decision. The application was made by the defendant on the basis that it had a real prospect of successfully defending the claim via a pending Part 8 challenge to the adjudicator’s decision.
The first adjudication between the parties had concerned a dispute over the precise nature of the agreement between them, and the adjudicator had determined that there were two contracts in existence, both a construction agreement and a compromise agreement. The third adjudication between the parties had related to monies due under the compromise agreement, and the adjudicator awarded the claimant subcontractor £180,000 from the defendant. The claimant initiated enforcement proceedings and the defendant sought to avoid payment of the money by issuing a Part 8 challenge to the third adjudication and a Part 7 claim for determination of the final account. The defendant was served with an enforcement order but failed to bring this to the attention of its solicitors, and so default judgment was entered against it.
The defendant therefore applied to set the default judgment aside, and the key issue to be determined was whether it had a real prospect of successfully defending the enforcement action on the basis that the judgment could not be enforced until the determination of the defendant’s Part 8 claim.
Carr J determined that this argument did not wash. Although a defendant could challenge enforcement of an adjudicator’s decision by way of Part 8 proceedings, and although it was possible for the TCC to hear the Part 8 claim and the enforcement action together at one hearing, this was at the discretion of the court and there was no right to a stay or refusal of the enforcement action until determination of the Part 8 claim. To hold otherwise would be contrary to the policy behind adjudication.
The application to set aside default judgment was therefore refused.