The Courts have decided that an adjudicator reached his decision in breach of the rules of natural justice.
In reaching his decision the adjudicator relied on a clause under the contract that neither party argued or mentioned and on which the adjudicator did not seek submissions prior to reaching the decision. The losing party applied to the TCC to resist enforcement. Its Claim succeeded. The judge followed the leading cases of Carillion Construction Ltd v Devonport Royal Dockyard Ltd and Cantillon Ltd v Urvasco Ltd, which confirm that an adjudicator's decision reached (i) without the parties having the opportunity to comment, (ii) on a point that is decisive or of considerable potential importance and (iii) that is material to the decision will constitute a breach of natural justice and place the enforceability of that decision at risk.
However, be aware that this is not open season to resist enforcement actions. Whether an issue is decisive or material is a matter to be decided by the judge during enforcement proceedings, it must be more than peripheral and never irrelevant, and a failure to respond to a point once raised is fatal. Parties must remain mindful and actively engaged with the process.
Adjudicators – remember that, whilst you may be permitted to discover the facts and law within the scope of your appointment, you must engage with the parties on any point not raised in submissions.
Adjudicatees – This claim does not signal a change in the law. Tenuous arguments regarding breaches of natural justice will be no more welcome now than they were previously. Materiality and decisiveness is key.