Many adjudication rules provide for a Response to a Referral Notice within seven days of the Referral. More time may be available following the recent case of CJP Builders Limited v William Verry Limited . In this case the Court held that the Responding party should have been allowed extra time to respond in the interests of natural justice. One form of natural justice is that each party to an adjudication has the right to have its case heard. If seven days to provide a Response to a Referral does not give the Responding Party a clear and fair opportunity to put its case, natural justice may be breached.
Verry engaged CJP to carry out work under the DOM/2 1981 form of sub-contract, incorporating amendments 1–8. Verry failed to make an interim payment and CJP adjudicated. Under the sub-contract Verry had seven days to respond after service of the Referral. Verry sought an extension of time from the adjudicator. The adjudicator decided that only CJP could agree such an extension of time under clause 38A.2.5 of the sub-contract.
CJP agreed a short extension for Verry’s Response. Verry missed the deadline by a few hours. The adjudicator decided not to consider the Response. The adjudicator ordered Verry to pay all sums claimed by CJP. Verry refused to pay the award and CJP applied to Court for enforcement.
Justice Akenhead held that the adjudication provisions in the contract gave the adjudicator the power to grant an extension of time, as long as it did not interfere with the time for delivering his award. That is to say nothing in the wording of the contract prevented the adjudicator from granting such an extension. The wording was not prescriptive. Further a party must be given a fair chance to present its case and for that case to be heard and considered. As the adjudicator had the right to grant an extension and it would not have interfered with him delivering his decision, he should have done so. By failing to grant the extension the adjudicator had breached the rules of natural justice and his decision was unenforceable. The judge stated that the parties may expressly agree to deny a party the right to be heard. Very clear wording would be required to achieve this.
Considerations Following CJP
If you are the Respondent in an adjudication, consider whether the CJP case may help you to persuade the Referring party to agree an extension or if it may encourage the adjudicator to direct an extension. Remember the extension cannot interfere with the adjudicator giving his decision.
If you are the Referring party then think carefully about natural justice before refusing a request for an extension of time. If you refuse the request, it may render the decision unenforceable.