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Pinned and needled
A client's attempts to wriggle out of adjudication
on three tricky points of law were quashed by one very clever
adjudicator – and he wasn't even a lawyer
“The consumer is king. The consumer, poor
chap, is to be mollycoddled, featherbedded, pampered”
Judge Thornton explained three useful points in
the case of Westminster Building Company vs Andrew Beckingham.
Before we go any further, hark the round of applause to the
adjudicator Mr Bob Ames. You were spot on, my boy. None of the
three points were easy. All of them were to do with the law and
this RICS non-lawyer fellow goes top of the class.
The story is about Mr Beckingham spending a
quarter of a million pounds on refurbishing his mid-terrace town
house. No mean sum. The contractual bumf proposed by Mr Beckingham's
team included the JCT Intermediate Form. That's spot on as well.
For one reason or another the contractual completion date ran
away. So the parties signed up a capping agreement at about month
eight. Then there was a row about what it meant. Westminster now
said it was underpaid. So the adjudicator did his 28-day
rain-dance and obliged Mr Beckingham to pay up. When Mr Beckingham
stalled, Westminster sued.
The short trial in court became a test of the
same issues raised in the summary judgment application. The first
of these is a source of constant disputes: the employer, its team
and contractor hammer out a deal, then while the documents are
being prepared, a letter of intent confirms that the builder will
start on site. Sometimes that letter says the whole deal is in
place and the signature on the JCT is merely a matter of admin.
Sometimes though the letter of intent bars the formal contract
coming alive until signed.
Mr Beckingham's letter of intent was the
latter. Eventually Westminster signed the JCT but not Mr Beckingham.
In the adjudication and at trial Mr Beckingham argued that his
want of signature prevented the contract having teeth. Won't do.
Mr Beckingham's silence, leaving the unsigned contract on his
sideboard, allowing the builder to press on and operating the
machinery in JCT were enough for the contract to take effect.
That's what the judge said and that's what the adjudicator said.
The second issue was about this further
agreement eight months into the work. Mr Beckingham argued that
the adjudicator had no jurisdiction to consider the capping
agreement, no power to decide a dispute about it. In a similar
case called
Shepherd vs Mecright no adjudicator could decide that quarrel
because the deal was outside the construction contract. But in
this latest case, the capping agreement changed the previous
agreements under the contract. That is to say, it was an internal
matter that was not outside the contract, so any dispute about the
capping agreement was subject to adjudication. That's what the
judge said and that's what the adjudicator said.
The third issue was another tricky bit of law.
Mr Beckingham argued that he escaped all this adjudication
malarkey because he is a "consumer". Remind yourself about the
status of consumers. The consumer is king. The consumer, poor
chap, is to be mollycoddled, featherbedded, pampered. Mr Beckingham
ran for cover under the Unfair Terms in Consumer Contracts
Regulations. Let me explain. The work for Mr Beckingham was on his
own domestic home. Thus he is not carrying out a construction
contract as defined in law and therefore no one can "make" him
adjudicate. Westminster said that since Mr Beckingham had agreed a
JCT form, which contains an adjudication clause, he had consented.
Do you now see why he earlier argued that the JCT form didn't
apply? Having been told he was bound by JCT and the adjudication
clause therein, he wanted to use these Consumer Contracts
Regulations to cry foul. Come off it. Mr Beckingham's RICS
surveyors recommended the JCT form; they were a competent bunch.
If adjudication were a pitfall, they would have said so. Nor does
adjudication constitute "a significant imbalance" to the
consumer's rights, nor does it hinder the consumer's right to take
legal action. Mr Beckingham could not use the Unfair Terms in
Consumer Contracts Regulations to duck adjudication. Mr Beckingham
has to pay up.
By the way, if you took a peep into this
particular QS adjudicator's office you might see why he stood a
chance of getting the law right. If you look on the adjudicator's
shelves you will see all of the Building and Construction Law
Reports ever published. He even has a law reporting service of
cases deciding that day. Not bad for an ordinary QS is it?
Tony Bingham is obliged to solicitor Jocelyn
Taylor of Nelsons for bringing the case to his attention..
Readers are invited to forward recent judgments
for reporting in this column (with full acknowledgement) to: Tony
Bingham, 3 Paper Buildings, Temple, London EC4Y 7EU. DX: 37164
Biggleswade
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