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Adjudication and voluminous documents

A recent ruling from the Technology and Construction Court has suggested that voluminous documents will rarely be a breach of natural justice in adjudication, write Arjen Xani and Sarah Wilson.

The recent case of Home Group Limited v MPS Housing Limited [2023] EWHC 1946 (TCC) looks at how the Court will assess a claim that an adjudication award should not be enforced due to a breach of natural justice in the adjudication; in this instance the ‘losing party’ claimed it did not have a fair hearing due to the voluminous documents provided by the other party.

Background

This related to a second adjudication to determine Home Group’s losses. Home Group’s Referral to adjudication comprised the following documentation:

  1. Expert report of 155 pages with 76 appendices comprising 202 files;
  2. 2,325 files in 327 sub folders; and
  3. Five witness statements.

MPS was given 19 days to respond (by the adjudicator). 

The adjudicator awarded Home Group £6.5m.

MPS’s arguments:

MPS challenged the adjudicator’s decision on the following grounds: 

  1. Quantity of documents provided by Home Group;
  2. Home Group unreasonably refusing to provide MPS with data or access to the underlining documents until the last moment; and
  3. MPS’ expert were unable to fairly interrogate and respond to the material in the referral. 

Decision

The Court held that:

  1. The quantity of information does not present a valid basis for challenging enforcement.
  2. The draft expert report was provided to MPS on 10 February 2023 and MPS should have been analysing the same instead, of spending time on the natural justice argument. The Court noted that upon receipt of the draft report, MPS should have reserved its position in the first instance in relation to the extent of the sample information provided and requested access from Home Group to review the underlying records but they had not done this in this case.
  3. By the time MPS received the Referral on 17 March 2023, five weeks had already passed from receipt of draft expert report, by which point MPS had been able to identify significant areas of dispute and advance arguments based on a sample of material. The Judge was content that in the time available MPS had engaged thoroughly in the substance of the claim. 

In light of the above, MPS had failed to demonstrate that, whether by reason of volume of material, constraints of time and access to material, there had been any material breach of natural justice.

Comment

The Court have consistently refused, over the years, to find a breach of natural justice exists where large volumes of documentation is provided by one party (typically the referring party). This is partly because a dispute must be shown to exist before a party can adjudicate, but mainly because adjudication is a fast track, temporary resolution of a dispute (despite that fact that in reality most parties accept it as the final decision).

To succeed in a claim of breach of natural justice, this case shows that the Court will look at the chronology of events following receipt of documents to establish whether there has been a breach.

Arjen Xani is a Solicitor and Sarah Wilson is a Partner at Bevan Brittan.

 

 
A&M Bacon