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John Doyle Construction Ltd (in liquidation) v Erith Contractors Ltd [2020] EWHC 2451 (TCC)

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An application for summary judgment failed.

In this case a claim for enforcement of an adjudicator's decision by way of summary judgment under CPR Part 7, in proceedings issued by JDC, which is in liquidation, and has been since 2013 FAILED. It is worth noting that Erith opposed summary judgment on a number of different grounds. The court also held that if the adjudicator’s decision should have been enforced then the court would have granted a stay to that enforcement in any event.

The court set down five principles which will be applied when an insolvent party seeks to enforce an adjudicator’s award (see para [54] of the judgment). These were:

“54. I consider that the principles to be applied by the court when considering an application for summary judgment on an adjudication decision in favour of a company in liquidation (given Lord Briggs' dicta in Bresco, and his approval of Chadwick LJ in Bouygues) are as follows:

1. Whether the dispute in respect of which the adjudicator has issued a decision is one in respect of the whole of the parties' financial dealings under the construction contract in question, or simply one element of it.

2. Whether there are mutual dealings between the parties that are outside the construction contract under which the adjudicator has resolved the particular dispute.

3. Whether there are other defences available to the defendant that were not deployed in the adjudication.

4. Whether the liquidator is prepared to offer appropriate undertakings, such as ring-fencing the enforcement proceeds, and/or where there is other security available.

5. Whether there is a real risk that the summary enforcement of an adjudication decision will deprive the paying party of security for its cross-claim.”

Therefore, unless the above principles are met, in particular the insolvent party can offer security for the sums it is to be paid, the adjufiation may not be enforced by way of summary judgment.

 

Also, it is worth noting Fraser J’s comments in respect of the ‘volume of evidence’ submitted –

"7. Both parties submitted a much larger number of witness statements than would ordinarily be expected on an application such as this……….. Some of the witness statements contained extensive argument. Notwithstanding the importance to both parties of the outcome of this summary judgment application, such a volume of evidence is not necessary. Submitting more numerous, and longer, witness statements than necessary is a temptation that parties generally seem unable to resist. I will only deal with such aspects of the evidence as are necessary in order to resolve this application."

 

 

 

 

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