The claimant, Hortimax, referred six disputes arising under six different contracts to adjudication by way of serving six separate adjudication notices. The six decisions were delivered in August 2004 by the adjudicator. Hendon, the defendant, was a commercial grower of cucumbers and other vegetables and carries out its operations in greenhouses at Burstwick. In order to increase production it decided to improve the watering system, and introduce artificial lighting and screens to the warehouses. The disputes related to this work.
Hendon resisted summary judgment on the basis that the work was excluded by Section 105 (2) of the Construction Act. If that were the case then the adjudicator would have no jurisdiction and his decision would not be enforced. Hortimax argued that the work was not excluded, and in any event Hendon had conferred jurisdiction on the adjudicator by their letter of 1 July 2004.
Judge Gilliland held that the question as to whether the contracts fell within the definition of construction operations depended on the meaning of the word “plant” in Section 105 (2) (c) of the Act. The judge referred to Hinton (Inspector of Taxes) vs Maden and Ireland , and in particular the judgment of Lord Reid where he considered that the term “plant” should be used in its ordinary sense and without limitation.
Judge Gilliland followed that rationale, noting that some limitation would in any event be placed upon the potential wide ambit of the term “plant” by virtue of the limited scope of the Act. The term “plant” was taken to mean the apparatus required for the carrying out of the business. However, he distinguished this from the “place or setting in which the business is carried on” and if it is to fall within Section 105 (2) (c) then the plant must also form a part of the land within Section 105 (1) of the Act.
The judge came to the conclusion that lighting, water storage, pipework, pumping facilities and filtering apparatus was an integral part of the system used by Hendon for the purposes of growing cucumbers. The lighting system and the screens was also an integral part of the system. They were therefore “plant” and were within Section 105 (2) (c) of the Act. As a result, the growing of cucumbers was within the exception in Section 105 (2) (c) and the adjudicator did not have jurisdiction under the Act to deal with any of the disputes referred to under the six contracts.
However, on 1 July solicitors wrote to the adjudicator stating that “Hendon is prepared to vest in you the power to decide upon your own jurisdiction”. The judge considered that this was a plain submission allowing the adjudicator to determine the jurisdictional issues. Unfortunately, the adjudicator had considered the submissions but did not come to a clear decision either way. Nonetheless, the adjudicator did then go on to make a decision and any previous reservation by Hendon had been waived as a result of its letter of 1 July. Summary judgment was therefore ordered in respect of all six decisions, together with interest.
*Full case details
Hortimax Ltd vs Hedon Salads Ltd, 15 October 2004, TCC, Salford, HHJ Gilliland QC.
Contact Fenwick Elliott on 020 7421 1986 or NGould@fenwickelliott.co.uk
The definition of what constitutes a construction contract under the Construction Act continues to give the industry problems. In this case plant for growing cucumber was excluded from the Act, and so the adjudicator did not have jurisdiction. However, as the respondent had asked the adjudicator to decide his own jurisdiction the court decided that they had waived their right to rely on the exclusion in the Act and so enforced the decision in any event.