A party that thinks an adjudicator has no jurisdiction can save money and bother by simply waiting until the end before making a song and dance about it
The same thing always happens at 10 past three in the afternoon on the third day of an adjudication. An email pings up, and it says: “Dear Mr Bingham, we the respondent think you should sling your hook. There is no right for the referring party to bring an adjudication. Therefore, you have no jurisdiction to be the adjudicator. Therefore, be a good boy and clear off.” And then follow all the neatly argued reasons why the adjudication can’t run – there’s no construction contract, there’s no dispute, there’s nothing in writing, the notice of adjudication was written on pink paper, instead of blue … this process will cost the respondent about two grand.
The referring party will then get uppity and submit a “reply submission” that insists the adjudicator pay no attention. That costs the claimant two grand. And, lo, there will be another reply, and another about the actual dispute. And then the adjudicator will write a mini-award saying why they should stay or go. The final bill for all this might be five grand.
I confess I enjoy these 10-past-three episodes. You get some ingenious arguments – some clever ones, some daft ones, some try-ons – just to see if the adjudicator is half-baked. And sometimes they work. Mind you, there is one helluva test I sometimes throw at the respondent: “Presumably, Mr Respondent, you are so convinced about there being no right to adjudicate that you will elect not to take part.” Reply: “Hmm … well, er, we will take part, but only under a flag of protest.” So we all spend a whole lot of money explaining these jurisdiction arguments and it makes the world go round. It’s a sort of warm-up routine.
In the recent case of GPS Marine vs Ringway Infrastructure, there is a reminder of a neat device that saves cost, time and hassle. The respondent need not go to all the nuisance of sending in a 10-past-three challenge. Instead, they can shout “Supercalifragilisticexpialidocious”, or “I hereby generally reserve my right to claim there is no right to adjudicate”. Then he can press on with the adjudication.
Well now, I reckon that costs them about 10 bob. And by the way, he doesn’t get on anyone’s nerves with such a one liner. In truth, he is reserving his position. If he loses at the end of the game he has the chance to scrabble around for reasons why he need never have taken part in the first place. He can wait for the result, then raise a jurisdiction challenge.
What happened in the case was that GPS brought an adjudication and won. Ringway’s defence was that the account being disputed was not a dispute at all, and that the final account had been long since agreed. That’s a 10-past-three argument, because no dispute means no right to adjudicate. But Ringway didn’t run it on day three. In fact, it didn’t run it as a jurisdiction argument at all. Instead, it was “just” a defence. What it did include in its argument was that throwaway line mentioned earlier, which is known as a “general reservation”. The no dispute/compromised account argument lost. The adjudicator decided there was no compromise. So Ringway was to pay money to GPS.
But it wouldn’t. Ringway argued that the adjudicator’s decision was not binding because they had no jurisdiction for the reason that there was no dispute, therefore no right to adjudicate. Dear me, said GPS, you didn’t run that in the adjudication as a jurisdictional argument, so it’s all too late. Wrong, said the court. A general reservation is good enough. You can run a jurisdiction point after you lose, provided you generally reserve your right and shout: “Supercalifrag …“
Well, that’s jolly unsporting, if you ask me. My 10-past-three-on-day-three fun is under threat. I will be deprived of intellectually stimulating, fun arguments, to say nothing of the fee. Is it really the case that all you have to do is spend 10 bob “generally reserving your rights?” Looks like it – until someone tries it again and comes a cropper …
Tony Bingham is a barrister and arbitrator at 3 Paper Buildings Temple