This is a decision of the Court of Appeal. Wilson maintained both during the adjudication and before Judge MacKay (at a hearing to enforce that decision at first instance) that the contract that was the subject of the adjudication had been made not with him personally but with a company, Gowersand Ltd. Thus the adjudicator did not have jurisdiction. Wilson was the principal shareholder and company secretary of Gowersand. An agreement to carry out construction work was made orally with TFC, which was later evidenced in writing by a letter. This letter referred to Wilson in the heading but was signed by Wilson, on behalf of Gowersand.
The challenge to the adjudicator's jurisdiction only arose as a result of s.107(2)(c) of the Construction Act, which provides that a contract is only in writing if it is evidenced in writing. Here the only evidence in writing was this letter. The Court of Appeal said that the letter did not provide clear evidence that Wilson and not Gowersand was the contracting party.

However, the court also considered the question of whether Wilson had agreed to accept the adjudicator's ruling as to the identity of the contracting parties and thus to accept jurisdiction. The trial judge had suggested that as the adjudicator was asked to make a decision on this point and as he actually did do this, his decision had to be followed by the court.

Reference

The court disagreed. Following the decision of Judge Gilliland QC in Nordot vs Siemens, which required a clear and unequivocal statement or agreement to be bound by an adjudicator's decision on jurisdiction, Lord Justice Brown said that there was no such clear evidence that Wilson was submitting to the jurisdiction of the adjudicator in this full sense. Therefore the decision of Judge Mackay was overturned on the basis that the adjudicator did not have jurisdiction to hear the referral.

Lord Justice Brown also took the opportunity to comment on a suggestion made in the Building Law Reports that there was a danger, following cases such as the decision of Judge Dyson in The Project Consultancy vs Trustees of the Gray Trust, that any arguable challenge to jurisdiction would result in an adjudicator's decision that was not summarily enforceable and that this in turn would have the effect of undermining one of the prime objectives of the Act, namely the prompt resolution of disputes.

Lord Justice Brown said the following:

"Let me now return briefly to the editors' commentary in the Building Law Reports. I readily recognise the concern lest this salutary new statutory power to promote early payment in construction contract cases be emasculated by jurisdictional challenges. The solution, however, seems to me not in finding defendants too readily to have, in the full sense, submitted to the adjudicator's jurisdiction, which if properly advised they plainly would not do. Rather, as Dyson J observed in paragraph 8 of his judgment in the Project Consultancy Group case, it is for courts (and adjudicators) to be 'vigilant to examine the arguments critically'. It is only if the defendant had advanced a properly arguable jurisdictional objection with a realistic prospect of succeeding upon it that he could hope to resist the summary enforcement of an adjudicator's award against him.

"The position can, I think, be summarised in the following two propositions. (1) If a defendant to a Part 24(2) application has submitted to the adjudicator's jurisdiction in the full sense of having agreed not only that the adjudicator should rule on the issue of jurisdiction but also that he would then be bound by that ruling, then he is liable to enforcement in the short term, even if the adjudicator was plainly wrong on the issue. (2) Even if the defendant has not submitted to the adjudicator's jurisdiction in that sense, then he is still liable to a Part 24(2) summary judgment upon the award if the adjudicator's ruling on the jurisdictional issue was plainly right."

*Full case details
Thomas-Fredric's (Construction) Ltd vs Wilson, 21 October 2003, Court of Appeal, Simon Brown LJ VP, Judge LJ, Parker J

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Postscript

If an adjudicator does not have jurisdiction the court will not really find that a party has submitted to adjudication. A clear agreement to adjudicate is required. If a challenge is to be made then it must be made promptly and the adjudicator must critically examine it and come to a conclusion. If a party submits to adjudication then that party will be bound by the decision, which may be enforced.