Abbas v Rotary (International Ltd) (NI, QBD - 28.5.2012)

Abbas v Rotary (International Ltd) (NI, QBD - 28.5.2012)

There should be no stay of the proceedings in which the consultant claimed outstanding fees despite the mandatory adjudication provisions of the consultancy agreement providing for the adjudicator’s decision to be final.
 

ABBAS v ROTARY (INTERNATIONAL) LTD

Northern Ireland, High Court, Queen’s Bench Division

Weatherup J

28th May 2012

The consultant carried out design work for the sub-contractor before and after the main and sub-contracts were entered into. A consultancy agreement was entered into after the sub-contract was entered into. The consultant brought these proceedings in which it claimed fees due in respect of its services rendered during periods before and after the sub-contract was entered into on the basis that the fees for the period after it was entered into were in respect of services performed under the consultancy agreement. The sub-contractor alleged that all the fees claimed were payable under the consultancy agreement. The resolution of the dispute as to the scope of the consultancy agreement was deferred by the parties. The sub-contractor applied for the proceedings to be stayed on the ground that the consultancy agreement incorporated an exclusive adjudication clause from the sub-contract which provided for the adjudicator’s decision to be final. The consultant alleged that (i) Even if the adjudication clause had not been incorporated into the consultancy agreement, it only applied to the fees claimed after the main and sub-contracts were entered into and (ii) The court in the exercise of its discretion ought in any event to refuse a stay of these proceedings.

 

Weatherup J in refusing to grant a stay of these proceedings stated that the consultant was justified in relying on two matters to avoid a stay. The first matter was that it its submission in respect of the pre-financial close fees was correct, this element of the claim was not subject to the consultancy agreement and could not be stayed on the basis that (i) Parallel adjudication and litigation would otherwise arise and would merely serve to increase costs resulting in wasted time, which would be contrary to the interests of justice (ii) The issue as to whether the consultancy agreement covered both parts of the fees was originally to be a preliminary issue in these proceedings but did not proceed and (iii) This was currently an issue that had not been decided with the possible outcome that there would be a split between two different tribunals deciding the fees due at the two different stages. The second matter was that the consultant’s claim for fees had been outstanding for a very considerable time but the sub-contractor had not invoked the dispute resolution procedure either in respect of the consultant’s claim for fees or its own claim for damages.

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