Bouygues v Dahl-Jenson
The adjudicator's decision should be enforced despite it being common ground that the adjudicator had made a mistake in arriving at the amount awarded
17 November, 1999
The adjudicator made a decision in the sub-contractor's favour whereby the contractor was ordered to pay a specified sum of money based on the adjudicator's valuation of the sub-contract works. The adjudicator failed to deduct from that valuation the contractual retention monies which were not due to be released to the sub-contractor at the time of the decision. It was common ground that the adjudicator had been wrong to do so. The sub-contractor brought court proceedings to enforce the decision notwithstanding the adjudicator's error. By the time of the appeal the sub-contractor was in liquidation. Dyson J stated that it was necessary to ascertain whether the adjudicator made a mistake and, if so, how that mistake should be characterised. This was on the basis that (1) If the mistake was deciding a dispute not referred to him, his decision would be outside his jurisdiction and of no effect insofar as the mistake would be analogous to a valuer departing from his instructions in a material respect of answering the wrong question and (2) If the adjudicator decided a dispute referred to him mistakenly, the decision was valid and binding even if the mistake was of fundamental importance. The purpose of the statutory adjudication scheme was to provide a speedy mechanism for settling disputes on a provisional basis. This requires adjudicators? decisions to be enforced pending final determination of the disputes. It was inherent in the scheme that adjudicators would sometimes make mistakes and that some of these mistakes would be glaringly obvious and disastrous in their consequences for the losing party if it was not able to recoup its losses in subsequent litigation or arbitration by reason, for example, of the insolvency of the victim or beneficiary of the mistake. In deciding whether the adjudicator had decided the wrong question (rather than giving a wrong answer to the right question), the court should bear in mind that the speedy nature of the adjudication process meant that mistakes would inevitably occur and guard against characterising a mistaken answer to an issue within the reference's scope as an excess of jurisdiction. Advice Note The Court of Appeal in this case endorsed the reasoning of Dyson J. It is now definitively established that a decision will be enforced by the courts notwithstanding the adjudicator having made an obvious error of fact or law provided that he acted within his jurisdiction in doing so.