Brown v Complete Buildings Solutions Ltd (CA - 13.1.2016)
The homeowners entered into a contract incorporating the JCT Minor Works Building Contract (2011 Edition). The architect issued what he described as the final certificate. The contractor claimed a final payment and began the first adjudication to recover that sum. The contractor accepted that the architect's “final certificate” was ineffective but relied on the contractual provisions in the eventuality (i) The contractor could issue a payment notice stating what it considered to be the final payment due and (ii) The employer could issue a pay less notice in response. The adjudicator in the first adjudication concluded that (i) The contractor’s purported payment notice was invalid and (ii) No sum was payable since no valid payment notice had been served. The contractor (i) served a second purported payment notice and (ii) issued a notice of adjudication to start a second adjudication. The homeowners (i) disputed the second adjudicator’s jurisdiction on the basis that he was being asked to decide (substantially) the same dispute as had been decided by the first adjudicator (ii) declined to participate in the adjudication and (iii) did not serve a pay less notice. The adjudicator in the second adjudication awarded the contractor the amount of its claim on the basis that (i) The contractor’s second purported payment notice was effective and (ii) The employer did not serve a pay less notice.
The Court of Appeal held that the dispute referred by the contractor in the second adjudication was different from the dispute referred in the first adjudication despite its claim being the same in both adjudications.
Simon LJ stated that whilst both adjudications were dependent on the ineffectiveness of the architect’s 'final certificate' and claimed the same sum (i) The contractor was not seeking the re-determination of any matter that had been decided by the adjudicator in the first adjudication and (ii) The 'relevant event' on which the contractor based its claim in the second adjudication was its second purported payment notice, which it served upon the adjudicator in the first adjudication rejecting the claim by holding that its first such notice was invalid. Neither this second notice (which the adjudicator in the second adjudication held to be valid) nor the consequence which flowed from its service (namely the entitlement to be paid due if, as was the case, no pay less notice was served by the homeowners in response to the notice) gave rise to disputes which had been referred in the first adjudication.