T Clarke (Scotland) Ltd v MMAXX Underfloor Heating Ltd (Scot, OH, CS - 26.03.2014)
The sub-contractor should not be granted an interim interdict (injunction) to prevent the sub-sub-contractor from commencing what would be adjudication 10 in the series of adjudications between the parties
26 March, 2014
T CLARKE (SCOTLAND) LTD v MMAXX UNDERFLOOR HEATING LTD
Scotland, Outer House, Court of Session
26th March 2014
Disputes arose between the sub-contractor and the sub-sub-contractor. The sub-sub-contractor began a series of adjudications against the sub-contractor which applied for an interim interdict (injunction) to prevent it from commencing another (tenth) adjudication.
The sub-contractor relied in particular upon comments made by the sole shareholder of the sub-sub-contractor in two telephone conversations with one of its representatives in which he threatened to commence an adjudication, namely that he had prior experience of obtaining money in such proceedings and "would never give up", was a “maverick” who didn’t “play by the rules" and would what he needed to do, including suspending the works.
The sub-contractor gave the following examples of what it characterised as the attitude, approach and conduct of the sole shareholder, namely that he (i) refused to address a health and safety issue (ii) made unjustified threats to suspend the works (iii) lodged various notices claiming delay without a proper foundation (iv) made erratic applications for payment, sometimes seeking different sums for the same work (v) made unjustified demands for payment and (vi) sent an erroneous notice of suspension.
Lord Woolman declined to grant an interim interdict.
The sub-contractor failed to establish a prima facie case by passing the high threshold required on the basis that there was no clear inference that the sub-sub-contractor acted unreasonably and oppressively because (i) Most of the adjudications begun by the sub-sub-contractor foundered on procedural problems (ii) The sub-sub-contractor had a measure of success in adjudication 3 (iii) The sub-contractor itself initiated adjudication 6 after five earlier procedures and (iv) The shareholder's conduct and the comments attributed to him were also consistent with a robust approach.
In addition the balance of convenience was in favour of the sub-sub-contractor on the basis that (i) The sub-sub-contractor would be significantly prejudiced if it could not take advantage of the speedier and cheaper means of dispute resolution provided by adjudication (ii) It would be unjust if the sub-contractor but not the sub-sub-contractor could refer a dispute to adjudication and (iii) The sub-contractor had a remedy, namely that of raising an action seeking damages for abuse of process.