CDR Newsletter 2nd Quarter 2009

NEW DIRECTOR APPOINTED

Congratulations to Lisa Cattanach who was appointed Director on 1 May 2009.  Lisa joined CDR in May 2000 as a Contract consultant and over the past nine years has developed her career, undertaking Expert Witness appointments and becoming an Adjudicator.  She is on RICS Scotland’s Panel of Adjudicators.  Lisa is delighted with the promotion and aims to develop her career further over the next nine years and beyond!


FAR-EAST SPEAKER

Janey again headed to the Far East on her second business trip to Hong Kong.  During her visit she was invited to speak at Pinsent Mason’s offices regarding the Changing Face of Adjudication in the UK and her own experiences in adjudication.  Whilst in Hong Kong, Janey also met with a number of CDR’s contacts in order to bolster relations!



CDR MANCHESTER OPENS

In our previous newsletter we advised CDR’s plans for expansion.  We are delighted to announce the opening of our Manchester office on 1 June 2009. 

We aim to develop our existing Client base in the south further over the coming years.

Office contact details are: Bass Warehouse 4 Castle Street Manchester M3 4LZ
Tel: 0161 834 0842


CDR GLASGOW AT BRODIES QUIZ

CDR Glasgow attended the Brodies’ Quiz Night and proved the old adage true, “It’s the taking part that counts”.  The aptly named Comic Disaster Relief received the wooden spoon for effort.

Unfortunately, there was not a prize for the best dressed team as clearly the team would have won!

MEDIATION UPDATE

The Chartered Institute of Arbitrators Mediation Panel, which Kahleen heads, has now been launched and it will be interesting to see the uptake.  There is no doubt that there is reluctance within the industry to turn to mediation in a dispute.  Having said that, mediation may not suit all disputes.  However, we remain of the view that it has a role to play as part of the “toolbox” of dispute resolution.  In times of financial constraint, mediation, which should be a relatively quick and economical process, is worthy of consideration. 

Kahleen is however actively involved in ongoing mediations so the tide may be turning...In other mediation news, Janey Milligan and Kahleen Crawford have been appointed to the RICS Scotland’s Mediation panel.  As part of the RICS’ Dispute Resolution Service, Janey and Kahleen are looking forward to being involved in many mediations in the future.


JANEY TAKES PART IN CHARITY WALK

On Saturday 13 June 2009 Janey and Carole Mackie (of Modus Estates Glasgow) both completed the 10 mile Ribbon Walk at Scone Palace, Perth which was in aid of Breast Cancer Care. The 10 mile walk was completed in a respectable 3 ½ hours

Janey thanks all of those who sponsored her.  If you have missed the opportunity to sponsor Janey in aid of this deserving cause please do so at http://www.justgiving.com/janeymilligan. 



THE JCT 2009 AMENDMENT 2

The Joints Contract Tribunal has begun rolling out the 2009 revision to it’s JCT contract suite this month.  The key changes are

• a new focus upon ‘sustainable development’;
• amendments to reflect the criteria set out in the Office of Government Commerce’s Achieving Excellence in Construction; and
•  modification to payment provisions. 

Whilst other contract clauses have been tweaked and amended, it is these three core changes that have driven the revision.  Some say that the issue of these revisions is JCT’s attempt to gain support for its contract in the face of the increased popularity of other contracts such as NEC3. 

Scottish Government Releases Draft Arbitration Bill

After many years of lobbying the Executive Bill was introduced by Kenny MacAskill MSP, the Cabinet Secretary for Justice, on 29 January 2009 and seeks to formalise Scots arbitration law, or as the Delegated Powers Memorandum sets out, “[to] clarify and consolidate Scottish arbitration law, filling in gaps where these exist, provide a statutory framework for arbitrations, ensure fairness and impartiality in the process, and minimise costs and ensure that the process is efficient.”

The Bill, which has gathered support from all areas of the Arbitration community as well as receiving cross party support, has been drafted in close consultation with the Chartered Institute of Arbitrators and other practitioners involved in the arbitration process.  It is hoped that the new Bill will open up pathways to arbitration in Scotland for all, from individuals, through to large businesses.

In conjunction with this, the Chartered Institute of Arbitrators is currently preparing it’s own short form
arbitration rules which will be of immediate assistance to businesses and consumers to offer, efficient, quick and low cost dispute resolution.

The Bill’s main aim is to provide continuity.  In essence, the Bill is seeking to provide a similar regime for arbitration to the Scheme for Construction Contracts in Adjudication.

CDR ADJUDICATION CASE REVIEW 2009 IN BRIEF

Mead General Building Ltd v Dartmoor Properties
The defendant client sought to resist enforcement of an adjudicator's decision on the ground that the claimant contractor was subject to a Company Voluntary Agreement (CVA) and so might be unable to repay money in arbitration. The Technology and Construction Court held that, while a CVA was a relevant factor to be considered, it was also relevant that the CVA was a result of the defendant client's failure to pay the contractor sums owed. The CVA supervisor took the view that the contractor was a viable concern which could trade its way out of trouble, which was also relevant. On the facts, no stay should be granted and summary judgment was confirmed.

Makers UK Ltd v Camden London Borough Council
Camden Borough sought to challenge the adjudicator's jurisdiction on the ground that he had been improperly appointed by RIBA. Makers had contacted RIBA to request the appointment of the adjudicator actually appointed. The court rejected the existence of an implied term that neither party should seek to influence the appointment, since the nominating body was under no obligation to accede to the representations. There was no appearance of bias in appointing an adjudicator previously requested by one of the parties

CDR Adjudication Case Review In depth
This time we concentrate on the issue of timetabling for Adjudications and how new material can seriously affect the whole process.  One case that has been poured over this month at CDR discussions has been the decision in the case of The Dorchester Hotel v Vivid Interiors Ltd. 

Dorchester Hotel v Vivid Interiors Ltd
Vivid Interiors were instructed by The Dorchester Hotel to carry out several works at the London hotel and upon completion there was the usual back and forth surrounding the Final Account.  After 10 months of discussions, Vivid Interiors finally served a notice of adjudication on 12 December, with the referral itself arriving on 19 December in the form of 37 lever arch folders, a 92 page Referral Notice.

The Dorchester, complained that given the quantity of material, the timetable was simply too tight to respond effectively, rendering the adjudication an unfair process and its approach was to go straight to the High Court. 

Vivid Interiors agreed with The Dorchester Hotel to extend the date of response to 28 January 2009 with a decision date of 28 February 2009.  However, The Dorchester maintained throughout the process that the timetable was too tight.  The Judge took a different perspective. 

The Judge stated that the process may or may not be unfair.  He instructed the parties to carry out the adjudication and, if The Dorchester still felt the process was unfair, he could look at the case again, retrospectively.

In an ideal world, the adjudicator receives the parties’ positions and contained within is all of the arguments and supporting evidence the adjudicator needs to reach his or her decision within 28 days.  In essence, it shouldn’t matter if there are 37 lever arch files of supporting evidence; both parties would have seen the same material throughout the course of the contract and formed their arguments accordingly.

In truth, this is rarely the case and certainly was not with The Dorchester dispute.  It contained five files of evidence and expert opinion that The Dorchester Hotel hadn’t seen before.

As so often is the case, the Referring Party had submitted new material to the dispute.  There was now the requirement for a further response from The Dorchester which would reasonably push the decision date back. 

Conclusion

The information contained within this newsletter does not
constitute legal or other professional advice. Construction Dispute Resolution will not be held liable for actions taken based on information contained within.