Van Elle Ltd v Keynvor Morlift Ltd
Citation: [2023] EWHC 3137 (TCC)
Facts
Van Elle had installed 4 new piles for a pontoon in the River Fowey in Cornwall which was used to moor the RNLI lifeboat. The works were subject to delays and Van Elle referred a dispute as to its entitlement under the final account to adjudication relying on a statutory right to adjudicate under the Housing Grants, Construction and Regeneration Act 1996 (“the HGCRA”).
The adjudicator made a decision substantially in Van Elle’s favour, ordering the defendant (“KML”) to pay the sum of £335,142.33 and rejecting its jurisdictional challenge that the contract was not a contract for the carrying out of construction operations in England so the statutory right to adjudicate under the HGCRA did not apply.
KML continued to maintain its jurisdictional objection so Van Elle issued enforcement proceedings.
Jurisdiction: where does England end under the HGCRA?
The jurisdictional issue raised a complicated, and apparently novel, question as to the geographical extent of “England” for the purposes of the Housing Grants, Construction and Regeneration Act 1996. KML resisted enforcement on the grounds that it said the contract did not involve construction operations in England under the Act because the piles were installed outside the low water line and outside a boundary of England shown on an OS map.
HHJ Stephen Davies held [at 76] that England ended on the baseline established by (i) the Convention on the Territorial Sea and Contiguous Zone, 1958 (“the 1958 Convention”), (ii) the United Nations Convention on the Law of the Sea (“UNCLOS”), (iii) the Territorial Waters Order in Council 1964 (“the 1964 Order”) and (iv) Territorial Sea (Baselines) Order 2014 (“the 2014 Order”). In this case, the baseline was across the mouth of the River Fowey where it entered the sea meaning the pontoon was behind the baseline. As a result, Van Elle’s works were construction operations in England.
The Court’s reasoning and findings is likely to be of interest to all those involved in adjudication, but particularly those dealing with works over, under or adjacent to water (whether that be in rivers or next to the coast).
Natural justice
KML raised a secondary defence that the Adjudicator’s decision was invalidated due to several alleged breaches of natural justice. KML argued that the Adjudicator had (a) failed to allow KML to make submissions on jurisdiction/ decided the jurisdictional issues on a basis not argued by the parties and (b) failed to decide certain issues which were in dispute between the parties.
The Court found that the natural justice complaints in relation to KML’s jurisdictional defence fell away because the Court was now deciding the question of jurisdiction.
The other natural justice complaints were also dismissed. The judgment confirms that natural justice challenges on the basis that an adjudicator failed to decide a point in issue are (generally) only likely to succeed if the breach is deliberate and that “an unintentional oversight in the context of a fiercely contested final account dispute” is unlikely to be serious enough to be considered a material breach of natural justice invalidating the decision.
Counsel
James Frampton acted for the successful claimant (“Van Elle”) in these adjudication enforcement proceedings, instructed by Warren Kemp and Jennifer Treverton at DAC Beachcroft.
The judgment can be found here.
