AMD Environmental Ltd v Cumberland Construction Co Ltd [2016] EWHC 285 (TCC)
AMD, an M&E works subcontractor, was engaged by Cumberland for works at Hilton Hotel on Park Lane, London. AMD sought payment of a final account. Cumberland disagreed with the amount claimed and so AMD commenced an adjudication. Cumberland argued that the dispute had not crystallised by the date on which the Claimant issued its adjudication notice, a point which the adjudicator rejected pointing to (among other things) the five month gap between the application for payment and the notice of adjudication. The adjudicator decided on the amount of the final account and sums were due together with interest from Cumberland, which Cumberland did not pay. AMD commenced court enforcement proceedings for Summary Judgment which was granted.
The Court acknowledged that lack of particularisation was common in building contract disputes and so a party could not put off paying a claim forever by repeatedly requesting further information. To do so would deny the payee of its statutory right to adjudicate and would allow the paying party limitless time to avoid paying. The Court reinforced the concept that it was for the paying party to evaluate the claim promptly and form a view as to its likely valuation despite the lack of particularisation as required under the Construction Act 1996.
Practical tip:
Assess applications and valuations as soon as possible and requests for further particulars should also be made quickly.
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