Adjudicator’s must consider all defences.
In the case of Manor Co-living Ltd v RY Construction Ltd [2022] EWHC 2715 (TCC), RYC referred to adjudication a dispute as to whether MCL had correctly served a termination notice.
In its referral RYC said that whether MCL had substantive grounds for terminating was not part of the dispute referred. In its response, conversely MCL said that it was entitled to terminate at common law.
MCL’s defence was that its termination notice was a valid acceptance of RYC’s repudiatory breach. The adjudicator dealt ‘head-on’ with that question and concluded the notice was not a valid acceptance. In the absence of a valid acceptance MCL’s case on repudiation failed on its merits.
The court found that the adjudicator was wrong to conclude that the question of RYC’s repudiatory conduct was outside of his jurisdiction, the had no bearing on his decision and there had been no breach of natural justice.
Commentator’s confirm that the referral can cut down the scope of the dispute but cannot cut down what the responding party may raise in defence.
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