Smash and Grab adjudications - time may be up

In a very recent development, the Technology and Construction Court has held that an employer is entitled to commence an adjudication to determine the…

In a very recent development, the Technology and Construction Court has held that an employer is entitled to commence an adjudication to determine the value of an interim application for payment. This is despite the argument that the employer’s payment notice and payless notice were invalid. The decision is contrary to other authorities notably the decision in ISG v Seevic.

Paul Lowe, Associate specialising in Construction disputes and Professional risk commented that:

"The case arose from a dispute concerning a new Premier Inn Hotel at Heathrow Terminal 4. During the course of the project disagreements arose about the monies due under an interim application for payment as well as the employer’s entitlement to liquidated damages.
"In the third of a series of adjudications, the adjudicator determined that the employer’s payless notice was invalid, meaning that the contractor had a prima facie entitlement to be paid £14m under its interim application.
"The decision is likely to be welcomed by employers and could mark the end of ‘smash and grab’ adjudications which have become increasingly popular.
"Permission to appeal was granted on certain of the points decided. It will be fascinating to see whether the Court of Appeal is called upon to review these important issues."

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