The TCC Considers The Slip Rule: A Useful Reminder

The case of Redwing Construction -v- Charles Wishart [2010] is about the enforcement of an adjudicator's decision. There are two key issues:

Had a dispute decided in the second adjudication already been determined in the first adjudication? Did the second adjudicator's correction to his decision go beyond the constraints of the slip rule? If the slip rule could be used, had it been applied within a reasonable time? Background

Wishart engaged Redwing to carry out a refurbishment of a residential property in London. The form of contract was a JCT Prime Cost Building Contract (2006 Revision 1 with amendments). The contract fee was £3,500 per week and the estimated prime cost was £723,334.64. Redwing took possession of the site on 14 July 2008. Completion was scheduled to take place on 12 December 2008. As you would usually expect, a number of variations were ordered so an extension of time was granted until 31 January 2009. Wishart took partial possession in late March or early April. Practical completion was achieved on 31 July 2009. The parties disputed Redwings' application for an extension of time from 31 January 2009 until 1 May 2009.

The first adjudication

Redwing referred its application for an extension of time to adjudication and sought both an extension together with loss and/ or expense. The first adjudicator awarded an extension to 6 March 2009 and an adjustment to the contract fee. The first adjudicator gave reasons as to how the contract fee was calculated and concluded that the fixed amount of £3,500 per week should not change. Redwing quickly pointed out that the dispute referred did not relate to any adjustment to the contract fee.

The second adjudication

The parties then disputed the final account. Redwing referred the matter to adjudication. Wishart responded with the assertion that any claim for an adjustment to the contract fee had already been decided in the first adjudication. The second adjudicator found in favour of Redwing on this point. However, the second adjudicator made an obvious error in calculating the adjusted contract fee.

The second adjudicator applied the formula for determining the adjusted amount to the difference between the total prime cost and the estimated prime cost. The key point is that the total prime cost excluded the contract fee but the estimated prime cost included it. In simple terms – the second adjudicator did not compare like with like. It resulted in a shortfall of £21,479.50.

There was...