Jurisdiction(s):
United Kingdom

Excluding cross-claims in adjudication breaches natural justice; enforcement refused; Grove on payment schedules is fact-specific – Morganstone v Birkemp [2024] EWHC 933 (TCC) (England and Wales)

Published on: 23 May 2024

Published by a LexisNexis Construction expert

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Re Morganstone Ltd v Birkemp Ltd [2024] EWHC 933 (TCC). What are the practical implications of this case?

This judgment underscores how critical the framing of a notice of adjudication is, and how any responsive defences must be considered within that frame. Adjudicators are required to tackle the dispute actually put to them and should resist an unduly narrow view of their own remit. As Lord Briggs JSC clarified in Bresco Electrical Services Ltd (In Liquidation) v Michael J Lonsdale (Electrical) Ltd [2020] UKSC 25, even a tightly drawn reference still empowers the adjudicator to resolve all matters that can properly be raised in defence, including any cross-claims relied on as, or pleaded by way of, set-off. Here, the court found that the adjudicator’s omission to confront those issues was intentional rather than accidental, was material, and, had the cross-claims been accepted, would have markedly altered the result of the adjudication overall. Accordingly, the scope of the reference defines the question, but it does not curtail the tribunal’s jurisdiction to hear every legitimate set-off, countering argument, or cross-claim advanced in response. That principle was decisive on the facts here. In addition, the mistake effectively arose from an attempt by Birkemp...

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