In the case of Lapp Industries Ltd v 1st Formations Ltd [2025] EWHC 943 (TCC), the Technology and Construction Court reinforced the robustness of adjudication decisions under the Housing Grants, Construction and Regeneration Act 1996, dismissing objections concerning jurisdiction and alleged breaches of natural justice, and emphasizing the importance of prompt enforcement in construction disputes.
Background
Lapp Industries Ltd (“LAPP“) entered into a contract with 1st Formations Ltd (“Formations“) to refurbish various parts of a London building. On 14 April 2023, LAPP submitted an interim payment application for £120,000. Formations failed to issue a valid Payment Notice or Pay Less Notice, leading LAPP to initiate adjudication proceedings on 22 November 2024.
During adjudication, Formations contended that multiple contracts existed between the parties, challenging the adjudicator’s jurisdiction. The adjudicator, Ms. Grace Cheng, rejected this argument, determining that a single construction contract governed the works. She ruled in favour of LAPP on 24 December 2024.
Formations did not comply with the adjudicator’s decision, prompting LAPP to seek summary judgment for enforcement.
Legal Issues
Formations resisted enforcement on two primary grounds:
- Jurisdictional Challenge: Formations argued that the adjudicator lacked jurisdiction, asserting that multiple contracts existed rather than a single agreement.
- Natural Justice: Formations claimed the adjudicator breached natural justice principles by allegedly deciding on issues not presented by the parties – a so-called “frolic of her own” – and by failing to consider certain defences.
Court’s Analysis
Jurisdiction
The court found no real prospect that Formations could demonstrate the existence of multiple contracts at trial. The judge noted that all work was performed at a single site and referred to by both parties as a “project,” supporting the existence of a single contract.
The court emphasized that challenges to an adjudicator’s jurisdiction must be clear and substantiated. In this case, the adjudicator had the authority to determine her own jurisdiction, and her conclusion of a single contract was within her remit.
Natural Justice
Addressing the natural justice claim, the court referred to fact that adjudicators must balance the need consider all of the parties’ submissions with the need to to make decisions within tight timeframes, noting that this might well result in broad interpretation of the issues.
The court found that the adjudicator did not engage in a “frolic of her own.” Instead, she addressed the issues presented, and any alleged failure to consider specific defences was deemed immaterial to the outcome. The court cited Roe Brickwork Ltd v Wates Construction Ltd [2013] EWHC 3417 (TCC) to support this position.
Conclusion
The court granted summary judgment in favour of LAPP, enforcing the adjudicator’s decision. This case underscores the judiciary’s support for the adjudication process, reinforcing the fact that successful challenges based on jurisdiction and natural justice are the exception to the norm.