Breaches of natural justice are frequently raised but rarely accepted in adjudication enforcement

17 Apr 2024

Home Group Ltd v MPS Housing Ltd
Bexhill Construction Ltd v Kingsmead Homes Ltd
Iluminesia Ltd v RFL Facades Ltd

Breaches of the rules of natural justice have been raised in several recent cases to resist the enforcement of an adjudicator’s decision. Only in AZ v BY [2023] EWHC 2388 (TCC), which concerned the deployment of without prejudice material in an adjudication, did the court refuse to enforce an adjudicator’s decision due to a breach of natural justice (see Legal update, Disclosure of without prejudice material renders adjudicator’s decision unenforceable due to apparent bias (TCC)).

This article considers the court’s recent approach to alleged breaches of natural justice.


In AZ, Constable J provided a summary of the relevant principles in respect of without prejudice privilege at paragraph 16 of his judgment before going on to consider the law in relation to without prejudice communications and apparent bias. Constable J noted at paragraph 20 that “communications do not have to be ‘material’ in the sense that they can be shown to have been the basis of a particular conclusion; they do have to be ‘material’ in the sense they give rise, objectively, to a legitimate fear of partiality.”

Against that backdrop, Constable J found, in a redacted judgment, that certain communications submitted to the adjudicator were subject to without prejudice privilege and inadmissible. Constable J concluded, for the reasons set out in paragraph 124 of his judgment, that the fair-minded and informed observer considering all of the circumstances of this case would conclude that there was a real possibility that, having seen the without prejudice material, the adjudicator was unconsciously biased.

Constable J remarked, at paragraph 125 of his judgment, “In the circumstances, this is one of the few cases in which a breach of the rules of natural justice, by reason of apparent bias, dictates that the Decision should not be enforced.” Constable J therefore dismissed AZ’s application for summary judgment and granted BY a declaration that the decision was unenforceable.

AZ acts as a warning for parties considering the deployment of without prejudice communications in adjudication and also confirms the difficulty in establishing a breach of the rules of natural justice based on apparent bias.

Home Group Ltd v MPS Housing Ltd

In Home Group Ltd v MPS Housing Ltd [2023] EWHC 1946 (TCC), Home Group served a referral notice with voluminous documentation including a quantum expert report of 155 pages with 67 appendices and a further 2,325 files in 327 sub-folders. MPS contended that it was unable to properly respond to the material served and that this was a material breach of natural justice that led to a material difference in the adjudication’s outcome.

In simple terms, MPS advanced three arguments:

  • The volume of material was too much to process in the time available.
  • Home Group unreasonably refused to provide the data or access to the underlying documents until the last moment.
  • MPS and its expert were unable fairly to interrogate and respond to the material.

In the enforcement proceedings, Constable J rejected such arguments:

  • The volume of information itself did not present a valid basis for resisting enforcement.
  • MPS did not accept Home Group’s offer to review information and evidence relating to an agreed sample. MPS could have reserved its position on the nature and extent of sampling but nevertheless requested access to review the records.
  • MPS had the draft expert report for five weeks and the appendices for three weeks prior to service of the referral. MPS’ expert therefore had sufficient time to understand the report.
  • MPS was able to and did properly engage with the substance of the claim and enjoyed relatively significant success.

This judgment acts as a reminder that reasonable and proportionate requests for time should be raised promptly in the adjudication but a party must nevertheless be prepared to take necessary steps to comply with the existing timetable.

For more information, see Legal update, No breach of rules of natural justice despite size and complexity of dispute (TCC).

Bexhill Construction Ltd v Kingsmead Homes Ltd

In Bexhill Construction Ltd v Kingsmead Homes Ltd [2023] EWHC 2344, the referral notice and response focused on whether the contract incorporated the JCT Short Form of Subcontract, 2016 Edition. The referral notice did not set out a basis of entitlement and the response “kept the powder dry” on the substantive entitlement. The reply sought payment on the basis that the work had been done and the rejoinder denied that there was any entitlement as the additional works had not been given written approval by Kingsmead, as required, which meant a payment obligation had not been triggered. Bexhill made further responsive submissions and Kingsmead was given permission to respond but did not do so.

The adjudicator was not asked to give reasons but he did so. He accepted the alternative argument that the Scheme for Construction Contracts (England and Wales) Regulations 1998 (SI 1998/649) (Scheme for Construction Contracts 1998) applied, found that there was no payment or pay less notice and awarded the sum claimed.

Kingsmead’s consultants informed the adjudicator that the decision did not address the argument in the rejoinder that no approval had been given for the additional works. In response, the adjudicator confirmed that he reviewed all submissions and that those that he did not expressly refer to did not impact his decision. In the enforcement proceedings, Kingsmead argued that the adjudicator failed to consider its defence. However, HHJ Kelly rejected the argument on several grounds:

  • There was no indication that the adjudicator deliberately excluded the defence. The adjudicator stated that he considered all documentation and that matters not expressly referred to did not impact his decision.
  • Kingsmead elected not to respond to Bexhill’s submissions that replied to the rejoinder.
  • The adjudicator was not requested to give reasons. The adjudicator’s decision to nonetheless give reasons did not oblige him to provide reasons and a discussion on every point raised.

The court therefore concluded that the adjudicator considered the defences and that there was no material breach of natural justice.

Bexhill reminds parties of the risk of strategically electing not to address arguments at the first available opportunity and the difficulty that a party is likely to face when it seeks to allege that an adjudicator has failed to consider a defence in circumstances where the adjudicator states that they have considered all material.

For more information, see Legal update, No breach of natural justice as adjudicator considered all defences (TCC).

Iluminesia Ltd v RFL Facades Ltd

In Iluminesia Ltd v RFL Facades Ltd [2023] EWHC 3122 (TCC), various jurisdictional arguments and a natural justice argument were raised. HHJ Davis-White KC noted that the jurisdiction of the adjudicator included determining:

  • Whether there was a contract and its terms.
  • Whether the terms permitted RFL to cancel the order for glass reinforced concrete panels without being in contract.
  • If RFL could cancel, what sum, if any, Iluminesia was entitled to.

The day before the decision was issued, the adjudicator informed the parties that he had decided the basis of the contract and its terms and invited submissions on a Court of Appeal authority concerning whether variations/additions/omissions were permitted without express agreement. Submissions were sent the following morning and the adjudicator issued his decision shortly afterwards.

In the enforcement proceedings, RFL described the question as being asked “at the 58th minute of the 11th hour” and submitted that there was a breach of natural justice. HHJ Davis-White KC rejected RFL’s arguments noting that RFL did not ask for further time to respond, there was no evidence that any more time was needed and the adjudicator’s question was comparatively short and obvious.

For more information, see Legal update, Court rejects defences to summary judgment and enforces adjudicator’s decision (TCC).


These cases reiterate the difficulty faced when seeking to resist the enforcement of an adjudicator’s decision due to an alleged breach of the rules of natural justice. Constable J’s comments in AZ reflect the difficulty in establishing a breach of natural justice based on apparent bias. Parties should be wary of leaving arguments in reserve or failing to raise matters in an adjudication whether for substantive reasons or to set up a future jurisdictional challenge. The adjudication is often the main show rather than the dress rehearsal and parties should act accordingly.

Article by Kort Egan – first published by Practical Law


Kort Egan

Call: 2017


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