RBH Building Contractors Ltd v Ashley James & Anor [2025] EWHC 2005 (TCC)

[2025] EWHC 2005 (TCC)Case No HT-2025-000039
IN THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
TECHNOLOGY AND CONSTRUCTION COURT (KBD)
Venue The Rolls Building, 7 Rolls Buildings, Fetter LaneDate Tuesday, 10 th June 2025
London
EC4A 1NL
Before
NEIL MOODY KCB E T W E E N:RBH BUILDING CONTRACTORS LTDPart 7 Claimant/Part 8 Defendant(1) ASHLEY JAMES(2) TRACY JAMESPart 7 Defendants/Part 8 ClaimantsMR J FRAMPTON appeared on behalf of the Part 7 ClaimantMR R HANNA appeared on behalf of the Part 7 DefendantsJUDGMENT(Approved)This Transcript is Crown Copyright. It may not be reproduced in whole or in part, other than in accordance with relevant licence or with the express consent of the Authority. All rights are reserved.
Between
RBH Building Contractors LtdClaimantAshley James & AnorDefendant

DEPUTY HIGH COURT JUDGE MOODY KC:

[1]There are before the Court two applications: the Claimant contractor’s application for summary judgment so as to enforce the decision of an adjudicator, and the Defendant employers’ application for declarations under Part 8 of the CPR. The Defendants resist summary judgment on the footing that the contract in question was a construction contract with a residential occupier, and so it is said that, pursuant to section 106 of the Housing Grants, Construction and Regeneration Act 1996 (“the 1996 Act”), the statutory scheme of adjudication is inapplicable and hence the adjudicator had no jurisdiction to determine the dispute between the parties.[2]The declarations sought by the Defendants pursuant to CPR Part 8 are to the effect that the employers’ payless notice was valid. The adjudicator decided that the payless notice was not valid. The Defendants further argue that in the event that they are successful in relation to the payless notice, the Court should reverse the adjudicator’s order as to payment of his fees. The parties agree that these applications should be heard together, and, by a consent order dated 4 January 2025, Waksman J gave directions to that end.[3]Mr Frampton appears for the Claimant and Mr Hanna for the Defendants, and I am grateful to them both for their lucid written and oral submissions.

The Facts

[4]The background to the dispute is as follows. The Claimant, RBH, is a building contractor and acts primarily through its managing director and owner, Mr Roger Huntley. The Defendants are Mr Ashley and Mrs Tracy James. In 2019, Mr and Mrs James purchased a property at Ferndown, Saunton, North Devon with the intention of demolishing and reconstructing it. In about January 2022, RBH was engaged by Mr and Mrs James to provide site and project management services in relation to the construction of a large luxury house on the site. Mr Huntley had worked for Mr James before. Mr James is said by RBH to be a property developer. It is accepted that he works in the property business. The precise nature of his work is a matter in dispute. He is a director of Trilogy Property Ltd, which is a family property business. Mrs James is a medical secretary. She is also a director of Daicko Developments Ltd, a property development company set up on 22 February 2022.[5]The contract was agreed orally. Nonetheless, it appears to be common ground that RBH was to be paid, first, a fee of £1,000 per week for supervision and project management, and, secondly, an additional fee of £10,000 per month for 18 months also for supervision and project management. RBH was to be reimbursed any costs incurred procuring subcontractors and materials. RBH’s position is that it was also entitled to a fee on top of its costs to cover overheads and profits.[6]The work started in about January 2022, and RBH ceased work on site in about April 2024. The parties appear to have fallen out, and the works were incomplete. By that time, RBH had received £1,310,039. On 18 November 2024, a claims consultant acting on behalf of RBH served an application for payment on Mr and Mrs James. The sum claimed was £663,016.16. The application was made by way of an email which attached an Excel spreadsheet. It stated that the due date for payment was 18 November 2024 and the final date for payment was 5 December 2024. It said that the total sum owing was £1,973,055.20. A further schedule showed that a total of £1,310,039.04 had already been received, and so the balance owing was the sum to which I have already referred, that is £663,016.16. The Excel spreadsheet provided a detailed breakdown.[7]On 27 November 2024, Mr and Mrs James served a letter in response, which they say is a valid payless notice. The validity of this document is the issue in the Part 8 proceedings. Given its importance, I set it out in full. “Dear RBH Building Contractors Ltd Notice of intention to withhold payment in respect of an Application for Payment dated 18 November 2024 We write in connection with the Application for Payment dated 18 November 2024 sent by email by Edward Ranns at 11:58 (the "Application") and hereby notify of you of our intention to withhold payment of the sum claimed. We intend to withhold payment of £663,016.16 and accordingly intend to make payment of £0. The reasons for withholding the sums claimed are that: The reasons for withholding the sums claimed are that: - Payment application for Sheldon South West of £94,083.67, insufficient evidence has been presented to confirm what sum (if any) might be due to RBH Building Contractors Ltd. - Payment application for Longcross Scaffolding of £19,720, insufficient evidence has been presented to confirm what sum (if any) might be due to RBH Building Contractors Ltd. - Payment application for 50% roof access of £5,839 is an unpaid invoice and therefore is not due to RBH Building Contractors Ltd. - Payment application for CES Engineering for glass balustrade of £45,450 is an unpaid invoice and therefore is not due to RBH Building Contractors Ltd. - Payment application for Easy Bathrooms tiles of £9,582.28, insufficient evidence has been presented to confirm what (if any) sum might be due to RBH Building Contractors Ltd. - Regarding Contract Welding Services, insufficient evidence has been presented to confirm what sum (if any) might be due to RBH Building Contractors Ltd. - Regarding payment application for Bespoke Timber of £43,149.50, insufficient evidence has been presented to confirm what sum (if any) might be due to RBH Building Contractors Ltd. - Regarding PGR Timber insufficient evidence has been presented to confirm what (if any) sum might be due to RBH Building Contractors Ltd. - RBH Building Contractors Ltd is not entitled to overheads and profit of £77,798.52. - Share of rental income was agreed as a project/performance related bonus. No such bonus is due including but not limited to given that the project ran significantly over time. - Regarding VAT, it was our understanding that this would remain in the build fund. In accordance with the Scheme for Construction Contracts (England and Wales) Regulations 1998 as amended by The Scheme for Construction Contracts (England and Wales) Regulations 1998 (Amendment) (England) Regulations 2011 (the "Scheme") the due date cannot be before 18 November 2024 (the date of the Application) and may be calculated to be a later date in accordance with paragraph 2 of Part II of the Scheme. In the event that the due date is 18 November 2024, the final date for payment of the Application (absent this notice of intention to withhold payment) would be 5 December 2024.”

The reasons for withholding the sums claimed are that:

[8]Thus Mr and Mrs James’ position was that no sum was owing at all. I note that they had at that stage taken legal advice from Taylor Wessing Solicitors. They did not, at that point, argue that adjudication was inapplicable because they were residential occupiers.

The Adjudication

[9]RBH served a Notice of Adjudication on 6 December 2024 and its Referral on 11 December. Since there was no written contract, the statutory Scheme for Construction Contracts applied, subject to the point about residential occupation to which I will come. Mr Robert Shawyer was appointed as the adjudicator. The adjudication was advanced on the basis that the sum claimed in the payment application was due because there was no valid payless notice. It was, therefore, what is sometimes called a “smash and grab” adjudication. I note that Mr and Mrs James complain that the Referral was made in the run-up to the Christmas period.[10]Mr and Mrs James took a preliminary objection to the adjudicator’s jurisdiction on the basis that they were residential occupiers because they said that, at the time of the contract, they intended to occupy the property upon completion. They said they subsequently changed their minds and decided to rent it out, and then later still, they decided to sell it. RBH argued that the Jameses were property developers, that they had never occupied it and never intended to occupy it. The adjudicator rejected the James’ jurisdictional objection and made a non-binding decision that he had jurisdiction. What appears to have been decisive in the adjudicator’s mind on the question of jurisdiction was first that the planning application for the new home included a ticked box for “market housing”, and second the submission of a purported payless notice which was taken as an admission by the Jameses that the Statutory Scheme applied.[11]Mr and Mrs James also argued that the Notice of Adjudication was defective. This argument was rejected by the adjudicator, and it has not been relied upon before me. Mr and Mrs James further argued that the payless notice was valid. The adjudicator rejected this argument, but it is now raised before me in the context of Mr and Mrs James’ Part 8 proceedings.[12]By his decision dated 17 January 2025, the adjudicator decided that RBH was entitled to be paid the sum of £663,016.16, together with interest on this sum and that such sums should be paid forthwith and, in any event, within five days. He further decided that Mr and Mrs James were responsible for his fees and expenses in the sum of £9,638 plus VAT. Mr and Mrs James have not paid any sums in relation to this decision, and accordingly RBH brings this application for summary judgment to enforce the adjudicator’s decision.

The Summary Judgment Application for Enforcement

[13]I turn then to address the enforcement application.[14]CPR Part 24.3 provides that: “The Court may give summary judgment against a Claimant or Defendant on the whole of a claim or on an issue if:(a) it considers that the party has no real prospect of succeeding on the claim, defence or issue; and(b) there is no other compelling reason why the case or issue should be disposed of at a trial”.[15]It is not suggested that subparagraph (b) is relevant in the context of this case, and so I focus on whether Mr and Mrs James have a real prospect of succeeding on their defence. The Court’s approach to summary judgment applications is well known and does not require extensive citation here. I remind myself of the principles applicable to applications for summary judgment as formulated by Lewison J, as he then was in Easyair Ltd v Opal Telecom Ltd [2009] EWHC 339 (Ch)and as approved by the Court of Appeal in AC Ward and Son v Catlin (Five) Ltd & Others [2009] EWCA Civ 1098. This is all helpfully summarised in The White Book at paragraph 24.3.2, and I have it well in mind. In particular, I note that the Court must consider whether the defendant has a realistic as opposed to a fanciful prospect of success. A realistic claim is one that carries some degree of conviction. This means a claim that is more than merely arguable. I should not conduct a mini-trial. I bear all this in mind when approaching the summary judgment issue in this case.[16]The correct approach to summary judgment in an adjudication enforcement claim where a jurisdictional defence is raised was addressed by Akenhead J in Estor Ltd v Multifit (UK) Ltd [2009] EWHC 2108:
“20. It is common in the Technology and Construction Court that if the jurisdictional point raised is simply a matter of law, for instance of contractual or statutory construction, the Court will be able to deal with the matter summarily even if there are proper arguments about jurisdiction. 22. The position is different, however, if the jurisdictional challenge is dependent upon fact and evidence.”
[17]That is the position in this case, and so I have to consider whether, on the evidence before the Court, the Defendants have no real prospect of succeeding on the defence.[18]Mr and Mrs James take two points, both of which they took in the adjudication and both of which were decided against them. The residential occupier point is a point which is fact-sensitive. The question, therefore, is whether Mr and Mrs James have a real prospect of succeeding on that issue. The second point that they take is that they served a valid payless notice, which is a point of pure law. Regardless of my decision on the residential occupier point, I am invited by Mr Hanna for Mr and Mrs James to decide that point finally and to give an appropriate declaration under CPR Part 8 if appropriate. It is agreed by Mr Frampton for RBH that this is the approach I should take.

Residential Occupation

[19]I turn then to consider the residential occupation point. Section 106 of the 1996 Act provides as follows: “(1) This Part does not apply: a) to a construction contract with a residential occupier (see below) … (2) A construction contract with a residential occupier means a construction contract which principally relates to operations on a dwelling which one of the parties to the contract occupies or intends to occupy as his residence…”. a) to a construction contract with a residential occupier (see below) …[20]This therefore goes to the jurisdiction of the adjudicator. If this exception is made out, the adjudicator had no jurisdiction to determine the dispute, and it would provide a complete answer to RBH’s claim for enforcement. Looking at the section, it is clear that there are two separate and disjunctive grounds on which the exception may arise:(i) where a party occupies the property as their residence; or(ii) where they intend to occupy it.[21]It appears to be the position that there is no reported case where this exception has been held to apply. I have however, been referred to four cases where the provision has been considered. Samuel Thomas Construction Ltd (2000) is an unreported case which was a decision of HHJ Overend sitting as a TCC judge at Exeter. It focused on the meaning of “principally”, which is not really an issue in this case. The contract involved the conversion of two barns - A and B - and the construction of a garage block for four barns. The employer intended to occupy barn B. The evidence before the Court was that barn B amounted in value to 65% of the total contract. The Court nevertheless held that the contract involved the conversion of one dwelling and one non-dwelling and so it did not principally relate to operations on a dwelling. As a result, the section 106 exception did not apply.[22]Howsons Ltd v Redfearn & Anor [2019] EWHC 2540 (TCC) was a decision of HHJ Bird sitting in this Court. He held that, to fall within the section 106 exception, the occupation had to be lawful. In that case, the alleged occupation was unlawful because it was contrary to the terms of the planning permission, which was for a live/work unit rather than a dwelling. In Edenbooth Ltd v Cre8 Developments Ltd [2008] EWHC 570, the Court held that the defendant could not rely on the section 106 exception for three connected reasons: first, the defendant was a company; second, the defendant was engaged in property development and third, the defendant company was not the registered owner of the properties which were owned by a director of the defendant as an individual.[23]The leading case and the most helpful one in the context of the case before me is Westfields Construction Ltd v Lewis [2013] EWHC 376, a decision of Coulson J (as he then was). That was an application to enforce an adjudication. The issue was again one of jurisdiction arising over the applicability of section 106. It is important to note that the issue appears to have been dealt with as a final hearing, not summarily, and there was oral evidence and cross-examination: see paragraph 1. The factual scenario differed from the present case. It appears that the defendant occupied the house at the time of the contract (although that was an issue in dispute) but (so it was held at paragraph 24) at all times he intended to let it out once the works had been completed. Coulson J noted at paragraph 10 that: “Section 106 was intended to protect ordinary householders not otherwise concerned with property or construction work, and without the resources of even relatively small contractors, from what was, in 1996, a new and untried system of dispute resolution…In this way, section 106 excluded adjudication in respect of construction works carried out for those who occupied and would continue to occupy as their home the property that was the subject of the works (even if they had to move out when those works were carried out), or who had bought the property and intended to live there when the construction works were completed”. [underlining added][24]He held further at paragraph 11 that: “Above all, section 106 needs to be approached with commonsense: it ought to be plain, on a brief consideration of the facts, whether the employer is or is not a residential occupier within the terms of the exception”.[25]Before leaving this case, I note also that at paragraph 6 Coulson J (referring to his own decision in Shaw v Massey Foundations Piling Ltd [2009] EWHC 493 (TCC)) concluded that, in relation to intention to occupy, “what mattered was the employer’s intention at the time of formation of the contract”. In my judgment, that must be right. The question as to when the intention to occupy should be determined must be at the time when the contract is entered into. Otherwise, if a party intended to occupy at the time of contract and then, as the build progressed, changed their mind, the result would be that adjudication would be inapplicable and then applicable. There must be some certainty during a building project as to whether the works are subject to adjudication provisions or not. However, post-contract events may well be relevant and they can be taken into account in determining objectively the nature of the employer’s intention at the time the contract was entered into.[26]Turning to the facts, Mr and Mrs James have never occupied the house. Indeed, the house has now been put up for sale, and they accept that they now have no intention of occupying it. However, their case is that at the time of the contract until about November 2022, it was their intention to occupy it. They say their intention changed because their finances were such that they were compelled to put the property up for sale. As things stand, I understand that the property remains on the market. The factual issue which arises on the residential occupier point is, therefore: what was their intention objectively determined as at the time of the contract?[27]A substantial body of evidence has been put before the Court on this point. There is a good deal more evidence available to me than was available to the adjudicator. I have three statements from Mr James, three from Mrs James and two from Mr Huntley. The Jameses have also served a statement from their architect, Mr Plant. Additionally I have two witness statements from Mr James served in the adjudication and one from Mr Huntley.[28]As I have indicated, the evidence of Mr and Mrs James is to the effect that they intended to occupy their new home as their main residence. They purchased the property in 2019, and they planned to erect a new build home on the site and to reside in it. Mr James says that this was the culmination of years of planning after they decided to move from Essex to the Devon coast. At the time of purchasing the plot in 2019, they paid an additional 3% stamp duty surcharge for a second residential property. They subsequently sold their house in Essex and moved to Devon and reclaimed the additional stamp duty surcharge.[29]It follows therefore that they owned one house. They lived in a caravan on the site during the works. They registered with the local GP, and they were put on the electoral register. They say that the property was designed to Mr James’ personal specification. In particular, they highlight the installation of a basement lap pool, which was specified because Mr James is a keen swimmer who has competed in Ironman competitions. Mrs James has disclosed mobile phone screenshots which suggest that a local Devon friend thought they were building a home to live in and not a second home. Whilst they say that, at the time of the contract, they intended to live in the property, they do accept that it was always their intention that they would let the property out on an “Airbnb basis” during holiday periods, and they would do this for about 13 weeks of the year in order to repay the financing of the property. The architect for the project, Mr David Plant, has known the Jameses for many years. He has provided a witness statement which confirms his understanding that they intended to live in the new house.[30]For RBH, Mr Huntley’s witness statement is to the effect that he was never told that Mr and Mrs James intended to occupy the property, and, in his view, it was intended as a development property and not a self-build. RBH rely, in particular, on the commercial loans which Mr and Mrs James took out to finance and build the property and which included undertakings to the effect that the property will not be used as a dwelling by the borrower and that the loan will be used for business purposes.[31]Turning to the parties’ submissions on this point, Mr Frampton argues that the section 106 exception cannot apply. He emphasises that Mr and Mrs James did not occupy the property at the date of the contract, that they have never occupied the property, and they now admit that they do not intend to occupy it in the future. He submits that Mr James is a property developer. He says the Court can decide summarily, at this stage, that the section 106 exception does not apply.[32]Perhaps recognising that there are clearly potential factual disputes on the evidence. Mr Frampton focuses on certain points which he says are determinative, regardless of the factual disputes. First, he says that Mr James is a counterparty to the contract but is not an owner of the property, and he cannot, therefore, be a residential occupier. He says it is insufficient for one of two counterparties to be an owner of the property. I do not accept this. Mrs James is the owner of the property, and it is true that Mr James is not an owner of the property. However, it is not unusual for a family home to be in the name of either the husband or wife. In this case, Mrs James was the owner of the property, and she was a counterparty to the contract. Mr Frampton relies on Edenbooth in this respect, but in that case the defendant was a company, it was engaged in property development, and it was not the registered owner of the property. I do not see how this assists in determining whether Mr and/or Mrs James were residential occupiers in the sense of intending to occupy it as their residence.[33]Second, Mr Frampton submits that, on Mr and Mrs James’ own evidence, they did not objectively intend to occupy the property as a dwellinghouse on completion of the works. This is because they accept that they would not reside in the property until a development loan had been paid off, and so their intent was, therefore, conditional. The condition has not been met because the loan has not yet been paid off. He argues that a conditional intent is insufficient for section 106, which requires an unambiguous intent. I do not accept this. “Intent” is a common English word. It does not connote unconditionality. Just because a condition has to be fulfilled before an intention may be realised, that does not mean that the relevant person does not hold the requisite intention. It might just as well be said that their intention to reside in the property was conditional on the building works being completed.[34]Third, Mr Frampton submits that Mr and Mrs James intended to rent out the property Airbnb style during holiday periods and that this was necessary to repay the development loan. It is said that this would, in effect, be a holiday let run with a buy-to-let mortgage. As I have indicated, Mr James’ evidence is that the plan was to rent the property out for about 13 weeks a year. Mr Frampton says that a property rented out for 25% of the time under a holiday/buy-to-let mortgage is not principally a dwelling occupied as a residence. I do not accept this. First of all, I consider that this is a misapplication of the word “principally”, having regard to its location in section 106. The provision requires that the construction contract must principally relate to operations on a dwelling. But in any event, many owner-occupiers, particularly in areas popular with holidaymakers, let out their properties on an Airbnb basis for a few weeks a year. If the intention was to let this property during holiday periods, but Mr and Mrs James would otherwise live in the property and, moreover, they had no other home (which is their evidence here) I consider that they would intend to occupy it as their “residence” within the meaning of section 106. I consider that Coulson J’s comment that section 106 needs to be approached with commonsense is apposite here.[35]Fourth, Mr Frampton relies on the planning document which refers to the property as being for “market sale” as opposed to “self-build” or “custom-build”. He submits that this demonstrates that the property was at all times intended to be sold. Mr James says that the form was completed by a consultant but, in any event, the reference to “market sale” is simply a reference to housing that can be sold freely on the open market as opposed to other categories, which would have restrictions. He says that the “self-build/custom-build” category would come with restrictions usually involving infrastructure contribution concessions. This is a factual dispute which I cannot determine on the material available to me, but I am satisfied that Mr and Mrs James have a real prospect of success on this issue.[36]Fifth, Mr Frampton relies upon the development loan which enabled Mr and Mrs James to finance the development of the property. He says that the development loan terms are inconsistent with and preclude an intent to occupy the property as a residence. The loan is dated 10 November 2021, two months prior to the date of the contract. Here, it seems to me that Mr Frampton is on firmer ground. The loan was advanced by MSP Capital Ltd. The borrowers are identified as Mrs James and Cassek Ltd, which is a property development company of which Mr James was the director. The loan was for up to £3.7 million and was guaranteed by Mr James and his brother, Philip. Mr Frampton then relies, in particular, upon clause 2.1(3) which stated: “The lender has received and is satisfied with the written undertaking signed by the borrower that the charged property is not used as and will not be used as a dwelling by the borrower or a related person of the borrower”.[37]Clause 2.1(4) stated: “The lender has received and is satisfied with written undertakings signed by the borrower that the loan will be used for business purposes”.[38]The first undertaking signed by Mrs James stated: “We declare, confirm and certify that neither myself, ourselves or any of my/our family or close relatives nor my/our partners reside nor have any intention to reside at the property”.[39]The second undertaking signed by her stated: “I am entering this agreement wholly or predominantly for the purposes of a business carried on by me or intended to be carried on by me”.[40]The development loan has been refinanced three times, and the total amount of the loan is now £4.5 million, but the terms have not changed. Mr Frampton says that the James’ contention in these proceedings that they intended to occupy the property as their dwelling is directly contrary to the undertakings that Mrs James provided under the development loans, and these undertakings are fatal to their jurisdictional arguments. He relies in particular upon the fact that any occupation would have been in breach of the terms of the loan, and so he says this would have amounted to unlawful occupation, which cannot be occupation under section 106, relying upon the Howsons decision.[41]It is true that in Howsons HHJ Bird held that occupation or intended occupation in breach of planning conditions could not be relied upon as occupation for the purposes of section 106, but he also went on to hold that, even if the occupation was lawful, it would not be appropriate to describe the works in that case as principally relating to a dwelling because the related to a live/work unit. In my judgment, a loan agreement with a third-party financier is different in kind to a statutory regulation. Breach of planning conditions is unlawful and may be subject to a penalty. Breach of a loan agreement is a civil matter which may sound in damages for breach of contract.[42]However, even assuming that Mr and Mrs James are in breach of their declarations under the financing agreement, I do not see how the fact that there was such a breach or potentially the fact that they were untruthful in their dealings in relation to the loan agreement is determinative of their intention objectively ascertained. The declarations that they made in connection with the loan agreement are part of the picture and part of the evidence that may be taken into account in determining what their true intention was, but to my mind, it is not determinative; it is part of the picture. In this respect, I note that Mr and Mrs James both say that their understanding of the loan declaration was that they were declaring that they would not live in the property for the duration of the loan. Mr Frampton fairly points out that this is not what the declarations say, and he also says that no explanation is given for the second and third declarations confirming that the loan and thus the works were for a business purpose. However, it seems to me that these are essentially factual matters which would fall to be investigated if the jurisdiction point went to trial.[43]Finally, Mr Frampton points further to various documents which identified Mr James’ property company, Trilogy, as the client. He refers to a health and safety at work prohibition notice, a method statement prepared by the health and safety consultant and an updated F10 form filed with the health and safety executive notifying it of the construction project.[44]I do accept that the loan documents and the Trilogy documents, in particular, require explanation and very clearly raise the possibility that the house was being constructed as a development for onward sale but, in my judgment, this is part of the picture and has to be set against the James’ own evidence. They say that at the time of contracting, they intended to live there. There is some support for this in the evidence of Mr Plant, the facts that they registered with a local GP and went on the electoral roll. The screenshots, the facts that they lived on site and sold their house in Essex, and the evidence in relation to their personal specification is also material. This all goes to support the James’ case on their intention at the time of the contract. If accepted, it would be determinative of the section 106 point. I cannot decide which evidence to accept on a summary basis. This issue, as in Westfields, would have to be decided on the basis of oral evidence and not summarily.[45]Looking at the evidence overall I consider that the evidence relied upon by Mr and Mrs James enables them to surmount the Part 24 test. In light of the material which has been adduced and which is far more extensive than the material which was available to the adjudicator, I consider that they have a real prospect of establishing that the residential occupier exception in section 106 is engaged. In that event, it is common ground that the adjudicator would not have jurisdiction. It follows, therefore, that I decline to enforce the adjudicator’s decision, and I dismiss the application for summary judgment.

The Payless Notice

[46]The parties are agreed that - even if I decline to enforce the adjudicator’s decision - I should, nonetheless, go on to decide whether the payless notice was valid, this being upon the assumption that the adjudicator did, indeed, have jurisdiction and the 1996 Act applies.[47]A payless notice is provided for by section 111(3) of the 1996 Act, which says: “The payer or a specified person may, in accordance with this section, give to the payee a notice of the payer’s intention to pay less than the notified sum”.[48]Section 111(4) sets out the requirements for a valid payless notice as follows: “A notice under subsection (3) must specify:(a) the sum that the payer considers to be due on the date the notice is served; and(b) the basis on which that sum is calculated. It is immaterial for the purposes of this subsection that the sum referred to in paragraph (a) or (b) may be zero”.[49]The decision of Joanna Smith J in Advance JV v Aniska Limited [2022] EWHC 1152 (TCC), at paragraphs 46 and 47, provides a helpful summary of the relevant law relating to the required content of payment and payless notices under the 1996 Act and how the content should be construed. Both parties rely on this in their skeleton arguments. “46. I was taken during the hearing to a number of authorities in the context of the proper approach to be taken by the Court to the interpretation of contractual notices, including Mannai Investment Co Ltd v Eagle Star Life Assurance Co Ltd [1997] AC 749 (‘Mannai), Thomas Vale Construction Plc v Brookside Syston Ltd [2006] EWHC 3637 (TCC) (‘Thomas Vale’), Henia Investments Ltd v Beck Interiors Ltd [2015] BLR 704 (‘Henia’), Jawaby, Surrey and Sussex Healthcare NHS Trust v Logan Construction (South East) Ltd [2017] BLR 189 (Surrey and Sussex’), Grove Developments Ltd v S&T (UK) Ltd [2018] BLR 173 (‘Grove Developments’) and S&T (UK) Ltd v Grove Developments Ltd [2019] BLR 1 (‘S&T’) (in which the Court of Appeal upheld the reasoning of the Judge on this issue at [57]). There is no need to set these out at length; the principles that they establish and which I must apply in this case are uncontroversial. 47. In summary, the approach to be taken by the court as gleaned from these authorities is as follows: i) In considering the true construction of a contractual notice (including notices under the payment regime in the Act; see Grove Developments per Coulson J at [21]-[22] and S&T in the Court of Appeal at [58] per Sir Rupert Jackson), the question is not how its recipient in fact understood it. Instead, the construction of the notices must be approached objectively. The issue is how a reasonable recipient would have understood the notices, i.e. a reasonable recipient ‘circumstanced as the actual parties were’ (see Mannai at 767 G-H and 768B-C per Lord Steyn). ii) The notice must be construed taking into account the ‘relevant objective contextual scene’, i.e. the Court must consider ‘what meanings the language read against the contextual scene will let in’; (see Mannai at 767H and 768A-B). This means that, amongst other things, the reasonable recipient will be credited with knowledge of the relevant contract (see Mannai at 768B-C). iii) The purpose of the notice will be relevant to its construction and validity (Mannai at 768E). iv) The Court will be ‘unimpressed by nice points of textual analysis or arguments which seek to condemn the notice on an artificial or contrived basis’; (Thomas Vale per HHJ Kirkham at [43]; Grove at [26]). Instead, as Sir Peter Coulson says in paragraph 3.36 of his book on Construction Adjudication (4th edition 2018), focusing specifically on payless notices: ‘The Courts will take a commonsense, practical view of the contents of a payless notice and will not adopt an unnecessarily restrictive interpretation of such a notice…It is thought that, provided that the notice makes tolerably clear what is being held and why, the Court will not strive to intervene or endeavour to find reasons that would render such a notice invalid or ineffective’. v) There is no principled reason for adopting a different approach to construction in respect of different kinds of payment notices (for example, because some may give rise to more draconian consequences than others) as that would be contrary to the guidance in Mannai (see Grove at [27]). However: ‘the particularly adverse consequences for an employer that follow from, say, a contractor’s unanswered application/payment notice are relevant to the test of the reasonable recipient’. vi) To qualify as a valid notice, any payment notice must comply with the statutory (and, if more restrictive, the contractual) requirements in substance and form (Henia per Akenhead J at [17]). Payment notices and payless notices must clearly set out the sum which is due and/or to be deducted and the basis on which the sum is calculated. Beyond that, the question of whether a notice is or is not a valid notice is ‘a question of fact and degree’; (Grove at [29] and S&T at [53]). vii) Over and above the question of whether a notice has achieved the required degree of specificity, will be the additional question of whether the document that is alleged to constitute a valid notice was in fact intended to be such and whether it is ‘free from ambiguity’; (Henia at [17] and Grove at [42]). The sender’s intention is a matter to be assessed objectively, taking into account the context. (Jawaby at [43], [59] and [63]). viii) Although in Grove, Coulson J observed that payment notices must make plain what they are, there is no requirement for a particular type of notice, such as a payless notice, to have that title or to make specific reference to the contractual clause in order to be valid: ‘[t]he question is whether, viewed objectively, it had the requisite intention to fulfil that function’. (Surrey & Sussex at [65]). ix) One way of testing the validity or otherwise of a payless notice will be to see whether it ‘provided an adequate agenda for an adjudication as to the true value of the works…’; (Henia at [32] and Grove at [26])”. ‘The Courts will take a commonsense, practical view of the contents of a payless notice and will not adopt an unnecessarily restrictive interpretation of such a notice…It is thought that, provided that the notice makes tolerably clear what is being held and why, the Court will not strive to intervene or endeavour to find reasons that would render such a notice invalid or ineffective’. ‘the particularly adverse consequences for an employer that follow from, say, a contractor’s unanswered application/payment notice are relevant to the test of the reasonable recipient’.[50]I set out the payless notice at paragraph 7 above. It took issue with specified, quantified claims which were at bullet points 1-5, 7 and 9 but it also rejected wholesale certain heads without referring to figures. Those are bullet points 6, 8, 10 and 11. The quantified and unquantified heads exceeded £663,000, and so the notice concluded that the sum owing was £0.[51]Mr Frampton submits that the notice is invalid because it does not comply with sub-section 111(4)(b). He argues that it does not set out a sum which the Jameses generally considered to be due, and does not provide an adequate basis for saying why the sum payable should be £0. In particular, he says, a number of the bullet points did not say what sum Mr and Mrs James were accepting was due. He submits that the total of the figures provided in the quantified bullet points came to £295,000 odd and, therefore, did not justify withholding the sum of £663,000 odd. He submits, therefore, that the payless notice did not provide an adequate agenda for a true value adjudication or make tolerably clear what was being withheld and why.[52]Mr Hanna submits that the letter of 27 November plainly satisfies the requirements of sub-section 111(4). In my judgment, he is right. If a payless notice is deemed invalid, it may have draconian consequences for the paying party. The Scheme was not intended to encourage overly technical arguments about what is and what is not a valid notice. As Sir Peter Coulson says, as long as the notice makes “tolerably clear what is being withheld and why, it will be valid”.[53]Mr Hanna produced a helpful table which sets out the 11 bullet points in the payless notice and explains how they are referable to sums claimed in the payment application by reference to the Excel spreadsheet attached to it. Item Payment application 27 Nov 24 Letter Sheldon South West RBH had claimed £94,084.17 (see lines 171, 180, 191, 202, 204 of the spreadsheet) Bullet point 1:
“Sheldon South West of £94,083.67, insufficient evidence has been presented to confirm what sum (if any) might be due…”
Longcross scaffolding RBH had claimed £19,720 (lines 297 – 308) Bullet point 2:
“Longcross Scaffolding of £19,720, insufficient evidence has been presented to confirm what sum (if any) might be due..”
. Roof Access RBH had claimed £5,839.50 (line 309) Bullet point 3:
“50% roof access of £5,839 is an unpaid invoice and therefore is not due”
CES Engineering RBH had claimed £45,450 (line 231) Bullet point 4:
“Payment application for CES Engineering for glass balustrade of £45,450 is an unpaid invoice and therefore is not due…”
Easy Bathrooms RBH had claimed £9,582.28 (line 453) Bullet point 5:
“Payment application for Easy Bathrooms tiles of £9,582.28, insufficient evidence has been presented to confirm what (if any) sum might be due”
Contract Welding Services RBH had claimed £394,327.20 (lines 313 – 320) Bullet point 6:
“Regarding Contract Welding Services, insufficient evidence has been presented to confirm what sum (if any) might be due…”
Bespoke Timber RBH had claimed £43,149.50 (lines 432, 436, 442, 450) Bullet point 7:
“Regarding payment application for Bespoke Timber of £43,149.50, insufficient evidence has been presented to confirm what sum (if any) might be due”
PGR Timber RBH had claimed £287,686.56 (see lines 365, 366, 370 – 377, 380 – 389, 391 – 400, 405, 408 – 414, 429 – 431, 437, 452). Bullet point 8:
“Regarding PGR Timber insufficient evidence has been presented to confirm what (if any) sum might be due”
Overheads and profit RBH had claimed £77,798.52 for overheads and profit (see line 535 of the spreadsheet) Bullet point 9:
“RBH Building Contractors Ltd is not entitled to overheads and profit of £77,798.52.”
Rental Income bonus BH had claimed £148,000 in respect of rental income (see line 537 of the spreadsheet) Bullet point 10:
“share of rental income was agreed as a project/performance related bonus. No such bonus is due including but not limited to given that the project ran significantly over time.”
VAT The VAT element of the sums claimed by RBH was £119,502.82 (see column K of the spreadsheet and the total figure at line 533). Bullet point 11:
“Regarding VAT, it was our understanding that this would remain in the build fund.”
[54]The total amount claimed in the payment application in respect of the items referred to in the 11 bullet points was £1,245,145.55. In the payment application, RBH claimed a balance due of £663,016.16 (line 543 of the spreadsheet). That was based upon a total valuation of £1,973,055.20 (line 539 of the spreadsheet), less payments received to date of £1,310,039.04 (line 541 of the spreadsheet). It follows that, since the letter of 27 November 2024 disputed items with a total value of £1,245,140.55 no payment was due on that application and the sum due, as stated in the letter, was £0.[55]I consider that how the bullet points in the letter related to the payment application would have been understood by any reasonably objective reader who had knowledge of the contract works, and I consider that those bullet points set an adequate agenda for an adjudication by identifying specifically which elements of the payment application were not accepted and, briefly, why they were not accepted. I do not accept that the letter had to set out an arithmetical calculation in order to amount to a valid payless notice. That would be to read into the statute an additional requirement that does not appear in section 111 and would be to take an overly prescriptive approach to the contents of a notice which would be contrary to the case law as summarised in Advance JV and also by reference to the comment in Sir Peter Coulson’s book.[56]For those reasons, I find that the letter dated 27 November 2024 was a valid payless notice. The result, therefore, is that no sums were due to RBH pursuant to its payment application. The adjudication was wrongly decided. Accordingly, I conclude that the Defendants succeed on their Part 8 claim.

The Adjudicator’s Fees

[57]I have therefore decided that the Jameses have a real prospect of success on the residential occupation point and so the adjudicator’s decision will not be enforced. I have further decided that on the central point of substance, the payless notice, the adjudicator was wrong. The question arises as to what order I should make in relation to the adjudicator’s fees. The adjudicator ordered that Mr and Mrs James were to pay his fees of £9,638 plus VAT and that the parties were jointly and severally liable for them. Mr Hanna submits that in this scenario, I should reverse the adjudicator’s decision in relation to fees and order RBH to pay them. Mr Frampton says that, even assuming the adjudicator’s award is reversed, I have no power or jurisdiction to change his decision on fees.[58]I was referred to five cases on this point. They are Castle Inns (Stirling) Ltd v Clark Contracts [2005] Scot CS CSOH 178, TSG Building Services PLC v South Anglia Housing [2013] EWHC 1151(TCC), Halsbury Homes Ltd v Adam Architecture Ltd [2016] EWHC 1422, D McGlaughlin & Sons Ltd v East Ayrshire Council [2021] CSOH 122 and A&V Building Solution Ltd v J&B Hopkins Ltd [2024] EWHC 2295.[59]The starting point is the decision of the Outer House of the Court of Session (Lord Drummond Young) in Castle Inns In that case, the judge was asked, in effect, to strike out the pursuer’s claim to recover the adjudicator’s fees that the pursuer had been ordered to pay as the losing party in an adjudication. It had not been decided at that stage whether the adjudicator’s decision was right or wrong.[60]The judge went on to consider at paragraphs 16 to 17 the position in relation to the adjudicator’s fees. His conclusion was that he had no power to interfere with the adjudicator’s decision in relation to fees, and he gave four reasons for this. “16. The critical question that arises in the present case is whether that part of the adjudicator’s decision can be reconsidered by the Court or, presumably, by an arbiter. In my opinion, it cannot, on the basis that such reconsideration would be contrary to the contractual scheme found in clause 41A. I reach this conclusion for four reasons. First, there is no contractual mechanism in clause 41A that would allow such reconsideration to take place. The power in clause 41A.7.1 is conferred specifically upon the adjudicator. No appeal is possible against an adjudicator’s decision, and an adjudicator’s decision cannot be challenged on the ground that it is wrong on the facts or in law: see Diamond v PJW Enterprises Ltd., 2004 SC 430. It follows that the adjudicator’s decision as to liability for his fee and expenses cannot be challenged directly. Secondly, although the contractual scheme does permit an indirect challenge to the adjudicator’s decision on any dispute submitted to him by means of court proceedings or arbitration, that mechanism only relates to a dispute or difference; that appears from the wording of clause 41A.8.1, and indeed section 108(3). It accordingly does not apply to the adjudicator’s decision on his fee and expenses, as that part of his decision does not involve a ‘dispute’ in the contractual sense. Thus, the contract has deliberately excluded any direct challenge to the adjudicator’s decision, and does not, at least according to its terms, contemplate that anything other than a ‘dispute’ can be the subject of indirect challenge. The possibility of challenging an adjudicator’s decision has accordingly been taken into account in the contract, and the contractual scheme is that an indirect challenge, through court or arbitral proceedings, is possible but only in respect of the underlying dispute. That seems to exclude any challenge to ancillary findings, such as a finding on liability for the adjudicator’s fee and expenses. Thirdly, because the adjudicator’s decision on liability for his fee and expenses is essentially ancillary in nature, there is no commercial necessity that it should be capable of reconsideration. In any system of dispute resolution, the parties are likely to incur irrecoverable outlays and expenses; indeed, in some jurisdictions, such as those in the United States, a successful party does not recover anything in respect of expenses, outlays and other costs. Thus, the normal criterion for the implication of a contractual term does not apply to the part of the adjudicator’s decision dealing with his fee and expenses. 17 The foregoing reasons for the conclusion that an adjudicator’s decision on his fee and expenses cannot be reconsidered by the Court all relate to the contractual structure of clause 41A. The fourth reason indicates an obvious rationale underlying that conclusion; it is the practical difficulty of reconsidering the adjudicator's decision on such a matter. Adjudication is a distinct process, with its own peculiar features. In particular, it is subject to very demanding time limits, which apply both to the parties and to the adjudicator. The result is that the parties’ cases may not be as fully prepared as is desirable, and the adjudicator may be compelled to come to a relatively hasty decision. In court proceedings, by contrast, a full and detailed presentation is expected, and the judge has a significantly better opportunity to come to a carefully reasoned decision. Moreover, additional facts may emerge, or additional arguments may be developed. It is accordingly impossible to conclude merely from the fact that the Court reached a different decision that the adjudicator’s decision was wrong. The decisive factor in the Court’s decision might not have been presented to the adjudicator, or might have been presented in such a way that its significance was obscured. If, therefore, the Court is to reconsider the adjudicator’s decision on liability for his fee and expenses, the facts and arguments presented to the adjudicator will frequently require to be investigated and taken into account. That is inevitably a difficult task; it involves weighing the significance of arguments that are not the same as those presented to the Court. In addition, in some cases matters may be argued before the adjudicator that are not argued before the Court. The present case provides such an example; in the first adjudication, the question of the adjudicator’s jurisdiction was argued, I was informed, at some length. That issue was determined in favour of the present defender. It is not, however, an issue that can arise in the present proceedings. If it is the case that a large part of the argument before the adjudicator was taken up with the question of jurisdiction, it is obviously likely that his decision on liability for his fee proceeded at least in part on the basis that the present defender had succeeded on that part of the argument. Consequently, even if the pursuer were wholly successful in the present litigation, it would not be appropriate to allow it to recover the whole of the adjudicator’s fee and expenses. How any apportionment should be carried out, however, is an extremely difficult task for a tribunal that has not heard the same arguments as the adjudicator. For all these reasons, I am of the opinion that there are sound practical reasons for holding that an adjudicator’s decision on liability for his fee and expenses cannot be reopened in any proceedings before the Court”.[61]At paragraph 32 of A&V Building Solutions Ltd, Mr Roger Ter Haar KC, sitting as a Deputy High Court Judge in this Court, noted that there were four strands to the reasoning of Lord Drummond Young in Castle Inns: “(1) There was no contractual mechanism that would allow a reconsideration of the adjudicator's decision in respect of his fees. (2) Whilst the contractual scheme permits an indirect challenge to the adjudicator’s decision on any dispute submitted to him by means of court proceedings or arbitration, that mechanism only relates to a dispute or difference. It does not apply to the adjudicator’s decision on his fee and expenses, as that part of his decision does not involve a ‘dispute’ in the contractual sense. (3) Because the adjudicator’s decision on liability for his fee and expenses is essentially ancillary in nature, there is no commercial necessity that it should be capable of reconsideration. (4) There is a practical difficulty of reconsidering the adjudicator’s decision in such a matter”.[62]I agree with the learned Deputy Judge’s analysis of Castle Inns. Castle Inns is also cited in Sir Peter Coulson’s book on adjudication at paragraph 10.25 as authority for the proposition that, “An adjudicator’s decision as to liability to pay fees is final and is not subject to challenge in subsequent arbitration/litigation”.[63]In TSG, Akenhead J reversed an adjudicator’s decision, but he did not reverse the decision on fees, and he held at paragraph 53: “However, the adjudicator had jurisdiction to decide what he did, although I have held that he reached the wrong conclusion. It follows that South Anglia must pay the adjudicator’s fee of £12,564 plus VAT”.[64]It is, perhaps, fair to point out that it is not clear from the report to what extent that point was argued.[65]In Halsbury Homes, Edwards-Stuart J considered the same point, commenting on an earlier edition of Sir Peter Coulson’s book and the reference to Castle Inns. He said this at paragraph 64: “I agreed with that observation. There is nothing in Lord Drummond Young’s opinion which suggests that his decision might be confined to Scotland. It seems to me that his reasoning is equally applicable to the relevant provisions of the RIBA conditions that apply in this case. However, Ms Stevens submitted that it would be an extremely unjust outcome if an erroneous exercise by an adjudicator should be at the expense of the correct responding party. If this were to be the ultimate position, then there would be some force in her point, but, of course, an adjudicator’s decision as to how his or her fees should be allocated between the parties may represent more than just the outcome of the decision. An adjudicator is not required to make a binary decision based simply on the result. He or she can, like the Court, take into account the conduct of the parties, other issues that were raised and the overall course of the referral”.[66]On the facts of that case, the judge held that he was not bound by the decision of the adjudicator as to fees because of the provisions of the contract which applied between the parties, and this enabled him to order that the ultimately successful party should recover its liability to pay the adjudicator’s fees from the unsuccessful party before the Court.[67]In D McGlaughlin & Sons Ltd v East Ayrshire Council, an adjudicator had found in favour of the pursuer and ordered the defender to make payment of the principal sum plus interest. The defender had paid these sums. In court proceedings, the pursuer sought enforcement of the adjudicator’s decision. The defender resisted enforcement unsuccessfully, but also lodged a counterclaim, seeking orders which included a repayment of the sums the defender had paid. The pursuer argued, relying upon Castle Inns, that the Court could not order repayment of interest. The case was decided against the defender, but Lord Clark dealt with the interest point at paragraph 42, where he noted: “In my view, the adjudicator’s fees and expenses discussed in Castle Inns v Clark Contracts Limited are quite different from interest which has to be paid from the date of the award. The latter is not ancillary to the dispute. Rather, it is part and parcel of the adjudicator’s award”.[68]Thus, the judge drew a clear distinction between repayment of interest and repayment of fees and expenses, as to which he made no criticism of Castle Inns.[69]More recently, in A&V Building Solutions v JB Hopkins, the decisions to which I have just referred were considered by Mr Roger ter Haar KC. He reviewed this case law, noting that all the authority in this Court and in Scotland supports the position that the adjudicator’s decision on fees could not be challenged: see paragraph 47. He commented that there were arguments to suggest that Castle Inns should be reconsidered, but he decided that the case before him was not the case in which to do it. He noted that the relevant point had not been pleaded, and it may also have been relevant that one of the parties was unrepresented.[70]Mr Hanna submitted that I have the power to reverse the adjudicator’s decision on fees. He accepted that the authority was all one way and was against him, but he submitted that the authority was thin. He then advanced three submissions: first, that Castle Inns could be distinguished on the facts; secondly, that the decision of the Supreme Court in Aspect Contracts v Higgins [2015] UKSC 38 enabled the Court to interfere with the adjudicator’s decision on fees; and thirdly, that the Court should imply a term (by reference to the officious bystander test) that, if an adjudicator’s decision was reversed by a final determination of a Court, then the ultimately successful party would be entitled to recover any adjudicator’s fees paid if the matters wrongly decided by the adjudicator could be shown to have led to the requirement to pay the adjudicator’s fees.[71]As to the first of these submissions, Mr Hanna argued that Castle Inns could be distinguished on the facts because the present case revolves around a single substantive issue, namely whether a payless notice was valid, whereas in Castle Inns, there was a multiplicity of issues at stake. That is true, but I am not persuaded that Castle Inns can be distinguished because the decision is plainly put on a broad footing. Furthermore, whilst that decision and the subsequent decisions I have referred to might be said, fairly, to amount to a thin line of authority, the plain reality is that it is all one way, and the comment in Sir Peter Coulson’s book to which I have referred is by an author who has unrivalled expertise in this field. I should not depart from the settled position unless I am persuaded that it is wrong.[72]More broadly, whilst it is correct to say that the position in this case differs from Castle Inns and that the picture here is a binary one, that is to say I consider that the adjudicator’s decision was wrong, there will be many cases where the adjudicator will be found to have been partly right or the picture may be a more nuanced one. Indeed, in this case, the Jameses took a point in the adjudication on which they lost., that is whether the notice of adjudication was defective. In my judgment, there is some merit in having a clear rule that the adjudicator’s decision as to fees is not susceptible to review. That was Lord Drummond Young’s fourth reason, and it weighed with Edwards-Stuart J at paragraph 65 in Halsbury. If the position were otherwise then, when deciding whether to alter the adjudicator’s decision as to fees, the Court would have to review the reasons for the decision on fees in light of the arguments presented to the adjudicator, the way in which they were presented and compare them with the position of the Court hearing.[73]Turning to the decision of the Supreme Court in Aspect v Higgins and Mr Hanna’s second submission, that case addressed the jurisprudential basis for the entitlement to recovery of sums paid pursuant to the decision of an adjudicator. Lord Mance said this at paragraph 23, (with which the other Justices agreed): “In my view, it is a necessary legal consequence of the scheme implied by the 1996 Act into the parties’ contractual relationship that Aspect must have a directly enforceable right to recover any overpayment to which the adjudicator’s decision can be shown to have led once there has been a final determination of the dispute”.[74]Mr Hanna argued that this implied term would cover orders as to the adjudicator’s fees. Attractively though the argument was put, I cannot accept it for the following reasons. First, I accept Mr Frampton’s submission that the Scheme treats the adjudicator’s entitlement to payment of fees as ancillary and separate to the dispute: see paragraph 25 of the Scheme. This is further supported by reference to paragraph 9(4), which deals with the payment of fees on the resignation of an adjudicator and paragraph 11(1) on the payment of fees on the revocation of an appointment.[75]Secondly, in my judgment there is nothing in the decision in Aspect v Higgins to suggest that it was intended to cover an adjudicator’s fees. Castle Inns was not cited. Aspect Contracts imported a causation test. If applicable to fees, it would be necessary to show that the adjudicator’s decision could be shown to have led to an overpayment. However, an adjudicator has a wide discretion as to fees. As I have already indicated, his or her decision on fees may depend upon a number of considerations, which would not be limited to a consideration as to which was the winning party overall. It would also include the manner in which the adjudication was conducted by the parties. If the implied term covered any decision in relation to fees, it would be necessary to review the exercise of the adjudicator’s discretion, and this may be difficult to do, particularly where short reasons had been given. I can see nothing in Aspect which suggests that Lord Mance intended this.[76]As to Mr Hanna’s third submission based upon an alternative implied term, I consider that this should be rejected for essentially the same reasons. It is inconsistent with the authorities and the statutory scheme, and it imports a causation test which I consider would be difficult to apply in many cases. I therefore do not accept that an implied term should be implied by reference to the officious bystander test.[77]Accordingly, I am not persuaded that I have the power to alter the adjudicator’s decision in relation to his fees.

Conclusion and Disposal

[78]The result, therefore, is that the application for summary judgment is dismissed. The Defendants succeed on their Part 8 claim. I make no order in relation to the adjudicator’s fees.[79]I have provisionally concluded that declarations in accordance with paragraphs 18.1 to 18.5 in the Part 8 claim would be appropriate, but I will hear counsel as to the appropriate orders. End of Judgment. Transcript of a recording by Acolad UK Ltd 291-299 Borough High Street, London SE1 1JG Tel: 020 7269 0370 legal@ubiqus.com Acolad UK Ltd hereby certify that the above is an accurate and complete record of the proceedings or part thereof. This transcript has been approved by the judge.