Adjudication Undone: Lessons from Tenderbids Limited v Electrical Waste Management
Locations
The Irish High Court case of Tenderbids Limited v Electrical Waste Management1 offers valuable insights into the importance of adhering to contractual terms and statutory requirements in construction disputes. This case serves as a reminder that procedural missteps can undermine the entire adjudication process, even in cases where the dispute itself is valid.
This case concerned a payment dispute under the Construction Contracts Act 2013 ("the Act").
Background
Tenderbids Limited, trading as Bastion, entered into a construction contract with Electrical Waste Management Limited. The contract stipulated that any notice of intention to refer a payment dispute to adjudication must be delivered via registered post. However, Tenderbids Limited instead served their notice by email.
Legal Issues
The primary issue was whether the email delivery of the notice complied with the statutory requirements under the Act. Section 10 of the Act provides that parties to a contract can agree on the method of service for notices. The contract between the parties explicitly stated that such notices be served by way of registered post.
Judgment
Despite the deviation from the agreed method of service, the Adjudicator proceeded with the case and issued an award in favour of Tenderbids Limited. Electrical Waste Management subsequently challenged the validity of the adjudication process in the High Court, arguing that the notice served by email did not comply with the clear contractual and statutory requirements.
The High Court ruled that Tenderbids' email delivery of the adjudication notice did not satisfy the agreed-upon method of service, thereby rendering the adjudication process invalid. As a result, the adjudicator's award was declared a nullity, and the application for its enforcement was refused. In its decision, the court emphasised the importance of strict compliance with contractual terms and statutory provisions.
Key Takeaways
- Parties must strictly follow the agreed methods of service for statutory notices to ensure the validity of adjudication processes.
- The court reaffirmed that statutory provisions must be interpreted both literally and purposively, with an emphasis on compliance.
- Procedural missteps can significantly impact the enforceability of adjudication outcomes.
Conclusion
This case underscores the critical role of procedural compliance in construction disputes. It highlights the need for parties to carefully draft and adhere to contractual terms, as well as the importance of understanding statutory requirements under the Act.
This case is a cautionary tale for contractors and legal practitioners alike, emphasising that even seemingly minor deviations from agreed procedures can have significant consequences.
Written by: Kiliian O'Reilly and Cian Ronan