While logic would suggest that a true value adjudication would cancel out any earlier smash and grab determination, the legal landscape is somewhat more complex. The judgment of Coulson J handed down in February 2018 was upheld in relation to the content of pay less notices, the “true value” adjudication issue, and liquidated damages under the JCT form of contract. Also, Kew would not be entitled to rely on any subsequent true value adjudication as a defence to the enforcement of the outstanding adjudication award. If the adjudications proceed in parallel, the second adjudicator may continue subject to the effect of a decision in the first adjudication prior to the decision in the second. This judgment has been keenly awaited by construction practitioners due its significant implications for the practice widely known as ‘smash and grab’ adjudications, in relation to which the Court of Appeal has now provided much needed clarification. In this second adjudication, it was found that the gross value of the final account was £867,557.54 (net). He was also not required to determine whether the adjudicator in the True Value Adjudication in this case had jurisdiction. subsequent true value adjudication leaving uncertainty around this issue. Notes: [1] Subject to an (entirely separate) argument by the employer for a stay of execution, relief which is usually difficult to obtain. On 30 November 2018, the second adjudicator (Mr Sliwinski) decided that as a result of his finding as to the “true value”, no sum was due to Davenport. In 2019 the common ‘true value’ adjudication was again in the spotlight. This was because the employer had not made payment of the earlier adjudication award before commencing its true value adjudication. The Greers issued a notice of adjudication on 30 October 2018 seeking determination of the “true value” of the final account. If the true value adjudication comes first, the second adjudicator could decide this issue if it is germane to the dispute referred to him/her. 21.02.2019. This is despite the fact that this case related to the final sum due at the completion of the works and not an interim payment during ongoing works. Legal commentators forecast the demise of ‘smash and grab’ adjudications following the first instance decision in Grove v S&T.Upholding that decision, the Court of Appeal decided that an unsuccessful party to a ‘smash and grab adjudication’ can commence a separate adjudication seeking a decision as to the true value of its interim payment application. The Greers sought to found upon the outcome of the “true value” adjudication … However, such issues did not arise in this case as the TCC had already enforced the adjudication award by giving summary judgment in favour of DIA. Despite ruling that the pay less notice was valid, the court went on to consider whether Grove would have a right to adjudicate in the absence of a valid pay less notice’. In this second adjudication, it was found that the gross value of the final account was £867,557.54 (net). However, as S&T had made payment, albeit WITHOUT a payment OR payless notice the judge stated: Under the subsequent "true value adjudication", the adjudicator determined that the builder had over claimed, and on the merits the owner was not liable to make any further payment. Six days after the award, the Employer commenced an adjudication seeking a decision on the true value of … The Technology and Construction Court of England & Wales has provided greater clarity and guidance to the construction industry in a recent decision [1] regarding when a paying party which is the subject of a so called “smash and grab” adjudication may then launch a separate “true value” adjudication. This case affirms that true value adjudications have limited applicability and cannot be commenced at a party’s leisure. The judge found a true-value adjudication could not start until after payment had been made, and that the mandatory payment provisions in the Housing Grants, Construction and Regeneration Act 1996 (as amended) must take priority over the statutory right to adjudicate: thus the paying party must pay first and adjudicate later. Payers would, no doubt, argue that the HGCRA 1996 be further amended to allow them to start a ‘true value’ adjudication before they have to pay under s 111 of the HGCRA 1996. Here comes the next set of challenges to Jurisdiction! However, Employers may still be parting with their cash before a true value is determined. Davenport raised an action to enforce the adjudicator’s decision from the “smash and grab” adjudication. However, he considered that: “without deciding on the true value of the Application. In S&T Ltd v Grove Developments Ltd EWCA Civ 2448, the Court of Appeal, upholding a first instance decision by Coulson J, confirmed that the employer under a building contract could commence adjudication proceedings in order to determine the true value of works forming the subject of an interim payment application submitted by the contractor. The TCC decided that the second ‘true value’ adjudication could not be relied upon to set off the sum awarded in the first adjudication. The question of entitlement to commence a true value adjudication was debated in the case of M Davenport Builders Ltd v Greer and another [2019] EWHC 318 (TCC) (20 February 2019). The Contractor obtained a valid ‘smash and grab’ adjudication award against the Employer in the sum of £106,160.84 plus interest (being the sum demanded on its final account plus interest). Could PAML raise a "true value" final account adjudication without paying the sum awarded (re Valuation 19) in Adjudication 1? ‘True’ value adjudication. Would PAML be able to determine a “true value” of Valuation 19 and go for adjudication? Archive. This second adjudication was a "true value" adjudication. The TCC held that the employer could not use the decision in a ‘true value’ adjudication as a defence to or set off to enforcement proceedings in relation to the earlier adjudication decision in favour of the contractor. Davenport commenced proceedings in the Technology and Construction Court (the TCC) to enforce Mr Sutcliffe's award. Although the adjudicator expressed his concerns about proceeding with the true valuation adjudication, because Mr & Mrs Greer had failed to make payment under the “smash and grab” adjudication, the adjudication proceeded. S&T (UK) Limited v Grove Developments Limited [2018] EWCA Civ 2448 The Court of Appeal may have issued the death blow to the informally termed "smash and grab" adjudication in its recent judgment. In M Davenport v Greer, one of the first cases to follow the court of Appeal’s decision in S&T v Grove (which we discussed here), the TCC held that an employer could not use a “true value” adjudication decision as a defence or set off to enforcement proceedings for an earlier decision in favour of the contractor.. Background. In proceedings to enforce an adjudicator’s decision for the amount stated in a contractor’s interim payment application, the Technology and Construction Court declined to grant a stay of execution to allow a ‘true value’ adjudication to take place in respect of the final account. ‘true’ value of any certificate, notice or application and as part of that process to open up review and revise the same. The principle of S&T v Grove holds strong and, as such, a party cannot use a true value adjudication as a means to stall or withhold payment awarded in a contingent adjudication decision. There is considerable interest in having the resolution of an important dispute such as this progressed without having to wait for the outcome of a “smash and grab” adjudication. As such, Stuart-Smith J did not take the opportunity to provide the … The update covered three main topic areas: ‘Covid-19 & Adjudication’, ‘Insolvency & Adjudication (Bresco v Lonsdale)’ and ‘True-Value Adjudications’. PAML cited the case of Grove Development Ltd v S&T UK ltd, and it was argued that based on that case, PAML should have the right to raise a “true value” account for adjudication. The Greers relied on the Sliwinski decision by way of set off or counterclaim. In the TCC proceedings, the employers argued that the first adjudication decision was correct but that they could rely on the second true value adjudication as a set-off or counterclaim. In Davenport Builders v Greer in February 2019, Mr Justice Stuart-Smith had to consider whether the employer, Greer, was entitled to commence or rely on its true value adjudication in circumstances where it had not paid the sum awarded in an earlier smash 'n' grab adjudication.. As such, payers often follow up quickly with a “true value” adjudication, hoping to obtain a decision which can be used to set off against the decision in the “smash and grab” adjudication. TCC Proceedings. While this appeal decision has confirmed that a payer can raise a 'true value' adjudication for an interim application even in the absence of a payment or pay-less notice, it does not make it any less important for payers to ensure that payment notices and pay-less notices are served correctly and on time, as payment must still be made of the (often inflated) sum sought by the payee. Instead, the employer had commenced its own ‘true value’ adjudication. True Value Adjudication. In this blog I focus on the “true value” adjudication issue, as this is of great importance to the construction industry. Slip rule allowed adjudicator to add interest and reverse liability for his fees (Axis M&E v Multiplex Construction) In practice, “true value” disputes can be detailed and complex, requiring time to prepare the substantive documents and, often, requiring longer than the default 28 days for adjudication. Can the true value Adjudication commence before the default Adjudication has been paid? The adjudicator accepted that he had no jurisdiction to determine the true value of the AFP or the defects claim (based on the drafting of the notice of adjudication). Employer not permitted to commence ‘true value’ final account adjudication (Broseley London v Prime Asset Management) Send to Email address * Open Help options for Email Address. You can send the message to up to 4 other recipients. Last week, the Court of Appeal handed down its judgment in S&T (UK) Limited v Grove Developments Limited [2018] EWCA Civ 2448. Thus the Court and an adjudicator has the same power to decide the true value of interim application 22. In the view of the court, permitting the employer to commence […] The Greers did not pay the amount awarded in the Sutcliffe adjudication. Summary. Following the First Adjudication, Greer commenced a further adjudication in an attempt to determine the true value of the works (True Value Adjudication). 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