Can an Adjudicator Use Their Expertise to Determine a Dispute?

In the recent case of Clegg Food Projects Ltd v Prestige Car Direct Properties Ltd [2025] EWHC 2173 (TCC), the court held that the adjudicator, a Chartered Quantity Surveyor, had not breached the rules of natural justice by applying his own “fair and reasonable” rates when determining a dispute. This article considers the court’s reasoning in Clegg and other cases where the court has found there to be a breach of natural justice in cases where an adjudicator has seemingly used their own expertise when deciding a dispute.  

The defendant employer, Prestige Car Direct Properties Limited (Prestige) engaged the claimant contractor, Clegg Food Projects Limited (Clegg), under an amended JCT contract for the construction of a leisure and retail centre. A dispute arose between the parties in respect of the valuation of the contractor’s application for payment (Application 37), including the valuation of eight variations. The dispute was referred to adjudication by Clegg. The adjudicator found in favour of Clegg on the basis that Prestige’s payment notice had undervalued the sums due to Clegg and Prestige was ordered to pay Clegg £541,880.12 plus VAT. In relation to the variations, the adjudicator applied new “fair and reasonable” rates to determine each disputed valuation. Prestige failed to pay, and Clegg sought to enforce the decision in the Technology and Construction Court (TCC).

Decision

In the TCC, Prestige argued that there had been a breach of natural justice, stating that the adjudicator had used his own rates and introduced new measurements to determine the value of each disputed valuation, neither of which had been advanced by the parties in their submissions. Clegg argued that no breach had occurred, on the basis that the adjudicator was entitled to use his own knowledge and experience to determine the dispute.

The TCC considered the adjudicator’s methodology and concluded that no breach of natural justice had occurred, for the following reasons:

1. Both parties had asked the adjudicator to assess the gross valuation of Application 37 and to award “such other sums as the adjudicator sees fit”. The judge found that whilst an adjudicator cannot go off on a “frolic of his own“, it is acceptable to come to a different view from the parties on an item which he considers “fair and reasonable,” provided he refers to the documentation submitted and relied upon by the parties.
2. On variation rates, the value determined by the adjudicator was an intermediate position between those contended for by the parties. Prestige had also already accepted that an approach which “split the difference” would be a legitimate interpretation and outcome.
3. The rates applied were mostly more favourable to Prestige and on this basis, there had been no material breach of natural justice.
4. In respect of any alleged failure by the adjudicator to consult the parties, the judge noted that the parties chose to instruct a Chartered Quantity Surveyor. The judge therefore did not accept that it was necessary for the adjudicator to set out the precise details of the methodology he had applied to determine the variation rates.

Previous case law

In Clegg, the TCC found there to be no breach of natural justice.  However, there are several previous decisions where the TCC found there to be a breach of natural justice, in circumstances where an adjudicator had seemingly used their own expertise, by departing from the evidential ranges advanced in submissions, without consulting the parties.

In Balfour Beatty Construction Ltd v Lambeth LBC,¹ Balfour sought to enforce an adjudication decision in respect of the correct measure of damages for delay deducted or withheld by Lambeth. Despite the adjudicator requesting further evidence from Balfour to clarify its as-built programme, its supporting evidence remained insufficiently clear from a factual and critical path perspective. The adjudicator therefore decided to revert to his own critical path analysis prepared in conjunction with his assistant.

The TCC decided that the adjudicator had breached the rules of natural justice, on the basis that he had introduced his own method of analysis, without consulting the parties prior to his decision. It was held that an adjudicator should not revert to their own expertise if, the parties are not consulted or given a reasonable opportunity to adequately comment upon it. Balfour’s summary judgment application was dismissed, and the adjudicator’s decision was unenforceable.

Primus Build Ltd v Pompey Centre Ltd² concerned a summary judgment application by Primus to enforce an adjudicator’s decision in relation to its claim for loss of profit. The adjudicator calculated the sum payable to Primus by using a percentage derived from Primus’ profit‑to‑sales ratio contained within the accounts appended to its submission, as opposed to the agreed calculation included in the parties’ contract. However, the adjudicator had been instructed to disregard Primus’ accounts and neither party had relied upon them in their submissions. The TCC held that where an adjudicator considers an alternative course of action based on their own expertise, they should seek representations from the parties to ensure procedural fairness. A failure to consult parties on such a decisive issue was held to be a material breach of natural justice. Primus’ summary judgment application was dismissed, and the adjudicator’s decision was unenforceable.

Van Oord UK Limited v Dragados UK Limited³concerned a case brought by Van Oord to enforce an adjudicator’s decision in respect of its entitlement to extensions of time and prolongation costs. The adjudicator had selected and applied a baseline programme which had been previously rejected by experts acting for both parties. The adjudicator’s chosen baseline programme also preceded the critical dates advanced by Van Oord. It was held that the adjudicator had breached the rules of natural justice by failing to allow either party to comment upon his chosen baseline or the consequences of the novel critical date selected. The duty of fairness required the adjudicator to give both parties the opportunity to present their arguments in respect of these issues.

Comment

In Clegg, there was found to be no breach of natural justice. Significantly, whilst the adjudicator decided to apply his own “fair and reasonable” rates without consulting with the parties, he did not go beyond the precise ranges contended for by them in their respective submissions. Further, there was no material breach of natural justice because the rates applied by the adjudicator were in fact often more favourable to Prestige or reflected an intermediate position between those contended for by the parties.

The decision in Clegg is interesting when set against the cases of Balfour Beatty, Primus and Van Oord, all of which involved findings of a breach of natural justice. In Van Oord, the adjudicator applied a methodology expressly rejected by the parties. In both Balfour and Primus, the respective adjudicators introduced new material which neither party had contended for or relied upon. In all three cases, the adjudicator failed to consult on the selected methodology.

These cases demonstrate that whilst an adjudicator may apply reasonable assessments using their own expertise, this must be within limits and prior consultation with the parties may be necessary. As stated by Justice Coulson in Primus, whether an adjudicator should consult with the parties when adopting an alternative approach is “always a matter of fact and degree”⁴ and a failure to do so may result in a breach of natural justice. 

Joy Bhattacharyya, Trainee Solicitor, co-authored the article.

Footnotes

1. [2002] EWHC 597 (TCC) 
2. [2009] EWHC 1487 (TCC)
3. [2022] CSOH 30
4. Primus, paragraph 40.