Key Contacts: Angelyn Rowan – Partner |Michael Cahill – Senior Associate
Statutory adjudication pursuant to the Construction Contracts Act 2013 (the “2013 Act”) has established itself as an increasingly popular means of resolving payment disputes in the construction industry. The popularity of adjudication stems from the relative speed of the process and the ability to enforce an adjudicator’s award by way of High Court judgment.
In recent years, the Irish High Court has consistently endorsed statutory adjudication and not entertained arguments that sought to challenge an adjudicator’s decision or their jurisdiction. Indeed, the recent report of the Chairperson of the Construction Contract Adjudication Panel reported that there were only 2 occasions where it was determined that an adjudicator lacked jurisdiction in a statutory adjudication process in the 12-month period between July 2023 and July 2024. You can read our analysis of the emerging statutory adjudication trends here.
The case of Tenderbids Limited trading as Bastion v Electrical Waste Management Limited [2025] IEHC 139 bucks the trend and is the first recorded decision where the High Court has refused to enforce an adjudicator’s award.
Rather than being a shift in judicial support for statutory adjudication, the judgment is a reminder of the importance of understanding and complying with express terms of the construction contract as agreed between parties and the Court’s endorsement of the provisions of the 2013 Act itself.
Dispute referral
In this case, a payment dispute arose between the parties and the Applicant purported to refer the matter to adjudication. The first procedural step in the adjudication process, as required by section 6 of the 2013 Act, is the issuance of a “notice of intention to refer a payment dispute to adjudication”. Section 10 of the 2013 Act provides that notices may either be delivered (a) in the manner agreed between the parties to the construction contract or (b) where there is no such agreement, either “by post or by any other effective means”.
The construction contract used by the parties was the RIAI (Yellow Form) (August 2017 edition) and it specifically provided that notices arising under the 2013 Act were to be delivered by registered post. However, the contract did allow for payment claim notices (pursuant to section 4 of the 2013 Act) to be delivered by means of email.
The Applicant issued its notice of intention to refer by way of email on 21 June 2024 to two directors of the Respondent company. It also provided unchallenged evidence to the Court that its email serving the notice was delivered to and opened by the Respondent.
Thereafter, an adjudicator was appointed by the Construction Contracts Adjudication Service with both parties to the proceedings being served with notices regarding the appointment by ordinary post and email. The Respondent did not participate in the adjudication where the adjudicator made a payment award of €1.53 million in the Applicant’s favour. Notably, the adjudicator did address the delivery of the Applicant’s notice of intention to refer in his decision and found that delivery of the notice by way of email was a valid method of service.
Subsequently, the Applicant issued High Court proceedings seeking to enforce the adjudicator’s award and entering judgment against the Respondent.
Correct means of service
The Court noted that it was not in dispute between the parties that the Applicant’s notice of intention to refer was not served in the manner provided for in the contract between them (i.e. by registered post). The Applicant argued that its failure to comply with the contractual method of service should not be fatal to its application. It further argued that the Respondent did not suffer any prejudice as a result of service by email over registered post, particularly where there was evidence indicating that the Respondent had received the Applicant’s notice.
In simple terms, the Applicant’s argument was that once it could be shown that the notice of intention to refer had been effectively served on the Respondent, a valid adjudication process had been commenced. The High Court did not agree as this argument ignores the wording of section 10 of the 2013 Act and the intention of the legislature that parties to a construction contract could prescribe the method by which dispute or payment notices are to be served. The Court found that there was “nothing in the [2013] Act which authorises the court to dispense with the prescribed method of service agreed by the parties”.
The Court also noted that the parties had expressly provided for the delivery of payment claim notices by way of email and it could not be said that, despite email being the preferred method of communication between the parties, that they had waived the requirement for statutory notices to be delivered by registered post.
As a result of the Applicant’s failure to adhere to the contractual notice provisions, the Court held that the payment dispute “was never validly referred to adjudication” and that “the purported adjudicator’s award is a nullity”. In those circumstances, the Applicant’s application to enforce the €1.53 million award made in its favour was refused by the High Court.
Takeaway
This judgment is a timely reminder of the importance of adherence to contractual notice provisions and how a party’s failure to comply with such terms could invalidate a claim or dispute process. Justice Simons’ judgment, follows the trend in a number of UK decisions where it was found that a failure to properly serve an adjudication notice will invalidate the jurisdiction of an appointed adjudicator making any award unenforceable.
In light of this judgment, employers, contractors and subcontractors are reminded to carefully scrutinise the notice provisions in their contracts when issuing or receiving notices for the purposes of the 2013 Act and they should not assume that the parties’ day-to-day method of communications will be sufficient to validly commence a statutory adjudication process.
This article was written with the assistance of Andrea Kells.
