Civil Engineering Reference
In-Depth Information
In general, the answer to this question is 'No', but there are circumstances in which interest
intoaJCT98contractwithPartnerwherebyPartneragreedtoerectalargehouseinLondon.
Eventually, Corinthian terminated Partner's employment and a series of adjudications en-
sued.Inthelastadjudication,theadjudicatorawarded£850,509toPartner,whichincludeda
substantial sum as interest. Corinthian refused to pay on the ground that the adjudicator had
no jurisdiction to award interest: If he awarded it under the Late Payment of Commercial
Debts (Interest) Act 1998, Partner had made no such claim; if he awarded it under clause
30.1.1.1, that clause only gave the right to interest where sums had been certified and not
paid. Corinthian also claimed that any order to pay should be stayed (postponed) because
Partner was unlikely to be able to pay back the money if Corinthian took the matter further.
Both Partner and Corinthian had been dormant since the termination.
The court ordered that Partner be paid the full amount awarded by the adjudicator. It held
that the adjudicator had not awarded interest under the 1998 Act, but rather because the no-
tice of adjudication had expressly requested him to do so. In calculating the interest, the
adjudicator had decided that the architect had under-certified. The adjudicator had then de-
cided the amount which should have been certified. Because the amount had not been paid,
the adjudicator awarded interest under clause 30.1.1.1. The court said that the adjudicator
hadthe powertoopenupcertificates andaward alargersum,andthat iswhat hadhappened
here.
The court refused to stay the order to pay. Several factors were taken into account: Part-
ner's current position was largely due to Corinthian's failure to pay it, Corinthian had itself
been trading while insolvent, and Partner genuinely wished to trade out of its current in-
debtedness and it needed the money awarded by the adjudicator if it was to do so.
Therefore, although it cannot be said that the adjudicator has a free-standing power to
award interest, he or she will have power if the referring party asks him or her to do so or
if the contract being considered expressly provides for interest. However, merely asking the
adjudicator to award interest will not automatically entitle the adjudicator to award it in ac-
cordancewiththeLatePaymentofCommercialDebts(Interest)Act1998,unlessthatisalso
part of the claim.
