Civil Engineering Reference
In-Depth Information
certificate which he refused to issue, or to have included a larger sum in a certificate
which he did issue, they can, and ordinarily will, hold that the contractor is entitled
to payment as if such certificate had been issued and award or give judgment for
the appropriate sum.
He went on to confirm that he did not consider that the decision in
Beaufort
compelled the conclusion that certificates were not a condition precedent to the right
to payment.
The issue was also considered in the Scottish case of
Karl Construction Ltd
v.
Pal-
isade Properties plc
(2002). In this case Lord Drummond Young held that payment
under the standard JCT forms was conditional on the issue of a certificate by the cer-
tifier or on the decree of an arbitrator or a court on the basis that the decree of an
arbitrator or court was equivalent to a certificate. He stated that:
The equivalence of a court decree to an architect or engineer's certificate follows
from
Beaufort
,onthebasisthatadecreeofthecourtcanachievethesameresultasa
decree of an arbiter. In every case, however, until an appropriate certificate or decree
has been obtained, the debt due by the employer to the contractor is contingent.
Consideration also needs to be given to whether an adjudicator has the power to open
up, review and revise interim certificates. It is submitted that he must have such a
power as the 1996 Act stipulates that a party has the right to refer 'any difference' to
an adjudicator for his decision, see s.108(1)-108(4) of the 1996 Act. Accordingly, it is
arguable that this must imply a right to open up, review and revise interim certificates.
If no such right is implied and if the adjudication provisions in a building contract do
notallowanadjudicatortoopenup,reviewandrevisecertiicates,thenitispossible
that the contract will not meet the requirements of s.108(1)-108(4) and the Statutory
Scheme for Construction Contracts will apply, see s.108(5). The Scheme specifically
provides that an adjudicator may open up, review and revise any decision taken or any
certificate given, see Part I of the Schedule to the Scheme for Construction Contracts
(Scotland) Regulations 1998, paragraph 20(2)(a).
This potential issue is avoided by clause 9.2 of the SBC and the SBC/DB which states
that if a dispute or difference arises which either party wishes to refer to adjudica-
tion, then (subject to some minor qualifications) the Scheme will govern the process
and, accordingly, an adjudicator has in respect of disputes under that form of con-
tract an express power to open up, review and revise interim certiicates. he position
is slightly less clear under the NEC3, although Options W1 and W2 dealing with dis-
pute resolution both provide that the adjudicator may review and revise any action or
inaction of the Project Manager which is likely to cover the position. It is submitted
that if parties drafting a building contract wish to ensure that their adjudication pro-
visions comply with the requirements of the 1996 Act, and thus avoid any risk of the
statutory scheme applying, it is prudent to expressly confer such a power upon the
adjudicator. It appears that when challenging interim certificates the burden of proof
will fall on the party mounting the challenge to establish that the interim certificate
was incorrect. If the contractor seeks further payment, then he will have the burden
and the employer will carry it if he contends that the certification is too high. his was
