Adjudication: Natural justice as a defence to enforcement of an adjudicator’s decision

We don’t often see enforcement of an adjudicator’s decision successfully defended on grounds of a breach of natural justice, but it happened in the recent case of Premier Modular Limited v Maidstone and Tunbridge Wells NHS Trust [2026] EWHC 1404 (TCC).

The Technology and Construction Court (“TCC”) found that the Adjudicator had gone off on a “frolic”and made his decision on a basis neither party had advanced nor had a fair opportunity to address. 

The facts

The contract between Premier and the Trust (the “Contract”) is based on NEC4 Option A and relates to the design and construction of a theatre at Maidstone Hospital. 

In the adjudication, Premier claimed that the Trust were required to provide a permanent water mains supply by 30 October 2023, but that the Trust did not do so until 20 February 20 and that this caused delay and a compensation event to arise under the Contract. In response, the Trust argued that there was no requirement for the water supply to be made available by a particular date. 

The Adjudicator found in favour of Premier and awarded c.£1.6 million. The Trust did not pay and so Premier commenced enforcement proceedings in the TCC and applied for summary judgment. The Trust defended those proceedings, alleging that the Adjudicator had breached natural justice in reaching his decision on the following grounds:

1. Ground 1: The Adjudicator’s central decision (that there was a compensation event) was based on a contractual argument that had not been put forward by either party and which neither party had been given the opportunity to address. The Adjudicator found that a compensation event had arisen under clause 60.1(3) of the Contract, whereas Premier had alleged that a compensation event had arisen under clauses 60.1(1), (14) and (18).
2. Ground 2: The Adjudicator failed to address one of the Trust’s defences, in that Premier had failed to notify a compensation event under the Contract and so Premier’s claim was now, in any event, time-barred. The Adjudicator found that there was no time bar; and
3. Ground 3: The Adjudicator found that the Accepted Programme had been updated, which was not part of the adjudication and was contrary to the clear position of both parties that the Accepted Programme had not been updated. The Accepted Programme did not require the Trust to provide a permanent water supply by any particular day. 

The Judge found that on grounds 1 and 3 the adjudicator had indeed breached natural justice 

Key extracts of Adrian Williamson KC’s Judgment are as follows:

Grounds 1 and 3 

“[..] that looks very much like an adjudicator going off on a frolic of his own, that is wishing to decide a case upon a factual or legal basis which has not been put forward by either side, without giving the parties an opportunity to comment. Indeed, the Adjudicator here seems to have thought that the case which he devised under clause 60.1(3) provided a solution which was “that simple”, even though it had not occurred to either party. He appears, therefore, to have decided a key point on a factual or legal basis that had not been argued or put forward in the submissions made to him.”

“It is, of course, correct that an Adjudicator is not obliged to decide a case only by accepting the submissions of one party or the other. But if he is to depart from the submissions of both parties, he must ensure that the issues have been fairly canvassed. This did not happen here. [..].”

“In summary, the Adjudicator determined that there was a compensation event within the meaning of clause 60.1(3) because the Trust had not provided the water main by the dates set out in the revised programme which neither party said was an Accepted Programme. By contrast, the Accepted Programme contained no such dates. This startling conclusion was clearly material to the Decision, and it should have been put to the parties for comment. It was a breach of the rules of natural justice not to do so: the Adjudicator went off on a “frolic” by, in effect, inventing a case for PML which he considered to be superior to that which they actually advanced.”

In other words, deciding a case on arguments that have not been put forward, without giving the parties the opportunity to comment can amount to a breach of natural justice.

Decision

The judge held that the Trust had a real prospect of succeeding on its contention that the Adjudicator’s decision was arrived at in breach of the rules of natural justice and therefore dismissed Premier’s application for summary judgment for £1.6 million.

He said that in so concluding, he said “It should be only in rare circumstances that the courts will interfere with the decision of an adjudicator”. However, in my view, this is one of those rare cases where there has been obvious unfairness [..]. I have also had very much in mind the difficult task which adjudicators face in dealing with substantial disputes in very short order………. In the present case, the Adjudicator did not neglect a matter under pressure of time. Rather, he sought to create a case for PML which PML had not made and with which the Trust had no proper opportunity to deal, even by the hectic standards of adjudication.”[1]

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