About this case:

• Citation:
  [2025] IEHC 469
• Judgment:
  External link
• Court:
  High Court
• Judge:
  Mr Justice Garrett Simons

Delivering judgment for the High Court, Mr Justice Garrett Simons found that “The referring party must either be asserting or resisting a claim to be paid an amount which is expressed or stipulated in the terms of the construction contract. This element is a prerequisite to a valid referral to statutory adjudication.” 

Background

The applicant employer/principal entered a construction contract with the respondent contractor for the design, supply and erection of a timber frame structure to be erected at the site of an existing dwelling house. The terms and conditions of the contract were set out in quotations issued in April and September 2023.

The applicant purported to terminate the contract for repudiatory breach where, as at the date of termination, works had only been completed to ground floor level and where most, if not all, of the timber frame had not been erected by an extended deadline of 16 August 2024.

The applicant not only sought to recover the purchase price paid, but also sought compensation for consequential losses said to have been incurred. There was no clause under the contract which made provision for payment to the applicant in the event of wrongful termination by the contractor.

Having secured a decision in its favour from the adjudicator, the applicant sought leave to enforce the decision before the High Court pursuant to s.6(11) of the Construction Contracts Act 2013.

The contractor opposed the application principally on grounds that the underlying dispute was not one which was amenable to statutory adjudication and that a dispute relating to payment as defined in the 2013 Act must have its foundation in a particular contractual term providing for such a claim for payment to be made.

The issues

Mr Justice Simons explained that the proceedings before him presented an issue of principle — whether a claim by an employer/principal for damages consequent upon the termination of a construction contract for repudiatory breach comprised a dispute “relating to payment” for the purposes of referral to statutory adjudication under s.6(1) of the Construction Contracts Act 2013.

The court also recognised that two additional issues arose: whether the adjudication process complied with fair procedures, and whether the contract should be regarded as tainted with illegality and so void or unenforceable where the contracted-for works allegedly would have entailed an element of unauthorised development.

The High Court

At the outset of his judgment, Mr Justice Simons explained that the default position is that the successful party is entitled to enforce an adjudicator’s decision pro tem, with the unsuccessful party having a right to re-argue the underlying merits of the dispute in subsequent arbitral or court proceedings, a “pay now, argue later” approach, but that the High Court nonetheless enjoys a discretion to refuse leave to enforce the adjudicator’s decision.

As to the first issue, the court considered that the 2013 Act confers a special status upon an adjudicator’s decision and that it would undermine the legislative intent if the “pay now, argue later” concept under the Act was erroneously extended to disputes other than those identified in the Act.

In this regard, the court highlighted: “The court will not lend its authority to enforce an adjudicator’s decision unless the underlying dispute is one which is properly amenable to statutory adjudication.”

Having analysed the relevant jurisprudence, Mr Justice Simons considered the statutory scheme under the 2013 Act, noting that “the scheme of the Construction Contracts Act 2013 is to enhance the position of the party executing the contract works by regulating the timing and enforcement of payment claims”.

The court outlined that there is an “organic link” between the provisions of the Act relating to payment claim notices and those establishing a dispute resolution mechanism by way of statutory adjudication, having regard to the context of s.6 and of the 2013 Act and to the object of the legislation.

The judge further highlighted that the distinction between the termination of a construction contract by way of acceptance of a repudiatory breach at common law and termination by way of the exercise of a contractual right to terminate was “of crucial importance”, where the right to refer a dispute to statutory adjudication could arise only in respect of the latter.

Having regard to inter alia the “remarkably spare” terms and conditions of the subject construction contract, Mr Justice Simons was satisfied that the dispute related to a claim for monetary compensation at common law, and so was not a dispute of a type amenable to statutory adjudication as it did not assert or resist a claim to be paid an amount provided for under the construction contract.

Accordingly, the court determined that the adjudicator did not have jurisdiction under the 2013 Act to entertain the applicant’s claim and so its decision was a nullity and could not be enforced under s.6(11) of the 2013 Act.

As to whether a breach of fair procedures had occurred, Mr Justice Simons considered the expeditious 28-day adjudication process stipulated by the legislature and noted that it “would undermine the legislative policy of ‘pay now, argue later’ were the court to refuse to enforce an adjudicator’s decision merely because the adjudicative process failed to replicate that of conventional arbitration or litigation. An adjudication is intended to be more streamlined: it will, for example, be rare for there to have been an oral hearing.”

The judge explained that the High Court will only refuse leave to enforce an adjudicator’s decision on grounds of procedural unfairness where there has been a “blatant or obvious breach” such that it would be unjust to enforce the immediate payment obligation.

The court was unconvinced by the arguments on part of the contractor that such a breach had occurred in circumstances where the applicant had refused to consent to an extension of time for the respondent to furnish its submissions and where the adjudicator allegedly failed to have regard to potential matters of defence flagged in correspondence.

In that regard, the court emphasised that the contractor failed to comply with the reasonable timelines for submissions laid down by the adjudicator and failed to submit any formal response to the claim within the time specified, warning: “A party who fails to comply with the reasonable directions of an adjudicator cannot subsequently rely on their own default in an attempt to resist an application to enforce the adjudicator’s decision.”

As to whether the contract was tainted with illegality such that the High Court could refuse to enforce the adjudicator’s decision, the court observed that it was not possible on the basis of the limited evidence before the court to determine whether the proposed works did not comply with the planning permission granted.

Nonetheless, the court found it unnecessary to determine this issue where the allegation was that the “performance” rather than the “formation” of the contract would have constituted an offence under the Planning and Development Act 2000.

Mr Justice Simons concluded that the contract was “lawful on its face” and was capable of being performed lawfully provided that the works were carried out in accordance with planning permission, and that having regard to the criteria identified in Quinn v IBRC [2016] 1 IR 1, the 2000 Act disclosed no legislative intent that any contract, the performance of which would entail the carrying out of works other than in accordance with planning permission, should be treated as void or unenforceable.

Conclusion

Accordingly, the High Court refused the relief sought by the applicant.

Connaughton v Timber Frame Projects Ltd t/a Timber Frame Ireland [2025] IEHC 469