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Adjudication enforcement by insolvent company requires final determination of claims and cross-claims (John Doyle Construction Ltd v Erith Contractors Ltd)

Published on: 20 October 2021
Published by: LexisPSL
  • Adjudication enforcement by insolvent company requires final determination of claims and cross-claims (John Doyle Construction Ltd v Erith Contractors Ltd)
  • What are the practical implications of this case?
  • What was the background?
  • What did the court decide?
  • Case details

Article summary

Restructuring & Insolvency analysis: Deciding in favour of the respondent on three grounds of appeal relating to security offered by the insolvent appellant, the Court of Appeal addressed a wider point in obiter remarks. The issue was whether a company in liquidation, with an adjudication decision on its final account in its favour, but facing a continuing set-off and counterclaim, is entitled to summary judgment at all. Both Lord Justice Coulson and Lord Justice Lewison explained that it is not. The Supreme Court in Bresco Electrical Services Ltd (in liquidation) v Michael J Lonsdale (Electrical) Ltd had made it clear that a company in liquidation was entitled to commence and pursue an adjudication, and that to do so was not a futile exercise. The Court of Appeal remarks explain that the enforcement of an adjudication award in that situation requires final determination of all claims and cross-claims between the parties. As a result, adjudication is less likely to be a useful mechanism for liquidators to pursue recoveries in construction disputes. Written by Chris Laughton, partner at Mercer & Hole. or take a trial to read the full analysis.

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