Contractor TClarke must pay more than £2m to a subcontractor after a High Court judge backed an adjudicator’s decision over a substantial data-centre job in London.
The High Court deputy judge in the case, Jonathan Acton Davis KC, found that TClarke had issued an “invalid” pay-less notice regarding Bell Building Ltd’s work on a 13,200 square metre data centre in Greenwich.
TClarke subcontracted Bell to the value of £20m in November 2021, to deliver a host of services at the Echelon LCY10 data centre site in Greenwich, London.
The work included a new superstructure, walls, floors and ceilings, plus demolition and fire-stopping works. As well as that, Bell delivered internal doors, walls and partitions, stairs, external walls, windows, external doors, and installed the lift.
Bell submitted an application (known as Application Number 18) for £20.9m worth of work to TClarke, a month and a half before TClarke issued the pay-less notice in June 2023. Emails presented to the adjudicator show that Bell “questioned the status” of the notice.
Bell then argued that the notice was invalid and referred it to adjudication.
On 13 September last year, the adjudicator found that the document was “not considered a valid pay-less notice and has no standing”. He also determined that TClarke should pay £2.1m, rather than the £1.4m claimed by Bell, after he found that the amount due should “exclude the sum” of £679,000.
The adjudicator said that this was because his decision focused on Application Number 18, and that he did not have jurisdiction to consider a final payment made by TClarke to Bell.
TClarke challenged the adjudicator’s actions, arguing that they amounted to “valu[ing] the work done” by Bell, which is outside of an adjudicator’s remit.
“He carried out a valuation exercise which was […] outside his jurisdiction and purported to award more than the sum claimed,” TClarke argued, which it claimed amounted to a “breach of natural justice”.
But the deputy judge said: “It simply cannot be said that this adjudicator went off on a frolic of his own, deciding a case upon a factual or legal basis which had not been argued or put forward by either side.
“He did not carry out a valuation: he corrected the arithmetic.
“The adjudicator was therefore acting within his jurisdiction to determine the sum due as he saw fit in response to the submissions made by [TClarke].”
The amount to be paid to Bell is £2.129m plus VAT, which it owed “in the absence of a valid pay-less notice”, and £170,080 of interest, since the payment was due in June 2023.
Bell also claimed that TClarke owed it £21,000 worth of adjudicator’s costs, but the judge said he “hope[d] that they can be agreed” between the parties without him needing to rule on them.
TClarke is the 45th biggest contractor in the UK, according to the latest CN100 ranking. In April, the engineering services contractor announced that Regent Acquisitions had bought the company for £90m, subject to TClarke shareholder and regulatory approval.
