BuildLaw | March 2018 30
entitling Jacob to some (but not all) of its wasted or additional costs as damages.
O'Farrell J argued in the alternative regarding the wasted costs order by referring to the existence of an implied term in the ad hoc agreement which provided:'... if one party changed its mind and decided to ignore the agreement, it would pay the wasted costs of the other party. Such a term was both reasonable and necessary. They were commercial parties with the benefit of legal representation and they were aware of the substantial resources and funds required to participate in an adjudication of this nature. If each party had been asked whether they would expect the other party to pay any wasted costs in such circumstances, they would have replied "of course". Although the ad hoe agreement did not prohibit Skanska from withdrawing part or all of its claim, and starting a fresh adjudication in respect of the same or substantially the same claim, it did impose responsibility on Skanska for the costs wasted or incurred by its failure to adhere to the agreed procedure and timetable.'
Jacobs reaffirms the basic principle that the adjudication scheme does not impose restrictions on a referring party's entitlement to unilaterally withdraw from one adjudication and to refer the same matter to a subsequent adjudication. Further, the case makes clear that the courts will only intervene and grant an injunction against the referring party refraining it from commencing a subsequent adjudication in circumstances where the high threshold of 'unreasonable and oppressive conduct' can be demonstrated. Finally, Jacobs sends out a clear warning that the courts will not hesitate to penalise a party by way of a wasted costs order where that party has failed to discharge its agreed procedural obligations in the adjudication scheme.
Masood Ahmed
Construction: Adjudication - unilateral withdrawal indeed
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