In a significant ruling on adjudication natural justice, the Technology and Construction Court found that the adjudicator had gone off on a “frolic of his own” when deciding a dispute between Premier Modular and Maidstone and Tunbridge Wells NHS Trust over delays to a hospital theatre project.

Premier Modular had secured an adjudication award of £1.65m after claiming delays caused by the late provision of a permanent water supply at the Trust’s new barn theatre project at Maidstone Hospital.

But deputy High Court judge Adrian Williamson KC refused to enforce the award after finding the adjudicator based his decision on a contractual argument that neither side had advanced.

The dispute centred on whether the Trust’s failure to provide a permanent water connection by October 2023 amounted to an NEC4 compensation event.

Both parties agreed during the adjudication that the only “Accepted Programme” under the contract was the original programme attached to the contract and that no later programme had ever been formally accepted by the project manager.

However, the adjudicator concluded that a later contractor-issued programme had effectively become an Accepted Programme and used that finding to determine that the Trust had failed to provide the water supply by the required date, creating a compensation event worth £1.65m.

The judge ruled that this approach had never been argued by either side.

In a strongly-worded judgment, Williamson said: “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.”

He added that the adjudicator’s conclusion was “startling” because it relied upon a programme “which neither party said was an Accepted Programme”.

The court found this amounted to a material breach of natural justice because the Trust had no opportunity to address the argument before the decision was issued.

While the judge acknowledged courts should rarely interfere with adjudicators’ decisions, he concluded this was one of the exceptional cases where enforcement should be refused.

He ultimately dismissed Premier Modular’s application to enforce the adjudicator’s award, leaving the contractor without the £1.65m payment pending any further proceedings.