Neutral citation: Vinci Construction UK Ltd v Beumer Group UK Ltd [2018] EWHC 1874 (TCC).

NEC contract topics: notifying compensation events after the defects date, Option W2.

Form of contract: NEC Engineering and Construction Subcontract (3rd Edition).

Main areas of law: enforcement of an adjudicator’s decision under the Housing Grants, Construction and Regeneration Act 1996, natural justice, jurisdiction of adjudicators.

 

Vinci Construction and Beumer Group entered into a subcontract dated 8 November 2012, based on the NEC Engineering and Construction Subcontract (3rd Edition) with bespoke amendments. The contract concerned works for the baggage handling system at the new Pier 1 at Gatwick Airport South Terminal.

The subcontract included Sections 5 and 6, referred to respectively as the Baggage Works and the Remaining Works. Vinci alleged that Beumer failed to complete both sections by the agreed Completion Dates. Vinci issued a Payment Certificate on 25 October 2017 asserting entitlement to £9,671,500 in liquidated damages. Beumer denied liability in a response dated 27 October 2017.

The contract provided for adjudication under Option W2. Clause W2.1(1) allowed for disputes to be referred to an adjudicator. Clause W2.3 set out the procedure, and Clause W2.3(11) stated that the adjudicator’s decision would be binding until determined by a tribunal or agreed by the parties.

This dispute was the seventh adjudication between the parties. Unlike prior adjudications, which had all been commenced by Beumer, the seventh was initiated by Vinci. The appointed adjudicator was Mr Brian Eggleston. On 2 May 2018, he issued a decision in Vinci’s favour, awarding the full amount claimed plus interest. Beumer refused to comply, prompting Vinci to seek summary judgment to enforce the decision.

 

Beumer challenged enforcement on three grounds. First, it argued that the adjudicator’s findings were inconsistent with those made in prior adjudications, thereby constituting a breach of natural justice.

Second, Beumer contended that the adjudicator failed to provide adequate reasons for his decision. Third, Beumer submitted that the adjudicator should have ordered disclosure of documents from an earlier adjudication between Vinci and another subcontractor, Balfour Beatty, or should have resigned. Beumer further alleged that the adjudicator improperly relied on Clause 61.7 of the subcontract, which provides that a compensation event is not notified after the defects date.

 

The court granted summary judgment in favour of Vinci, rejecting each of Beumer’s objections. The court held that there was no inconsistency between the adjudicator’s findings and those made in earlier adjudications. Previous decisions concerned monetary assessment of compensation events, whereas the seventh adjudication was the first to address entitlement to extension of time for those same events.

The court concluded that Clause 61.7 had been raised by Vinci during the adjudication, contrary to Beumer’s assertion that it was introduced without opportunity for response. The judge found that the adjudicator’s reliance on the clause was within the issues presented to him.

Regarding the sufficiency of reasons, the court held that the adjudicator's rationale was clear: the claims for extension of time were time-barred and lacked supporting evidence and delay analysis. The judge confirmed that an adjudicator’s decision need not be to the standard of a court judgment, referencing authority that "provided that the broad thrust of the reasoning is provided, the Court should enforce".

On the issue of disclosure, the court determined that the adjudicator was not asked to make an order under Clause W2.3(4) and had no obligation to do so unilaterally. The judge found no evidence that Vinci had adopted an inconsistent position in the adjudication with Balfour Beatty, and no breach of natural justice was established. Importantly, Beumer had referred previous disputes to Mr Eggleston despite knowing of his involvement in the Balfour Beatty adjudication.

 

This judgment reinforces the courts’ continued support for adjudication, affirming that decisions will be enforced unless there is clear evidence of breach of natural justice. Parties should expect that adjudicator decisions, even if legally or factually debatable, will be upheld unless demonstrably unfair.

For users of NEC contracts, the judgment provides key reinforcement that clause W2.3(11) is effective in binding parties unless or until litigation or agreement resolves the dispute. Moreover, the emphasis placed on compliance with clause 61.7 serves as a reminder of the importance of notifying compensation events before the defects date. Failure to do so will likely bar future claims.

The case also clarifies that where previous adjudications have addressed only compensation amounts, they do not preclude later adjudications concerning time. Practitioners should carefully distinguish between the scope of prior and current adjudications to assess whether issues are truly being re-litigated. Further, this decision provides a caution to parties considering challenges based on alleged inconsistency or fairness: the courts require evidence of actual prejudice or procedural misconduct. Mere dissatisfaction with an outcome, or speculative claims of conflicting positions, will not suffice.

Finally, the court’s approach supports the view that the NEC framework is robust in dealing with disputes through adjudication, and that its dispute resolution mechanism offers effective temporary finality.