19th November 2020
Hot on the heels of the Supreme Court decision in Bresco Electrical Services Ltd v Michael J Lonsdale (Electrical) Ltd, MSI's Northern UK law firm Myerson Solicitors have successfully represented Styles and Wood (in administration) on what may be the first summary judgment to enforce an adjudicator’s decision in favour of a party in administration, following the principles laid down in Bresco.
Styles & Wood (S&W), entered into a building contract with GE CIF Trustees (GECIF) acting through DTZ Investors for an office to residential conversion project at St Ann’s Square, Manchester. Following completion of the works, a dispute occurred regarding the final account of the multi-million-pound account.
Having started an adjudication process, S&W went into administration, but the proceedings continued, and S&W were awarded a substantial sum by the Adjudicator. However, GECIF refused to comply with the Adjudicator’s decision on the grounds of futility and, in response, S&W brought enforcement proceedings before the Courts.
Using the Supreme Court’s judgement on Bresco as the basis for the case, Myerson argued that the insolvency set-off rules do not trump a construction contract party’s right to adjudicate. S&W proposed to fulfil the conditions of enforcement, as set out in Meadowside, by ringfencing the awarded sums for three months and taking out an ATE insurance policy to cover any potential adverse costs in subsequent proceedings.
The Court accepted these arguments and, on 4th September 2020, decided in favour of Styles & Wood. Making this one of the first cases in which an insolvent party has successfully secured an adjudicator’s award in the Courts since the Supreme Court decision in Bresco.
The Myerson Solicitors team was led by Neil Armstrong and Jack Duncanson with Riaz Hussain QC of Atkin Chambers as Counsel.
Having represented Styles & Wood in both the adjudication and enforcement proceedings, Neil Armstrong, said: “It’s always exciting to test new precedents in court and this decision will be of significant interest to parties involved in adjudication and the insolvency of construction companies.”
Myerson was founded in Manchester, Cheshire over 30 years ago and is a leading, full service commercial and private client law firm providing bespoke legal advice to businesses and affluent individuals across Manchester, Cheshire, the UK and beyond.
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