attempt the legal problem question and write a word-processed essay on the essay topic below

Visionary Developments Limited (‘Visionary’) and Creative Fabrications LLP (‘Creative’) reach agreement for Creative to build a modestly-sized shopping development in southwest England, near Bristol. The governing contract for the project is the JCT Design and Build Contract 2016. The project progresses to practical completion without a hitch. However, within a few weeks after the defects rectification period commences severe cracking begins to develop in structural (supporting) walls at the rear of five of the seven shop units.

Subsidence is evident at the rear of the development, leading to initial speculation that Creative’s design has failed to address some obviously problematic and historical ground conditions. Mike Palmer, the CEO of developers, Visionary, points the finger of blame at faulty raft foundations, which appear to have undergone catastrophic failure. Scaffolding supports are installed as a temporary precaution against possible collapse of the cracked walls.

Alasdair MacAndrew, the managing partner of Creative, is prepared to acknowledge that the design flaws were partly Creative’s responsibility, albeit pointing out that elements of the initial design – which were included in the employer’s requirements under the building contract – were the responsibility of Visionary.

The parties refer the matter to adjudication under clause 9.2 of the contract, with the adjudicator being tasked to determine the proper extent of Creative’s responsibility and make a monetary award to Visionary on that basis.

Once the adjudication process gets underway Alasdair MacAndrew finds out that the appointed adjudicator is a non-executive director of Visionary. He becomes concerned at what he considers to be ‘improprieties’ around the conduct of the adjudicator’s preliminary fact-finding exercise. He receives a tip-off that a lengthy private exchange of emails and other communications concerning the dispute has passed between the adjudicator and the CEO of Visionary.

The adjudicator does not formally send copies of the emails or other communications to Creative. However, at the start of the hearing on the first day, he provides Alasdair with a brief summary of the communications. In Alasdair’s view, this makes light of what Alasdair has reason to believe is (probably substantial) evidence collected by the adjudicator in private communications with Visionary.

At the hearing the adjudicator appears to go to some lengths to treat the parties fairly and to question witnesses on both sides in a balanced and impartial manner. He also carefully questions Creative’s representatives about Creative’s limited responsibility for the defective foundation works, taking care to distinguish Creative’s involvement from that of an architect (appointed by Visionary at an early stage in the project) who had some responsibility for design, and for specification of materials, for the raft foundations.

Within 10 days the adjudicator’s decision is communicated to the parties. The decision leaves Alasdair MacAndrew in shock.

The award – which Creative must pay ‘forthwith’ to Visionary – is for a sum in the region of £750,000. It is immediately clear to Alasdair that an award on that scale would more appropriately reflect the entire loss sustained by Visionary as opposed to a more limited award that would properly reflect the true extent of Creative’s involvement. Visionary insists on payment of the awarded sum, arguing that, even if the level of award is excessive, matters can always be resolved later at an arbitration or by way of court action.

Question

Advise Alasdair where Creative would stand legally if it were to challenge, by way of court proceedings, the adjudicator’s award and decision in the problem scenario outlined above.

In your answer you should have regard to all relevant provisions of (A) the JCT Design and Build Contract 2016, (B) the Housing Grants, Construction and Regeneration Act 1996 as amended, and (C) The Scheme for Construction Contracts (England and Wales) Regulations 1998 applicable to adjudication and having a bearing on the problem scenario.

In relation to the substantive issues around the adjudicator’s award the answer should incorporate, among other things, an informative discussion of relevant and applicable case law.