Misrepresentation on adjudicator nomination forms: A reminder to be precise

Can a statement on a form derail an entire adjudication? The short answer is, yes. The English court recently confirmed that an inaccurate statement on an adjudicator nomination form can invalidate the entire process. The judgement is a sharp reminder that accuracy and honesty during the nomination process are critical and that any resultant incorrect information can make subsequent decisions unenforceable.

Background

RNJM Ltd (RNJM) and Purpose Social Homes Ltd (Social Homes) concluded a JCT Minor Works Building Contract 2016 for a residential project. The parties went through four adjudications under that same contract. In the third and fourth adjudications, the adjudicator, Mr Bunker, ruled against RNJM and ordered it to pay his fees. RNJM refused to pay, and Social Homes eventually did so after Mr Bunker threatened legal action.

RNJM started the fifth adjudication but on the Royal Institution of Chartered Surveyors (RICS) nomination form, it stated there was a “dispute over payment with referring party” regarding Mr Bunker. This wording implied a conflict of interest and resulted in RICS appointing a new adjudicator, Mr Wood. Mr Wood decided the dispute in the fifth adjudication and awarded payment to RNJM.

Social Homes challenged enforcement of Mr Wood’s decision, arguing that RNJM’s statement about Mr Bunker was false and the appointment of Mr Wood was invalid.

The court’s decision

The court found that Social Homes had a strong case in that RNJM made a false statement on the nomination form before RICS.  RNJM argued that it genuinely believed there may be bias because of a “payment dispute” with Mr Bunker.  They, however, offered no factual basis for that belief, ignored repeated requests for clarification from Social Homes, and could not explain the supposed dispute.  Accordingly, the court found the statement unsupported and potentially false, making Mr Wood’s subsequent appointment and decision unenforceable.

The judge highlighted the following key principles for parties completing adjudicator nomination forms:

• False statements can invalidate an appointment. Even one inaccurate or misleading comment about a potential conflict can make any subsequent decision based on that information unenforceable.
• It is irrelevant whether the nominating body was misled. The focus is on the accuracy of information provided, not how it was received.
• Incomplete or careless statements can be a misrepresentation.
• Parties must hold an honest belief in what they state on the form. Any hint of a party behaving recklessly or a lack of evidence when making allegations will result in the nominating body disregarding the allegation.

Key takeaways

This decision reinforces that honesty and clarity are essential when completing adjudicator nomination forms. Any inaccurate statement can:

• Void any decisions made based on the inaccurate information.
• Make any resulting decision unenforceable.
• Cause costly delays and procedural disputes.

Parties alleging a conflict of interest must be accurate and transparent. Only claim a conflict of interest if there is a clear factual basis and explain the circumstances and reasons if you raise a concern.

Contact Nikita Lalla, Ricardo Pillay, Danielle Giannico, or Msizi Zungu to mitigate risks and minimise disputes when planning, negotiating, or delivering infrastructure projects.