Enforcement of Adjudication Award Stayed

In the case of Tate Building Services Ltd v B&M McHugh Ltd [2014] EWHC 2971(TCC), the Court granted summary judgment in favour of the claimant but ordered a partial stay of execution of such award.

The claimant had entered into a company voluntary arrangement (CVA) and the court viewed the claimant's evidence with "scepticism’. Due to this, the court has partially stayed execution of the claimant’s successful summary judgment application which enforced the adjudicator's decision.

The claimant sub-contractor had entered into a company voluntary arrangement (CVA) and while its trading position had seemingly improved since then, the court found some of the financial evidence before it was inadequate.

The court concluded that the defendant contractor faced a "high or significant risk" that the sub-contractor would not be able to repay the full amount if the adjudicator's decision was reversed at a full trial of the dispute. On that basis, the court permitted partial enforcement and required the contractor to make a payment into court.

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A party should continue to tread carefully when seeking enforcement of an adjudicator's decision if it has a CVA in place. Accurate financial information will assist the court, but the precise facts and circumstances of the CVA and adjudication may lead to different outcomes.

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