Adjudication Enforcement and Insolvent Companies: The unsatisfactory state of the law

James Bowling

October 2015

A paper based on a talk given to the Society of Construction Law at a meeting in Bristol on 14th May 2015

The courts (especially the TCC) rightly have a strong presumption in favour of ordering execution of an adjudicator's decision. If however the winning party is not financially sound, the chances of the losing party in later proceedings (litigation or arbitration) successfully reclaiming money paid over may be limited or zero. Such a party has an interest in asking the court for a stay of execution - but what are the principles (largely adapted from the law on security for costs) which the courts follow in considering such issues? Are they adequately principled and clear? James Bowling argues that they are neither, proposing reforms which would eliminate the need for the court to analyse the financial standing of the winning party, thus also the risk that the court may be misled by inaccurate financial information.

Introduction - The aim of this paper - The genesis of adjudication enforcement through the cases - Stays of execution: impecuniosity and the 'hard cases' - The novel use of CPR 83.7: 'exceptional circumstances' and stays of execution - The 'stay rules' in practice: the limitations of the procedure - Dishonest statements and committal for contempt - The current state of the law: the results in practice - Towards a new regime - Conclusion.

The author: James Bowling is a barrister, practising at 4 Pump Court, Temple, London.

Text: 21 pages