Michael J Lonsdale (Electrical) Ltd v Bresco Electrical Services Ltd

Michael J Lonsdale (Electrical) Ltd v Bresco Electrical Services Ltd

A company in liquidation cannot refer a dispute to adjudication when that dispute includes determination of any claim for further sums said to be due to the referring party from the responding party, because upon liquidation, all claims and cross-claims are replaced by a single balance under the Insolvency Rules, and an adjudicator has no jurisdiction to determine such a dispute.

Parties
Claimant: Michael J Lonsdale (Electrical) Limited; Defendant: Bresco Electrical Services Limited (In Liquidation)
Jurisdiction
England and Wales
Judgment Date
31 July 2018
Procedural Posture
Civil (construction/commercial) / Judgment on Part 8 Claim for Declarations and Injunction
Outcome
Declarations granted; adjudication not allowed to continue; injunction to be issued.
Legal Topics
Adjudication in Construction Contracts, Effect of Liquidation on Claims, Jurisdiction of Adjudicator, Insolvency Set Off, Enforcement of Adjudicator's Decisions
Insolvency Construction Law Civil Procedure Adjudication in Construction Contracts Effect of Liquidation on Claims Jurisdiction of Adjudicator Insolvency Set Off Enforcement of Adjudicator's Decisions

Case Brief

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Parties

Michael J Lonsdale (Electrical) Limited

Claimant

Bresco Electrical Services Limited (In Liquidation)

Defendant

Procedural Posture

Civil (construction/commercial) / Judgment on Part 8 Claim for Declarations and Injunction

Legal Issues

  1. 1 Whether a company in liquidation can refer a dispute to adjudication when that dispute includes determination of a claim for further sums due to the referring party from the responding party
  2. 2 Whether the appointment of a liquidator and operation of the Insolvency Rules extinguishes or merges claims and cross-claims into a single balance
  3. 3 Whether an adjudicator has jurisdiction to determine such disputes post-liquidation

Ratio Decidendi

A company in liquidation cannot refer a dispute to adjudication when that dispute includes determination of any claim for further sums said to be due to the referring party from the responding party, because upon liquidation, all claims and cross-claims are replaced by a single balance under the Insolvency Rules, and an adjudicator has no jurisdiction to determine such a dispute.

Court Disposition

Declarations granted; adjudication not allowed to continue; injunction to be issued.

Orders

  • Declarations that the adjudicator lacks jurisdiction to determine the dispute referred by Bresco in liquidation.
  • Permanent injunction restraining Bresco from continuing the adjudication.