Why must jurisdictional arguments be raised early in construction adjudication

On 16 March 2026, the Technology and Construction Court (TCC) in Liverpool handed down judgment in Danion Ltd v IPS Roofing Ltd [2026], which became publicly available in September 2026.

It contains a clear warning: jurisdictional objections must be raised and maintained throughout the adjudication if a party wishes to rely on them at the enforcement stage.

Factual background

The case concerned the engagement of Danion Ltd (Danion), the subcontractor, by IPS Roofing Ltd (IPS), the contractor, to carry out complex scaffolding works under a JCT standard-form contract.

On 28 July 2025, Danion submitted Application for Payment No. 20 to IPS and a dispute arose over the sums payable. IPS sought to make deductions in respect of variations, hire charges, delay costs and liquidated damages.

Danion commenced adjudication in October 2025, seeking a determination that the deductions made by IPS were invalid and that IPS was required to pay the sums it had withheld. The adjudicator decided that IPS owed Danion approximately £176,000, excluding VAT, and rejected IPS’s entitlement to deduct delay costs and liquidated damages.

IPS did not comply with the decision, so Danion issued Part 7 proceedings in the TCC to enforce it.

IPS resisted enforcement on two grounds: first, that the adjudicator lacked jurisdiction; and second, that the adjudicator had breached the rules of natural justice.

Lack of jurisdiction

IPS contended that the notice of adjudication referred only to a notified sum dispute, commonly known as a ‘smash and grab’ adjudication, and that the adjudicator had therefore exceeded his jurisdiction by carrying out a true valuation exercise.

District Judge Baldwin rejected this challenge, holding that, if IPS intended to challenge the adjudicator’s jurisdiction, it should have reserved its position during the adjudication.

By participating in the adjudication without raising a jurisdictional challenge, IPS was treated as having waived its right to raise the objection at the enforcement stage. The judge described the position on jurisdictional challenges as “well established”, referring to the Court of Appeal’s decision in Bresco Electrical Services Ltd v Michael J Lonsdale (Electrical) Ltd [2019].

In any event, quite apart from IPS’s failure to reserve its position, the court held that the jurisdictional objection would have failed.

Read objectively and as a whole, the notice of adjudication encompassed a true valuation dispute and was not confined to a ‘smash and grab’ notified sum claim. The notice made clear that the dispute concerned the validity of deductions, including liquidated damages, hire charge discrepancies and disputed variations. These issues went well beyond a simple notified sum claim.

Breach of natural justice

IPS also argued that the adjudicator had breached the rules of natural justice by applying the burden of proof unfairly and by adopting an “eccentric” critical path delay analysis without giving the parties notice or an opportunity to make submissions.

District Judge Baldwin held that IPS’s first argument, that the burden of proof had been applied incorrectly, fell away because it depended on the rejected characterisation of the adjudication as a notified sum dispute.

In any event, IPS had failed to show that a different approach to the burden of proof would have made a material difference to the outcome.

As to the second argument, the court held that criticality had already been raised in the adjudication and that IPS had the opportunity to address it in its rejoinder but did not do so. There was therefore no procedural unfairness.

The failure of this argument demonstrates that a party alleging a breach of natural justice must establish both procedural unfairness and that the unfairness had a material effect on the decision.

Where an issue has already been raised in the parties’ submissions, the court is entitled to conclude that there was sufficient opportunity to respond.

The clear jurisdictional warning

This decision is a further reminder of the importance of raising and reserving jurisdictional objections during an adjudication.

An adjudicator’s decision is binding until the dispute is finally determined by legal proceedings, arbitration or agreement, under section 108(3) of the Housing Grants, Construction and Regeneration Act 1996. The courts will enforce adjudicators’ decisions robustly.

Objections should therefore be stated clearly, promptly and with specificity, and maintained throughout the adjudication if a party wishes to rely on them at the enforcement stage. A failure to reserve its position may amount to a waiver, preventing a party from advancing the argument later.