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Adjudication Defined

By Robert Fenwick Elliott
1998

There is no definition of Adjudication as such, but the features of a compliant adjudication procedure required by Section 108 are as follows:-

• It must enable a party to give notice at any time of his intention to refer a dispute to adjudication.⁽¹⁾
• It must provide a timetable with the object of securing the appointment of the Adjudicator and referral of the dispute to him within 7 days of such notice.⁽²⁾
• It must require the Adjudicator to reach a decision within 28 days of the referral or such longer period as is agreed by the parties after the dispute has been referred.⁽³⁾
• It must allow the Adjudicator to extend the period of 28 days by up to 14 days, with the consent of the party by whom the dispute was referred.⁽⁴⁾
• It must impose a duty on the Adjudicator to act impartially.⁽⁵⁾
• It must enable the Adjudicator to take the initiative in ascertaining the facts and the law.⁽⁶⁾
• It must provide that the decision of the Adjudicator is binding until the dispute is finally determined by legal proceedings, by arbitration (if the contract provides for arbitration or the parties otherwise agree to arbitration) or by agreement.⁽⁷⁾
• It must provide that the Adjudicator is not liable for anything done or omitted in the discharge or purported discharge of his function as Adjudicator unless the act or omission is in bad faith and that any employee or agent of the Adjudicator is similarly protected from liability.⁽⁸⁾

If the contract itself, or the adjudication rules incorporated by reference, comply with these 8 requirements, then the contractually agreed scheme applies. In other cases, the adjudication provisions in the Scheme for Construction Contracts will apply.

Note that the 8 points are not rules which will be applied automatically to all adjudications; they are there only for the purpose of determining whether a contractual scheme is or is not compliant with the legislation.

Existing Adjudication Schemes - Do they comply with the legislation?

It is not clear how the 8 compliance points will be construed.

Take, for example, the first compliance point:

The Contract shall ... enable a party to give notice at any time of his intention to refer a dispute to Adjudication.

Is it necessary that the contract should expressly enable a party to give notice at any time? Or is it sufficient that the contract does not prevent a party from giving notice at any time?

Or this one:-

The Contract shall ... impose a duty of the Adjudicator to act impartially

Is it necessary that there should be an express provision to this effect? It might be said that all adjudication provisions contain an implied term to that effect (see the Aga Khan case)?

Even adopting a liberal interpretation, it seems clear that none of the standard adjudication provisions which pre-dated the Act would comply.

The scheme of the Act is thus that if a contract complies with the eight compliance points set out in the section, then the contractual scheme applies. If any one of the eight compliance points is not met, then the adjudication provisions in the Scheme for Construction Contracts will apply, presumably in their entirety.⁽⁹⁾ None of the adjudication schemes current at the time of the passing of the legislation, namely:

1. Section 108(2)(a)

2. Section 108(2)(b)

3. Section 108(2)(c)

4. Section 108(2)(d)

5. Section 108(2)(e)

6. Section 108(2)(f)

7. Section 108(3)

8. Section 108(4)

• DOM/1, cl 24
• JCT81, supplemental cl 1
• ICE 6th edition, cl 66
• Engineering and Construction Contract,⁽¹⁰⁾ cl 9
• GC/Works/1, cl 59
• IChemE Lump Sum Contract, cl 46
• FIDIC Design and Build, cl 20.4

Meet the eight points:

Although the producers of these forms are making amendments designed to make them compliant, it is likely that it will be some time before the old forms are fully out of circulation.

What is Adjudication?

Adjudication is not the invention of the construction industry. Adjudication is provided for by statute in a number of areas, eg the Asylum and Immigration Appeals Act 1993, the Social Security Act and the Prison Rules. It is a technique that is used in other non-statutory contexts, for example the Law Society Compensation fund.⁽¹¹⁾ The common feature of these adjudication processes is that they all endeavour, in one way or another, to resolve some sort of dispute or question by means of something other than litigation or arbitration.⁽¹²⁾

Comparison with Arbitration, Certification, Mediation and other Consensual Processes

The dividing line between the three main types of third party decision-making process, namely

• arbitration
• expert determination, and
• adjudication⁽¹³⁾

is not always distinct.

There are statutory definitions of arbitration:

In this part of this Act, unless the context otherwise requires, the expression "Arbitration Agreement" means a written agreement to submit present or future differences to arbitration, whether an Arbitrator is named therein or not

In this Part an "Arbitration Agreement" means an agreement to submit to arbitration present or future disputes (whether they are contractual or not).

It is, however, clear that the label used by the parties themselves is not conclusive. The issue has arisen in the context of rent review arrangements, where provisions in leases sometimes provide for arbitration and sometimes for expert determination. In Langham House Developments Limited v Brompton Securities Limited,⁽¹⁴⁾ the court said:

Where a third party is to determine the rent under the provisions of a rent review clause, the third party may act either as an expert or an arbitrator: normally the clause will make it clear in what capacity the third party is to act; if it does not, it will be a matter of construction as to which was intended and the mere description of a third party as 'expert' or 'arbitrator' in the lease will not necessarily be conclusive.

9. Difficult questions may arise where the parties have agreed a non-compliant adjudication procedure, which is likely to conflict with the statutory scheme.

10. The contract previously known as the New Engineering Contract.

11. The courts sometimes also talk of 'adjudication' by courts and arbitrators, but this use of the word is not of interest in this context.

12. The law has traditionally treated litigation and arbitration as being essentially similar in nature. For example, in Northern Regional Health Authority v Derek Crouch Construction Limited [1984] QB 644 at 670, Sir John Donaldson said 'Arbitration is usually no more and no less than litigation in the private sector. The Arbitrator is called upon to find the facts, apply the law and grant relief to one or other or both of the parties'. The passing of the Arbitration Act 1996 may lead to some change in this attitude.

13. In this chapter, the various forms of dispute resolution board arrangements that have grown in popularity in recent years, particularly in international contracts, are treated as a subset of adjudication.

14. (1980) 265 Estates Gazette 919.

In A Cameron v John Mowlem & Co the question arose as to whether the decision of an adjudicator could be enforced as an arbitrator's award. At first instance,⁽¹⁵⁾ Judge Esyr Lewis QC held that a decision of an adjudicator under a JCT contract is not so enforceable, his reasoning being that 'The Adjudicator ... does not perform an arbitral function and does not make any final award definitive of the parties rights'.

That decision was upheld on appeal,⁽¹⁶⁾ the Court of Appeal saying:

Mr Richard Fernyhough QC for Cameron argued in this Court that the judge was wrong and that the adjudication process qualified as an arbitration. He referred to the list of factors in Mustill and Boyd, Commercial Arbitration (2nd edn, 1989) pp 41 et seq which may be material in determining whether a procedure qualifies as an arbitration. Undoubtedly some at least of those factors are present in the adjudication process but rather than proceeding by reference to a list we prefer to focus upon the subcontract. That does contain an undoubted arbitration provision (Article 3) and it is by an arbitrator appointed under that Article that a dispute as to set-off is to be ultimately resolved whatever an Adjudicator may decide (see clauses 24.1.1 and 24.3.1). An Adjudicator's decision is 'binding ... until' determination by an Arbitrator. The decision has an ephemeral and subordinate character which in our view make it impossible for the decision to be described as an award on an arbitration agreement. The structure of the subcontract is against that conclusion. We would dismiss this appea".

Conversely, in Drake & Scull Engineering Limited v McLaughlin & Harvey Plc,⁽¹⁷⁾ the court found that the same adjudication procedure was part of the arbitration procedure, saying:

This action is not brought to go outside the agreed arbitration machinery, but to enforce the agreed arbitration machinery ... the Plaintiffs are coming to court to enforce an order made by an adjudicator in the course of the arbitration procedure.

Similarly, in Cape Durasteel Limited v Rosser & Russell Building Services Limited,⁽¹⁸⁾ Judge Humphrey Lloyd QC, Official Referee, found that the following provision namely:

In the event of any dispute arising out of or in connection with the subcontract the parties agree to refer such dispute to adjudication to a person agreed upon or failing agreement to some person appointed by the President for the time being of the Chartered Institute of Building Services Engineers.

did constitute an arbitration agreement.

In the Channel Tunnel case, disputes arose out of the 'lump sum works', ie the design and construction of the terminals at each end of the Channel Tunnel and the design, supply, installation and commissioning of fixed equipment. The adjudication provision⁽¹⁹⁾ contained the following features:

• disputes in the first instance went to a panel of three persons, who were expressed to be 'acting as independent experts but not as arbitrators'
• the unanimous decision of the panel was final and binding unless challenged in subsequent arbitration.

Disputes arose; the contractors threatened to stop work on the cooling system. The employer sought an injunction restraining the contractors from taking that course.

The court declined to grant that injunction, largely on the basis that it should not interfere with the dispute resolution mechanism that the parties had chosen for themselves. The Court of Appeal said:

It has not been suggested that this paragraph provides in law for an arbitration despite the term that the panel members shall act as experts and not as arbitrators. So we need express no opinion on that point.⁽²⁰⁾

The Court of Appeal may or may not have been offering a hint here that they would have entertained an argument, if advanced, that the Panel was in fact acting in an arbitral capacity, as opposed to a mere expert capacity. In any event, it was conceded when the matter went on to the House of Lords⁽²¹⁾ that the panel procedure did not amount to part of the arbitral process, and so the point was not taken further.⁽²²⁾

If any procedure, whatever its label, is found to be an arbitration procedure, then the result is that the provisions of the Arbitration Acts will apply;

Decisions and appeals

It is generally⁽²³⁾ agreed that adjudication should be final and binding only pro tem, subject to review. Dependent upon the way the adjudication procedure is worded, the review may be in either of two forms:

(1) A review de novo, such that a court or arbitrator is free to consider the dispute from scratch, without troubling itself as to what the adjudicator decided and why.

(2) Alternatively, the subsequent court or arbitration proceedings may be limited to points of challenge, whereby the court or arbitrator is stuck with the adjudicator's decision unless and to the extent that it can be shown that the adjudicator was wrong in his decision. Such a position is very much akin to the powers of the court to review certificates as explained in Balfour Beatty v Docklands Light Railway,⁽²⁴⁾ and at least one Official Referee, Judge Anthony Thornton, has in the past expressed the view that that is all an arbitrator is entitled to do in relation to a certificate.

Natural Justice

The High Court does, of course, exercise very considerable control both over the proceedings of inferior courts and over the proceedings of arbitrators; in practice, that control has exercised a very significant influence. Arbitrators are not infrequently persuaded into aping High Court procedure in every respect.

The control exercised by the courts over adjudication is rather less tight, but in practice can remain a significant influence. A distinction needs to be drawn between public matters and private matters.

(1) Public matters

Where the adjudication amounts to some sort of quasi-judicial process, then the courts can and frequently do intervene by way of judicial review.⁽²⁵⁾ In particular, the court may intervene where the challenge is made, not upon the rightness or otherwise of the decision, but upon the ground that the practice or procedure of the adjudication process has contravened the principles of 'natural justice'.

The principles of natural justice are plainly less demanding than those required of a court or an arbitrator, and there is no hard and fast definition of the requirements. In Russell v Duke of Norfolk,⁽²⁶⁾ the Court of Appeal said:

There are, in my view, no words which are of universal application to every kind of enquiry and every kind of domestic tribunal. The requirements of natural justice must depend on the circumstances of the case, the nature of the enquiry, the rules under which the tribunal is acting, the subject matter that is being dealt with, and so forth; accordingly, I do not derive much assistance from the definitions of natural justice which have been from time to time used, but, whatever standard is adopted, one essential is that the person concerned should have a reasonable opportunity of presenting his case.

In Wiseman v Borneman,⁽²⁷⁾ the House of Lords said:

Natural justice requires that the procedure before any tribunal which is acting judicially shall be fair in all the circumstances, and I would be sorry to see this fundamental principle degenerate into hard-and-fast rules.

In various contexts, the courts have found that it is a requirement of justice that a person should not be judge in his own cause, that everyone is entitled to a fair hearing and, depending on the circumstances, that the parties are entitled to reasons for the decision. In other circumstances, the courts have found that it is not necessarily a requirement that they are entitled to legal assistance, or to prior notice of the subject matter of the process.

(2) Private matters

The cases on natural justice often involve complaint about the way some agency of the Government has exercised its executive powers, but this is not always so. For example, in R v Lord President of the Privy Council, ex p Page,⁽²⁸⁾ a dispute arose between a university and a university lecturer. The lecturer was made redundant, and took the matter to the visitor of the university (a procedure very similar to an adjudication process under a building contract save that the lecturer's rights were governed, not merely by a private contract, but by the statutes of the university that had been made under a Royal Charter).⁽²⁹⁾ The eventual decision of the House of Lords was that the visitor's decision was subject to judicial review, but not merely for error in fact or law. The decision could be reviewed if it was in excess of the visitor's powers, or an abuse of power, or not made in accordance with natural justice.

Conversely, in R v Disciplinary Committee of the Jockey Club, ex p Aga Khan,⁽³⁰⁾ the Court of Appeal declined to intervene in proceedings at the Jockey Club on the basis that only private, and not public rights were involved. It is, however, interesting to note the final words of Lord Justice Hoffmann in that case:

In the present case, however, the remedies in private law available to the Aga Khan seem to me entirely adequate. He has a contract with the Jockey Club, both as a registered owner and by virtue of having entered his horse in the Oaks. The Club has an implied obligation under the contract to conduct its disciplinary proceedings fairly. If it has not done so, the Aga Khan can obtain a declaration that the decision was ineffective (I avoid the slippery word void) and, if necessary, an injunction to restrain the Jockey Club from doing anything to implement it. No injustice is therefore likely to be caused in the present case by the denial of the public law remedy.

What parallels can be drawn from the law relating to expert determinations? In his book Expert Determination⁽³¹⁾, John Kendall summarises the position as follows:

Must each side be allowed a say?

Questions are sometimes raised about the fairness of procedures adopted by experts. No one would argue that experts' procedures should not be fair. Difficulties arise over how to assess whether a procedure is fair, specifically whether the rules of natural justice apply to expert determinations. Do the procedures allow each side to have its say and know what the other side is saying?

Contract law governs the position

The problem arose in an acute form in the Australian case of Capricorn Inks Pty Ltd v Lawter International (Australasia) Pty Ltd⁽³²⁾ when the expert made his decision on the basis of a much larger claim, unknown to the other party. Commentators have asked⁽³³⁾ what the effect would be if the parties required their expert to observe the rules of natural justice. They have argued that there is no reason why parties should not expect fair procedures to be followed and that the public law decision Ridge v Baldwin⁽³⁴⁾ applies the rules of natural justice to any person making a decision about individuals. But the dismissal of a chief constable is very different from a company's claim for damages. Denning LJ (as he then was) stated⁽³⁵⁾ that a domestic tribunal must observe the principles of natural justice but this was in the context of being given a reasonable opportunity to meet a charge, in this case the attempt to expel a member from a trade union. A disciplinary tribunal has been held to be obliged to conduct its proceedings fairly⁽³⁶⁾. It would be difficult to argue against an implied term that an expert will conduct his determination fairly but fairness does not necessarily bring with it the whole doctrine of natural justice. It was clearly unfair in Capricorn Inks⁽³⁷⁾ for the expert to have made his decision on the basis of a much larger claim made by one of the parties without informing the other party but that does not necessarily oblige the expert never to communicate with one of the parties without the other knowing which is a requirement of the rules of natural justice. Further there is no machinery⁽³⁸⁾ for the setting aside of experts' decisions for failing to observe the rulers of natural justice as there is with arbitration awards; and expert determinations, as decisions made under private contracts, are not susceptible to judicial review⁽³⁹⁾ for failing to comply with the rules of natural justice⁽⁴⁰⁾. The RICS Guidance Notes⁽⁴¹⁾ used to say that the expert should observe at least the most fundamental of the rules of natural justice and of evidence. Bernstein & Reynolds⁽⁴²⁾, commenting on this, agreed that this was 'good advice for the expert, but whether a court would criticise one who failed to heed it remains to be seen. There is much to be said for the view that by stipulating expert determination the parties have contracted for a procedure unfettered even by these rules'. The latest edition of the RICS Guidance Notes has dropped this assertion⁽⁴³⁾.

The duty does exist, but each case will need investigation

An expert, therefore, does have a duty to observe procedural fairness. The matter will be governed by the terms of reference and the procedure established, together with any code of conduct adopted. Those arrangements will have to be interpreted. Difficult cases will arise where those arrangements do not exist, have not been documented, are ambiguous or are in conflict with each other.

It is generally the duty of an arbitrator to decide the questions submitted to him according to the legal rights of the parties, and not according to what he may consider fair and reasonable under all the circumstances⁽⁴⁴⁾. He is thus required to make a judicial-type of decision. Conversely, an expert is ordinarily entitled and expected to act according to his own opinion.

The division between the role of the arbitrator and that of an expert is not absolute. Thus, for example:

• An arbitrator with a power to open up, review and revise certificates has some of the characteristics of an expert.⁽⁴⁵⁾
• Section 46(1)(b) of the Arbitration Act 1996 allows for arbitrations to be decided otherwise then in accordance with the law if the parties so agree.⁽⁴⁶⁾
• The court have sometimes referred to 'look sniff' arbitrations, in which rather more casual rules apply. Thus, in the first instance decision in Bremer Vulkan Schiffbau Und Maschinenfabrik v South India Shipping Corporation Ltd⁽⁴⁷⁾ Donaldson J⁽⁴⁸⁾ said:

  Arbitrations vary greatly in their character from major proceedings which are wholly indistinguishable from a heavy High Court action to disputes on the quality of commodities (the 'look-sniff' arbitration). But so do actions. Actions prosecuted under the small claims procedures in the county courts are indistinguishable from similar claims determined by arbitration under the auspices of the motor, building or travel industries or by so-called small claims courts, which are in fact not courts but arbitral bodies. With the sole exception of the look-sniff arbitration, all employ the adversary system.⁽⁴⁹⁾

Into which category does an adjudicator fall? There is no authority on this point, save perhaps that the answer is likely to depend upon the wording of the adjudication clause rather than on generalised policy considerations⁽⁵⁰⁾. Some guidelines may be tentatively suggested:

• There may be express provision in the contract or applicable adjudication rules. For example, the provision at r 15 of the ORSA rules provides that wherever possible, the decision of the Adjudicator shall reflect the legal entitlements of the parties, but that where it appears to the Adjudicator impossible to reach a concluded view upon the legal entitlements of the parties within the practical constraints of a rapid and economical adjudication process, his decision shall represent his fair and commercially reasonable view of how the disputed matter should lie unless and until resolved by litigation or arbitration.⁽⁵¹⁾
• If the adjudicator is given power to open up and review certificates that would be binding on a court, then that suggests that the adjudicator is not precluded from making a decision according to his own judgment as to what is fair and reasonable, at any rate for the purposes of such opening up and review.
• Where the adjudicator is bound to make a decision upon a matter so complex that it would not be practical to hear or read all the evidence and submissions within the permitted timescale, then there may be some ground for concluding that the process cannot be intended to be in the nature of an arbitration⁽⁵²⁾. Conversely, where the adjudicator is permitted or obliged by the contract or adjudication rules not to make any decision in these circumstances, but to abort the adjudication, then that would suggest that he is limited to judicial-type decisions.
• Where the adjudication process is, on a proper analysis, an arbitration, then the adjudicator is probably limited to judicial-type decisions.⁽⁵³⁾

The Orsa Rules

15. (1989) unreported.

16. (1990) 52 BLR 24.

17. (1992) 60 BLR 102, [1992] CILL 768.

18. (1995) 46 Con LR 75.

19. It was variously referred to as 'the disputes review procedure' or 'review panel procedure'. It seems clear that it was in the nature of an adjudication provision.

20. Channel Tunnel Group Ltd v Balfour Beatty Construction Ltd, (1992) 56 BLR 54, [1992] 2 WLR 741, [1992] 2 All ER 609.

21. Channel Tunnel Group Ltd v Balfour Beatty Construction Ltd [1993] AC 334; [1993] 2 WLR 262; [1993] 1 All ER 664, HL.

22. Save inasmuch as the House of Lords was plainly anxious that, whatever the legal nature of the procedure agreed by the parties, the court should so exercise its powers as to support, and not frustrate, that procedure. The House of Lords said: 'Notwithstanding that the Court can and should in the right case provide re-enforcement for the arbitral process by granting interim relief, I am quite satisfied that this is not such a case, and that to order an injunction here would be to act contrary both to the general tenure of the Construction Contract and to the spirit of international arbitration'.

23. Happily, it appears from the statement made by the Government in the House of Lords on 22 April 1996 that the Government also agreed.

24. (1996) unreported, CA.

25. It does so by one of the three traditional prerogative writs of certiorari, mandamus or prohibition.

26. [1949] 1 All ER 109, [1949] 65 TLR 225, [1949] 93 SJ 132.

27. [1971] AC 297, [1969] 3 WLR 706, [1969] 3 All ER 275.

28. [1993] 3 WLR 1112, HL, [1993] 1 All ER 97, (1993) 137 SJ (LB) 45.

29. The House of Lords summarised the position thus: 'It is established that, a university being an eleemosynary charitable foundation, the visitor of the university has exclusive jurisdiction to decide disputes arising under the domestic law of the university. This is because the founder of such a body is entitled to reserve to himself or to a visitor who he appoints the exclusive right to adjudicate on the domestic laws which the founder has established for the regulation of his bounty'.

30. [1993] 1 WLR 909, [1993] 2 All ER 207.

31. Second Edition, FT Law & Tax, at section 16.9.

32. [1989] 1 Qd R 8: see 15.13.2

33. Burke and Chinkin in [1989] ICLR 401

34. [1964] AC 40

35. In Lee v Showmen's Guild of Great Britain [1952] 2 QB 329 at 342

36. R v Disciplinary Committee of the Jockey Club, ex p Aga Khan [1993] 2 All ER 853 at 876: obiter by Hoffman LJ (as he then was).

37. Cited above.

38. For arbitration awards it is provided by Arbitration Act 1996, s 68

39. Under RSC, Ord 53.

40. Jockey Club case cited above.

41. Guidance notes for Surveyors acting as Arbitrators or as Independent Experts in Rent Review, 6th edn (RICS Books).

42. 11-52

43. The RICS' Code of practice for commercial property leases in England and Wales issued in December 1995 states that an expert 'must act with due care and diligence but is not bound by the rules of natural justice'.

44. David Taylor and Son Ltd v Barnett Trading Co [1953] 1 WLR 562 at 568.

45. In Northern Regional Health Authority v Derek Crouch Construction Co Ltd [1984] 2 WLR 676 [1984] 26 BLR 2, [1984] 2 All ER 175, the Court of Appeal said 'The powers conferred on the arbitrator are of a different kind. Under clause 35(3) he has power not merely to determine disputes on legal rights under the earlier provisions of the contract (including the consequences flowing from certificates or opinions of the architect). In addition, he is given power to modify those contractual rights by varying the architect's certificates and opinions if he disagrees with them by substituting his own discretion for that of the architect. The arbitrator has power not only to enforce the contractual obligations but to modify them'.

46. Section 46(1) provides that 'The arbitral tribunal shall decide the dispute (a) in accordance with the law chosen by the parties as applicable to the substance of the dispute, or (b) if the parties so agree, in accordance with such other considerations as are agreed by them or determined by the tribunal'. But note the special commencement date for this section.

47. [1979] 3 WLR 471, [1979] 3 All ER 194, (1979) 123 SJ 504.

48. As he then was.

49. This passage appears to have received the approval of the Court of Appeal when the matter went on appeal: [1980] 2 WLR 905.

50. Conoco v Phillips Petroleum (1996) CILL 1204.

51. There is something of a parallel to this approach in the case of interlocutory injunctions, where the courts have for many years adopted the test set out in American Cyanamid v Ethicon Ltd [1975] 1 All ER 504 [1975] 2 WLR 316, [1975] 119 SJ 136. In that case, the House of Lords said:

52. It is no part of the court's function at this stage of the litigation to try to resolve conflicts of evidence on affidavit as to facts on which the claims of either party may ultimately depend nor to decide difficult questions of law which call for detailed argument and mature considerations. These are matters to be dealt with at the trial. One of the reasons for the introduction of the practice of requiring an undertaking as to damages upon the grant of an interlocutory injunction was that 'it aided the court in doing that which was its great object, viz. abstaining from expressing any opinion upon the merits of the case until the hearing': Wakefield v Duke of Buccleugh (1865) 12 LT 628, 629. So unless the material available to the court at the hearing of the application for an interlocutory injunction fails to disclose that the plaintiff has any real prospect of succeeding in his claim for a permanent injunction at the trial, the court should go on to consider whether the balance of convenience lies in favour of granting or refusing the interlocutory relief that is sought.

53. As to that, the governing principle is that the court should first consider whether, if the plaintiff were to succeed at the trial in establishing his right to a permanent injunction, he would be adequately compensated by an award of damages for the loss he would have sustained as a result of the defendant's continuing to do what was sought to be enjoined between the time of the application and the time of the trial. If damages in the measure recoverable at common law would be adequate remedy and the defendant would be in a financial position to pay them, no interlocutory injunction should normally be granted, however strong the plaintiff's claim appeared to be at that stage. If, on the other hand, damages would not provide an adequate remedy for the plaintiff in the event of his succeeding at the trial, the court should then consider whether, on the contrary hypothesis that the defendant were to succeed at the trial in establishing his right to do that which was sought to be enjoined, he would be adequately compensated under the plaintiff' undertaking as to damages for the loss he would have sustained by being prevented from doing so between the time of the application and the time of the trial. If damages in the measure recoverable under such an undertaking would be an adequate remedy and the plaintiff would be in a financial position to pay them, there would be no reason upon this ground to refuse an interlocutory injunction.

54. Although both court proceedings and arbitrations are sometimes constrained by guillotines, so that that the mere presence of a time limit for the proceedings cannot of itself be conclusive.

55. Although it would still remain arguable that the process is in the nature of a 'look sniff'.

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