{"id":95189,"date":"2021-06-24T10:30:59","date_gmt":"2021-06-24T09:30:59","guid":{"rendered":"https:\/\/www.pbctoday.co.uk\/news\/?p=95189"},"modified":"2021-06-24T10:30:59","modified_gmt":"2021-06-24T09:30:59","slug":"foreign-jurisdiction-clause","status":"publish","type":"post","link":"https:\/\/www.pbctoday.co.uk\/news\/planning-construction-news\/foreign-jurisdiction-clause\/95189\/","title":{"rendered":"Can a UK party adjudicate if the construction contract is subject to foreign jurisdiction?"},"content":{"rendered":"

Can a party adjudicate and enforce an adjudicator\u2019s decision in the courts of England and Wales if the contract is subject to a foreign jurisdiction clause?<\/h2>\n

Phil Caton, construction law senior associate at Aaron and Partners<\/a> considers the recent adjudication case of Motacus Construction Ltd v Paolo Castelli SpA.<\/p>\n

The issue of a foreign jurisdiction clause \u2013 which gives legal authority to a particular court or courts in a specified country to enable a party to sue on a contract \u2013 is a topical one that has again reared its head in England and Wales.<\/p>\n

Motacus Construction Ltd v Paolo Castelli SpA<\/h3>\n

The case in question is a recent one involving Motacus Construction Ltd v Paolo Castelli SpA and this has given clarity over an issue that will be of interest to many within the construction industry. The issue is this \u2013 can a party adjudicate and more importantly, enforce an adjudicator\u2019s decision<\/a> in the courts of England and Wales if the contract of the underlying dispute is subject to a foreign jurisdiction clause?<\/p>\n

The judgment of the Technology and Construction Court as demonstrated in the recent case of Motacus is \u201cYes\u201d.<\/p>\n

The case concerned the fitting out works of a hotel at One Bishopsgate Plaza, London. A dispute arose in relation to payment and the contract contained an exclusive jurisdiction clause whereby all disputes had to be submitted to the exclusive jurisdiction of the courts of Paris. To complicate matters, the choice of law in the contract was not French law, but Italian law.<\/p>\n

The claimant (Motacus) commenced an adjudication<\/a> under the statutory scheme for construction contracts in England & Wales and was successful in obtaining an adjudicator\u2019s award for payment in the sum of \u00a3454,678.65 plus VAT and interest.<\/p>\n

The defendant (Paolo Castelli SpA) refused to make payment on the basis that the adjudicator had no jurisdiction to make such an award and the Claimant sought to enforce the award in the Technology & Construction Court in Manchester. The Defendant opposed the application relying upon the exclusive jurisdiction clause.<\/p>\n

The sole issue before the court was whether an exclusive jurisdiction clause in favour of another foreign court would preclude the English court from enforcing the adjudicator\u2019s decision until the final determination of the dispute.<\/p>\n

The impact of Brexit<\/a> was relevant to the case because following the UK\u2019s departure from the European Union, jurisdictional questions were no longer determined by the Brussels Regulation, which had established case law on this matter, but by the older 2005 Hague Convention which did not.<\/p>\n

The Claimant sought to rely upon 2 exemptions under the Hague Convention that would allow the English Courts to grant summary judgment of the adjudicator\u2019s decision they were:<\/p>\n