“Payment disputes” under s.6 of the Construction Contracts Act 2013 are confined to contractual payments; common‑law termination damages are not adjudicable — and planning irregularities do not render construction contracts void

Case: Connaughton v Timber Frame Projects Ltd t/a Timber Frame Ireland [2025] IEHC 469 (High Court, Simons J, 1 September 2025)

Docket: 2024/644 MCA

Area: Construction law; statutory adjudication; administrative law (fair procedures); planning law and illegality

Introduction

This High Court decision, delivered by Simons J in the Construction Contracts List, clarifies the scope of statutory adjudication under the Construction Contracts Act 2013 (“CCA 2013”). The applicant employer (the “referring party”) sought to summarily enforce an adjudicator’s award made in a dispute with the respondent contractor over the design, supply and erection of a timber frame. The employer had terminated the contract for alleged repudiatory breach and referred a claim seeking (i) repayment of sums paid and (ii) wide-ranging consequential losses — i.e., a common‑law damages package associated with termination.

Three issues arose:

Jurisdiction: Is a post‑termination claim for damages for repudiatory breach a “dispute relating to payment” under s.6 CCA 2013?
Fair procedures: Did the adjudicator breach fair procedures by proceeding without extending time and without treating a unilateral email as a response?
Illegality/public policy: Was the construction contract void or unenforceable due to alleged unauthorised development (demolition without explicit planning permission)?

The judgment is a leading authority on the statutory meaning of “payment” within the CCA 2013, drawing a sharp line between contractual payments stipulated by the parties and common‑law damages for breach. It also gives robust guidance on adjudication fair procedures and addresses the intersection of planning control and contract enforceability.

Summary of the Judgment

Core holding: A “dispute relating to payment” under s.6(1) CCA 2013 means a dispute about a payment provided for under the construction contract (interim, final, or other contractual payments, including payments triggered by express termination clauses). It does not include a claim for common‑law damages for repudiatory breach (paras 16–26, 52–55, 114–116).
Result: The adjudicator lacked jurisdiction because the employer’s referral concerned common‑law damages post‑termination, not a contractual payment. The adjudicator’s decision was a nullity and could not be enforced (paras 54, 116).
Fair procedures: The Court rejected the respondent’s due process objections. Adjudicators may proceed within the statutory 28‑day framework absent consent to extend; only blatant unfairness justifies refusing enforcement. Here, the timetable and the adjudicator’s approach were fair (paras 56–77).
Illegality/public policy: Even if the works would have involved unauthorised development, the contract was not void or unenforceable. Applying Quinn v IBRC factors to the Planning and Development Act 2000 (“PDA 2000”), the planning code’s comprehensive civil/criminal sanctions are sufficient; superimposing contract unenforceability would be inconsistent and potentially counterproductive (paras 78–113).
Unresolved points: The Court expressly left open (i) whether serving a s.4 payment claim notice is a prerequisite to referral; and (ii) whether a paying party can obtain a positive monetary award (beyond set‑off) when it is the referring party, absent an express contractual payment provision (paras 37–41).
Costs: Although the contractor succeeded on jurisdiction, the Court proposed a one‑third discount to reflect failure on two subsidiary grounds and wasted time, with capped written submissions and measurement on a single two‑hour hearing basis (paras 118–120).

Detailed Analysis

A. The statutory meaning of “dispute relating to payment” under s.6 CCA 2013

Section 6(1) CCA 2013 grants a right to refer “any dispute relating to payment arising under the construction contract” for adjudication. The Court adopted a contextual, purposive reading (per Heather Hill [2022] IESC 43), harmonising s.6 with the payment architecture in ss.3–4:

Sections 3 and 4: Require contracts to provide for the amount/timing of interim and final payments and regulate the mechanics of “payment claim notices” and responses (including set‑off). The Act elevates the position of the executing party (contractor/subcontractor) by facilitating and enforcing contractual payment flows (paras 18, 22–24).
Definition of payment: Although “payment” is undefined, “payment claim” is a claim “to be paid an amount under a construction contract” (s.1). Reading ss.3–6 together, “payment” is a contractually stipulated payment (interim, final or other payment — including express termination payments in standard forms). It does not encompass common‑law damages (paras 18–21, 24–26).
Defences and set‑off: Once a valid contractual payment claim is in play, the paying party may raise any defence or set‑off reducing or excluding liability, mirroring the s.4 response mechanism (paras 21–23).

On this textual and structural analysis, the adjudication regime is not a universal forum for all money claims arising from construction contracts. It is targeted at the contract’s own payment machinery. The “pay now, argue later” policy is thus limited to disputes about sums the contract itself says are payable — subject to defences/set‑off.

Application to the present dispute

The underlying referral sought: (i) refunds of price paid; and (ii) consequential losses (project management, scaffolding, inflation, storage, rent, holidays) totalling €224,579.68 (paras 49–50). The contract contained no clause providing for any termination payment to the employer (para 46). The employer’s claim was framed as a combination of restitution, reliance, and loss‑of‑bargain damages following acceptance of a repudiatory breach (paras 50–53). This is a common‑law damages controversy, not a claim to a “payment under the contract.” Therefore, the adjudicator had no jurisdiction under s.6 (paras 52–55, 114–116).

Important contrast: standard form contracts

Simons J underscored that many standard forms (e.g., RIAI Blue Form cl. 33; FIDIC Red 2017 cl. 15.4) expressly entitle an employer to recover specified costs after termination. A dispute over such an express contractual termination payment is a s.6 “payment dispute” amenable to adjudication (para 55). The lesson is contractual: if an employer wants to use the s.6 pathway when termination occurs, the contract must provide the payment mechanism.

B. Rejection of a broader “financial consequences” test

The employer argued that any dispute with a financial outcome should qualify. The Court rejected this on several grounds:

Text and context: The phrase “relating to payment” narrows “dispute”; treating the qualifier as surplusage is impermissible (para 35–36).
Coherence with ss.3–4: The Act is designed around payment claim notices and contractual payment cycles; adjudication is organically linked to that regime (paras 22–24).
Foreign models: Caution against treating Australian/Singaporean (or even UK) approaches as transferable; those statutory schemes are structurally different (paras 30–33). The Irish Act is uniquely confined to “payment disputes.”
“One‑stop shop” presumption: Even if such a presumption exists in construing arbitration agreements, it does not displace the clear statutory language of s.6 (para 35).

C. Fair procedures in adjudication: tight timelines, narrow grounds to refuse enforcement

The Court restated the enforcement standard from John Paul Construction Ltd v Tipperary Co‑Op Creamery Ltd [2022] IEHC 3: leave to enforce is generally granted once formal proofs are met; refusal on fair procedures grounds is reserved for blatant, material unfairness (paras 56–60). Key points:

28‑day decision window: Extensions require the referring party’s consent; a unilateral request by the respondent does not suffice (ss.6(6)–(7); paras 61–67).
Non‑participation: If a party fails to comply with directions without sufficient cause, an adjudicator may proceed and decide without that party’s materials (Code para 32; paras 74–75).
No private channels: A unilateral email to the adjudicator (not copied to the other side) is improper and cannot be treated as a formal response, especially where the adjudicator made clear it would not be considered (paras 72–73).
Unavailability of counsel: Not a compelling reason for adjournment in adjudication’s compressed timetable; parties must ensure representation that can meet the statutory schedule, or proceed without (paras 66–67).

Although the Court ultimately refused enforcement on jurisdictional grounds, it made plain that the adjudicator’s conduct would have passed fair procedures scrutiny.

D. Planning illegality and contract enforceability

The contractor argued the contract was void/unenforceable because the works allegedly involved demolition outside the scope of the existing planning permission. Applying Quinn v IBRC [2016] 1 IR 1, the Court methodically assessed whether, statute‑specifically, the PDA 2000 compels a contract voidness sanction for contracts performed in breach of planning control. It held:

Contract lawful on its face: The contract did not require unlawful performance; at most, alleged illegality arose in performance, not formation (paras 87–89).
Comprehensive statutory “package of consequences”: The PDA 2000 provides robust civil and criminal sanctions (e.g., s.160 injunctions; restoration orders; fines up to €12.7m; imprisonment up to two years). That elaborate regime indicates legislative sufficiency; courts should not add the further sanction of contract unenforceability (paras 93–98).
Proportionality and policy: The planning code tolerates proportionate, nuanced responses, including the possibility of retention permission. Treating contracts as void would be inflexible and could produce windfalls or frustrate completion of developments subsequently regularised — counterproductive to proper planning and sustainable development (paras 101–109).

Accordingly, alleged planning illegality did not render the contract void/unenforceable for public policy purposes (paras 109, 117). The Court did not decide collateral issues such as whether specific performance would lie where planning permission is uncertain (paras 112–113, 39).

E. Issues expressly left open

Payment claim notice prerequisite? Whether service of a s.4 payment claim notice is always a prerequisite to referral under s.6 remains undecided (paras 37–39).
Employer’s positive monetary award when employer refers: Conventional wisdom limits the paying party to set‑off; whether an employer can obtain an affirmative monetary award in adjudication absent an express contractual payment provision remains open (paras 40–41).

F. Costs guidance

Despite succeeding on jurisdiction, the respondent faced a one‑third discount to reflect failure on two subsidiary grounds and the wasted vacated date; costs to be measured on the basis of a single two‑hour hearing with aggregate submissions capped at €3,500 plus VAT (paras 118–119). The message is that parties should focus issues and avoid over‑complication in the summary enforcement forum.

Precedents and Authorities Cited

Aakon Construction Services Ltd v Pure Fitout Associated Ltd [2021] IEHC 562: The court must be satisfied that a purported adjudication fits the statutory scheme before granting leave to enforce; the Irish CCA is confined to payment disputes (paras 11, 30).
Heather Hill Management Co v An Bord Pleanála [2022] IESC 43: Restatement of the integrated literal–purposive approach to statutory interpretation; the onus to displace plain meaning lies with the party asserting a non‑plain construction (paras 13–14, 36).
O’Donovan v Bunni [2021] IEHC 575: Temporal applicability of the CCA 2013 (used by analogy to show the court must test statutory criteria before enforcement) (para 11).
John Paul Construction Ltd v Tipperary Co‑Operative Creamery Ltd [2022] IEHC 3: Discretion to refuse enforcement only for blatant procedural unfairness; default is enforcement (“pay now, argue later”) (paras 58–59).
McGill Construction Ltd v Blue Whisp Ltd [2024] IEHC 205: Referred to clarify that it is not authority for a blanket rule requiring separate referrals per payment claim notice (para 39).
K & J Townmore Construction Ltd v Kildare and Wicklow ETB [2019] 2 IR 688: “One‑stop” principles in arbitration cannot override the clear statutory restriction in s.6 (para 35).
Quinn v Irish Bank Resolution Corporation [2016] 1 IR 1: Framework for assessing when statutory illegality renders contracts unenforceable; statute‑specific, not case‑specific; evaluate legislative sanctions, purpose, proportionality (paras 83–98, 101–109).
Bailey v Kilvinane Wind Farm Ltd [2016] IECA 92: Planning authority views are not conclusive on lawfulness (para 81).
ISG Retail Ltd v Castletech Construction Ltd [2015] EWHC 1443 (TCC): Cited by the employer for combined remedies; of limited weight in light of the Irish statutory confinement to contractual payments (para 51; the Court’s analysis rests on the CCA 2013 text).
Patel v Mirza [2016] UKSC 42: Not determinative here; noted in passing on restitution and illegality (para 112).

Impact and Implications

1) Scope of adjudication in Ireland is narrower than commonly assumed

This ruling cements that Irish adjudication is not a general monetary dispute forum. It is anchored to contractual payment entitlements and their timing, as defined by the parties’ contract and the Act’s payment machinery. Claims for damages at large (e.g., reliance/expectation losses after repudiation) cannot be referred under s.6. Expect more jurisdictional challenges where referrals stray beyond contractual payment provisions.

2) Drafting consequences for employers

To preserve access to adjudication on termination, employers should ensure their contracts include express termination payment clauses (e.g., reimbursement of completion costs, liquidated damages, or other employer‑entitlement payments) — mirroring standard forms (RIAI/FIDIC). Those are “payments under the contract”.
Absent such clauses, an employer’s post‑termination remedies lie in arbitration or court proceedings, not statutory adjudication.
Employers can still use adjudication defensively: refer issues to establish non‑liability to pay amounts claimed by contractors under the contract (declaratory relief as to payment obligations), and deploy set‑off within the s.4 response architecture.

3) Conduct of adjudications

Adjudicators should verify jurisdiction at the outset: identify the specific contractual payment provision at issue. Where a referral concerns common‑law damages, decline jurisdiction or invite reframing to fit a contractual payment.
Respondents should not assume adjournments will be granted; the referring party’s consent is pivotal. Prepare to respond within the compressed timetable, even without counsel.
All communications must be inter partes. Unilateral emails are improper and may be disregarded.

4) Planning irregularities are not a silver bullet

Alleged breaches of planning control rarely void contracts. The planning code supplies its own robust sanctions. Parties cannot usually deploy planning illegality as a collateral contract‑avoidance device. This promotes proportionality, avoids windfalls, and supports completion of developments where lawful regularisation is possible.

5) Enforcement strategy

For claimants (typically contractors): Anchor referrals to specific contract payment clauses; anticipate set‑off defences; comply with s.4 notice choreography.
For respondents: A potent defence is to challenge adjudicator jurisdiction where the referral concerns non‑contractual damages. Reserve merits for arbitration/litigation if enforcement proceeds.

Complex Concepts Simplified

“Pay now, argue later”: The policy that adjudicators’ decisions are provisionally binding and summarily enforceable; the losing party can re‑litigate the merits later. In Ireland, this applies only to payment disputes under s.6.
Contractual payment vs damages: A contractual payment is an amount the contract itself says must be paid (e.g., interim/final payments, agreed termination payments). Damages are compensation imposed by law for breach (restitution, reliance, loss of bargain). Only the former are adjudicable under s.6.
Repudiatory breach: A serious breach evincing an intention not to be bound, allowing the innocent party to accept the breach, terminate the contract, and sue for damages.
Set‑off: A defence allowing the paying party to reduce or extinguish a payment claim by asserting counter‑claims (e.g., defects, delay costs) according to s.4’s response mechanism.
Nullity: A decision made without jurisdiction has no legal effect and cannot be enforced.
Retention planning permission: A mechanism allowing a developer to apply to regularise certain unauthorised development retrospectively; a hallmark of the PDA 2000’s proportionate enforcement approach.

Practical Checklists

For referring parties

Identify the specific contract clause stipulating the payment claimed.
Ensure s.4 payment claim notice discipline is observed (even if not expressly held to be a prerequisite in every case).
Where termination is in play, prefer a contract with express employer payment entitlements.
Avoid bundling common‑law damages with contractual payment claims in the same referral; keep adjudication focused.

For respondents

Scrutinise jurisdiction: does the referral concern a contractual payment or common‑law damages?
File a timely, inter partes response; do not rely on counsel’s unavailability.
Particularise set‑off and defences in line with s.4; these can be decisive in adjudication.

For drafters

Include clear interim/final payment mechanisms and timing (s.3 compliance).
Add employer‑side payment clauses on termination (e.g., completion costs, LDs) to preserve adjudication routes for the employer.
Allocate responsibility and warranties for planning compliance, recognising that planning illegality will not usually void the contract.

Conclusion

Connaughton is a pivotal Irish authority defining the jurisdictional boundary of statutory adjudication under the CCA 2013. It establishes that:

Only disputes about payments provided for under the construction contract are amenable to adjudication under s.6; common‑law damages claims — including those following repudiatory termination — are outside the regime.
The Act’s payment claim process (ss.3–4) and adjudication mechanism (s.6) are organically linked. The “pay now, argue later” principle sits within this architecture and is not a general licence for interim determinations of all monetary disputes.
Fair procedures objections will not lightly defeat enforcement; adjudication is intentionally fast and formalistic. Parties must adapt to the 28‑day cadence.
Alleged planning illegality does not, without more, render a construction contract void or unenforceable; the PDA 2000 supplies a comprehensive, proportionate set of sanctions and remedies.

For industry participants, the message is clear: if you want the speed of adjudication, draft and frame your disputes as contractual payment matters. Where damages at large are in issue, arbitration or ordinary litigation remains the proper forum. On the public policy front, planning enforcement will occur through the planning code’s own levers, not via the blunt instrument of contractual voidness.