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Introduction
On 16 March 2026 the Technology and Construction Court (TCC) handed down their judgment in the case of Laing O’Rourke Delivery Ltd v Shepperton Studios Ltd [2026] EWHC 612 (TCC).
The case concerned the enforcement of an adjudication decision which focused on whether a payment notice and pay less notice issued by Shepperton Studios Ltd (SSL) to Laing O’Rourke (LOR) were valid. The adjudication decision was for over £5.6 million plus VAT and contractual interest.
Below, we look at the key issues and outcomes arising from the judgment.
Background
The Adjudicator had found that SSL’s Payment Notice (the Payment Notice) and Pay Less Notice (the Pay Less Notice) were invalid as the Payment Notice did not set out the basis on which the sum which was considered to be owed to LOR had been calculated, and the Pay Less Notice therefore flowed from the invalid Payment Notice and was also invalid.
When LOR brought the decision before the TCC for enforcement, the Adjudicator’s jurisdiction was not an issue in dispute. Instead, the TCC were asked to decide on the following key issues:
- Was the Payment Notice valid, given that it did not provide the basis for calculation of the gross valuation as required under the contract between the parties?
- Was the Pay Less Notice valid, and did it provide sufficient detail for all the deductions made to the proposed payment?
- Did the implications of other adjudications (in which LOR had been refused extensions of time and the value of deductions had been decided) affect LOR’s entitlement to the sum claimed, and did those decisions impact enforcement of the current adjudication decision?
An application was also made by SSL to stay the execution of the judgment and payment of the judgment sum to LOR, on the basis that LOR was financially weak and they would be unlikely to recover any of the sum awarded in any later proceedings for repayment.
Judgment
Regarding the notices, the TCC held that the Adjudicator was correct to find that the Payment Notice was invalid on the basis that it failed to set out how the gross valuation had been calculated, as was required under the contract between the parties.
Clause 4.7.5 of the contract required that a sum due had to be ‘calculated in accordance with clause… 4.13 and clause 4.14, and the basis on which that sum has been calculated’. SSL argued that the detail of the calculation had been submitted previously in spreadsheets in earlier applications, and it was highlighted by the Judge that if the spreadsheets had been ‘incorporated by express reference’ into the Payment Notice, which they had not been in this case, then the Payment Notice would have been valid.
However, the TCC diverted from the Adjudicator on the issue of the Pay Less Notice, finding instead that the Pay Less Notice remained valid because the contract allowed for deductions to be made, although these were deductions from a figure previously provided by the invalid Payment Notice.
On the issue of whether other adjudication decisions should affect the judgment, the TCC held that they should not be considered and rejected SSL’s argument that the provisions of paragraph 9.4.5 of the TCC guide (which says that the Court should take into account issues where it would be “unconscionable” not to) did not apply.
The TCC therefore held that the adjudication decision could be partially enforced, and that SSL were required to pay LOR almost £3.2 million plus VAT and contractual interest. This figure was calculated as the difference between the sum claimed by LOR and the sum set out in the Pay Less Notice.
This adjudication decision will be relevant in separate Part 8 claims which SSL has issued against LOR and which are set to be heard in April 2026. Part 8 is a form of legal proceedings where issues can be determined without evidence or with limited evidence. In these proceedings SSL will be arguing that the effect of the other adjudication decisions is to reduce any sum due to LOR to virtually nothing.
SSL’s application for a stay on the requirement to pay LOR the judgment sum was also rejected by the TCC, on the basis of a guarantee being provided from LOR’s parent company.
Conclusion
This judgment highlights that even in the context of an invalid payment notice, a subsequent pay less notice can be valid in the context of contractual provisions which allow for deductions to be made.
It also highlights that a payment notice needs to identify the basis on which the sum is calculated. Had the payment notice referred to other documents that explained the sum stated in the payment notice it would have been valid.
Another key takeaway from the judgment is the reinforcement of the ‘pay now, argue later’ principle, which is prevalent in the enforcement of adjudication decisions, and how the court will seek to maintain this principle even in the context of a company in financial difficulty, where a guarantee from a solvent parent company is also present.
If you need advice on an ongoing adjudication or have any questions more widely about the adjudication process, please contact Ashley Pigott in the Michelmores Construction & Engineering team.
This article is not legal advice and should not be relied upon or construed as such.