Sasol South Africa (Pty) Ltd v Murray & Roberts Limited

Sasol and Murray & Roberts concluded an NEC3 Engineering and Construction Contract in 2015 for work at Sasol’s Secunda plant. The contract provided for a project manager and a tiered dispute resolution process involving adjudication and, if necessary, arbitration. Sasol instructed the project manager (via PMC200) to demobilise resources and disallow certain costs, resulting in substantial deductions from Murray & Roberts’ payment claims. Multiple disputes were referred to adjudication, where the adjudicator upheld the project manager’s assessments. Disputes 1 and 2 were referred to arbitration, where the arbitrator found in favour of Murray & Roberts, holding that the timesheets were contractually binding and PMC200 invalid. The project manager partially implemented the arbitration award but refused to apply it to all related payment assessments. Murray & Roberts referred this refusal as Dispute 16 to adjudication. The adjudicator ordered Sasol to pay the outstanding amounts. Sasol refused to comply, contending the adjudicator’s decision was invalid. Murray & Roberts successfully enforced the adjudicator’s decision in the High Court, and Sasol appealed to the Supreme Court of Appeal.

The appeal was dismissed with costs. The order of the High Court was varied to direct Sasol to make immediate payment to Murray & Roberts of specified amounts plus VAT, together with interest from 10 June 2019 at the applicable prime lending rate, compounded annually.

The case affirms the binding and enforceable nature of adjudicator’s decisions in NEC3 construction contracts pending review or arbitration. It underscores that parties cannot unilaterally disregard adjudicators’ decisions on the basis of alleged invalidity and clarifies the interaction between adjudication and arbitration within South African construction law.