More on that anon. Ah yes, the adjudicator could not make head nor tail of how the main contract could be made to work as a subcontract, and pronounced that he did indeed have jurisdiction to be the ref. It is often said that unless parties expressly or impliedly give the power to an adjudicator to decide their jurisdiction, there is no power for the referee to make a binding decision as to whether jurisdiction exists. This judgment of Lady Paton explains how wrong this idea is. I will explain.
Adjudicators only have power to decide matters arising under the contract.
The court said this quarrel was an issue arising under the contract, and therefore the adjudicator had the authority to decide his fate. When one party says an adjudication clause is or is not part of a contract, that issue is a dispute arising under the contract. It would be different if the quarrel was whether or not a construction contract existed. No power ordinarily rests in an adjudicator to decide such a fundamental question, nor can he or she bind the parties to the answer because it is not an issue arising under the contract. The referee Harrison was doing nothing more than construing the existing contract to see what terms made up the bargain.