What is Adjudication
Adjudication is a fast-track process for resolving disputes arising under construction contracts.
Parties to qualifying construction contracts generally have a statutory right to refer a dispute to adjudication at any time. The Adjudicator will normally reach a Decision within 28 days of the Referral, subject to any agreed extension.
The Decision is binding on the parties unless and until the dispute is finally determined by litigation, arbitration or agreement and is generally enforceable through the Technology and Construction Court.
Because the timetable is compressed, early preparation, good project records and a clear understanding of the contractual position are critical.
When can Adjudication be used?
Adjudication can be used for a wide range of construction disputes, including:
- Payment & Valuation
- Final Accounts
- Variations & Change
- Extensions of Time
- Delay & Disruption
- Loss & Expense
- Payment Notices & Pay Less Notices
- Defects & Remedial Costs
- Contra-Charges & Set-Off
- Termination & Contractual Entitlement
The amount in dispute is only one consideration. The contractual position, available evidence, commercial objectives and proportionality of the costs should also be considered.
The Adjudication Process
Adjudication moves quickly. Understanding the process and preparing early can be critical.
Initial Review & Strategy
Before commencing an adjudication, we review the dispute, contractual position and available evidence.
Depending on the issues, this may include the contract, applications and payment notices, correspondence, valuations, programmes, site records, variations, instructions and other contemporaneous project documentation.
The purpose is to establish what can actually be supported by the contract, facts and evidence, and to identify weaknesses as well as strengths before committing to adjudication.
Notice of Adjudication
The Notice formally commences the adjudication and defines the dispute being referred.
Careful consideration of the Notice is important because it establishes the scope of the Adjudicator’s jurisdiction. AA can prepare the Notice and coordinate the appointment of the Adjudicator through the appropriate nominating body.
Referral
The Referral sets out the Referring Party’s case and the evidence relied upon.
Depending on the dispute, this may include contractual entitlement, chronology, project records, correspondence, payment documentation, valuations, quantum analysis, programme and delay evidence and witness evidence.
An effective Referral is not about producing the largest possible submission. It is about identifying the matters that require determination and presenting the facts, contractual entitlement, evidence and quantum as clearly as possible.
Response
AA also acts for Responding Parties.
The time available to respond can be extremely short. Our immediate priority is to understand the dispute referred, establish the relevant facts and contractual position, identify the evidence available and determine the matters that genuinely require answering.
We then prepare the Response and supporting evidence and manage the Responding Party’s case through the adjudication.
Reply & Further Submissions
Where directed or permitted by the Adjudicator, further submissions may follow the Response.
AA manages the Reply, Rejoinder and any further submissions, together with responses to questions or directions issued by the Adjudicator.
The Decision
The Adjudicator will consider the parties’ submissions and evidence and issue a written Decision.
An Adjudicator may accept some arguments and reject others, and the valuation or contractual position determined may differ from the position advanced by either party.