When disputes arise in the construction industry, the need for a swift and cost-effective resolution is crucial. Construction adjudication offers a valuable mechanism for resolving disputes without the need for lengthy court proceedings.
At LEXLAW, our team of experienced construction lawyers specialises in construction adjudication and can provide you with the expert guidance and representation you need to navigate this process effectively.
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What is Construction Adjudication?
Construction adjudication is a statutory process in the UK which provides parties involved in construction disputes with a quick and binding resolution, having been introduced by the Housing Grants, Construction and Regeneration Act 1996 to promote timely dispute resolution in the construction industry.
Key Features of Statutory Adjudication for Construction Disputes
These features make statutory adjudication an efficient and accessible method for resolving construction disputes in the UK.
- Non-negotiable Right to Adjudicate: Parties involved in a construction contract cannot opt-out of the right to adjudicate. This provision allows either party to refer a dispute to adjudication “at any time,” ensuring fairness and access to resolution.
- Interim Dispute Resolution: Statutory adjudication offers a mechanism for promptly resolving disputes in construction contracts on an interim basis; adjudicators’ decisions hold binding authority, until the dispute is conclusively determined through legal proceedings, arbitration, or mutual agreement.
- “Pay First, Argue Later” Policy: The concept of statutory adjudication revolves around the principle of “pay first, argue later”; this means that parties are expected to fulfill their financial obligations promptly, ensuring cash flow within the construction industry. Disputes can then be resolved separately, avoiding delays in payment and project progress: Tally Wiejl (UK) Ltd v Pegram Shopfitters Ltd (2003) 1 WLR 2990.
- Speed and Cost-Effectiveness: Statutory adjudication provides a fast and cost-effective approach to dispute resolution. Under the Construction Act 1996, the timeframe between referral to the adjudicator and the adjudicator’s decision is set at 28 days; however, this period can be extended, if mutually agreed, allowing for flexibility in resolving complex issues.
Construction adjudication is known for its speed, informality, and enforceability. Adjudication allows parties to present their case to an impartial adjudicator, who will make a decision within a fixed timeframe, typically 28 days. The decision, known as the adjudicator’s decision, is binding unless and until it is overturned in subsequent legal proceedings.
Types of Construction Disputes Suitable for Adjudication
Construction adjudication covers a broad range of disputes, including payment disputes, variations, delays, defective workmanship, and professional negligence claims; it is a versatile process that can be applied to both simple and complex construction disputes. Residential disputes must be expressly made subject to adjudication
We can provide advice upon a wide range of building and engineering disputes, including:
- Latent and patent defects in quality of work and materials and remedial options
- Project delays, including:
- Requests for extensions of time and “relevant events”.
- Critical path analysis and concurrent delays.
- Claims for liquidated and assessed damages (LADs).
- Evaluation of whether LAD clauses amount to a penalty and are voidable.
- Claims for loss and expense, prolongation and disruption.
- Claims for overhead and profit.
- Valuation of, and delays caused by variations.
- Final accounts and retentions.
- Delays or failure to make interim and final payments.
- Interpretation of standard terms, including JCT, ICE, NEC, and FIDIC forms of contract.
- Contract novations and assignments.
- Exclusion and limitation clauses.
- Terms implied under the Construction Act 1996, including payment and pay less notices.
- Suspension, or cessation of works, by the contractor.
- Nuisance claims, including noise, vibration and damage to adjacent properties.
- Party wall issues.
- Compliance with the Pre-Action Protocol for Construction and Engineering Disputes.
- Bonds, warranties and guarantees.
- Related insurance disputes, including:
- Contractor’s All Risks
- Public and employer’s liability
- NHBC type warranties
- Professional negligence disputes involving architects, building and quantity surveyors, structural engineers and property valuers.
The Step-by-Step Guide to the Construction Adjudication Process
Here’s a step by step guide on how to initiate the Construction Adjudication Process:
- Notice of Adjudication: The party initiating the adjudication process must serve a Notice of Adjudication on the other party or parties involved in the dispute, the notice should specify the nature of the dispute, the relief sought and the appointment of an adjudicator.
- Appointment of the Adjudicator: The parties have the option to agree upon the appointment of an adjudicator; if they cannot agree, the adjudicator will be appointed through a nominating body, or an adjudicator-nominating body (ANB).
- Response and Referral: The responding party must submit a written Response within a specified timeframe, usually within seven days of receiving the Notice of Adjudication; the Response should address the claims made by the initiating party. Prior to the Response, the referring party will submit a Referral, which sets out the details of the dispute and appends supporting documents.
- Adjudication Timetable: The adjudicator will typically set a timetable for the exchange of documents, including the Referral, Response and any supporting evidence; the timetable will also include deadlines for any subsequent submissions, meetings, or site visits.
- Adjudication Hearing: Whilst adjudication is primarily a document-based process, there may be an opportunity for a face-to-face, or virtual hearing, if deemed necessary by the adjudicator; during the hearing, both parties will present their arguments and evidence before the adjudicator.
- Adjudicator’s Decision: The adjudicator must issue a written decision, known as the adjudicator’s decision, within a fixed timeframe, usually within 28 days from the date of the Referral; the decision will outline the reasons for the decision and specify any payment, or actions, required by either party.
- Compliance with the Adjudicator’s Decision: The parties are legally bound to comply with the adjudicator’s decision, unless and until it is overturned in subsequent legal proceedings; the decision may require one party to make a payment, provide specific performance, rectify defects, or take other necessary actions.
- Enforcement, or Challenge: If a party fails to comply with the adjudicator’s award, the successful party may seek enforcement through the courts; conversely, the unsuccessful party may challenge the award by commencing court proceedings inorder to have it overturned.
Addressing Adjudicator Bias in Construction Adjudication
Adjudicator bias is a concern which parties involved in construction adjudication may have when seeking a fair and impartial resolution to their disputes. Whilst the construction adjudication process is designed to provide an impartial decision by a neutral adjudicator, there are instances where concerns about bias may arise. We understand the importance of addressing such concerns and ensuring that the adjudication process is conducted fairly and transparently.
Identifying and Addressing Adjudicator Bias
- Selection of an Impartial Adjudicator: It is crucial to select an adjudicator who is neutral and free from any potential conflicts of interest. Parties can consider the adjudicator’s background, experience and reputation when appointing, or agreeing on, an adjudicator. Nominating bodies and adjudicator nominating bodies (ANBs) play a significant role in the appointment process to ensure impartiality.
- Disclosure of Potential Conflicts: Adjudicators have a duty to disclose any potential conflicts of interest, or circumstances which may give rise to a reasonable apprehension of bias; this includes any prior involvement with the parties, the subject matter, or any personal, or financial, connections which could impact their impartiality. Parties are also encouraged to disclose any concerns they have about potential bias.
- Impartiality and Fairness: Adjudicators must act impartially and ensure that both parties have an equal opportunity to present their case. They should base their decisions solely upon the evidence and arguments presented during the adjudication process, without favouring one party over the other.
- Challenging Adjudicator Bias: If a party believes that an adjudicator is biased, or has a reasonable apprehension of bias, they can seek redress through the courts; this may involve challenging the adjudicator’s appointment, or seeking a declaration of bias. It is essential to act promptly and provide clear evidence to support the claim of bias.
Our experienced construction lawyers can provide you with expert advice if you have concerns about adjudicator bias. We have the knowledge and expertise to assess the circumstances, review the evidence and guide you on the appropriate course of action to address any potential bias.
If you decide to challenge an adjudicator’s appointment or seek a declaration of bias, our skilled lawyers are ready to represent you in court proceedings; we will effectively present your case, ensuring that your concerns are properly addressed and taken into consideration.
Contact LEXLAW today to discuss your concerns about adjudicator bias and receive comprehensive legal support; our construction lawyers are here to assist you and guide you towards a fair resolution.
Instructing our Construction Lawyers
Our experienced construction lawyers have a deep understanding of construction law and the adjudication process; we can guide you through every step of the adjudication process, from preparing your case to presenting arguments before the adjudicator, ensuring that you have the best chance of a successful outcome.
We will assess the merits of your case and advise you on the most effective strategy for your construction adjudication; our lawyers will analyse the relevant contracts, documents and legal arguments to develop a strong case on your behalf.
Our team will assist you in preparing all the necessary documents for your adjudication, including the Notice of Adjudication, Response, witness statements, expert reports, and legal submissions; we ensure that your case is presented clearly and persuasively to maximise your chances of success.
Our skilled lawyers have extensive experience in presenting cases before adjudicator; we will advocate on your behalf, presenting your arguments robustly and effectively to the adjudicator to support your position.
If the other party fails to comply with the adjudicator’s award, we can assist you in enforcing the decision through the courts, ensuring that you receive the compensation, or remedies, to which you are entitled to.
Contact Us for Effective Construction Adjudication Support
If you are considering construction adjudication, or require assistance with an ongoing adjudication process, our experienced construction lawyers are here to help; contact us today to schedule a consultation and discuss your construction adjudication needs.
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