Adjudication Process – Put Simply
If you find yourself in a construction contract with a dispute claim requiring resolution, you should consider taking advantage of the adjudication procedure set out in the Housing, Grants, Construction and Regeneration Act 1996 and the Statutory Scheme for Construction Contracts Regulations 1998.
This article is going to explain the steps to adjudication and the adjudication process.
Notice of Adjudication
The first step is to serve every party notice of your intention to refer the dispute to adjudication. Without a doubt, this is the most important document of the entire adjudication procedure, because it defines the scope of the dispute and defines the parameters of the adjudicator. The notice provides the following information:
- A description of the contract including names, addresses of the contract
- A description of the dispute including where and when the dispute arose
- A description of the relief being sought in the adjudication
In terms of multiple disputes being claimed simultaneously. You would require all parties to give their consent unless the contract specifies the use of adjudication for multiple disputes to be heard as one single dispute. As the notice is the foundation of the dispute, it’s essential that it accurately defines the claim’s scope.
Appointment of the adjudicator
Once the notice of adjudication has been delivered, you have 7 days to appoint the adjudicator. For speed’s sake, it’s common to send the adjudication request at the time you send the adjudication notice to the relevant parties.
When the adjudicator is named in the notice, it’s important to ensure the adjudicator is able to deliver adjudication within the statutory time period. A copy of the adjudication notice should be delivered to the adjudicator as soon as possible.
This document gives the referring party the opportunity to set out the legal and factual components of their claim in more detail. It’s important to attach all documents that support the claim that might include (but is not limited to) copies of the relevant parts of the contract, contemporaneous documentation of the progress of the works (e.g. meeting minutes) and any witness or expert evidence.
It’s important that you only include relevant documentation and that all documentation has been seen by the other relevant parties, otherwise you are opening yourself up to the argument that the dispute hasn’t arisen yet.
Response to the Referral Notice
Once the other parties have received the referral notice, they are obligated to create a response to the referral notice. Often, the response is laid out in a paragraph by paragraph format. With different paragraphs corresponding to different elements of the referring party’s claim. Often, not many documents are required because normally the documents supplied by the referring party or prevalent, however, if documents are required, they should be attached.
The responding party does not have the right to reply unless they can persuade the adjudicator that it is appropriate and necessary and it can be done within the time constraints of the adjudication process stipulated by the HGCRA.
In most cases, the adjudicator will not require an oral hearing. One of the cases where an oral hearing might be necessary is if the facts of the claim are in dispute. Then a hearing could be needed, with witnesses and independent experts.
The Adjudicator has to deliver their decision within 28 days, from the deliver of the Referral. It’s essential that the adjudicator takes into account the scope of their adjudication and all parties must comply with the decision, immediately.
Generally, the adjudicator’s decision is binding, if only temporary until the underlying dispute is litigated, arbitrated or settled. The courts in the Uk have made it clear; the judgement must be considered a summary judgement until litigation takes place at a later date