What is Adjudication?
Adjudication is an alternative procedure to County Court proceedings for resolving disputed debts. It can often be a quick way of resolving disputes but it can only be used if adjudication is stated as a term within a contract or the dispute relates to a construction contract as detailed below.
Section 108 of the Housing Grants, Construction and Regeneration Act 1996 (“the Construction Act”) provides that parties to a construction contract, as defined by section 104 of the Construction Act, have the right to refer a dispute under the contract to adjudication.
The process is set out in the Scheme for Construction Contracts (England and Wales) Regulations 1998 (as amended) (“the Scheme”).
Before starting the adjudication process it is important to establish that there is a right to adjudicate either under a construction contract or as implied by the Scheme.
Assuming that there is a right to adjudicate, a dispute must have arisen in order for the same to be referred to an adjudicator. Typically this will have been established in correspondence between the parties.
Once a right to adjudicate has been established and a dispute has arisen either party may refer the matter to adjudication for a decision to be made.
The process
1. Notice of intention to refer to adjudication must be provided – Day 1
2. An adjudicator should be appointed either by agreement between the parties, in accordance with the terms of the contract or by referral to an adjudicator nominating body – Day 2-5
3. Within seven days of the notice of intention to refer to adjudication the referral notice must be served. This should only be issued once the adjudicator has accepted the appointment. The adjudicator has two days from receiving the request to accept or reject the request.
4. The responding party must then respond to the referral notice – by Day 14
5. If new evidence has been raised in the response to the referral notice, the referring party will usually be given the opportunity to respond to the same – typically this will be within a reasonably short time frame between Day 14 and 21
6. The responding party may also be given an opportunity to respond to the referring party’s response – typically this will be within a reasonably short time frame which mirrors the length of time provided to the referring party to provide their response
7. Adjudicators decision – Day 28
*The time frames can be extended by agreement between the parties.
How can Lovetts help?
If you have a construction dispute our Commercial Litigation team can assist. We offer a fixed fee review of your case, an assessment of the strengths and weaknesses or your claim and advice as to your options.
Our fixed fees for advice start from £500 plus VAT for claims under £10,000 and from £800 plus VAT for claims over £10,000.
Our advice will provide you with the following:
- An estimate of your chance of success;
- Set out your legal position;
- Set out the strategy, tactics and options available to you; and
- Set out the likely costs for each of the options.
As specialists in debt recovery, we have successfully assisted construction companies in taking action through the adjudication process and can offer support and advice throughout.
Should you wish to proceed with an adjudication and are successful we can also assist you with the enforcement of an adjudicator’s decision.
Contact our Litigation team for more information [email protected]