Construction Adjudication Solicitors
Adjudication is a process to help resolve construction and engineering disputes quickly, and in a cost-effective way.
IBB’s Construction and Engineering Team are well-versed in adjudication and the full range of disputes for which it can be used. We have acted for employers, developers, main contractors (including utilities contractors) and sub-contractors, whether they be the referring or responding to disputes.
Our construction and engineering dispute resolution experts have recently assisted parties with adjudicating disputes relating to:
- the validity of and/or failure to issue relevant payment notices or pay less notices
- the true valuation of works
- the standard of works
- delay, disruption and extensions of time for completing works
- breach and contract termination
- final accounts
Recent successful results for our clients using construction adjudication
Significant sums saved for homeowner facing multiple claims from a main contractor
Our construction adjudication solicitors acted for a homeowner in multiple adjudications for claims raised by a main contractor carrying out extensive basement works at their property. In total, the employer was facing a claim of £800k. IBB’s team prepared comprehensive submissions containing extensive witness evidence, arranged surveying and quantum evidence, burnt the midnight oil, and ultimately saved the homeowner almost £785k, with the adjudicator only awarding the referring contractor a fraction of the claimed sum.
Favourable settlement for hotel developer responding to £650k ‘true value’ claim
Our team acted for a hotel developer facing a main contractor’s ‘true value’ claim for payment valued at £650,000. Our construction adjudication solicitors prepared comprehensive submissions relating to the true value, resulting in a favourable settlement being achieved quickly.
Successful defence of hotel developer facing costly delay claim
We acted for a hotel developer in responding to a main contractor’s delay claim. If this claim had been granted, it would have established that our client was responsible for delays to construction and the main contractor would have been able to make a subsequent claim for significant losses and expenses. Submissions comprising extensive witness statements and expert reports were prepared within a tight timeframe. The adjudicator awarded the main contractor no extension of time, and the dispute was ultimately settled.
What is the adjudication process for construction disputes?
Once a dispute has been established, the adjudication process will be as follows:
- The referring party will serve a Notice of Adjudication on the responding party, setting out a brief description of the nature of the dispute and the remedy sought.
- Within 7 days of serving the Notice of Adjudication, the referring party will need have appointed an adjudicator. The identity of the adjudicator may be agreed between the parties, or the referrer can apply to the relevant adjudicator nominated body.
- Within 7 days of serving the Notice of Adjudication, the referring party must also serve its Referral Notice on the responding party and the appointed adjudicator. It is the Referral Notice that sets out in detail the referring party’s claim and will accompanied by any documentary evidence that the referring party wishes to rely on (including witness statements and any expert reports).
- Subject to any agreeable extensions, the adjudicator’s decision must be made within 28 days of service of the Referral Notice. Typically, the adjudicator will require the responding party to submit any response to the Referral Notice within 7 days and provide the referring party 7 days thereafter to submit any reply to the responding party’s response. The responding party can request additional time, but there is no guarantee that the adjudicator will grant further time.
- It may be that the adjudicator requires a hearing, which generally now take place remotely before making and issuing their decision within the above timeframe. In the majority of disputes, the parties will accept the decision without needing to re-test the issues via costly and protracted court proceedings or arbitration.
Who can benefit from adjudication for construction disputes?
Any party to a contract where:
- the relevant contract or professional appointment provides the parties with an option to refer disputes to adjudication (the contractual right to adjudicate); or
- the relevant contract is a ‘Construction Contract’ as defined by the Housing Grants, Construction and Regeneration Act 1996, as amended (the ‘Act’), in which case the parties have a statutory right to adjudicate.
The Act provides a very wide definition for what a ‘Construction Contract’ is, extending from contracts relating to the construction, alteration, repair, maintenance and extensions of structures forming part of the land (which will including property, roadwork, power-lines, runways, harbours, railways, sewers and water-mails), and installing heating, lighting, air-conditioning, drainage and communication systems, to operations integral to the above (including site clearance, earth moving, excavation and the erection of scaffolding).
The above are only examples of contracts whereby the parties are likely to be entitled to refer disputes to adjudication, in reliance on the statutory right to do, but highlight the sheer breadth of contracts to which the adjudication regime can apply.
Why choose to refer a construction dispute to adjudication?
Referring a dispute to adjudication has a number of benefits compared to court proceedings or arbitration. The headline benefits being:
- Adjudication is a speedy process.
- The Act sets out a very tight timeframe for the process.
- In general, the adjudicator’s decision needs to be made with 28 days of the dispute being referred. This may be extended with the adjudicator’s consent. To compare, a defendant usually has 28 days to defend a court issued claim (subject to an acknowledgment of service being issued within 14 days) and unless the dispute is settled beforehand, it may be more than a year later than a final decision is reached.
- As above, within the 28-day timeframe, the responding party will have a very short window to make its submissions. The best advice for a potential responding party is to get its ducks in a row as soon as there may be an indication that a dispute may be referred to adjudication or, at the very latest, as soon as a Notice of Adjudication is received.
- Due to the speed of the process, adjudication can be much more cost effective.
- The adjudicator’s decision is binding on the parties unless and until it is finally determined by court proceedings, arbitration or agreement. Until then, the losing party must comply with the adjudicator’s decision.
- The losing party can rarely successfully challenge an adjudicator’s decision, and so is put to the cost of the more expensive and protracted court proceedings or arbitration routes if the losing party wishes to overturn the decision.
What is the position on recovering costs of the adjudication?
In general, unless the parties agree otherwise, each party is responsible for its own costs of an adjudication irrespective of the outcome. The Adjudicator will determine which party is responsible for his fees (generally the loser pays).
Why choose IBB’s Team to assist with your adjudication?
IBB’s Construction and Engineering Team is growing. That is a direct result of the increased (and repeat) adjudication instructions, and the successful outcomes being achieved. If expert input is required (delay, standard of works or quantum), IBB can recommend suitable experienced experts, appoint these without delay, and closely manage the full team to ensure the tight deadlines adjudication deadlines are met.
We also recognise the need for costs certainty given the fact the adjudication process is a cost neutral process. Accordingly, and where possible, we are also willing to offer a fixed fee options rather than the traditional hourly rate fee approach.
Speak to our construction adjudication solicitors
If you have a construction or engineering dispute that you believe may be suitable for adjudication or are on the receiving end of a Notice of Adjudication or Referral Notice, then please contact the IBB Construction & Engineering Team to discuss how we can help.