Construction adjudication is a legal process used to resolve disputes in the construction industry quickly and cost-effectively – in theory within 28 days. It is governed by the Housing Grants, Construction and Regeneration Act 1996 (as amended) in the United Kingdom. Below is a basic guide outlining the process, timescales, and key considerations:
1 Notice of Adjudication
The referring party issues a Notice of Adjudication to the Responding Party (and any other parties) which sets out:
1.1 the nature and a brief description of the dispute and of the parties involved;
1.2 details of where and when the dispute has arisen;
1.3 the nature of the redress which is sought; and
1.4 the names and addresses of the parties to the contract (including, where appropriate, the addresses which the parties have specified for the giving of notices).
It is imperative this Notice adequately outlines the scope of the claim.
2 Appointment of Adjudicator
2.1 Within 7 days of the service of the Notice of Adjudication, the parties must either agree on an adjudicator or seek appointment from a nominating body such as the Royal Institution of Chartered Surveyors (RICS) or the Royal Institute of British Architects (RIBA).
2.2 The parties will be jointly and severally liable to pay the adjudicator a reasonable amount in respect of fees for work reasonably undertaken and expenses reasonably incurred by him.
3 Referral Notice
3.1 Within 7 days of the service of the Notice of Adjudication, the Referring Party issues a Referral Notice, alongside evidence (including expert reports and witness statements, if any).
3.2 It is important to try and ensure the Referral Notice is prepared well in advance given the deadline to submit it sits alongside the competing deadline of the Appointment of the Adjudicator and given it is a considerable undertaking to prepare it.
3.3 The 28-day timetable for the adjudication begins after service of the Referral Notice – it can, and often is, extended with the consent of the adjudicator, especially if there is mutual agreement between the parties.
4 Response
4.1 While not required to by statute, usually the adjudicator will require the Responding party to submit a Response to the Referral Notice as directed (often within 7 days of the Referral Notice).
4.2 It is important as much of Response is drafted before the Referral Notice (i.e. the instruction experts to produce competing expert evidence) is served as is possible.
4.3 Further submissions are made as directed by the adjudicator.
5 Decision
5.1 The adjudicator must reach a decision within 28 days from the date of Referral Notice (unless agreed otherwise).
5.2 The decision made is temporarily binding – i.e. it is binding and must be followed once made (subject to certain caveats) but can be challenged in court or in an arbitration.
6 Enforcement of Decision
If a party fails to comply with the adjudicator's decision, the other party can usually enforce it through the courts.
