Adjudication Claims

Welcome to Francis Wilks and Jones a firm of lawyers specialising in construction adjudication.

Adjudication is a compulsory procedure for resolving disputes without the need for parties to engage in a lengthy and often extremely costly court case. The procedure was introduced in the UK in 1996 by the Housing Grants, Construction and Regeneration Act (Construction Act). Adjudication applies to parties under a construction contract, who cannot contract out of it and it is a 28 day procedure although in some cases the parties can agree an extension to this period.

Construction Adjudication is a complex area and we advise that any party seeking to commence adjudication proceedings (or have been served with such proceedings) should seek independent legal advice.

Contact us now for expert advice in relation to Construction Adjudication. Call us on 0207 841 0390.

For out of hours enquiries ring one of our expert teams as follows:

Steve Killick  ( +44 (0) 7793 394 500 )

Christopher Ahearne  ( +44 (0) 7525 793 979 )

1. What is adjudication in construction?

Adjudication is a fast track process for parties to obtain a binding decision in a relatively short period of time. Adjudication is a popular form of alternative dispute resolution in light of the obvious commercial advantage of it being most cost effective and quicker than normal court proceedings. The use of adjudication in construction disputes is designed to protect cashflow during construction introduced by the Housing Grants, Construction and Regeneration Act 1996 defined as the Construction Act. The Construction Act allows the party to a construction contract the right to refer a dispute to adjudication. 

2. How to begin the Construction Adjudication process?

The party seeking to refer the matter to adjudication must serve on every party to the construction contract written notice of its intention to refer to the matter to adjudication. This is an extremely important document which sets out the scope of the dispute which the referring party is seeking to resolve under the adjudication process. There are various types of claims which are appropriate for adjudication but most of them relate to disputes concerning interim payments, an extension of time for completion of works, any delay and disruption to works and most importantly a dispute over the final account.
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3. What must be included in the Notice of Adjudication?

The Notice of Adjudication must comply with section 28(2) of the Construction Act. It is extremely important the referring party comply with the requirements under the Construction Act serving the Notice of Adjudication. In any event, the Notice of Adjudication should include the following:

  1. A brief description of the contract with the correct names and addresses of all parties;

The referring party must also set out the nature of the dispute between the parties with specific details as to how it arose and what remedy the referring party is seeking under the adjudication process. It is important to note that if the Notice of Adjudication does not include a matter which the referring party later seeks to raise with the adjudicator then he/she will not have any jurisdiction to determine that particular issue. It is also important that the Adjudication Notice include a statement setting out the Respondents rights and obligations under the adjudication process.
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4. What is the next step after serving the Notice of Adjudication?

After the referring party has served the Notice of Adjudication the next step is to appoint an adjudicator. It is important to note that the referring parties must secure the appointment of the adjudicator within 7 days of service of the Notice of Adjudication. The parties can agree the identity of the adjudicator however, in the absence of an agreement, the referring party must make an application to an adjudicator nominating body defined as ANB.
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5. How do you make an application to an adjudicator nominating body?

If the parties cannot agree an adjudicator then the referring party must complete a form and pay the required fee before sending it to the adjudicator nominating body. On receipt of the same, the ANB must select an adjudicator and send notice of their decision to the referring party within 5 days of receiving the request.
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6. What is a referral notice?

A referral notice must be served within 7 days of service of the Notice of Adjudication. This is an important document which sets out both the legal and factual basis of the dispute which is being referred to adjudication. Each party should be aware that the adjudicators jurisdiction will be limited to the legal and factual matters identified in the Notice of Adjudication. Any errors in the notice cannot be rectified in the Referral Notice. Effectively the parties would have to begin the process again. The referral notice must include the documentation in support of the referring parties case. This may include any expert reports or witness evidence which the referring party seeks to reply upon at the adjudication. 
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7. What do I do if I receive a Notice of Adjudication?

The party that receives a Notice of Adjudication should consider whether or not there is a construction contract is in place which allows the matter to be referred to adjudication. In order for the matter to be referred to adjudication the dispute must have been crystallised. As such, the receiving party should consider whether or not the referring party has made the claim in writing setting out in clear terms what is being sought in the basis of the claim prior to beginning the new adjudication process. This is essential as the court will refuse to enforce an adjudicators decision where not dispute had in fact crystallised prior to the adjudication process starting.
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8. What is a response to the referral notice?

This is an important document which is produced in receipt of a referral notice. The document must set out the receiving parties case in detail dealing with each and every issue raised by the referring party in the referral notice. The responding party should refer to any documents relied upon by the referring party and if important documents had been omitted in the referral notice then only then should these be annexed to the response to the referral notice. The document must be served within 7 days of receipt of the referral notice although this can be extended to 14 days with agreement between the parties if an agreement between the parties can be reached.
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9. Does the referring party have a right to reply?

There is no automatic right to reply. The referring party may in some circumstances reply to the response if they can persuade the adjudicator that its appropriate. However, the adjudicator will often limit a response to specific issues in light of the tight time constraints for he/she to make their decision.
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10. When does the adjudicator make their decision?

The adjudicator must make a decision within 28 days of service of the referral notice however, this can be extended by 14 days if the referring party agrees or can be further extended in both parties can reach an agreement.
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11. Is an adjudication decision binding?

An adjudication decision in binding unless it is revised by arbitration or litigation. It is important to note that all parties must comply with the decision reached by the adjudicator and they cannot seek to dispute the same issue in further adjudication proceeding.
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12. Can a party object to the adjudicator?

Any objection made by a party in relation to the appointment of a particular persons adjudicator will not impact of the adjudicators appointment or any later decision reached.
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13. How long does Construction Adjudication take?

An adjudicator must reach a decision within 28 days of receipt of the referral notice unless the party referring the dispute agrees to extend the time or both parties agree a different period for the decision. Within 7 days of serving the Notice of Adjudication the referring party must have sent the referral notice and any relevant documents in relation to the dispute to the adjudicator and to the responding party. In normal circumstances the responding party will be expected to serve a response to the referral notice within 7 days (although this can be extended to 14 days which is usually agreed between the parties).
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14. How effective is adjudication in construction contracts?

Constructions adjudication is an effective way of resolving disputes in a timely and cost effective manner. In most cases the parties accept the decision of the adjudicator which is binding in any event. Due to the compulsory nature of adjudication it has become an important form of dispute resolution in settling disputes within the construction industry. In the event that a party does not comply with the adjudicators decision, will usually be obtained in a matter of days. Whilst adjudication is a very effective form of alternative dispute resolution and it is designed to be a simple process it is important that the parties undertake the proper preparation and preparation of a written case as it is critical when seeking to obtain a successful result at adjudication.
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15. What are the adjudicators fees and expenses?

The parties will be jointly and severally liable for the adjudicators fees which means that both parties are ultimately liable or in circumstances where one does not pay the other may be pursued for the whole amount. The parties are required to pay a reasonable amount for the work undertaken by the adjudicator and he himself can decide what is reasonable. If both parties (or one of the parties) dispute the sums charged by the adjudicator then this may be referred to the court for determination.
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16. Can a party enforce an adjudicators decision?

A successful party in an adjudication can apply to the Technology and Construction Court to enforce an adjudicators decision if the other party has failed to comply with the adjudicators decision.
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17. What is the procedure for seeking to enforce the adjudicators decision?

The relevant procedure depends on the nature of the adjudicators decision if it relates to a payment of money or something else such as an extension of time for completion of works. If the decision relates to a monetary award then the successful party should issue a claim under Part 7 and at the same time issue an application for Summary Judgment under Civil Procedure Rule 24.  If the decision relates to a matter which does not involve a monetary payment then the successful party should issue a claim under CPR Part 8 seeking a Declaration from the court that the unsuccessful party has failed to comply with the adjudicators decision. The successful party must lodge a number of documents at court including the following:

  • Claim form
  • Particulars of Claim
  • Application Notice requiring the Defendant to respond in a shorter period of time
  • Witness Statement in support of the claim form and notice of application which will include reference to the adjudicators decision. All of the documents should be marked “Paper without notice adjudication enforcement claim and application for the urgent attention of TCC Judge”. This will ensure that the Court deals with the matter quickly and the TCC Judge will generally deal with the application on paper within 3 working days. TCC Judge will give recommendations for the Defendant to file an acknowledge of service an evidence will a full hearing taking place usually within 21 days of the Order.

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