REUTERS | Navesh Chitrakar

Adjudication – your flexible friend

Adjudication can be a very flexible process, despite the prescriptive nature of the Construction Act 1996 and the Scheme for Construction Contracts 1998Provided both parties agree, the timetable can be adapted to suit the parties and, in some instances, the adjudicator. This flexibility can apply to any aspect of the process, including the conduct of the adjudication. It can even extend to how the adjudicator delivers his decision.

Parties almost always ask for reasons for the decision (the Scheme does not require the adjudicator to give reasons unless at least one party requests them). Parties also, generally, invite me to apportion my fee on a “loser pays” basis. Sometimes, as happened to me recently, I may be asked to provide a split decision, that is, to separate my decision on liability from any decision on who will pay my fees.

On this occasion, one party was insistent that I should not proceed to reach my decision on liability for my fees until:

  • After the parties had sight of my decision on the substantive issues; and
  • I had received submissions on the appropriate finding in respect of liability for my fees.

To deal with this, I proposed a procedure (which both parties agreed to) whereby:

  • My findings on the substantive issues (without reasons) were published as set out in the adjudication timetable.
  • Within 24 hours, both parties provided their submissions on liability for my fees.
  • Within 24 hours after that, I published my decision with reasons dealing with the substantive issues and liability for my fees.

As a procedure, it seemed to work well. While the parties did not disclose the fact that a settlement offer had been made, I assumed that that was the case and was the reason for this request.

What made this work was the parties’ agreement to the arrangement. I could not have unilaterally imposed this on the parties – the adjudicator’s powers do not extend that far – and adjusting how my decision was to be delivered could have put me in danger of delivering the decision out of time.

Another method which I have experienced is the sealed envelope approach, where I am instructed to open the envelope between reaching my decision on the substantive issues but before dealing with liability for my fees.

While this approach can also work, I find it helpful if the parties prepare short submissions after they know what the findings on the substantive issues are. Those submissions then reflect the actual findings, rather than a “what if” or hypothetical scenario.

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