Conducting the adjudication — overviewNotice of adjudication

A Notice of Adjudication can be given at any time but must be served prior to requesting appointment of an adjudicator. The notice must be in writing under the Scheme or as provided by the contract. As the adjudicator's jurisdiction is derived from the notice it must be carefully drafted.

Referral Notice

The Referral Notice is the written referral of the dispute to the adjudicator. An adjudicator has no power until he has received the Referral Notice.

The Referral Notice must be received by the adjudicator within 7 days of the from the date of the Notice of Adjudication.

The purpose of the Referral Notice is to set out clearly and concisely the Referring Party's case. It is an extremely important document in the adjudication. It should provide an explanation of the dispute, the facts, relevant technical arguments, any pertinent case law and the remedy sought. Any documents relied upon should be enclosed with the notice.

Response

A contract may provide for a Response; one is not expressly required under the Scheme. Prior to putting in a Response, a Responding Party should set out, in a letter to the adjudicator, a summary of its case, any jurisdictional challenge and the time required for putting in a detailed response. The time table for putting in the Response is within the adjudicator's discretion, unless provided otherwise by the contract. A Response can request that the decision gives reasons and/or costs and for any documents to be treated as confidential.

A Responding Party is entitled to raise any points to defend itself, even if not previously raised in correspondence. Any jurisdictional issues must be dealt within full in the Response with care being taken not to give the adjudicator jurisdiction.

Directions and conduct of adjudication

An adjudicator has a wide discretion as to the directions and procedure to be followed. An adjudicator may allow a Response, reply or other submission. Parties must comply with an adjudicator's request or direction.

An adjudicator has the power to appoint an expert, assessor or legal advisor to assist him, if he notifies the parties of his intention. In most adjudications, a hearing is unnecessary and many are done on the documents. A hearing maybe appropriate in a technically complex case where a hearing with experts may assist an adjudicator.

Consideration should be given as to whether information or documents should remain confidential. If so, then they cannot be disclosed to the other party.

Evidence in an adjudication

There are no strict rules as to the format or the type of evidence which must be provided in an adjudication, although a contract may set out specific requirements.

Consideration must be given as to the categories of documents relevant to the dispute. An adjudicator will take documents at face value if they are not addressed in a witness statement; there is no requirement for witness statements.

Expert evidence may be used if appropriate. The expert evidence of the Referring Party should be enclosed with the Referral Notice; if not provided to the Responding Party until service of the Referral Notice, there maybe an argument that the dispute had not crystallised. The expert evidence of the Responding Party should enclose with the Response.

Multiple adjudications

It is not uncommon to have more than one adjudication arising out of a contract. Where a number of adjudications are raised between the parties there maybe an overlap between them in which case an adjudicator may have no jurisdiction in the subsequent adjudication and any decision will be a nullity. Under the Scheme, an adjudicator must resign where the dispute is the same, or substantially the same, as one previously referred to adjudication.

The extent to which a decision is binding in a subsequent adjudication will depend on a number of factors. The legal and factual issues do not need to be exactly the same, it is enough if they are 'substantially the same'. Whether they are substantially the same is a question of degree.

Concurrent adjudications are possible, although if a contract provides for a named adjudicator there maybe timing difficulties. There is no statutory requirement for adjudications to be dealt with by the same adjudicator.

The same documentation may be submitted in successive adjudications; so long as the subsequent adjudication is considering a different dispute to the first.

Multiple parties

For obvious reasons, adjudications involving multiple parties are relatively rare. Most adjudication regimes, and the Scheme, do not contemplate multi-party adjudications. That is because most parties want a decision in 28 days on a dispute which has arisen between two parties. However, the courts have provided some assistance in determining whether clauses for multi party adjudications are effective.

Costs of conducting an adjudication

The parties may make express provision in their contract; there is no provision for costs under the Scheme.

Parties can agree that an adjudicator should have the power to award costs. Such an agreement may impliedly provide an adjudicator with jurisdiction. This should be considered if an issue has been taken as to jurisdiction. There can be implied agreements for an adjudicator to award costs which provide an adjudicator with the jurisdiction to award costs.

An adjudicator is entitled to his reasonable costs; he determines the proportion each party pays towards his costs. Parties are jointly and severally liable for such costs.

Procedure under various rules other than the Scheme

Contracts often contain detailed adjudication provisions which, if the contract complies with the Act, will supplant the Scheme. Standard form building contracts such as JCT and nominating bodies provide their own adjudication rules. Contracts may set out the adjudication rules in full or by reference. There are a number of differences between the different standard form rules and nominating body rules which should be considered. It should be noted that if any of the provisions in the rules are incompatible with the Act, none of the rules will apply and the Scheme will apply by default.

Timescales

The overriding objective of adjudication is the speed of process and the timetable is mandatory and the courts have consistently stressed that non compliance will, with very rare exceptions, render a decision void. There are provisions within the Act and the Scheme for extending the time period between service of the Referral Notice and making the award.

Where an act has to be done within a specified period after or from a specified date the period runs immediately after that date. Where a period includes a bank holiday or Christmas or Good Friday then those days will be ignored in computing the time period.

Role of the court during adjudication

Declarations can be sought that the adjudicator does not have jurisdiction. This process is encouraged by the TCC, but seems to be rarely used in practice.

If a contract provides that a dispute must be adjudicated prior to court proceedings, the court will grant a stay of the court proceedings unless persuaded there is good reason not to. A court cannot grant an injunction to restrain a party from referring a dispute to adjudication; even where there are litigation or arbitration proceedings on the same dispute.

Abandoning the adjudication

The Referring Party can withdraw or abandon the adjudication at any time without agreement of the other party or approval of the adjudicator even though this maybe unfair on the Responding Party. Under the Scheme there is no provision for party/party costs and there will be no cost penalty on the Referring Party.