Adjudication so far

Many articles have been written about Latham-inspired statutory adjudication as a means of resolving construction disputes but little has been said to date about what the process is like in practice. The reason for this is that there have been relatively few referrals since the adjudication provisions of the Construction Act came into force. The signs are that this is changing. My colleague, Eric Mouzer, and I have now carried out six adjudications between us. This hardly provides sufficient knowledge to form definitive conclusions, but some initial observations may be useful and interesting.

Who is using the process?

With the exception of residential occupiers, adjudication is available to practically any party to a construction contract. However, the disputes we have dealt with have either been subcontractor versus main contractor or main contractor versus employer.

What are disputes about?

Generally, and not surprisingly, most disputes have been about payment – or rather the lack of it – although two have also involved alleged wrongful determination of contract. The amounts in dispute have been between £8000 and £30 000, with one exception, where the sum involved was £300 000.

Are referring parties preparing ambushes?

One of the frequently expressed concerns about adjudication was that the referring party would deliver a highly detailed, complex claim in an articulated lorry and ask for a decision in 28 days' time. This presented the alarming scenario of the other party trying to get a decent response together in a week or so and the adjudicator trying to reach a sensible decision in what remained of the 28-days after the submissions were received.

So far, the disputes referred to us have been explained without copious documentation.

Is 28 days enough time to decide the issues?

The matters referred to us have been relatively straightforward and we have not had any difficulty reaching a decision within 28 days. Perhaps more importantly, we think it highly unlikely that our decisions would have been different even if more time had been available to consider the issues referred.

• Referring parties are not ambushing
• Enforcement has been a problem, but this may now change
• Referring parties tend to win

How much does it cost?

Adjudicators fees and expenses have varied from £250 to £3000. Some contracts allow the adjudicator to apportion his fees and expenses, so the successful party will generally not have to pay the adjudicator's bill. I have not yet seen a contract that allows the successful party to recover their own costs in preparing or defending the case.

Who's winning?

In each of the six cases that we have decided, the referring party has won all or some of the issues.

Is enforcement working?

Apart from the ambush fear, the other great concern has been: "How will the winning party get the adjudicator's decision enforced?" Non-compliance with decisions does appear to be a problem. We understand that at least half of our decisions have not been honoured. One of these became the first to be referred to the Technology and Construction Court. Mr Justice Dyson enforced Eric Mouzer's decision by way of a summary judgement.

Conclusion

There are three desirable elements in a dispute resolution process: high speed, low cost and a fair decision. My worry was that adjudication could not guarantee the third, and I thought who wants a quickie on the cheap if the end result is lousy? I think the answer to this is that anything is better than nothing. To the thousands of small players in the industry, adjudication offers hope of a solution where before there was none.