Adjudication: is it time to evolve?

A fascinating report looking at how statutory adjudication operates in the real world has recently been published by King’s College London (KCL) in collaboration with the Adjudication Society. Titled 2022 Construction Adjudication in the United Kingdom: Tracing Trends and Guiding Reform, it is the work of the research team led by Professor Renato Nazzini, who heads the Centre of Construction Law and Dispute Resolution at KCL.

In his foreword to the report, Lord Justice Coulson concludes: “I enthusiastically commend this report to anyone involved or interested in construction adjudication. I suspect that its publication will come to be seen as a seminal moment in the story of this unique dispute resolution process.”

The report is based on two empirical surveys, one of adjudicator nominating bodies and the other of individuals involved with statutory adjudication. Rich with data and tangible information, it is compelling and provocative – an irresistible read for everyone involved with statutory adjudication. Professor Nazzini’s team at KCL must be congratulated on many levels.

Some of the analysis in the report will not surprise readers, but some of the information will. I cannot realistically summarise the whole report here, but among its key findings are the following:

• Claims for extension of time are the most common head of claim
• Claims for professional negligence or liability account for only 5%
• The median hourly fee of adjudicators is between £251 and £300
• Adjudicators spend between 40 and 56 hours per adjudication
• 15% of respondents felt that up to 40% of adjudicators’ decisions contained errors affecting the outcome
• The median total fee charged by adjudicators falls between £12,001 and £14,000
• 40% of respondents suspected at least once that an adjudicator was biased towards one party
• 58% of respondents believe adjudicators’ decisions should not be published but 30% think they should, with redactions, following the Singaporean model.

The report also found that fewer than 8% of adjudicators were female in the lists submitted by the adjudication nominating bodies responding to the survey. This is wholly unacceptable and has no correlation to the percentage of female judges or to the number of women in the legal profession. Something is wrong.

The publication of adjudicators’ decisions may create an informal system of precedent, affording consistency or certainty, and may encourage adjudicators to maintain high standards

International arbitration has embraced the so-called Equal Representation in Arbitration Pledge, and one wonders whether, as a starting point, there should also be a similar pledge for adjudication, whereby organisations and practitioners within the field could undertake to promote diversity among adjudicators. Patently, the nominating bodies must do very much more to encourage, train and accommodate female adjudicators.

The report suggests establishing a taskforce on diversity in construction adjudication. Perhaps the Adjudication Society will now take the lead on this. There is simply no time for further debate. The sharp reader may have spotted that I have cited only gender diversity – as the report makes clear, other forms of diversity are simply invisible in statutory adjudication.

The report also shows that 24% of respondents believe greater transparency and publication of statistical data will help – and I agree.

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The notion of transparency ties into my next plea for change – publication of adjudicators’ decisions. In Singapore, decisions are redacted and then made publicly available. Since 2022 in Queensland, Australia, decisions have been published without redaction. The publication of adjudicators’ decisions may create an informal system of precedent, affording consistency or certainty, and may encourage adjudicators to maintain high standards.

The courts very often name adjudicators in cases, and I can see little downside if adjudicators were to be named but the decisions were redacted. The Adjudication Society should explore this idea further, given that a third of respondents to the survey believe publication with redactions is a good idea. Whether nominating bodies publish such decisions or whether the Adjudication Society now becomes the central library for such redacted decisions can be readily resolved.

For the industry, the key must be that 25 years after the Construction Act and the arrival of statutory adjudication, there needs to be significantly greater transparency and far less anxiety about how adjudicators actually decide disputes and about the provision of data. As Lord Justice Coulson comments, publication of this report could be a seminal moment. The industry must embrace the opportunity to evolve.

The report can be found at: www.adjudication.org/resources/news/adjudication-society-kings-college-london-report-construction-adjudication.

Hamish Lal is a partner in Akin Gump Strauss Hauer & Feld